Starting an HVAC company is challenging, but it can be very rewarding. Unfortunately, for many failed startups a lack of business and marketing knowledge lead to their demise. Even if you are the best technician in the world, if you do not have a clear growth plan, your chances of failing increase exponentially.
To save you the trouble of learning through (painful) experience, we are going to cover 5 tips today that will help you get a leg up on your competitors while building a scalable, repeatable system for acquiring new clients. Without further ado, let’s get to it!
Marketing and Sales Should Be Your Primary Focus Initially
As a new business owner, especially those of you coming from a background as a technician, the first instinct is to focus 100% on your service. I have seen countless entrepreneurs spend weeks or months defining and adjusting their service offers, without so much as running it by a potential customer. While it is easy to chalk this up to “wanting to make the best service possible” it usually is just about avoiding less comfortable areas like sales and marketing.
A typical service with a great sales funnel will outlast and outgrow one of a great technician without a process. Stop avoiding what makes you uncomfortable and tackle sales now. It will get better in time and once you start booking more jobs, the feedback of your best customers is what should influence how you improve your service.
Ask for Honest Feedback and Apply What You Learn
Software companies, fashion designers, and service-based companies all have one thing in common. Regardless of what you think is the perfect product or service, your customers will disagree.
The key to putting customer feedback to work for your business is to listen only to the right type of customers. Once you start to build up your database of customers, you will see some clients that emerge as the ideal customer for your business.
Maybe they schedule regular maintenance and inspections, maybe they are a strong source of referrals, or maybe they are just pleasant people to work with. Once you identify your ideal customer, look at their feedback thoroughly. Some businesses instead try to make numerous adjustments to please the wrong type of clients. The sad part about that is, before you know it, your business is modeled less about serving your ideal customer and more about serving nightmare customers. I am sure you can imagine how that plays out, so don’t do it.
Cut Costs Without Cutting Corners
As your company starts to grow, you are bound to face some financial pains as well. It could be for tools, training new staff, or getting the word out about your business. The key to success is to know where to save and where to splurge.
Here are 3 Areas You Can Save Without Hurting Your Business
Leasing Vs. Buying Your Fleet
For many HVAC companies, building a fleet of commercial trucks and vans is one of the biggest expenses. Every new service technician means another vehicle, the cost can get out of hand in
a hurry. Instead of buying hundreds of thousands of dollars worth of vehicles, consider leasing them instead. With leasing, you can vary your fleet size up or down depending upon the workload. At the end of the day your customers won’t know or care if you own or lease, and you could save a substantial amount in the process.
Avoid Carrying Unnecessary Overhead Expenses
As a new business, your first few months are probably going to be slow. For the first 6 months or even the first year, your sales could fluctuate, as you get your footing and establish your brand.
Even so, many people get “shiny object” syndrome and start spending money where they don’t need to in order to keep up with an established competitor. Having a nice fleet of vehicles can help you make a good first impression with a potential customer, having $25K of parts in storage will not.
Until you have gathered enough information about supply and demand, you should keep your inventory small. Look for a warehouse that can get your parts quickly, and keep them on speed dial. You can save tens or even hundreds of thousands on overhead by reducing what you keep on hand early in the life of your business. As you grow and demand becomes predictable, you will know what to keep on hand and what to order when needed.
Outsource Non-Essential Roles During the Startup Phase
While one day you may need a full in house staff to handle the work behind the scenes, when you are first getting started, that is not likely to be the case. Outsourcing work that is not part of your service offer to the client is a great way to keep costs down. Here are a few tasks you should outsource instead of doing in-house in the beginning:
- Answering Phones & Scheduling Appointments
- Accounting & Taxes
- Legal Business Filings
- Marketing & Web Design
Phone answering services are much cheaper than paying a full-time salary to a receptionist and your clients will rarely notice a difference.
When it comes to tax filings, legal document creation (like contracts) and general accounting, specialized knowledge is required to make sure the right steps are taken. It can be tempting to draft your own contract, however, the cost of one that doesn’t hold up in court is going to be a lot more than the average cost of an attorney.
While marketing can be a big expense, hiring a company to do it will still be much cheaper than hiring a full in house team with the skills needed to do it right. Without a sound marketing strategy, you are setting yourself up for failure from the start.
Hopefully the tips we covered today will help you as you start your new business. If you are considering becoming an entrepreneur, “The E-Myth Revisited” is one of the best books to read to get a clear grasp on the change that must happen for your “job” to become a full-fledged business.