How COVID-19 Changed Business
Originally published: 03.01.21 by Pete Grasso
The pandemic has affected the way many people do business, contractors included. Some have had to make significant changes to operating procedures to survive.
Toward the end of 2020, I interviewed Dan Foley, owner and president of Foley Mechanical in Lorton, Va. for our 20 Questions column. During the course of the interview, the conversation inevitably steered toward the coronavirus pandemic and I asked him how it had affected his business.
“We were going pretty strong, and then the brakes hit in March as clients just didn’t want us in the house,” Foley recalled. “No one did. It was uncertainty.”
It was a sentiment that was echoed by many contractors with whom I spoke with last year. Uncertainty was a common theme. But then, as we continued to talk, Foley revealed to me that his business was put in further jeopardy when he began to exhibit symptoms of COVID-19.
“The first week of April, I started feeling funny and I just couldn’t get out of bed,” he said. “I went and got tested and I was positive (for COVID-19).”
Hospitalized for a week and unable to muster any energy for a few more after that, Foley realized an even bigger setback with his business — as the linchpin of the company, Foley’s business came to a halt without him there to lead his team.
“I’ve got talented technicians but I’m the one that brings the work in,” Foley said. “That was not a good place to be in because none of my guys were trained to close jobs or sell jobs or bring in work. So, we had no income basically.”
Throughout the summer, as Foley recovered and business started to pick up, he implemented changes within the company to ensure his absence didn’t stunt the company’s growth ever again.
His story is a cautionary tale that is all too familiar to contractors: Be sure your company can survive without you.
That said, I wondered how the pandemic affected others in the industry, so I reached out to a handful of contractors to find out what their experience has been in the past year and what changes they implemented to survive and thrive in the current global climate.
The panel included Mike Graessle, general manager of Hetter Heating & Cooling in Columbus, Ohio; Benson Green, president of Benson’s Heating and Air Conditioning in Tallahassee, Fla.; Eddie McDonald, owner of Zen Air Heating & Cooling in Suwanee, Ga.; Rob Minnick, president and CEO of Minnick’s in Laurel, Md.; and Brian Stack, president of Stack Heating, Cooling & Electric in Avon, Ohio.
Here’s what they had to say.
How has business been in the past 12 months?
Graessle: The overall mindset has changed in the past 12 Months. We are truly appreciative of our health, our clients and each other. Sometimes, you tend to take things for granted when things are flowing. What this pandemic did was got everyone to hit pause and assess this new environment.
Immediately we sat down as a management team once the stay at home order hit. We calculated “worst case scenarios” if we shut down but kept payroll flowing. We assessed 90-day and six-month projections. We communicated stay at home and dispatching procedures for all field technicians.
We implemented schedules for office personnel to work from home and confirmed that systems were operable remotely. We stockpiled personal protective equipment (PPE) materials and distributed them to all employees. We changed advertising messages to ensure customers that we were adhering to the CDC guidelines. We took it one day, one call at a time.
Green: We were behind on budget and a little behind on 2019 numbers. No one thing just all the little things added up for the low sales.
McDonald: Last year was worse than expected. We were down about 35 percent from the previous year.
Minnick: It has been less than in the past, though I would not say horrible.
Stack: We were worried how the year was going to end up with the pandemic. The beginning of the year was rough. Things picked up through the summer, however, and we kept everyone working through the year. In the end, the year was better than I expected.
How did the pandemic affect your business last March/April?
Graessle: The customers were hesitant at first. They were trying to digest all of the media reports. March gradually slowed down and April was a challenge. For 60 days, service fell 35 percent and installations dropped 20 percent.
Green: We were a little slow just because we serve a lot of older citizens that did not want us in their homes for maintenance. But it didn’t last long once they saw all of our safety protocols in place.
McDonald: Business slowed tremendously.
Minnick: We had a horrible March, April and May in 2020.
Stack: Being mostly a residential service/replacement company, the pandemic really affected us in March/April. Most of our customers called and put everything on hold until we knew what was happening with COVID-19. This led to us laying off more than half of the company until we were able to secure the PPP Loan.
What changes did you have to make to your operating procedures, short term, to deal with the pandemic last spring?
Green: We followed all CDC guidelines then and now throughout our business and continued with a strong service presence in our area with some outstanding reviews about our safety and service that keep work coming in. I believe, all in all, it was a very positive year considering everything that was going on in 2020.
McDonald: We implemented a mask protocol, using sanitizer and wiping down everything we touched. We have a total contactless experience for customers now.
Minnick: We didn’t have to make a lot of changes, as we already had all the PPE … we just need to get more.
Stack: We started by putting together a new safety plan to ensure we were protecting our employees and customers the best we could. Our CSRs had to adjust and change scripts to make sure the customer knew we were taking this seriously. I can see some of these new procedures sticking with us for a while.
How did you rebound, if at all, during the summer?
Graessle: Once warmer temperatures arrived, with thousands of people working from home, business picked up quickly. If they were home, they wanted to be comfortable! We ended with our best year on record.
McDonald: We rebounded somewhat, but summer was not that hot in Georgia, so we still ended up lower than the previous year.
Minnick: Summer was fantastic for us and the PPP loan helped us make it through the year.
Stack: The warm weather did help with business. With more people working from home, their indoor comfort became more important. We saw an increase in service and replacement sales along with more indoor air quality (IAQ) sales.
What changes did you institute, long term, as a result of last spring/summer?
Graessle: Our overall communication, both internally and externally with customers, has improved. Our digital advertising has grown as well.
We appreciate each other. We appreciate our customers allowing us to continue to serve them. I believe our distributors appreciate us more. The challenges we face now and moving forward are inventory related based on “production lags” over the past 12 months.
We will take it one job at a time. It has been a team effort and relationships have improved.
Green: Our customers in our area will expect these new safety procedures from here on out and unless they tell us we do not need to do something in our procedures, we will always perform like this.
McDonald: We will continue to implement the mask protocol.
Minnick: We’ve created virtual service calls, virtual sales calls and virtual energy audits, which has really helped.
Stack: One of our biggest changes was adding a second line of equipment to the mix. We have always carried only one line. Equipment shortages caused us to start looking for a second line to ensure we could take care of our customers.
One year later, how are you poised to grow your business as a result of changes you’ve had to make because of the pandemic?
Graessle: We were able to maintain our staff — actually add to our staff — and we are positioned to grow. Our scheduling, communication and overall efficiency has improved over the past 12 months. We are thankful that we were deemed “essential” a year ago and we ALL realized quickly that we provide an important service to others. We are blessed.
Green: We are moving our marketing around and devoting more money to acquire more customers. We have gone through extensive sales training for service and maintenance technicians. Our comfort consultants are in sales training now so after we capture more leads we will be able to close at a higher percentage.
With our customer base still working from home, they have more time to shop for multiple quotes on service and change outs and we are learning how to combat these issues.
McDonald: We survived! So, now we’re putting a team in place to be successful when the busy season hits.
Minnick: At the beginning of 2020, our plan was to automate 80 percent of our processes and procedures. The pandemic gave us the time to do that and we have made the changes which have helped us be more efficient.
We have also put more time into our marketing strategy. Both of these will help us grow as we are already seeing movement.
Stack: We are planning for growth this year, but I don’t think I would attribute that to any changes we have made because of the pandemic.