And why not, when they have the newest innovations and biggest industry event to show them off in?
MARCH 2024 contractingbusiness.com HELPING HVACR MANAGERS RUN BETTER BUSINESSES SINCE 1944 ALSO IN THIS ISSUE: 14 Service Tool Special 26 Rosenberg Enters Hall of Fame 32 What to Expect in 2024 Scarcity of Resources a Challenge for OEMs, Page 13 HVACR SHOW-OFFS!
PAGE 18 Welcome, Lee Rosenberg
High-level support for priceless peace of mind. For more information on how you can become a Westinghouse distributor, please contact Sales@WestinghouseAC-USA.com. www.WestinghouseAC-USA.com and Westinghouse are trademarks of Westinghouse Electric Corporation. Used under license by Fujitsu General America. All Rights Reserved. Our full line of single and multi-zone systems includes a wide variety of highly reliable, ductless mini split units and multi-position air handling units (MPAHUs). Each one is loaded with standard features and backed by exceptional service usually reserved for premier product lines. With cutting edge inverter technology, our new MPAH system combines our compact side discharge outdoor units with a modular design indoor unit. The result: high efficiency, space saving, quiet systems that allow for multiple installation options. Let Westinghouse take your business to a whole new level.
a n d s e r v i c e d b y a f fi i a t e d a n d t h i r dp a r t y n s u r e r s
P r o g r e s s i v e C a s u a l t y I n s C o C o v e r a g e p r o v i d e d
As a small business owner, you can’t escape your to-do list. That’s why Progressive makes it easy to save with a commercial auto quote, so you can take on all your other to-dos. Get a quote in as little as 6 minutes at ProgressiveCommercial.com
COLUMNISTS 6 First Word | Terry McIver 30 CB Influencers | Lori Tschohl, Andrew Fuselier 32 The Rant | Matt Michel DEPARTMENTS 4 What’s New Online 8 From the Field 10 Products 13 Manufacturer News 31 Ad Index 2 | CONTRACTING BUSINESS | MARCH 2024 COVER STORY 18 HVACR SHOW-OFFS! And why not, when they have the newest innovations to share at the industry’s biggest event? See our show report on page 18. TECH UPDATE 14 Service Tool Special Specialty tools and helpful accessories are featured in this special section. THE GREATS 26 Lee Rosenberg to Enter HVAC Hall of Fame After 50 years of contributions to the HVAC industry, Lee Rosenberg is still psyched to serve. He will enter our Hall of Fame during the ACCA show. REFRIGERATION SERVICE TODAY 28 Navigating the Refrigerant Transition During BDR’s SPARK 2024 conference, BDR coaches provided essential information related to the transition to A2L refrigerants. ON THE COVER: 2024 AHR Exposition. Jan. 21–24, McCormick Place, Chicago. Source: AHR Exposition @contractingbiz https://www.facebook.com/CBMag https://bit.ly/CBonLinkedin 18 26 14 MARCH 2024 | VOLUME 81, NUMBER 3 Connect with us: contractingbusiness.com 10
Goodman 115V AHVE Air Handling Unit
LEARN MORE AT www.goodmanmfg.com
When retrofitting existing gas heating systems to all-electric heat pump systems, upgrading the indoor unit’s electrical system to 230V is often necessary and expensive. However, the new Goodman 115V indoor air handler, engineered specifically for the Goodman Side Discharge (SD) system, is an all-electric solution that can replace a gas furnace without upgrading the electrical breaker to a 230V circuit.
Bring quality, comfort, and energy-saving performance home the new 115V air handler features an inverter-tuned variable speed motor. Combined with a Goodman SD heat pump, homeowners will continue to say Thank Goodness for Goodman!
Engineered for compatibility with the Goodman SD heat pumps.
www.goodmanmfg.com
2024
A DAIKIN BRAND
How to Sell Decarbonization
https://contractingbusiness.com/2180708
New Building Controls System
https://contractingbusiness.com/21280196
CO2
https://contractingbusiness.com/21280661
ACCA
https://contractingbusiness.com/21282920
SMACNA Names 2024 Innovator of the Year
https://contractingbusiness.com/21282892
Danfoss Shares Findings on Decarb for Data Centers
https://contractingbusiness.com/21282661
David Richardson provides ways to revive or strengthen your craftsmanship.
https://contractingbusiness.com/21281723
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Searchable database can be found at mycontractoruniversity.com.
Training
https://contractingbusiness.com/21282039
How to Avoid Burnout
https://contractingbusiness.com/21279916
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Weather challenges will continue. So must your business ingenuity and effort.
Don’t Talk About the Weather, do Something.
To follow the mild winter of 2024, they’re saying we will have a warmer spring and summer across the northern United States, but cooler temperatures in the south, at least in March.
This is challenging news for southern heating and air conditioning contractors but good news for those up-north. One successful northern contractor I spoke with said revenue was down by 27% through January, despite the polar vortex in early part of the month, which he says was crazy busy. But yes, normally, you can’t expect the phone to ring when it’s 40-50F in February.
But for as long as there has been HVAC contracting, there have been challenges posed by weather. So if the weather won’t cooperate, and controlcrazy bureaucrats won’t stop adding challenges to business operations, that leaves it to you to make 2024 a great year.
In Matt Michel’s column on page 32 you will find an excellent history of the HVAC replacement industry’s business situation since 2005, which was a record year for HVAC system replacements. After that, shipments began a 5-year decline, from 8.6 million units shipped to 5.2 million in 20092010. Michel says the shipment cliff will be with us awhile longer, after which we will see up to 10 years of growth. Let’s hope that becomes reality.
So again, it’s up to you, the contractor, to take steps to bring about a great 2024. Matt offered some suggestions, but you should already know what to do. First, focus like never before on service, and make money from it.
EDITORIAL ADVISORY BOARD
TOM CASEY Climate Partners Griffin Service
MIKE CONLEY Pioneer Heating & AC
VINCE DIFILIPPO
DiFilippo’s Service Co.
DOMINICK GUARINO National Comfort Institute
LOUIS HOBAICA Hobaica Services
MATT MICHEL
Author BRIAN STACK Stack Heating & Cooling
Don’t pull back on marketing and advertising. Don’t “disappear” while smart competitors increase their visibility. Find ways to get prospects to visit your shop (or product showroom, which you should have). Give stuff away, hold breakfast or lunch events to get people to see what you can do for their home comfort, including indoor air quality. Matt also suggests this could be the time to expand into some home-friendly offerings, like home security or generators. And find ways to work smarter and more efficiently throughout your organization.
HVAC great Leland Smith told me he comes into the office on Sunday to get some work done, but to also look around. Not to spy, but to look at how things are set up to run. In those quiet moments he’s found some impressive ways to save money.
ContractingBusiness.com is filled with businessbuilding information, so please visit it daily. We share advice from Matt Michel, National Comfort Institute’s Dominick Guarino and David Richardson and weekly links to EGIA’s Contractor University “Cracking the Code” shows. There, an expert-ofthe-week joins Weldon Long to share ways to grow your HVAC business. It’s all free, so please check it out.
The AHR Exposition in Chicago, Jan. 22-24 was another excellent AHR event. I’ll say one more time how much I prefer Chicago as the location for this show. Next year it will be in Orlando, a close second.
The 2024 AHR Expo offered more presentations than usual on electrification and decarbonization, if that is of interest to you. You already know how heat pumps work, so the next question is, will your customers want them? I don’t recommend forcefeeding them just to sell something, for two reasons: first, there is no climate crisis (for every article about climate change there’s contrary evidence that’s been hidden from view by the mainstream media); and second, every situation is different.
As Tom Casey wrote in our February issue, your advice should be based on your customers’ comfort demands: “For any markets that are not already HPs, that makes a complex sale more complex. A confused mind always says ‘no’ so we can run the risk of more objections than usual.” Even the best, most efficient system, fossil fuel or electrified, is only as good as the installation itself. Do no harm and always act in the best interests of the customer, wrote Casey. See bit.ly/decarbtalk .
As you read this I will be at the Air Conditioning Contractors of America Annual Conference in Orlando. In addition to a packed schedule of educational sessions, this year’s ACCA show features a reunion of past ACCA chairmen, including Larry Taylor and Stan Johnson, and the induction of Lee Rosenberg into the Contracting Business HVAC Hall of Fame, a long-overdue recognition.
Lee Rosenberg has been a lion in the industry in matters related to licensing, standards, and business management excellence. Both Taylor and Johnson told me of Lee’s commitment to sharing information to help other contractors get better. Read about Lee Rosenberg on page 26.
Welcome to the Hall of Fame, Lee.
6 | CONTRACTING BUSINESS | MARCH 2024
FIRST WORD BY TERRY MCIVER, EDITOR-IN-CHIEF
Low-GWP Refrigerants Certification Exam Now Available Study Guide Available in the NATE Online Store WWW.NATEX.ORG
Multiple HVACR Business Acquisitions Reported
Redwood Services, a home services firm focused on investing in leading residential HVAC, plumbing and electrical services companies in growing U.S. markets, today announced it has invested in Crisafulli Bros, a third-generation family business serving the Albany, New York region since 1939. It has 150 full-time employees and has serviced 23,000 residential customers over the last two years.
