The HVAC industry isn’t just a business for me—it’s part of my family’s fabric. My grandfather dedicated his career to it, my father spent nearly 20 years as a Lennox sales rep, and almost all of my uncles worked in the industry, with one even becoming a partner in one of the largest manufacturing rep firms in the country. HVAC is in my blood.
As for me, I’ve had the privilege of founding and growing a contracting company to over 400 technicians, and I’ve played key roles in expanding a warranty company within the HVAC space. Now, I’m making big investments to shape the future of this industry, and my vision centers on bringing HVAC online.
The move to digital is gaining speed, and for good reason. We’ve seen what companies like Apple and Amazon have done by putting the customer first, and I believe the HVAC industry needs to adopt the same mindset. Here’s what moving residential HVAC online is going to do:
1. It will benefit the customer: By going online, it will introduce pricing transparency and a more streamlined purchasing process. The result? A more pleasurable and efficient experience for customers. In today’s market, that’s what they expect.
2. It will challenge contractors: This shift will reduce the significant margins contractors have historically enjoyed. Just like car dealerships had to adapt when the auto industry evolved, contractors will have to evolve too. It’s going to be a tough adjustment, but it’s inevitable.
That’s where Caddie comes in. Our goal is to provide contractors with the tools they need to compete in this increasingly competitive environment. Part of this evolution involves tough decisions that may impact short-term revenue but will build long-term value for everyone.
One key example is warranties. We sell a lot of warranties through our contractor partners at Caddie Contractor Solutions, and they’re a healthy revenue stream. But, we’ve come to realize they’re not always the best product for contractors. At the end of the day, contractors are responsible for the equipment they install. Did you know that a high-quality installation can reduce the likelihood of system failures dramatically? In fact, installation quality plays a bigger role than the equipment itself when it comes to system performance and breakdowns.
We’ve also seen wide variations in warranty loss costs—some contractors on average have less than $100 of claims over 10 years, while others have claims that exceed $2,000. While we offer performance-based pricing to reward contractors with fewer claims, we want to go further. We’re now showing contractors how they can self-warranty their own jobs and how much that would cost.
By doing this, contractors keep more profit within their businesses, rather than losing it to a warranty company. And with margins tightening, every penny is going to count. Our mission with Caddie is to ensure that contractors who partner with us are prepared to navigate these shifts successfully.
Keep Your Money in Your Company: Quit Paying the Warranty Company
We may be crazy for using that headline, considering that one of our core products is extended service contracts or warranties. However, while we use performance-based pricing—much like a safe driver discount—to ensure contractors get the best-priced warranty program, we also recognize that this is just a stepping stone toward the ultimate goal: giving contractors complete control over their warranty programs.
Read more in our new "Caddie Shack" blog 👇
https://lnkd.in/ex_HMKa9
