The first half of 2020 saw vast changes to the contracting and service industry landscape due to COVID–19. While the specifics of the impact have varied, nearly every business in the heating and cooling industry has been affected by the pandemic and subsequent economic shutdown. The arrival of what is normally a busy summer season now coincides with the gradual reopening of the economy — and continued uncertainty about often-changing public health recommendations. What does this mean for the HVAC industry?
Post-Corona: Review the Numbers
- March brought an increase in cancellations and loss in revenue, which appeared to correlate with the timing of shelter-in-place orders by region.
- April saw a fairly consistent impact on revenue across the board, ultimately landing a few points down compared to the year prior. Revenue began to trend upward in April week over week, but still remained down compared to 2019.
- May to June data shows a continued trend in revenue recovery in the service industry, and according to ServiceTitan, the week of May 28-June 3 was “the fifth consecutive week with revenue above 2019 numbers — and… is the highest since the crisis began mid-March.”
Post-Corona: How to Thrive
While the service industry, and HVAC businesses specifically, are generally showing an upward trend in revenue, not all contractors have thrived during this time. But, during the emergency phase of COVID-19, and now in the post-coronavirus recovery phase, those who have thrived share some important best practices. Consider these as you navigate your HVAC business through the post-corona trends.
First and foremost, recognize your position as a community leader. Providing relief from intense heat and cold is essential for the well-being of people in your community. So, while medical professionals are the heroes in the hospitals, HVAC technicians and the like provide vital services for people in their homes and workplaces.
Let your community know your HVAC business is open and that you can safely serve them. Reinforce this message in all customer communications. Send a video message, put a pop-up banner on your website, and reassure customers when they call in to book an appointment.
While it’s tempting to cut spending and conserve cash across the board, resist the urge to pull marketing, and instead adjust your strategy. Remember that marketing is an investment in gaining new leads, which will lead to more revenue. Evaluate where you are seeing returns on your marketing dollars. Consider launching an indoor air quality campaign. Review the cost of marketing channels you maybe haven’t maximized before; some are less expensive right now because of decreased competition. Use that to your advantage.
Data is showing that while service calls have increased, job sizes are down. During the current economic downturn, consider re-framing financing options as a promotional offer. Begin this conversation early in the appointment process so the customer is well-informed about their options before the technician even arrives. Also, if you typically only offer financing on new equipment installations, consider offering financing for service and repairs during this time as well.
Contact (or not)
Predicting HVAC trends post-corona, even as we enter a normally busy summer season, still presents an abundance of unknowns. As safety restrictions and guidelines continue to relax, the uncertainty of the coming months still weighs heavy. Be proactive about establishing and training employees to provide a contactless service experience. This positions your business to serve customers even if public health recommendations tighten again.
Hopefully the entire HVAC industry trends upward exponentially during this post-corona summer season. But, in the face of economic turbulence, prioritize these foundational practices to keep your HVAC business upright and even growing.
Are you looking to expand your business, but also want to ensure your financial security in a time of uncertainty? We are conducting an industry specific acquisition search and business valuations for a named and retained buyer who is looking to expand in the HVAC industry. Contact us today for a confidential inquiry.