“Andrea Crisafulli and her husband Alan Ayers have expanded on the Crisafulli Bros. legacy and driven tremendous growth over the past several years,” said Richard Lewis, CEO of Redwood Services. “Crisafulli Bros. is one of the largest and best-known HVAC brands in upstate New York, having been named the Best of the Capital Region for 17 straight years and named a Top Workplace in Albany in both 2021 and 2022. The company is a strong addition to the Redwood Family, and we are eager to work together on Crisafulli’s next chapter of growth.”
The Crisafulli Bros. team will continue to operate and manage the business under the Crisafulli Bros. banner and name, while Redwood will offer operational, strategic, and financial support to enhance the company’s growth.
Crisafulli Bros. is Redwood’s thirteenth platform investment. It follows in North Carolina, Memphis, TN, Kent, OH, Jackson, MS, Phoenix, AZ, Cincinnati, OH, and Tucson, AZ, Indianapolis, IN and Albritten, WA. Redwood Services sources say it is building a family of people-focused essential home service companies, actively investing in the HVAC, plumbing and electrical trades throughout the United States. RedwoodServices.com
Sila Services Acquires ECS
Sila Services, LLC announced its continued expansion into Central Pennsylvania with the recent acquisition of ECS Comfort Heating & Cooling. Based in Palmyra, PA, ECS Comfort specializes in both residential and light commercial heating, cooling, and water heating system service and installations across Lebanon, Dauphin, and Lancaster counties. Since its founding in 1988, ECS Comfort has been rooted in providing 5-star customer service and proudly delivers over three decades of industry expertise to their loyal and rapidly growing customer base.
“We are pleased to take this significant step in further expanding our footprint in the Central Pennsylvania region with the acquisition of ECS Comfort Heating & Cooling,” stated Jason Rabbino, CEO of Sila Services. “ECS Comfort’s long-standing record of customer satisfaction and technical excellence perfectly complements our commitment to enhancing our service
Wyckoff New CoolSys President
CoolSys, a market-leading provider of sustainable refrigeration, HVAC, energy, and engineering solutions, announced recently that its Board of Directors appointed Rich Wyckoff as the company’s next CEO and President. Wyckoff will also join the Company’s Board of Directors.
Rick Frier, who has served as Interim CEO and President since February 2023, will remain involved with the business in his role as Chairman of the CoolSys Board.
Wyckoff is a seasoned executive with more than 30 years of experience leading high-quality service and manufacturing businesses. Most recently, Mr. Wyckoff served as Interim CEO of Pritchard Industries, a leading provider of facility services, where he remains Chairman of the Board of Directors. From 2019 to 2023, Mr. Wyckoff was President and CEO of Arctic Glacier, a leading provider of premium ice products and related services.
offerings and reaching new communities in a distinctive manner. We look forward to working with Andy Sattazahn and his tremendous team in building on the strong foundation ECS Comfort has established over the past 35 years and delivering innovative, unparalleled comfort solutions to our growing customer base across the Central Pennsylvania region.”
Sila Services is a leading home services platform, operating 25 brands across 32 locations throughout the Northeast, MidAtlantic, and Midwest.
Strikepoint Acquires Three
Strikepoint Group Holdings (SGH), formerly Horizon Group Holdings announced in November 2023 that it has expanded its presence across the tri-state area with three acquisitions:
• Campbell Comfort Systems, a family-owned and operated residential HVAC contractor serving communities throughout New Jersey’s Burlington, Camden, Gloucester, and Salem Counties.
• Kagel’s Heating & Air Conditioning, a full-service residential HVAC contractor serving customers in Burlington and Mercer counties of South New Jersey.
• SABRS, a veteran-owned-andoperated company in Delaware’s Eastern Sussex County.
SMACNA Names Innovator of the Year
Sheet Metal Air Conditioning National Association (SMACNA) has named Chris Hronek of Tweet/Garot Mechanical in De Pere, Wisconsin, as the recipient of its 2024 SMACNA Innovator of the Year Award, which recognizes contractors who are visionaries, game-changers, and the driving forces behind continuous improvement. The award was presented at the 2024 MEP Innovation Conference, the preeminent technology conference for mechanical, electrical, plumbing, service and sheet metal contractors. It is a recognition of excellence and celebrates those who are transforming and shaping the future of their industry.
8 | CONTRACTING BUSINESS | MARCH 2024 FROM THE FIELD COMPILED BY TERRY MCIVER, EDITOR-IN-CHIEF
Hronek SMACNA
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MARCH 2024 | CONTRACTING BUSINESS | 9
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Motors & Drives
ABB ’s Baldor-Reliance direct drive motors are synchronous permanent-magnet motors that use laminated finned frame construction to provide a highly efficient, power-dense package with flange-mounting dimensions that can replace right-angle gearboxes and jack shaft installation in many cooling tower applications. This same technology is offered in conventional, yet power-dense, foot mounted designs that can replace beltand-sheave configurations where more vertical mounting space is available. Derived from one of the toughest motor platforms used in the most demanding industrial applications, BaldorReliance direct drive motors are the right solution for operation inside the tower’s hot and humid environment. Direct drives are ideal for cooling towers, air cooled condensers and air-cooled heat exchangers. new.abb.com/drives
MARS , a leading supplier of motors, components, service/installation products, and equipment announces the release of a Bluetooth enhanced version of its Azure constant torque replacement ECMs.
Azure motors are designed with innovative features intended to simplify the life of the service tech. These features include auto-sizing technology, 1% incremental speed adjustability, and the industry’s smallest inventory footprint. The newly enhanced Bluetooth motors (MARS 10858 & 10859) carry on that tradition:
• Integrated Bluetooth control and free app allows wireless initiation of auto-sizing, optional off-delay, and manual speed control to optimize CFM in every application
• App displays real time motor performance data including volts, amps, and watts
• Two motors replace any OEM constant torque ECM 115/230V up to 1HP
• Connects directly to the factory harnesses of traditional X13® equipped systems
• Connects directly to Ensite® equipped systems using supplied adapter
• Connects directly to hard wired constant torque systems using supplied harnesses marsdelivers.com
Customers seeking a compact drive that will enhance their HVAC system’s reliability and efficiency now have an option with Danfoss ’s new iC2 Micro family of drives. With all the functions of a full-featured unit, the drive is perfectly crafted to be easy and durable, allowing users to seamlessly integrate with existing drives and building automation systems. This compact and intelligent drive is tailored to optimize a wide range of applications like pumps and fans and is capable of controlling permanent magnet motors. With the help of the drive’s 120 degrees Fahrenheit working temperature, coated printed circuit board, natural cooling, and a removable fan, improving cooling efficiency and lowering energy consumption in harsh environments is no problem. iC2-Micro includes an LED display, status indicators, clear navigation buttons, and a built-in frequency setting potentiometer, providing remote monitoring, real-time data insights and predictive maintenance capabilities. danfoss.com
The Synchronous Reluctance Motor from Nidec is a variable frequency motor provides the starting benefit of an induction motor, the operating benefit of a pure synchronous reluctance motor, and suitability benefit from the simple volts/hz drive. This motor provides higher efficiency and power density without risking components. A unique design gives the freedom to replace components individually instead of the entire system—leading to a lower cost of maintenance. acim.nidec.com
The Evergreen CM motor, or commercial building series VAV box replacement motor (pictured next page) is designed to replace OEM constant torque ECM indoor blower motors such as Genteq ® X13 and Endura® Pro motors. The Evergreen® DS dual shaft motor easily replaces most permanent split capacitor (PSC) motors in modular building applications. Designed to
10 | CONTRACTING BUSINESS | MARCH 2024
PRODUCTS COMPILED BY TERRY MCIVER, EDITOR-IN-CHIEF
replace direct drive, dual shaft induction motors found in HVAC indoor blower motor applications with forward curved (squirrel cage) blower wheels. rexelrexnord.com
Welling ECM motors can be used in American air duct machines and heat pumps. Equipped with frequency conversion technology, the motors are upgraded to be more efficient and energy-saving. In particular, the plasticencapsulated ECM motors has a high stability leveraging constant torque and 6000V surge protection and the iron-shell ECM motors has an efficiency of up to 85%, a torque control accuracy of ±3%, and a noise reduction design that can control noise to be under 48 decibels, providing ultimate quiet. wellingmotor.com
Commercial Unitary Equipment
Daikin Applied on Feb. 7 introduced enhancements to its award-winning Rebel Applied commercial heating and cooling system (photo at top right). The packaged rooftop HVAC system is now available in a bigger cabinet that provides 45-75 tons of air-conditioning capacity with supply airflow volumes up to 29,000 cubic feet per minute (CFM). The new unit also features low-global warming potential (GWP) R-32 refrigerant, originally developed by Daikin. With the transition to a more climate-friendly refrigerant, the new upgrades provide building owners a cost-effective solution to improve energy efficiency and start decarbonizing facilities. daikinapplied.com
Designed for today’s demanding commercial applications and the ever-changing preferences of diverse customers, the Rheem Resolute 30 ton G/E and A/C are the industry’s first 30
ton packaged systems with standard fieldconvertible airflow and single-zone and multizone Variable Air Volume (VAV), and the smallest and lightest 30 ton packaged units available in the industry. Built on
The professional’s new go-to for Condensate Removal
littlegiant.com
. Scan to Learn More 2403CB_FranklinElectric_Rev.indd 1 2/19/24 1:05 PM MARCH 2024 | CONTRACTING BUSINESS | 11
nearly a century of engineering HVAC innovation, Resolute 30 ton units offer numerous benefits for commercial and industrial cooling applications, higher efficiencies, thoughtful serviceability features that result in material advantages for contractors and building owners, and better occupant comfort through zoning capabilities. rheem.com/commercial
Fittings
Conex Bänninger has 115 years of experience in manufacturing innovative fitting products and operates an accredited Quality Management System to EN and ISO 14001.
