Ruth King, president of HVACChannel.tv
Originally published: 11.01.15 by Terry Tanker
HVACR Business Publisher Terry Tanker recently spoke with Ruth King, contractor, author and president of HVACChannel.tv. King, whose popular monthly finance column continues to help contractors improve business operations, discusses contractor training, changing the way the industry thinks and having the courage to be profitable.
1. You have a Master's degree in chemical engineering from the University of Pennsylvania and an MBA in finance from Georgia State. What was your goal after graduation?
Toown a business — I wasn't sure what it would be at that time, but I always knew I wanted to be a business owner.
2. How did you start your first business?
I was working for an energy consulting firm while in grad school, but didn't care for it and started the Small Business Development Center in the basement of the old court house building in Decatur, Ga. In 1982, we didn't know whether Congress would fund the SBDC's in perpetuity but they did. I left when I finished school.
3. You've been around the industry a long time. What first attracted you?
A friend in school told me about Service America and that they needed help. I started working for Ron Smith. I immediately found an industry I loved and where I could make a huge difference — and I have.
4. Can you tell me about your time there?
It was a great company that spawned a lot of good people. I started in 1987 and left in 1989. I was a field support leader helping contractors grow their businesses and also handled marketing for a while. I developed the Comfort Creature Campaign with an ad agency that won a national direct mail award.
5. What did you do after you left?
I started my consulting business.
6. You started HVACChannel.tv in 2002 — why?
I was consulting all over the country, traveling 200 nights a year. That got to me after a while. My daughter was still only 9 at the time and I had to get off the road. I started using the Internet and videoconferencing in 1998. In 2002, we'd developed the technology well enough to start HVACChannel.tv.
7. With regard to training, in what area do contractors need the most help?
The financial statements their companies produce — or don't produce — and what those numbers indicate. Contractors also struggle with letting employees go who aren't good for their company.
8. If you could teach contractors just one finance lesson, which one would it be?
Without question, I'd teach them about net profit per hour.
9. How are you able to get your point across to them?
I physically take a spreadsheet and show them how to calculate the true profit numbers. Often, jobs they think are profitable are actually in the red.
10. When you show them this and the light bulb goes off, how do they respond?
Most tell me they feel like they just got punched in the gut — that nauseous feeling you get when you realize you've been doing something really bad for a long time.
11. You mentioned most shy away from the personnel decisions — why?
They procrastinate and, inherently, people don't like confrontation. For most, it's easier to live with the problem. Firing is never as bad as they think and it's always better to confront the situation and eliminate the problem. Moving forward, the business almost always runs better.
12. In what other areas do contractors struggle?
Analytics for their business. Two examples would be marketing programs that are not tracked back to sales and maintenance agreements. Both areas require a process that must be put in place.
13. How long does it take you to get contractors to think differently and do things the right way?
It's usually takes one to two years.
14. Is it difficult to get them to change?
No, because they're usually making so much more money they don't want to go back to the old way. But the processes and training take time to implement.
15. What are the big area contractors struggle with outside of finance and metrics?
They like to be out in the field taking care of customers, but they can't do that anymore. That's when they get into trouble. They have to focus on running the business.
16. Is there an area where larger contractors struggle?
They grow to the point where they can no longer manage, or their managers can't manage. There is a different skill set managing larger companies. Often owners need to hire "new blood" to continue to grow.
17. What happens with existing staff when new people are brought in?
The majority doesn't want the responsibility of moving up. They're comfortable where they are. For those who want the challenge, however, additional training is the answer to help the company keep moving forward.
18. You've written several books — "The Courage to Be Profitable," "The Ugly Truth About Managing People" and "The Ugly Truth about Small Business" — were they all based on your consulting work?
Yes. I think I wrote "The Courage To Be Profitable," in a month — it just poured out of me. But what I want contractors to understand is that they all have the same challenges, problems and opportunities. And, there is a lot of help available to them — they simply have to ask.
19. Are you working on anything new?
Actually, yes! We're building a program for small contractors with five employees or less. We're calling it "HVACR Business in a Box" and its all technology driven. We've found a way to combine dispatch, flat rate, proposal pricing and Quick Books in one package. This program will help them to price profitable jobs, which is a small company's number one problem.
20. When will it be available?
December 1st. Contractors can call us (877-520-4321) for more details.