Friday, February 21, 2014

Why can't I find young Technicians?

As I meet with clients I am hearing how hard it is to find young Technicians in plumbing, HVAC, or electrical service companies. Their advertising for new Technicians goes without much in the way of success. With unemployment high, especially for young adults, you would think there would be a significant number of applicants for entry level or helper type positions. It just does not seem to be. Let’s look at some of the reasons this is the case.

High School Counselors
Hiring Young Technicians for Plumbing, HVAC, and electrical
Without a lot of exposure to the opportunities for highly skilled service technicians, the long-term career opportunities, and the monetary rewards, many counselors are not showing students the careers available with firms that provide service in our fields. Successful students are pushed toward four year (or more) college degrees and jobs that relate to those degrees. Students often end up with a degree, no job, and tens of thousands of dollars of debt in their early twenties. Those students with little motivation or poor grades are directed to a whole variety of various trades and jobs. With the complexities in our industry today, we need successful students with great educational backgrounds.

Those Leaving the Military
Many younger Americans join the military when they graduate from high school. They mature
Plumbing, Heating, Air Conditioning, and Electrical Service Companies
and gain training in the military that could be applicable to our businesses. They learn how to use tools, computers, understand technical manuals, and many other skills. They leave the military with their
GI education benefits but we have few opportunities for them to use them in our service industry. Instead, they are actively recruited into other skilled labor industries such as aircraft maintenance, automobile repair, and computer repair. There are schools specifically setup and operating to train young veterans in these fields. These fields also have a lot of pizazz which we lack or we lack conveying it to veterans.

Drugs, Driving Records, and Records
Bergstrom - Elder Consulting Group
My experience has been that a third to a half of those who apply for an entry level position cannot pass a pre-employment drug test.  Many young applicants have serious driving violations which are not acceptable to insurance companies. Since we work in customer’s homes or place of business and employees must be able to drive our vehicles, the legal liability is too great to for a business to take the risk and hire them. Lastly, some come in with criminal records. This can present business risk that most of us are unwilling to take on.

Weekends and Nights
Many young job candidates are not willing to do whatever it takes to continue in our field. They
want evening and weekends free for their own pursuits and not burdened with on call during these times. They will pursue jobs that don’t require interruption of their personal life.

Instant Gratification
Many young prospects are not willing to put in the years and the energy to gain the knowledge necessary to service the plumbing, heating, air conditioning, or electrical in  homes and businesses. They can conquer the skills needed to flip burgers in a few hours. They can learn to do a lot of less skilled jobs in a few days or weeks.

No in house training or career plan
Bergstrom - Elder Consulting Group
Few contractors have developed any type of in house training program for the future of their business. They look for Technicians who already possess the technical and customer service skills necessary to meet customer needs. There is no career plan so a young prospect can see where they can advance and have a career not just an entry level job. All the young prospect can see is 20+ years doing exactly the same thing day in and day out. The old adage, "What's in it for me" still rings true in young people. 

We think of competition, we think of other businesses in our fields. Sure
they are some of your competitors for young workers but businesses outside of our field are much bigger competition. Young people with skills are being hired by school systems, maintenance companies, chain stores, building owners, manufacturing companies, and even unrelated services and products industries.

Stay Tuned

Stand tuned for the next article on some ideas to overcome some of the issues listed above.

Dan has been in the service industry for nearly 50 years. He has operated a large plumbing, heating and air conditioning service company and for the past 12 years has helped small companies in the service business to grow and prosper. Contact him at

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Wednesday, February 12, 2014

Can Your Business Have Too Much Profit?

Bergstrom - Elder Consulting Group
The service business is an interesting business. It has its ups and its downs. The downs are often related to weather in the HVAC service business. A cool summer or a warm winter can slow down the customer’s need for service and reduce the opportunities for system replacements since the systems aren’t taxed with mild weather. The plumbing, HVAC and electrical service businesses are usually affected by poor economic times. When customers are concerned about their income and expenses they tend to let maintenance and service go or look for cheaper (in their eyes) alternatives such as friends or a handyman.

What Contractors tend to do

Contractors tend to tighten up the purse strings when the economy is slow or the weather does not cooperate. They put off new trucks, computers, tools, and needed repairs on those items. After all, they need to meet payroll, satisfy suppliers and pay their taxes. I’ve been there and done that through several recessions and a number of poor weather seasons. That’s what a small business does to survive.

Many of my clients had very good years in 2013. Some even had record growth and record profits. In Michigan, the cold weather of December and January resulted in the phones ringing. At least two of my clients had record January sales and profits. What a way to start the year. But, what happens when a service business has a very good year or even a very good month?

