Running your own HVAC/R business can be challenging says Ed Gancarz principal of the SHA+RP (Successful Heating Air Conditioning and Refrigeration Professionals) Institute. The business side of HVAC/R can feel overwhelming: how much do I charge someone for a service call? How much money do I want to make? What does it cost to run my business?

Through the SHA+RP Institute, Gancarz, who has 27 years of experience in the HVAC/R industry, trains contractors in the business skills that can help them be successful. “Many HVAC/R businesses come and go,” said Gancarz. “And it’s not because of their technical abilities. It’s the business side of the equation.”
They just don’t make enough money, he said. Too often, contractors charge customers only what they think the market will bear, he said. “But if the market will bear only so much and your cost structure is higher than that, then the clock is ticking on your business,” he said.

Gancarz outlines three ways to increase profits:
• Manage the costs of running your business. Always look at its cost structure and know what it is. Has your insurance increased? What are your fuel costs? Make sure to get quotes from multiple companies so you know you’re getting the best price for services.
• Make sure you are getting the most value from your suppliers. Volume purchases or a unique transaction may be an opportunity to save money.
• Price for profit. You can’t reduce costs forever; at some point, you’ll have to raise your prices.

Often with new business owners, “the business is not necessarily run as a business — it’s a living,” Gancarz said. “You have to ask yourself, do you want to make money or do you want to make a living?”

Gancarz, an MBA who spent the majority of his career with a Fortune 50 company, also recommends looking at what parts of your business bring in the most money. Take, for example, the new construction bubble that burst last year. Many contractors, Gancarz said, are in trouble because their main business was new housing. “If you put all your eggs in one basket, then you’re going to be in trouble when there’s a downturn.”

Contractors should cultivate more service calls and service agreements with clients — they generate revenue and are beneficial to the homeowner. It’s also a great time to get involved in IAQ products, he added; consumers are interested in and familiar with IAQ, and there’s money to be made while helping customers.

By paying attention to the business side of their business, HVAC/R contractors can be highly successful, Gancarz said. “The talent pool in this industry is very shallow — it doesn’t draw people the way the auto industry or technological fields might,” he said. “If you’re good at what you do, you have the opportunity for lifetime employment in this industry.”

Edward Gancarz is the principal of the SHA+RP Institute. Their services include small business consulting and training, individual and group coaching, organization development, call center management and
marketing and selling support.

Phone: (315) 263-1234
E-mail: egancarz@twcny.rr.com