Press copper and bronze fittings are tested and certified by independent national certification bodies confirming its suitability and reliability for use with potable water applications.
Press fittings by Conex Bänninger are quick and easy to install. This flame-free product range is designed with an innovative 3-point press system which ensures a secure, permanent leak-free joint and is suitable for multiple applications. conexbanninger.com
Streamline® sources say Streamline is the industry’s bestknown, most trusted name—with a nearly 100-year history of providing what it describes as the best-in-class products contractors need to work more efficiently and productively. The new Streamline® ACR Press System is the brand’s latest example of industry-leading innovation and excellence. Features include dual sealing elements, three points of 360-degree circular crimping, traditional lay lengths and compatibility with leading press tools on the market. The Streamline® ACR Press System sets a new level of performance for flameless refrigerant system installs, sources report. muellerstreamline.com
NIBCO PressACR fittings, for use in copper pipe systems for air conditioning and refrigeration applications, create safer installations for HVACR systems where Class A refrigerants are present, since there is no flame or fire hazard. The patent-pending groove design and crimp pattern supports the higher pressure requirements of an HVACR system. NIBCO fittings are UL recognized to 7psi and feature an extended warranty period of 15 years. nibco.com All product claims are made by the manufacturers.
12 | CONTRACTING BUSINESS | MARCH 2024 2005CB_ShortRidge_AirData.indd 1 4/22/20 12:43 PM TECH UPDATE
REPORT: Scarcity of Manufacturing Resources is Real
A new report from ABB Motion, entitled “Circularity: No Time to Waste,” reveals that 92 percent of industrial businesses in the U.S. are feeling the effects of resource scarcity, prompting 67 percent to increase their investment in circularity initiatives within the next three years.
Raw materials (39%) are seen as the scarcest resource, followed by labor (35%), and electronic components (33%). Resource scarcity has led to increased costs for 39% of businesses, as well as supply chain disruption for 39 percent and slowdowns in production capacity for 29 percent. Despite energy being an increasingly scarce resource, over 40 percent reported it as their biggest source of waste. This highlights an urgent need for greater energy efficiency across industry, something the International Energy Agency (IEA) says will be a critical lever in meeting Net Zero targets.
The global survey, conducted by Sapio Research in October 2023, gathered responses from 3,304 industrial decisionmakers across 12 countries including the 400 respondents in the U.S. Respondents represented a range of industries, such as energy, metals, chemicals, oil and gas, marine, mining, and utilities.
What is Circularity?
According to the ABB report, circularity involves sustainable sourcing, resourceefficient operations, and responsible end-of-life practices. The move from a “take, make, dispose” model to a circular economy aims to minimize waste. For industrial businesses, a holistic approach is crucial, covering circular design, efficient operations, optimized product use, and responsible end-of-life practices.
Some HVACR product manufacturers have initiated intense recycling programs to stem accelerated loss of raw materials.
While there is optimism about investing in circularity, the survey identified obstacles to immediate progress. For example, no single definition of “circularity” was accepted by the majority of respondents. Also, only 14% saw circularity as a company-wide responsibility, but this group
experienced the highest level of improvements across key circularity metrics, such as energy consumption, use of recycled materials, and carbon emissions.
The survey also revealed that limited adoption of many important circular practices with the U.S., including partnering with waste management companies (41 percent), incorporating energy-efficient technologies (37 percent), and promoting circular principles in the supply chain (36%). Encouragingly, 81% are using recycled materials in their products to some extent.
Investing in circularity has already led to measurable benefits, including waste reduction (44%) and energy efficiency improvements (49%). Although some businesses express concern about the upfront investment required, many anticipate long-term improvements in process efficiency and cost control.
Most respondents (84%) agree that the circular economy encourages innovation and drives competitiveness. They also support increased regulation and reporting requirements (80%) and want more government support for adopting circular business practices (82%).
Find the full report here: https://social. abb/circularity-report
Fieldpiece Announces Third #MasteroftheTrade Scholarship
Fieldpiece Instruments recently announced the launch of its third annual #MasteroftheTrade Scholarship. Fieldpiece will distribute $25,000 in scholarship funds in 2024, with the support of SkillsUSA, which will collaborate on the program’s administration. The initiative underscores Fieldpiece’s continued commitment to uplifting the HVACR industry community it proudly serves.
The #MasteroftheTrade Scholarship will support 12 individual recipients with funds earmarked for their education in a college or postsecondary HVACR technology
program. Among the winners, six $2,500 criteria-based postsecondary education scholarships will go to SkillsUSA HVAC students and a total of $10,000 in scholarships will go to the six gold, silver and bronze medal-winning high school and college/postsecondary students who top the leaderboards of the National Leadership & Skills Conference (NLSC) in June. Apply online at: bit.ly/masteroftrade.
Malco Tools Accepting Nominations for ‘HVAC Trade Pro of the Year’
Now in its 8th year, the HVAC Trade-Pro of the Year Award recognizes and celebrates exceptional HVAC technicians who are committed to doing great work, focused on on-the-job safety, and give back to their communities.
The top five winners from throughout the U.S. will receive $1,000 worth of Malco tools of their choosing, and all qualifying trade professionals who are nominated will receive a Malco cap and pair of gloves. Trade pros are encouraged to self-nominate, or nominate a fellow pro, for the honor.
“We are always immensely proud to recognize the great work HVAC pros do on the job and in their community,” said Rebecca Talbot, vice president of marketing at Malco. “In the same way Malco develops Damn Good Tools™, the HVAC Trade-Pros of the Year are doing damn good work around the country that deserves celebration. We’re excited to shine a light on some outstanding individuals in the HVAC industry!”
To nominate yourself, or another technician who has made a difference in your community, visit: www.malcoproducts. com/2024-hvac-trade-pro-of-the-year Entries will be accepted until June 28, 2024, and winners will be announced in September 2024.
MARCH 2024 | CONTRACTING BUSINESS | 13 MANUFACTURER NEWS COMPILED BY TERRY MCIVER, EDITOR-IN-CHIEF
Essential Tools for Techs
by Rebecca Talbot
Some of the most important tools for HVAC technicians are those that save time, money or effort—and ideally all three simultaneously.
Power-assisted tools are often powerful not only in their designs, but in the fact that they help techs save time and headaches when it comes to repetitive tasks. A few examples of essential power-assisted tools for an HVAC technician’s tool bag include:
• Power-assisted crimpers for sheet metal ducting complete crimping jobs in a fraction of the time.
• Power-assisted tools for removing fasteners from mastic or sealant save headaches from digging the screws out first. It’s so much better if you can do both tasks at the same time with a power-assisted tool.
• Hole cutters that pair with an impact or other driver provide for faster, more accurate hole-cutting than doing it manually.
• Additionally, smart technicians know how to look for tools that help them consolidate the number of items they need to bring into the field, weighing down their bag or belt and spending time looking for the right product on the job. Look for products that offer multiple functions in one, like a flippable driver socket that changes between common fastener sizes, or a goodquality multi-tool.
• Finally, it never hurts to return to the basics by investing in a good pair of Snips that not only stay sharp for a long time but also offer easy-to-replace blades when the time
comes. As the old saying goes, you get what you pay for, and HVAC techs shouldn’t have to pay for cheap tools with their money and time. malcotools.com
Rebecca Talbot is director of marketing for Malco Tools LLC.
Manage Your Equipment
by Scott Bohannon
It’s hard to grow if you can’t get a handle on costs. Outside of labor, one of your biggest expenses is managing tools and high-dollar equipment.
As part of your overall budget, you often have to predict when equipment will fail or need to be replaced. You not only have to schedule maintenance for your company trucks, but you have to have a good inventory of your tools and when they may need to be tuned up or replaced.
While there are digital tool management systems you can use to help keep track of your tools, Home Depot (HD) Supply’s inventory management solutions is a commonly used platform on the market and is a CEO Warrior strategic partner. HD Supply’s management system gives you greater visibility into your stock so that you can provide improved customer service levels at reduced costs. The HD Supply inventory management platform helps companies plan so that they will not lose revenue by acquiring and holding inventory too long.
Home service business owners have so many opportunities to grow and scale their businesses. But growing intelligently takes intention and planning. Defining your vision, seeking expert help and using digital platforms to fill in the gaps can help you scale your business the right way.
Scott Bohannon is CEO of CEO Warrior. He supports entrepreneurs and their teams in the trades by helping them improve their business performance. ceowarrior.com
Duct Sealing Tape: Quality Matters
The quality of HVAC duct sealing relies on how well the duct tape that’s used produces an airtight bond on joints and seams.