High Five Times

Often the first reaction is of joy and high fives as it should be. Then suppliers and other vendors are paid so accounts with them are current, again as it should be. But here comes the concern I have that a profitable year or even a very profitable month causes owners to spend on computer upgrades, trucks, tools, give oversized wage increases, and buy stuff for owner use. They don’t do it at a reasonable pace but tend to forget about the need to have some reserves since another stretch of tough months may be ahead. Funds are spent with the thought that the next month or season will also be very profitable. They also forget about paying down on their line of credit since the bank may only require a payment of interest or minimal principle.

Say Yes To Success
Ant or Grasshopper

The Ant and the Grasshopper, also known as The Grasshopper and the Ant (or Ants), is one of Aesop's Fables, providing a lesson about the virtues of hard work and planning for the future. Similarly as business owners, we should be storing up our abundance for the difficult times that inevitably will be coming. When we are prepared for slower business, we can pay our vendors on time often getting better pricing and terms. We can get materials without scrambling around to try and get them since our credit may be tarnished. We can be prepared to take on additional opportunities when business picks up. Financial reserves give a business a better chance for survival and a chance to grab opportunities when they present themselves.

The answer is NO a business cannot have too much profit but the profit must be used wisely.

Dan has been in the service industry for nearly 50 years. He has operated a large plumbing, heating and air conditioning service company and for the past 12 years has helped small companies in the service business to grow and prosper. Check us out at

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Wednesday, February 5, 2014

First to Try Guy

Let me relay an experience I had a number of years ago and then a repeat of that experience 15 or so years later. I guess I didn’t learn from the old adage, “Fool me once shame on you, fool me twice shame on me.”
The New Rooftop Units
I was a sales engineer with a large HVAC equipment manufacturer right out of college. I was teamed up with a great mentor and partner. We had submitted bids to contractors who were bidding on a low rise office complex which would require multiple 20-30 ton rooftop units. Our old units were not very competitive since the curbs, plenums, dampers, and other accessories needed to be assembled and installed on the basic unit. Our competitors had fully assembled units which saved the contractor labor, making the installed price less than with our equipment. Well the powers to be at corporate saw the light. They redesigned our units so they would be fully assembled at the factory. We also had some features available in the units that engineers, owners and installing contractors would find of value. The installing contractor who got the job liked our bid and we were selected to provide the equipment with our redesigned units.
This was the largest order the factory had to date on these new units, so one of the engineers flew in to see the installation and be there for startup. As we were driving him from the airport to the jobsite, we passed another low rise office complex going up. Just the structural steel was in place but the roof curbs were set in place for the roofers to install the roofing material. The engineer commented,” Is that the way they support the roof curb and unit?” We discussed this for several minutes when my partner and I looked at each other in sheer astonishment. The engineer thought much more structural steel was used to support the rooftop unit. We knew we were in trouble! The type of fans used in these units caused a lot of vibration when installed with code approved structural steel which was much less than the engineer had thought would be used. We had a problem job! We did eventually solve the problem but the lesson was IT IS NOT ALWAYS A GOOD IDEA TO BE THE FIRST TO TRY GUY.
The New Furnaces
Leaking Chimney
I moved on after several years in that position to take over a family plumbing business. Years later, after adding HVAC to my plumbing business, our major equipment supplier held their annual dealer meeting and introduced the furnace of the future. It eliminated the flue damper, had a new heat exchanger, had a new circuit board to control the unit and could vent into a masonry chimney just as the less efficient units did. It increased the efficiency from the mid-sixty percent efficient to eighty percent efficient. Wow! We immediately began to market and sell the units. Obviously most every customer wanted a more efficient furnace in their home and we were ready to provide it. After installing dozens of these units, we started getting calls about water on the basement floors below the chimney cleanout. What was going on? We asked the factory engineering staff and they said it was condensate forming in the chimney. They asked if our chimneys had clay tile liners inside of the brick. Well of course they did since this had been code for many decades. What they didn’t know that most clay lined chimneys do not have a consistent air gap between the clay tile liner and the exterior brick so the chimneys were too cold to carry the moisture out of the chimney before condensing. What can be done? No one seemed to have an answer. By trial and error we found that installing an aluminum liner the problem went away.  After several years the flue piping began to rot out and had to be replaced with B vent. The aluminum liners rotted out and had to be changed. Several generations of circuit boards had to be replaced. Problem after problem gave us the privilege of satisfying many unhappy customers at our expense for issues that was not our fault. I recall one contractor who did not jump on board with the new and improved units for two plus years. He avoided many of the headaches we endured .The lesson was IT IS NOT ALWAYS A GOOD IDEA TO BE THE FIRST TO TRY GUY.

Although it can be exciting to have newest products, the newest truck designs, the newest software, it can be costly and create unhappy customers, employees, or owners. Tread cautiously when and if you decide to be the first to try guy!

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Often owners and managers need assistance in using their time wisely to grow the business or improve the business. We can help. Contact us.

Dan has been in the service industry for nearly 50 years. He has operated a large plumbing, heating and air conditioning service company and for the past 12 years has helped small companies in the service business to grow and prosper. Contact him at