Key Takeaways
- Universal Parts Model: Stock a handful of universal components to fix 80%+ of service calls instead of hundreds of OEM parts
- Opportunity Cost: Not fixing equipment on the first visit costs your business $500+ in lost revenue and customer satisfaction
- Customer Retention: Same-night repairs build loyalty and generate referrals versus multi-day waits for OEM parts
- Smart Investment: Minimal inventory investment with universal parts versus thousands tied up in OEM stock that may become obsolete
Most of us have heard the statement “Work Smarter, Not Harder” before. So, what does that mean in a residential HVAC service business?
1) Take the shortest route to the call?
2) Make sure your truck is stocked with the right parts before you head out for the day
3) Pack your lunch instead of wasting valuable lunch time to get to a place to eat
4) Organize your truck, so you know where to find what you need?
5) Always have something in your hands when you walk back to the truck (trash, tools you don’t need, etc.)
No brainer stuff, right? Well, imagine this scenario…
The Midnight Service Call Reality
It’s midnight on a Saturday in the middle of winter and you’re standing in front of a furnace that doesn’t work. You’ve already experienced the high levels of stress from your customers that they spent the last 15 minutes explaining to you. They’re staring over your shoulder waiting for your next move in hopes that your magic wand will give them heat again.
You diagnose and come to the expert conclusion that the Integrated Furnace Control is faulty. Then… wait for it… you don’t have the part on your truck to fix it and be the hero of the day, or evening for that matter. The company service strategy has always been to only use Direct Replacement/OEM Parts. Plug and Play, Easy, Fast.
Is that Smarter? Or Harder? Let’s discuss that a little further.
The OEM Parts Dilemma
To successfully maintain the service model of Direct Replacement/OEM Parts, you need to stock hundreds and hundreds of parts. How much weight can your truck hold? How big is your shop? How much of your money do you feel like investing? Do you have the right stuff? How much dust will collect on it before it’s used? When does it become obsolete?
Better yet, how many times will your distributor open their warehouse for you after hours? Usually there’s a fee for that. The likelihood of making this large investment in a service business, and hoping that you guess right, is not likely.
Some would argue that they’ll just sell the homeowner a new furnace, since it will take too long to get the part they need. Furthermore, the customer still has no heat for at least a night or two, depending when the technician can come back. Is that a happy outcome? Not necessarily for the customer. That’s a lot of money!
The Universal Parts Solution
Let’s touch on the smarter scenario that could have taken place. After the diagnosis, you communicate to the customer that they will have heat that night. The stress is lifted. A sigh of relief and a smile or two. Hero Status!
The reason is because the company believes in having a Universal Parts business model that allows them to fix hundreds of applications with a handful of parts stocked on the truck. In addition to that, all the service technicians in the company have been trained on how to adapt and install these Universal Components to where installation time is almost as fast. Using a free smartphone app to determine which part you need from your truck eliminates downtime and gets your customer warm and cozy sooner.
A very minimal investment is needed to accomplish this, and the ability to fix approximately 80% or more of what you would run into on a typical call can be a realistic outcome. AND YOU GET PAID!
Understanding Opportunity Cost
Did you know that it costs the business money to NOT fix it? The tech goes to the house, doesn’t have the parts, then needs to either leave and go to another call, or go to the supply house, then eventually go back to the house (still not getting paid until the repair is complete). This could be a matter of hours, or even days before the repair is made. This downtime is Opportunity Cost. It can get expensive. Is $500 enough of a chunk every time you can’t fix it?
Who still doesn’t have heat? Is unhappy? Is thinking about calling a competitor to fix it? YOUR customer. Why risk it?
Just like scheduling heating maintenance in September prevents these emergency winter calls, having the right parts strategy prevents lost revenue when they do happen.
The Fix vs Replace Economy
The reality is that the post-apocalyptic economy that has impacted us all has motivated consumers to “fix vs replace.” We figured that this mentality would have gone away by now, almost 10 years later, but it hasn’t. Holding on to those precious dollars can be far more important nowadays. Especially if the cost to repair is a fraction of the cost of a new unit.
When you’re prepared with universal parts, you can offer customers what they really want – an affordable, immediate solution. This approach aligns perfectly with proper heat load calculations that help customers understand their actual heating needs versus oversized replacement recommendations.
Growing Your Service Business Smarter. While you’re building your universal parts inventory, consider how Property.com’s ‘Know Before You Go‘ tool helps you arrive at service calls already knowing the equipment history and customer preferences. This preparation, combined with having the right parts on hand, creates the perfect recipe for five-star reviews and repeat business. Learn how Property.com helps HVAC pros convert more emergency calls into loyal customers.
Making the Smart Choice
My advice is to take the time to learn about what your options are to work Smarter and Not Harder, and get more referrals, the price you deserve for your work, and happy, loyal customers that stay with you for years on end. Whether you’re troubleshooting heat pump reversing valves or dealing with complex BMS controls, having the right parts strategy makes all the difference.
Sounds like a great outcome, doesn’t it?
Check out the link to my YouTube channel for more tips, tricks, and troubleshooting videos and check out the The HVAC Know It All podcast here or on your favourite podcast app. Happy HVACing…