Shurtape aluminum foil HVAC tape for joining and sealing joints, connections and seams on rigid fiberglass ductboard and flexible air duct, and as a UL 181A-P listed product, can also be used in place of mechanical fasteners on rigid ductboard. UL 181A-P/B-FX Listed and printed, AF 099 delivers full system
14 | CONTRACTING BUSINESS | MARCH 2024
TECH UPDATE: COMPILED BY TERRY MCIVER, EDITOR-IN-CHIEF
A.
C.
D.
B.
A. A good pair of snips that not only stay sharp for a long time but also offer easy-to-replace blades. B. Hole cutters that pair with an impact or other driver for faster, more accurate hole-cutting rather than manual scissor cutting. C. The Malco Turbo Crimper provides for faster installation of round duct pieces. D. The Malco Tools C-HREX drill bit removes screws that are covered in mastic or are just plain tough to remove.
Duck Pro® by Shurtape® BR Code™ heavy duty, permanent scannable labels for securely connecting physical locations to digital information, such as text, photos, video links, maintenance documentation, instructions and more in applications that demand extreme durability.
withstand colder temperatures, while warmer ones will require tape that can withstand normal environments. DPXL BR labels feature preprinted codes that are weather- and chemical resistant and permanently adhere to a range of surfaces to make information easily accessible via the BitRip® app or desktop application. Shurtape.com
Easier System Measurements
The YELLOW JACKET® TITANMAX™
Digital Manifold provides an easy path to system measurements. This 4-valve manifold provides fast and accurate measurements for refrigeration and A/C systems. The high resolution backlit touchscreen display erases the need for multi-function buttons and provides Harris Products Group ’s brazing repair kit features Aluxcor® for aluminum and Stay-Silv® 15, the industry’s most widely used copper brazing alloy. harrisproductsgroup.com
closure by forming airtight bonds on joints and seams in temperatures ranging from -20F to 260F and in humid conditions.
Before you buy HVAC tape, you should consider two factors that can impact a tape’s lifespan. First, only use tape that is UL-listed, as it confirms the tape will meet safety standards and inspections. Using tape that isn’t UL-listed can result in a poor seal or failed inspections, jeopardizing your work and reputation.
Second, make sure that the tape you are using is right for the climate. Colder environments will require tape that can
The Wrist ReporterTM is a 6-in-1 meter for air and water pressure/velocity/ flow/temperature/humidity. The Wrist Reporter is used for air balancing, commissioning and troubleshooting in commercial buildings, cleanrooms, and residences. It displays real-time results from as many as 10 wireless sensors at 10 different locations. Applications include duct traverse, flow damper setting, ventilation calculations, duct pressures, room-to-room pressure hierarchies, coil performance testing, hood certification, and wireless datalogging. evergreentelemetry.com
FORANE® REFRIGERANTs BIG IMPACT. Forane® R-32 is the low-GWP alternative to R-410A, offering 30% refrigerant charge reduction that reduces the direct emission impact on global warming. Learn more about Arkema’s commitment to sustainability at ark.ma/contractingb Forane is a registered trademark of Arkema. © 2024 Arkema Inc. All rights reserved. UL® is a registered trademark of Underwriters Laboratories, Inc. forane.com | 800-245-5858 SMALL CHANGE. 2403CB_Arkema.indd 1 2/15/24 8:53 AM MARCH 2024 | CONTRACTING BUSINESS | 15
Hydrocarbon Charging Kit provides all the necessary tools to charge R-290 (propane) and R-600a (isobutane) hydrocarbon systems safely and effectively.
The YELLOW JACKET® mini-split toolkit includes high-pressure gauges, heat pump manifold, hoses, flaring tool, vacuum/charge valve R-410A coupler, torque wrench, tube cutter and bag.
clear graphical and digital measurements. It also features internal data logging. Connect via Bluetooth® to the YJACK VIEW® App or measureQuick® App for further analysis. TITANMAX™ P/N 40881 includes TITAN® Temperature Clamps (2), Vacuum Sensor and USB-C Charging/Data Cable. Backpack kits also available. yellowjacket.com
Shortridge Instruments:
The HydroData Multimeter is accurate across an extremely broad range of fluid gauge pressures and differential pressures. The high pressures found in pumps, chillers, cooling towers, and high rise building conditions can be measured up to 250psi. Capable of taking three readings in one unit. It is extremely sensitive over a broad range. The HydroData Multimeter comes complete with a shutoff, bypass, and blow down valve network mounted on a portable meter panel. The valve network panel facilitates meter zero procedure, air bleed-off, pressure venting or water draining. The valves are a quarter turn, brass body, stainless steel ball, Teflon seat design. shortridge.com
For Improved Refrigerant Servicing
Just prior to the 2024 AHR Expo, Fieldpiece introduced three valve core removal tools (VCRTs) designed to improve system charging, recovery and evacuation tasks. VCRTs remove the valve core from service valves in air conditioning, heat pump, and refrigeration systems to replace defective cores and provide an unobstructed flow of refrigerant for faster servicing. The Fieldpiece VCRTs represent a significant leap forward in valve core removal
technology, overcoming the limitations of existing tools. One of the game-changing features within the Fieldpiece VCRT lineup includes an integrated sight glass that allows technicians to verify at a glance that the valve core is captured prior to removing it and confirm when refrigerant is flowing. Fieldpiece eliminated the frustration that techs face when it takes multiple tries, and lost refrigerant, before the valve core is captured with current competitive products. The Fieldpiece VCRT capture tip also includes an interior gasket that the valve core pin presses into to secure it for removal. No more fishing around for lost valve cores—a solid grip guarantees that the job is done right the first time, every time. A comfort spinner (a free-spinning, rubberized cap) makes removing and inserting the valve core, while under pressure, easier and more comfortable. fieldpiece.com
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The YELLOW JACKET®
The Fieldpiece VCRT lineup includes an integrated sight glass.
EXPERT GUIDANCE FOR HVAC BUSINESS LEADERS + TURNKEY TRAINING SOLUTIONS FOR EMPLOYEES LEARN MORE AND SEE HOW YOU CAN GET STARTED TODAY BY VISITING EGIA.ORG/CBS 24/7 Ask the Experts Virtual Hotline On-Demand 24/7 Online Classes Live Educational Workshops, Bootcamps & Conferences Discounts On Products & Services For Your Business 1-on-1 Business Coaching OPTIMUS Financing for Your Customers EGIA FoundationGiving Back to the Industry Business Evaluation & Customized Training Roadmaps Industry's Largest Searchable Resources Database BEST PRACTICES TRAINING ON: IN-HOME SALES FINANCIAL MANAGEMENT SERVICE MANAGEMENT OPERATIONS MARKETING & LEAD GENERATION TECHNICIAN COMMUNICATION & SELLING LEADERSHIP MINDSET SERVICE AGREEMENTS PRICING CUSTOMER SERVICE AND MUCH MORE “Our net profit is up 119% since we joined the program last year.” – Mike Hendrix, Hendrix Heating & Cooling TRY IT FOR 30 DAYS FREE!
HVACR SHOW-OFFS!
And why not, when they have many new and innovative products for heating, air conditioning, ventilation and refrigeration contractors, and the world’s best HVACR event to show them off in?
WESTPORT, Conn., Jan. 31, 2024 —The AHR Expo (International Air-Conditioning, Heating, Refrigerating Exposition) returned to Chicago for a week of learning, reconnecting, perusing and demonstrating everything new coming to market in HVACR. Notable topics included all things decarbonization —from equipment on the floor to discussions in education programming —refrigerant regulation updates, the heat pump resurgence and the unveiling of many new products that are shaping the path forward for HVACR.
“The industry showed up for business in Chicago,” said Show Manager Mark Stevens. “Throughout the year we’ve followed discussions regarding regulation rollouts, decarbonization trends and various other tracks about the way we conduct business as an industry. It was evident in the halls that the professionals in attendance are primed to create solutions and drive business forward.”
The AHR EXPO team reported total attendance of 48,034 and 1,875 exhibitors.
The show’s Podcast Pavilion hosted 20 podcasters covering the latest topics happening across the industry. Inside exhibitor booths, industry tradesmen, women and influencers hosted events, competitions
and meet-ups, opening exciting channels of content creation and networking opportunities.
“The network transformation is resulting in incredible visibility and partnership for professionals,”said Nicole Bush, Director of Marketing. “There is a true line of two-way communication between the professionals in the field and the manufacturers creating products and technology. Having an in-person forum like AHR Expo to strengthen the social relationships formed online is proving to be immensely beneficial to our industry.”
HERE’S A SAMPLING OF WHAT WE SAW AT THE AHR EXPO:
Automated Logic’s building automation system, WebCTRL, is a powerful web-based platform that provides facility managers with software tools to keep occupants comfortable, manage energy conservation measures, identify key operational problems, and analyze the results.
BadgerMeter’s Ryan Nice introduced the firm’s M2000 ModMag, an electromagnetic flow meter that offers high accuracy for zero straight applications.
Climate Control Group welcomed us to another impressive exhibit. The Climate Control Group family of companies offers a range of HVAC products
18 | CONTRACTING BUSINESS | MARCH 2024 AHR EXPO 2024 | COMPILED BY TERRY MCIVER
Jerry Wiegele of Xylem Bell & Gossett, told us about the e-1510X Smart Pump. This advanced, integrated pump and motor package offers simplicity and efficiency, thanks to its compact design and Xylem’s industryleading HydrovarX Smart Motor. The e-1510X Smart Pump delivers annual reductions of up to 380 metric tons of CO2 emissions.
