Bundling of Products & Services - How to Survive and Grow A Home Performance Business in 2013 and Beyond?

Working with my customers and friends that are home performance contractors we always seem to be seeking answers to questions such as:

What will make my business survive in the short term?

What does it mean to run a successful home performance business?  

What can I do if my local utility rebates, tax credits, and programs change?

For the most part it is true that individuals and businesses alike do prefer certainty over uncertainty. The problem with this statement is that we (as individual businesses) cannot control what the business environment, the economy, and our customers are about to do. We need to be adaptive and stay quick on our feet.

With that in mind we are always discussing business approaches that focus on home performance contractor taking charge of their own destiny. Instead of allowing third party organization determine the destiny of a home performance contractor I believe that there is a great deal that a home performance contractor can do to becoming or staying successful.

Personally, I believe that there are straightforward products and product categories that can easily be included as standard product and service offers in many home performance jobs:

 

Electric water heaters. If the existing water heater is older than 10yrs old it may be good business to write up a bid to replace it with a Marathon water heater or heat pump water heater. Consider partnering with a local plumber or water heater installer.

 

Ductless mini-split heat pumps. They look all techie, but these are prepackaged systems that can be installed right out of the box. Consider providing a bid to home owners with existing electric resistant baseboard heaters.

 

Advanced home ventilation fans. Personally, I am a victim of a silly jet-engine-noise-producing Broan fan in my bathroom. I wish I had known about whisper quiet Panasonic fans a few years ago. Easy to install. High customer satisfaction. Very high quality without manufacturing defects that I have come across so far.

I am not sure whether this will be controversial blog post or not.  I thought it would be good to get a general perspective from what contractors think. I have written a longer blog entry on this topic this week providing some ideas on how contractors can implement these suggestions

What do you think?  Have you added quick and straightforward product offers in your business model? Do you think it takes away focus? Does it provide the business benefits that you are looking for?

Views: 609

Tags: business, contractor, credit, development, ductless, fans, financing, heat, heater, home, More…marathon, mini-splits, performance, pump, rebate, tax, utility, ventilation, water

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Comment by Bob Sullivan on September 28, 2012 at 9:08am

Successful businesses, especially successful small business, build their success upon relationships, relationships and relationships. Tammy is 100% correct. Do whatever it takes to separate your business from your  "Elmo & Bubba" competitors. It's well worth the added effort if your efforts lead to a marketplace consensus that your company is above and beyond everyone else. Companies so perceived command premiums for their services. Premiums and added profitablity go hand in hand.

Comment by Tammy Kenworthy on September 28, 2012 at 8:41am

@Joseph I absolutely agree with your comment The successes come from happy clients telling their neighbors, co-workers, family and friends about how good you were to them, how you took the time to do everything right, and how comfy their place is.  In our territory the most successful contractors are those that hire personable crew members, do high quality work and throw in extras. They thank their customers for referral and stay in touch with them. Much like Realtors do, they stay in contact and make sure they follow up on every referral. 

-Tammy  http://www.ilovewaterheaters.com/

Comment by Roch Naleway on September 24, 2012 at 7:27pm

@ Ted Kidd. The financing aspect to energy efficiency is interesting. There is on bill utility financing going on in the Oregon market. There are also a handful of banks offering efficiency loans to residential and commercial customers.

The problem is that folks that qualify for financing do not need financing. The folks that do need financing don't qualify for credit, cash flow, or other reasons. I would say that we havve 30% of the population that can't participate in energy efficiency, because they do not have the resources to even do the simple stuff.

Comment by Roch Naleway on September 24, 2012 at 4:02pm

I like the attitude. :-) Go for it Bob!

Comment by Bob Sullivan on September 24, 2012 at 1:40pm

We're in the injection foam manufacturing business, and we'te thriving, too. One way to survive economic downs turns is to ignore them. Play the cards you're dealt and let the other players worry about the cards that weren't dealt. As difficult as the economy has been, it's nothing like the Carter years of gas lines & 21% interest. Attitude has much to do with success.

Comment by Roch Naleway on September 24, 2012 at 1:25pm

@Joseph - Greetings to Seattle. I will be up there in a few weeks. It is great to see that your business is thriving. It is good to hear that you are including some good energy saving widgets when going after jobs.

I think that there are choices for Home Performance Contractors to make on what each business wants or does not want to do. You can do some stuff in-house and other stuff needs someone else to do it. There is a path for folks to use that allows for inclusion on easy to access technologies and products.

Comment by Joseph Lamy on September 24, 2012 at 12:29pm

Bob, we're doing both - consulting and general contracting. We find the work doing audits, bid on them as a general contractor and then do some work in-house and some with sub-contractors. We are BUSY and so are our subbies. Oil has caused pain in our area, and we weatherize all houses and reduce the energy load as well as replace out-dated stuff. With an electric grid based on 90 + % hydro-power, we are finding quite a few folks who want mini-splits, R-60 attics, high density walls, insulated floors and air sealing. We are even installing quite a few solar PV arrays and an occasional DHW. Being both a consulting and also a contracting outfit lets our little company dump quite a few new jobs and lots of work into our economy. Happy clients are sharing their joy, enjoying comfort for very low cost, and telling their neighbors. Times are good here in Seattle - plenty of work, plenty of rain and plenty of happy folks.

Comment by Bob Sullivan on September 24, 2012 at 10:37am

You got to decide which path to take. Energy performance consultant. Equipment and systems installation contractor. Both have their rewards. They overlap quite a bit but, they don't always come together under the same roof to generate consistently sustainable profitability. Installing stuff means hiring labor. Hiring labor means headaches. Installing stuff also requires some sort of warehouse where necessary inventories can be maintained. Then there's insurance; another headache. Hmmm ... being a consultant sounds like more fun and less grief.

Comment by tedkidd on September 24, 2012 at 10:17am

I love this statement:

it is true that individuals and businesses alike do prefer certainty over uncertainty.

Rick Gerardi's Contractor Registry would take the huge uncertainty of results and turn it from a mountain into a pebble by allowing the consumer to see ability to deliver on projections.  

When you have proof of ability to deliver, banks will loan against free cash flow projections.  Right now you take EE projections to a bank and they'll laugh at you.  (maybe not to your face...)

Comment by Roch Naleway on September 24, 2012 at 9:48am

Bob - I am good with collaboration. Definitely good. I don't think that everybody can carry a mechanical and electric license. If the Home Performance Contractor can specify out the good technologies they should be able to earn a few dollars on the referral and/or sales job. We see some collaboration between Home Performance Contractors, plumbers, and HVAC folks in the field.

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