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10 Common Mistakes HVACR Owners Make

Originally published
Originally published: 7/1/2023

Owners of HVACR companies sometimes make mistakes that can hinder their business growth and success. I’ve outlined ten common mistakes below. Avoiding these mistakes requires proactive planning, continuous improvement, and a customer-centric approach. By investing in marketing, prioritizing customer service, optimizing operations, promoting ongoing training, and maintaining financial discipline, HVACR business owners can set a strong foundation for growth and success.

Here are ten common mistakes to avoid:

1. Lack of Strategic Planning: Failing to develop a clear vision and strategic plan can hinder the long-term success of an HVACR company. Without a roadmap, owners may struggle to identify growth opportunities, make informed decisions, or adapt to changing market conditions. It's crucial to set measurable goals, conduct regular SWOT (Strengths, Weaknesses, Opportunities, Threats) analyses, and create actionable strategies to guide the company's growth and sustainability.

2. Lack of Customer Focus: Failing to prioritize customer satisfaction and service can be detrimental to an HVACR business. Customer loyalty and positive referrals are crucial for success in this industry. Owners should focus on providing exceptional customer service, responding promptly to inquiries, addressing customer concerns, and delivering high-quality workmanship. Failure to prioritize customer needs leads to a loss of business and a damaged reputation.

3. Inadequate Workforce Development: The success of service businesses relies heavily on the skills and expertise of their employees. Neglecting employee training and development results in subpar service quality, decreased productivity, and limited growth opportunities. Owners must invest in ongoing training programs, certifications, and apprenticeships to ensure their workforce stays knowledgeable and skilled in the latest industry practices.

4. Inadequate Financial Management: Poor financial management will kill even the best companies. Owners must stay on top of their cash flow, and budgetary constraints, to sustain and grow the business. Owners who don’t do the proper financial planning, keep accurate books and implement cost control measures often may find themselves struggling to cover expenses or make strategic investments. It's crucial to have a solid financial management system in place, including regular financial analysis, budgeting, and forecasting.

5. Neglecting Maintenance Contracts: We’ve been writing about the importance of maintenance contracts since starting the publication in 2006.  Still, many contractors focus solely on one-time repairs or installations and neglect the potential of maintenance contracts. Offering maintenance agreements to customers provides a stable recurring revenue stream while ensuring that customer systems are properly maintained. Implementing a proactive approach to maintenance also prevents most sudden major breakdowns.

6. Inadequate Marketing and Promotion: Neglecting marketing efforts is a significant mistake. Some company owners assume that word-of-mouth referrals alone will sustain their business. However, over the long run, this won’t work. You need to invest in a comprehensive marketing strategy that includes a strong online presence, social media, search engine optimization (SEO), and targeted advertising. Failing to promote your business limits your reach and prevents potential customers from finding you. Owners should have a well-designed website, maintain an active presence on relevant social media platforms, and actively manage online reviews. And as the company grows TV, radio, and print advertising should be incorporated.

7. Inefficient Operations and Workflow: Poorly organized operations result in delays, mistakes, and dissatisfied customers. Owners must establish streamlined processes for handling inquiries, scheduling appointments, dispatching technicians, managing inventory, and handling paperwork. By investing in efficient systems and tools, you can improve productivity, reduce errors, and enhance customer satisfaction.

8. Ignoring Technological Advancements: As an industry, we’re constantly evolving, with new technologies and innovations. Owners failing to stay updated on the latest advancements miss opportunities to improve efficiency, offer better solutions to customers, and gain a competitive edge. It's important to invest in training and education to keep up with industry trends and leverage new technologies that can benefit your business.

9. Lack of Diversification: Relying heavily on a single market segment or customer base is always risky. Remember what happened to new construction 2008 – 2010. Economic downturns or shifts in customer preferences can significantly impact the business. Owners have to consider diversifying their customer base by targeting residential, light commercial, and industrial sectors. Offering a range of services such as installation, maintenance, repairs, and energy audits can also help mitigate risks and expand revenue streams.

10. Poor Communication and Customer Education: Effective communication is key to building strong relationships with customers and ensuring their satisfaction. Owners who fail to communicate clearly and educate customers about their systems will encounter misunderstandings, low customer loyalty, and missed opportunities for upselling or cross-selling. It's important to establish clear lines of communication, provide transparent explanations about services and costs, and educate customers on system maintenance, energy-saving tips, and available upgrades.

Not one set of principles or words of advice can replace the knowledge you have about what works best for your business. However, these are strategies that have worked for countless HVACR owners who’ve come before. If you follow this advice and continue to be adaptable to change, certainly you will avoid potential (and mostly predictable) hurdles that can threaten to stop growth and hinder the long-term success of your business. 

Terry Tanker is the owner of JFT Properties LLC and publisher of HVACR Business magazine. He has more than 25 years of experience in the advertising and publishing industries. He began his career with a business-to-business advertising agency. Prior to forming JFT Properties LLC in January 2006 he spent 20 years with a large national publishing and media firm where he was the publisher of several titles in the mechanical systems marketplace. In addition to his experience in advertising and publishing Terry has worked closely with numerous industry-related associations over the years including AHRI NATE and ABMA

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