AHR EXPO
The DENZO Edge Cool is the only split system designed for selfcontained operation sources say. Powerful evaporator and condenser units require no additional floor space and work with nearly any new or existing server rack.
for a variety of applications and markets. For more than 50 years, the company has been designing and manufacturing innovative residential and commercial products including geothermal heat pumps, fan coils, configurable modular chillers, and custom air handlers. This collaboration positions Climate Control Group to offer highly configurable HVAC system solutions, providing it with the ability to combine best in class equipment options and controls for optimal indoor air quality, comfort control, efficiency and equipment performance. These brands include Climate Master, IEC, ClimaCool, and ClimateCraft.
Today’s heat pumps are better suited for cold weather. Bosch Home Comfort introduced the Inverter Ducted Split (IDS) ultra cold climate heat pump and GreenTronic 7000 T Hybrid Electric Water Heater. Both systems support the industry shift toward electric solutions for home heating, cooling, and hot water. The IDS Ultra is the first Bosch air-to-air heat pump designed specifically for cold climates—even areas that experience sub-zero temperatures. Powered by Bosch inverter technology, the system can heat at 100 percent heating capacity down to an outdoor temperature of 5° Fahrenheit (-15 Celsius) and will continue to initiate heating even down to -13° Fahrenheit (-25 Celsius).
The transition away from high-GWP refrigerants has been the key item on the Chemours agenda. Chemours has been introducing Opteon XL41 (R-454B), a non-ozone depleting, low global warming potential hydrofluoro-olefin based refrigerant to replace R-410A in residential and commercial air conditioning and scroll chiller applications. Opteon XL41 offers similar capacity, discharge temperature and pressure to R-410A. This helps original equipment manufacturer customers minimize design changes and smooth the transition away from R-410A.
Copeland made its first show appearance since it split last year from Emerson and investment firm Blackstone. Copeland CEO Ross Shuster addressed industry media and revealed that Copeland is now uniquely positioned to help navigate industry and environmental challenges by accelerating innovation and delivering a broad range of sustainable climate solutions.
On display at the very visible Copeland exhibit, were heat pump solutions, ideas to develop more sustainable buildings lower GWP refrigerant-based solutions and energy management products.
Jennifer Butsch, Director of Regulatory Affairs, participated in a panel series on how the Southwest region of the USA is responding to refrigerant transitions and regulations.
Daikin Comfort Technologies showcased its “Simple. Powerful. Sustainable.” approach to decarbonization that revolves around the core technologies—low-global warming potential (GWP) refrigerants, inverter compressors and heat pumps—developed to create more comfortable, efficient and sustainable spaces to live and work.
MARCH 2024 | CONTRACTING BUSINESS | 19
Don Gillis of Chemours provided updates on EPA actions and the AIM Act schedule of refrigerant phasedowns, as well as describing the features and benefits of Opteon A2L refrigerants.
Visitors to the very noticeable Copeland booth learned about Copeland’s compressor and controls innovations. Copeland
Woo Young Choi, residential and commercial AC sales manager, took us through the features and performance/ environmental benefits of the Bosch Home Comfort Inverter Ducted Split (IDS) ultra cold climate heat pump.
Daikin is focused on the “right refrigerant for the right application,” by integrating low-GWP refrigerants that can reduce the climate impact of heating and cooling homes and buildings. In particular, the company has committed to R-32 refrigerant in applications that previously used R-410A.
John Schwartz of Daikin Comfort Technologies spoke about the next wave of refrigerants and how prepared the Daikin organization is and has been for many years. He reminded us that back in 2017, Daikin was so far ahead of the field on R-32 refrigerants that it decided to release its proprietary technology to the market “for the good of the industry.”
“We feel R-32 is a better refrigerant. It’s a commodity product. Nobody owns it. Nobody’s got patents on it.”
In December 2021, Daikin launched the first split system with R-32 in North America, Daikin ATMOSPHERA, a single zone ductless system that can reduce carbon emissions by up to 80% compared to similar R-410A systems and has efficiencies up to 27.4 SEER2 and 11.2 HSPF2. For commercial and industrial applications, Daikin Applied recently introduced the Trailblazer AGZ-F, one of the first R-32 air-cooled scroll chillers available in North America, with R-32 refrigerant. Trailblazer AGZ-F delivers up to 10% greater capacity and efficiency versus previous models.
DiversiTech offerings included the Quick-Sling line of mini-split stands. These come in many different sizes, materials, and configurations to meet the needs of most all equipment installations. Outdoor ductless condensing units come in many different sizes and configurations and require unique mounting solutions for each. Quick-Sling offers the broadest range of sizes to fit most all condensing units on the market today. Asurity ™ is a DiversiTech brand of condensate management products that provide a complete system solution of pumps, switches, treatments and drain pans, backed with invaluable resources, extensive experience, and highly trained technical support.
Greenheck added to its BAER belt drive sidewall propeller fan line to include supply airflow configurations and expanded sizes, with propeller diameters from 24- to 48-in. and performance capabilities from 300 to
are unlike anything we’ve seen before, and we want to help lead, with new products and technology training,” as the low-GWP transition continues,” Landy said.
54,000 cfm or up to 3.3 in. wg. Designed for improved efficiency in wall-mounted clean air applications, it features cast aluminum airfoil or fabricated steel blades and hubs, an AC induction motor, and an automatic belt-tensioning system that minimizes regular maintenance of the fan belt. Ideal for factory and warehouse applications.
Bob Landy, Vice President and General Manager of Heatcraft Refrigeration Products, spoke to media during a Monday morning press conference. “Regulations are unlike anything we’ve seen before, and we want to help lead, with new products and technology training,” as the low-GWP transition continues, he said. HRP offerings on display were the intelliGen universal field mount refrigeration controller and PRO3 packaged refrigeration system.
Evergreen Telemetry has a wide range of precision recording tools. The Wrist Reporter’s wireless technology allows the
user to connect up to 10 sensors at once. It displays real time readings for damper adjustment, and sores up to 100,000 readings for later upload into an Excel spreadsheet. Other Evergreen products include Meter-Sensors with on-board display that can be used as a stand-alone unit when taking quick readings. The temperature
Greenheck BAER sidewall fan.
20 | CONTRACTING BUSINESS | MARCH 2024 AHR EXPO 2024
Bob Landy, VP/GM of Heatcraft Refrigeration Products, welcomed media representatives to an early morning press conference. At right are marketing manager Kevin Norris, and Michael Pennington, director of engineering. Heatcraft is ready for industry changes, and will meet or exceed the requirements of the AIM Act. Bob Landy, Vice President and General Manager of Heatcraft Refrigeration Products, spoke to media reps during a Monday morning press conference. “Regulations
Friedrich’s Jared Adams shared news about BREEZE, a universally flexible inverter heat pump. It operates in nearly any home, in almost any installation application or climate.
start-ups/shutdowns that traditional systems require to maintain the set temperature. Each system can adjust capacity and cooling output to provide only the amount of cooling needed at a given time.
Fujitsu General’s AIRSTAGE Cloud monitors and controls the operation of HVAC systems at multiple sites, streamlining tasks and lowering operating costs.
Detailed operation history, alarm processing, and configurable notifications enable timely service response and reduces downtime.
Lennox Commercial focused guests’ attention on its Enlight dual fuel heat pump and Model L™ ultra-high efficiency unit. Trent Davis, Director of Product Management and marketing for Lennox
Energy Recovery Pays Back
and humidity Meter-Sensor can also be connected to the Wrist Reporter for complete psychrometric data applications that require multiple readings from multiple locations, or data logging projects.
Friedrich’s room air conditioning solutions are designed for use in homes, hotels, and multi-family buildings, among other applications. We took note of the Floating Air series of ductless split systems. Precision Inverter technology varies the compressor, the outdoor and the indoor fan speeds, eliminating constant compressor
Greenheck’s energy recovery ventilators (ERV) deliver engineered performance, increased ventilation, and reduced heating and cooling costs in commercial or industrial building retrofit applications. With 75% energy recovery, providing up to twice the amount of fresh air to optimize indoor air quality while reducing ongoing energy costs, Greenheck ERVs pay back in dollars and IAQ.
©2024 Greenheck ERV PAYBACK Specify with Confidence. Specify Greenheck. Upgrade Your Existing System with Fresh Thinking 2403CB_Greenheck.indd 1 1/18/24 11:55 AM MARCH 2024 | CONTRACTING BUSINESS | 21
Lennox Enlight operates down to 0F, and features an on-board CORE unit controller with Bluetooth interface.
from
30,000 btu
160-feet line length, to
48,000
230-feet line length. Adaptive fan motor speed control ensures max comfort and excellent energy savings. Indoor sound level
25dB.
Robert Lombardo, regional sales manager for the Fujitsu AIRSTAGE H-Series across the mid-Atlantic states, gave us the rundown on the Fujitsu AIRSTAGE Infiinite Comfort Series. Systems range
24,000 to
for
36,000 and
for
as low as
Commercial, said Lennox is responding to the refrigerant transition and heat pump innovations. The Enlight commercial heat pump is available in 2- to 20-tons. It operates down to 0F, and features an on-board CORE unit controller with Bluetooth interface, to assist technicians in configuring the unit, diagnose issues and monitor performance. Refrigerant-wise, Davis said Lennox is moving to R-454B refrigerant as R-410A is phased down. Plans are to begin shipping new R-454B products by the end of 2024. The new Model L™ rooftop units also feature the Lennox® CORE unit controller and advanced variable-speed technology to maximize energy savings. Premium diagnostic features reduce installation, service and maintenance to provide the lowest total cost of ownership in the industry.
Steve Scarbrough, Senior Vice President and General Manager of LG HVAC Air Solutions, Commercial Air Conditioning and Air Conditioning Technology, addressed an audience during a Tuesday morning presentation on how LG assumes its role in environmental responsibility and product development.
“The last 10 years have been extremely important for our future as we started to focus less on the product and more on what we can do to create an environment, and more importantly, a sustainable product and a sustainable future for our people and the planet. As we move forward with manufacturing, we have to be able to continue to utilize the products that we have, but more importantly, to create a sustainable future.” He then outlined a number of ways LG is practicing environmental responsibility, from clean technology to waste recycling in a circular economy (see p.13).
New this year, LG’s Home Electrification Zone displayed a variety of technologies that maximize energy efficiency across the home and help improve energy resiliency. LG’s suite of home electrification products highlighted at AHR Expo includes the LG R-32 Air-to-Water Heat Pump Monobloc system, a compact and efficient solution for all-in-one heating, cooling, and domestic hot water, replacing traditional gas systems; the LG Inverter Heat Pump Water
Heater, which increases efficiency and cuts energy costs; the LG Electronics Home 8 Energy Storage System, the next-generation, all-in-one energy ESS to manage energy, provide backup power and reduce dependence on the electric grid; the MultiVi (pictured) and ThinQ®, LG’s mobile app that easily controls and monitors LG HVAC systems and other products as well as building energy management.
Mitsubishi Electric Trane HVAC US LLC showcased a strong lineup of all-electric heat pump solutions and supplementary products. Designed for life, inside and out, all-climate heat pumps provide unparalleled energy efficiency through their ability to vary capacity based on the heating or cooling requirements of a space. Three offerings were:
• intelli-HEAT Dual Fuel System, which consists of an exterior heat pump to replace an air conditioner and an interior a-coil installed on an existing furnace. The award-winning smart solution improves air-conditioning efficiency on hot days and determines the best source of heat—electric or gas—on cold days, so the HVAC system runs at peak efficiency and comfort.
• The Premier Wall-mounted System, METUS’s most versatile wall-mounted ductless solution offers a wide range of applications with sizes from 6 to 24 KBTU/H. The MSZ-GS is compatible with Mitsubishi Electric’s single-zone and multi-zone heat pumps or the H2i® systems.
• The Deluxe Wall-mounted H2i sumo™ System is METUS’s latest (coming late in 2024) and most feature-packed system. The Deluxe is a wall-mounted indoor unit connecting to the H2i sumo outdoor unit. This wall-mounted unit is wireless and enabled for the kumo cloud app. It has a Dual Barrier Coating, Dual Barrier Fusion and Triple Action Filtration with a PM 2.5 filter.
Leon van Oostende, national sales manager, spoke to us about Panasonic’s new energy recovery ventilators with improved efficiencies. The Intellibalance 100 is now offered as a reverse version and a hard-wired unit. There is also a hard-wired standard and hardwired reverse unit, for multi-family applications.
Now attending his 27th AHR, Mike Smith of Mitsubishi Electric Trane US said METUS products were being tagged in social media by homeowners and building owners for favorable performance during the polar vortex temperatures in early January. “We’re continuing to elevate the all-climate capabilities of our heat pumps,” Smith said.
22 | CONTRACTING BUSINESS | MARCH 2024 AHR EXPO 2024
LG
Rebecca Talbot is marketing director for Malco Tools. A main product offering this year is the C-RHEX driver, Ideal for contractors, commercial HVAC and duct jobs, this time-saving tool may be small, but it packs a punch. The C-RHEX driver installs and removes 3/8-in. and 7/16-in. fasteners, without having to switch out to other tools. Plus, cleaning it is as easy as flipping the flip socket, removing the socket and cleaning the magnet. And of course, the magnet makes sure that no fasteners go flying off, getting lost and sending techs scrambling to find them.
Panasonic’s WhisperComfort 60 comes in a 20 CFM model with a MERV 13 filter option and an HVI listing for the industry’s only ceiling insert ERV. Interios is a new Panasonic whole-home hybrid unit is available that uses R-32 refrigerant, and is available
SALES CONTACTS
South & West: Senior Manager, Business Development
Randy Jeter
512/263-7280
Cell: 512/426-9145;
Fax: 913/514-6628 rjeter@endeavorb2b.com
East Coast: Senior Manager, Business Development
Brian Sack
Cell: 732/629-1949; bsack@endeavorb2b.com
Account Manager Midwest
Bill Boyadjis
973-829-0648 • bboyadjis@endeavorb2b.com
Classifieds/inside sales:
Media Account Executive
Steve Suarez
Cell: 816-588-7372
Office: 941-259-0867
ssuarez@endeavorb2b.com
Director of Sales, Buildings & Construction Group
Joe Agron
941-200-4778 • jagron@endeavorb2b.com
2311CB_EvergreenTelemetry.indd 1 10/5/23 11:28 AM
MARCH 2024 | CONTRACTING BUSINESS | 23
Terry Pappas described features and benefits of Panasonic’s Interios heat pump.
Stephanie Welda, director of product marketing at Rectorseal had lots of product news to share. This is the ClearDrain PVC. Designed for air conditioner drain lines, ClearDrain PVC prevents white slime buildup, ensuring smooth condensate drainage.
in 1.5- to 5-tons. It’s Energy Star Cold Climate Certified for 100 percent heating capacity at 5F.
Rapid Locking System (RLS), the leading manufacturer of the largest size range of HVACR press fittings, celebrated its extensive contractor network and more than 20 million fittings installed globally since the company launched less than a decade ago. In 2024, RLS plans to further its commitment to contractor training across the board by unveiling a new training center at the company’s headquarters and partnerships with trade schools and apprenticeship programs. And a road show is coming soon.
The Rheem heating and cooling division shared news about the latest additions to its Endeavor Line for residential solutions. This included the cutting-edge Classic Series ULN gas furnace to the commercial prowess of the Renaissance™ Line, with offerings such as the Classic Series packaged A/C and Resolute™ Classic® 30 ton, all of which meet Department of Energy efficiency standards.
Rheem’s new line of high-quality Mini-Split Systems provide homeowners with a flexible and efficient heating and cooling alternative. Whether for a single room or multiple zones, our revolutionary ductless solutions are perfect for controlling hard to heat or cool areas.
LG Compressors & Motors has released the GEN3 Scroll Compressor, which offers significant improvements to motor efficiency and friction reduction.
Ritchie Engineering/YELLOW JACKET ’s Combustible Gas Leak Detector detects combustible hydrocarbon gases such as LP gas or natural gases. This digital handheld gas leakage detector displays readings in PPM, % Vol., % LEL in rapid response time with user configurable parameters. TitanMAX Digital Manifold is a four-valve manifold that provides fast, accurate measurements. It has internal data logging and Bluetooth connectivity.
From Resideo comes the new Honeywell Home T10+ Smart Thermostat with RedLINK 3.0 offers humidification, dehumidification and ventilation control (with EIM)—to give contractors a customizable solution for each customer from a single device without running new wires. The T10+ Smart Thermostat offers complete and customizable control of a home’s IAQ, heating and cooling and can be managed via the Resideo app.
Samsung’s Rick Nadeau said the company has had no trouble filling orders for its DVM chiller, whereas many competitors are up to 52 weeks behind on comparable orders. All OEM’s are under pressure due to ongoing changes to refrigerant regulations. The Samsung DVM Hydro Unit connects to a DVM (Digital Variable Multi) outdoor unit and supplies hot water up to 80C (176F) as well as cooling and heating through refrigerant heat exchange. The WindFree 3.0 has built-in WiFi and voice control with Bixby 2.0.
24 | CONTRACTING BUSINESS | MARCH 2024 AHR EXPO 2024
Tony Young had a busy week sharing news on Rheem’s RP18 Endeavor line Classic Plus air conditioning systems in 2- to 5-ton capacities. Here he is with a 3-ton model. Efficiencies go up to 20 SEER2.
Rapid Locking System (RLS) exhibit always draws a crowd, with product news and demonstrations and competitions. Watch for the RLS road show, which will visit cities in the North and South in 2024.
WHERE FACILITY CHALLENGES
FIND SOLUTIONS
CENTRAL VALLEY
March 20-21, 2024
Modesto, CA
NORTHWEST
May 8-9, 2024
Portland, OR
facilitiesexpo. com
SOUTHERN CALIFORNIA
April 17-18, 2024
Anaheim, CA
O W N E D & P R O D U C E D BY:
Welcome, Lee Rosenberg
Lee Rosenberg’s HVAC legacy is as an immensely successful business owner, association supporter and mentor to his fellow contractors.
He started out as an engineer, but eventually turned his many talents to the HVAC industry, and we can all be glad he did. For 50 years as the owner of two HVAC companies— both of which were so profitable they were each bought by consolidators— and as an HVAC industry leader, Lee Rosenberg has brought a passion for excellence, a willingness to lead, and a devotion to mentoring others.
in 1966. He joined the Anaconda Wire and Cable company in Sycamore, Ill., helping to develop coaxial TV cable. He also invented a cable with enhanced durability, for government communications applications.
This month, Lee Rosenberg, P.E., founder and Chairman of Rosenberg Indoor Comfort, San Antonio, Texas (now Rosenberg Plumbing and Air) will enter the Contracting Business HVAC Hall of Fame, during the 2024 ACCA Conference in Orlando, FL. It’s a recognition that’s long overdue, and we’re honored and glad to do it now. And at 79, Lee is as excited as ever to be in the game.
Like many of the greats who entered the HVAC Hall of Fame before him, Lee Rosenberg was destined to succeed. His first career was as an electrical engineer, after he graduated from the University of Texas, Austin
“After I developed the manufacturing process for that cable product, I was asked to oversee the construction of the factory where they’d be making it, just outside of Madison, Wisconsin,” he recalled as he spoke to us from his San Antonio office. “Then they wanted me to be the factory general manager, which I did for about five years. After the company acquired another manufacturer, I was asked to move to Rome, NY to manage another facility.” Lee and his wife Betsy moved a second time, but after a year, decided it was not where they wanted to be. It was time to get closer to their Texas roots.
“I looked at some opportunities in the South, but then I got a phone call from my brother-in-law, who had two or three businesses in San Antonio. He told me about a friend in the air conditioning business who needed some help and was looking for somebody to run their sales and engineering. I didn’t know anything about HVAC, so I read up on it and figured that, as an engineer, I could do it. I returned to my hometown of San Antonio and joined that AC business.”
Rosenberg helped grow that company’s annual revenue from $1.25 million to $9 million. Later, after differences with the owner, he left that job and took some time off to plan his next career move.
His Own Shop
“I was encouraged by many customers, friends and family to start my own air conditioning company,” he said. “This was in the mid-1980s, when the Texas economy was going down the tubes, but still, I decided to give it a go.”
Metro Tech Service Company was born in June of 1986 as a two-technician, two-truck HVAC business performing residential and light commercial HVAC service and replacements. Rosenberg described it as, “a very difficult time, physically, mentally and emotionally. It was tough.” But his banker, who floated him a $250,000 line of credit, told him, “I know you can do it.”
Over time, the business prospered. To keep it on track, Rosenberg joined Air Conditioning Contractors of America and got plugged in to an ACCA MIX Group, where he received helpful advice from many of the
THE GREATS | BY TERRY MCIVER 26 | CONTRACTING BUSINESS | MARCH 2024
Betsy, Lee and Michael Rosenberg.
Images courtesy of Daniel Pawlowski
leading contractors of the day, those who had “been there and done it.”
“I’ll never forget my first MIX Group meeting,” he said.
“One of the members was Jim Isaac from Isaac Heating and Air Conditioning. He put his arm around me and said, ‘Lee, I sure hope you make it. You’re a nice fella.’ I went away from that meeting and decided, ‘we’ve got no choice. We’ve got to continue to build this business.’”
For Rosenberg, the mid-1980s into the 1990s were a valuable time of learning. “It spurred me on. I learned from other successful contractors that if you run this business right, and you know what you’re doing, you could make a good profit in this business,” he said. “And indeed, we became quite profitable, so much so that we became a target during one of the early rounds of HVAC business consolidation. Blue Dot made me an offer I couldn’t turn down, and we sold that first business in 1998.”
After years of effort, success and more involvement in ACCA, Rosenberg was nominated to the ACCA Board by the late Vince Gillette, Sr. of Gillette Air Conditioning Co., also based in San Antonio. He also became active in his local ACCA chapter, eventually being named Board Member and President. His activity in the Texas ACCA included working with TACCA founder and
‘Without leaders like Lee, willing to step forward and challenge others to make this industry better, many contractors who are in business today would have failed.’
—Larry Taylor
contractor Stan Johnson and contractor and Larry Taylor to bring about passage of a state HVACR licensing law.
“These were some exciting and tough days of legislative activity toward obtaining a state law and he was always willing to step up and help however he could,” Taylor said. “Lee has always had a heart for helping other HVACR contractors in learning how to build and manage profitable businesses. He was a driving force in making the MIX Group program grow and develop. Lee made numerous presentations at ACCA meetings, sharing his experience and knowledge of what goes into making a good business.
“With his wife Betsy and son Michael they built a very smoothrunning operation while helping not only his local customers, but his local competitors and communities, all the while being a strong advocate for ACCA,” Taylor shared.
“I first met Lee Rosenberg in the early 1970s, on one of those great international trips that the factories used to put on every year,” recalled Stan Johnson. “It was a trip where we also took customers. My first impression of Lee was that he believed in taking care of his customers even while we were on vacation. I learned over the years that for Lee, that extended to taking care of our industry. He, too, believed that taking care of and helping fellow contractors grow and develop was good for everyone in our industry,” said Johnson.
In the late 1990s, Rosenberg was nominated Chairman of the Texas Department of Licensing and Regulation’s Air Conditioning and Refrigeration Contractors Advisory Board, and was a
major contributor to the development of what is now the North American Technician Excellence (NATE) certification program.
Consulting and a Second Business
Following the sale to Blue Dot, Rosenberg went on the road as an HVAC, plumbing and electrical business consultant, eager to help in the success of fellow business owners. During that time he had joined a group of leading HVAC contractors in designing what was to become ServiceNation, a major service trades business support group first envisioned by Matt Michel, who had been a Lennox marketing employee. At its beginnings, co-founder Rosenberg was chairman and Michel was president.
In 2003, Rosenberg got back into the swing of business ownership. He and the family co-founded Rosenberg Indoor Comfort, which is now Rosenberg Plumbing and Air, following its acquisition in 2022 by Hometown Services of Tulsa, Okla., a business consolidator currently with 25 locations in five states. As before, the business is 55% residential and 45% light commercial HVAC service agreements and system replacements.
Rosenberg Plumbing and Air operates out of the same building as did Rosenberg Indoor Comfort. The space has grown from 3,000 to 10,000 sq. ft. but could still use more space. They have 60 employees, 35 vehicles, and lots of fun. Michael Rosenberg is president, and Betsy helps to keep it all together.
Know Your Numbers
Lee Rosenberg’s advice to fledgling contractors is, KNOW YOUR NUMBERS COLD, especially if you’re an ex-technician who wants to own their own business.
“You might be able to fix anything, but that’s much different than running a business. You’ve got to drill it down to all the different things you do: residential, commercial, replacement, new construction. You’ve got to know the numbers related to the types of work. That’s the only way you’re going to figure out how well or how poorly you’re doing in certain aspects of the business,” Rosenberg advised.
Lee Rosenberg was ACCA’s 2021 Residential Contractor of the Year and was named a “Marketing Master” by RYNO Strategic Solutions, for developing superior marketing programs. Another leading HVAC publication has also recognized the Rosenbergs for their enormous success and many industry contributions.
Early in this interview, Rosenberg described the physical, mental and emotional challenges that came with starting his first company. Many others have failed at those early stages, and many will continue to fail, which is why we must always be thankful for the Lee Rosenbergs of the world, those intrepid entrepreneurs who stay in the game, learn the business, and do what must be done to achieve success according to the highest ethical standards.
“Without leaders like Lee, who are willing to step forward and challenge others to make this industry better, many contractors who are in business today would have failed,” said Larry Taylor.
Thank you, Lee Rosenberg, for your commitment to the heating and air conditioning industry, and for sharing your knowledge, then and now.
Welcome to the Contracting Business HVAC Hall of Fame.
MARCH 2024 | CONTRACTING BUSINESS | 27
Refrigerant Transition Facts
A rundown of best practices to be followed when using A2L refrigerants.
In our continuing mission to keep contractors informed related to the ongoing HVACR refrigerant transition, here are the most important handling requirements, as shared by Jay Crowe, Head Coach and Trainer, and Dave Consulo, Lead Head Coach and Trainer for Business Development Resources (BDR), during the BDR SPARK 2024 Conference, Jan. 9-11, Savannah, Georgia.
The 2020 AIM Act directed the US Environmental Protection Agency to set a 750 GWP (Global Warming Potential) rating limit for air conditioning products. R-410A—the most-used refrigerant for residential HVAC systems—has a GWP of 2088 and will eventually no longer be produced or approved for any use other than recharging existing R-410A systems.
The two refrigerants that are most preferred as total replacements for R-410A are R-454B and R-32. Both are classified as A2L—or mildly flammable—refrigerants.
HVAC systems manufacturers have started to reduce production of HFC refrigerants at a faster rate than expected (by 10% in 2023 and by 40% in 2024). By 2036, only 15% of the 2022-2023 R-410A production allowance will be in circulation.
Manufacturers are moving away from the A1L family of refrigerants and moving to A2L/mildly flammable refrigerants.
Changes contractors will be required to make are related to tools, vehicles, storage areas, cylinder use, and code and fire official permits and licensing.
Tool Changes
• New, “no spark’ drills must be used around A2Ls
• Scales and vacuum pumps will not be affected
• A2L-specific leak detectors will be needed
• Due to the cylinder changes, technicians may need to obtain new hoses. The new cylinders will thread to the left.
Storage
The storage area changes for A2L refrigerants are as follows:
• “Non-Sprinklered” areas are allowed for storage.
• The maximum amount of A2L refrigerant that can be stored is 20,000 lbs.
• Shelves or racks for storing A2L refrigerant must be made of steel.
• There must be a 20-ft. separation between A2L products and other flammable liquids.
• The maximum height of the product on the shelves or racks is 6-ft. unless the area has sprinklers.
• A Code/Fire official permit is required for storage.
• A Class B fire extinguisher must be present in the storage area.
• Signage indicating the presence of A2L refrigerants is required.
Vehicle Modifications Required
• R-454B and R-32 each have a maximum ambient temperature of 125 degrees
• The new freon cylinder has a pressure relief valve instead of the old rupture disc. Ths greatly increases the potential of product loss.
• Cylinders must be secured in the service vehicle
• HAZMAT protocols will be required if transporting more than 26 pounds of A2L refrigerant. This includes Class B fire extinguishers and appropriate warning signage. To regulate the ambient temperature of the A2L refrigerant will require a specialized reclaiming truck, a specialized reclaiming trailer, roof vents in the van and a cooling mechanism.
Cylinder Changes
• The new cylinders will be grey with a red strip along the top to warn of flammable substance.
• The cylinders will have a pressure relief valve
• All cylinders containing A2L refrigerant will require two labels: “Flammable” and “Compressed Gas”
• The new A2L cylinder has a pressure relief valve instead of the old rupture disc. This greatly increases the potential of product loss.
Licensing
Contractors will want to review their EPA Section 608 licensing to be sure they are up to date with curent certification and licensing requirements.
Training & Communication
Educate all team members on the changes and challenges that lie ahead.
Develop a script for team members to use when discussing refrigerants with customers: inform, educate and offer.
• Train technicians and Installers: ensure that technicians and installers have a thorough understanding of why replacing may be a better option than repair.
• Update repair v. replace policy.
• Customer messaging: Educate customers on the changes coming and their options.
• Make upgrading equipment affordable for customers by offering financing options. This can help spread the cost over time and provide monthly cash flow for households or businesses.
Meet with your distributor territory managers to learn how they plan to navigate the many changes. Ask them when they are receiving A2L-specific equipment and when they will begin stocking the new tools, including hoses and leak detectors.
28 | CONTRACTING BUSINESS | MARCH 2024 PRODUCTS, TRENDS, AND SERVICE AND BUSINESS MANAGEMENT INFORMATION
Lori Tschohl
Lori Tschohl is the 2024 President of Women in HVACR, and owner of Eagle Pipe & Mechanical LLC, Port Ludlow, WA.
This commentary is taken from Lori’s first address as WHVACR president, during the WHVACR 2023 annual conference in Jacksonville, FL.
The WHVACR Scholarship Program was kickstarted by a $25,000 gift from WHVACR Founder and HVAC business consultant, Ruth King. Donations are needed and welcome. Visit whvacr.org.
Giant Steps for Women in HVACR
Iam deeply honored to assume the role of President of Women in HVACR. I have made it my mission to bring about additional growth and transformation within Women in HVACR in 2024.
One of our primary goals is to enhance the capabilities and expertise of our board members. We recognize the importance of equipping our leadership team with the knowledge and skills required to excel in their roles. This involves a comprehensive and in-depth training program to ensure that our board is well-prepared to serve our valued members.
Our vision is to ensure that Women in HVACR serves its fundamental purpose: to improve the lives of our members by providing a professional avenue for women to connect, grow their careers and succeed in the HVACR industry. Our board will mirror this commitment. We are dedicated to creating a leadership team that is knowledgeable and deeply passionate about our mission and will empower women to succeed by facilitating networking opportunities, mentoring relationships and providing essential education. In pursuit of a more responsive and connected Women in HVACR, accessibility and efficiency are paramount. We have designed plans to introduce additional roles within our administration. By bolstering our administrative staff, we aim to ensure that members’ feedback and inquiries are meet with more prompt and effective responses.
WHVACR Regional Events
One of our most exciting ventures for 2024 is the concept of bringing WHVACR directly to you, no matter where you are located. We plan to host four regional events in this year, to facilitate greater participation from our members, but also strengthen our community bonds.
Our regional events initiative, developed by Marcia Christianson, is a robust platform that expands our collaborative horizons and creates various unique opportunities. These events are designed to facilitate close collaboration with the employees of partner companies, vendors, supporters and distributors across multiple regions. By extending our reach, we open doors to engage with a more diverse set of industry professionals.
Education Endowment Fund
We recognize that scholarship lies at the heart of our mission. One of the most significant barriers to
entry into the HVACR industry is the cost of education. Many aspiring women in this field face financial constraints that make it challenging to pursue their dreams, even when their passion and desire to excel are unwavering. Technical schools and colleges provide valuable education and training, but they can be expensive for many. This financial barrier not only affects the individual, but also hinders the industry’s potential for growth and diversity.
To address this issue, Women in HVACR has started an education Endowment Fund as a beacon of hope for aspiring women in HVACR. It enables us to recognize and support deserving women who aspire to excel in this field. We accept scholarship applications each year until June 1, and award the scholarships in September.
By fostering partnerships, raising awareness and engaging with industry stakeholders we can magnify the impact of our scholarship program. We encourage industry leaders, businesses and fellow organizations to join us in this crucial mission. Together, we can break down the financial barriers that deter talented women from pursuing careers in HVACR.
WHVACR is in the midst of a significant growth pattern. This growth is a testament to the tireless dedication and commitment of our board, members, partners, sponsors and supporters. It’s a reflection of the passion and drive that underscores our mission. We are fortunate to collaborate with organization that share our vision and values, such as Women in Plumbing & Piping, LadyTitans, INWIC and many others. These alliances are not just about collaboration; they represent of collective effort to break barriers, create opportunities and build a stronger future for women in the trades.
I’d like to acknowledge the incredible work of Colleen Keyworth. As she transitions from her dedicated work with Women in HVACR, she is working to foster the growth of International Network of Women in Cooling. I must also recognize the contributions of the remarkable women on our board: Erica Leonor, Sarah Hammond, Laurelyn Arriaga, Tanya Steindl, Kristin Gallup, Becky Hoelscher, Jane Sidebottom, Crystal Williams, Linda Rodriguez, Marcia Christiansen, Colleen Keyworth and Kerri Cup.
We are breaking new ground, empowering women in the HVACR industry, and building a legacy of progress and success. Here’s to the exciting journey ahead.
GUEST EDITORIAL
MARCH 2024 | CONTRACTING BUSINESS | 29
Andrew Fuselier
Andrew Fuselier is the COO and Co-Creator of SmartAC. com. In addition to running the day-to-day operations of the business Andrew spends a considerable amount of time with Enterprise clients helping them to discover the ROI of their existing Membership programs and to understand the opportunities of improvement in conversion rate, churn rate and low/no fee truck rolls by applying system connectivity, realtime data, proactive health detection and automated customer interactions. Andrew.fuselier@smartac. com | https://www.linkedin. com/in/andrew-fuselier845a402/ www.smartac.com
Membership Plans— What you don’t know CAN hurt you
It often happens in business that we tend to focus on the most urgent items or sometimes the items that we enjoy working on the most. But as a business owner (and as you probably already know) it’s important to step back and look at the full picture and ask yourself “What important aspect of my business have I NOT been focusing on?”
In the HVAC industry quite often we forget to do this. We forget to step back and re-focus our energy on one of the most important aspects of your business health… your Memberships. While often simply viewed as a lossleader to many, the structure and strength of your membership program can be the difference between going out of business or selling your company for many millions of dollars. And the key is often in how you, the owner, approach your program.
those superior organizations is the use of lower cost connected equipment (aka monitoring technology) to assist in a better customer experience while also allowing the company to enhance their profit potential.
‘If you look at your membership program as a step-child to the Demand season, then so will your team.’
These platforms open up a new world for contractors to deliver value remotely through virtual health reports, easy chat-based communication, app-based scheduling and a similar peace-of-mind feeling for their comfort that customers get from a security system. And not only is the customer experience better, there are many profitability advantages the company gains as well.
If you look at your membership program as a step-child to the Demand season, then so will your team. If you look at it purely as a way to “get more sales opportunities in the home” then so will your team. But many of the brightest and most successful contractors in the industry know that a properly structured and healthy membership program is the foundation of a highly profitable business, and share a fundamental belief that customer experience is at the center of that program. It’s easy to think of a maintenance visit as a potential lottery transaction, but the best companies view their entire program like a 401k savings plan; the little deposits you make on a consistent basis payoff huge over time.
Those customer “deposits” have traditionally come in the form of a quality tune-up or discount on a service call, but the world is changing quickly. One of the more recent trends amongst
First, twice as many homes can be serviced with the same number of technicians by reducing unnecessary truck rolls that lead to low or no fees. Many of the contractors I interact with tell me 50-80% of all visits made to the home result in no significant sales transaction (<$150). Second, legacy maintenance plans can cause a big build up in deferred revenue for those unfulfilled, but promised maintenance visits. Not only does this cause a reduction in EBITDA, but the maintenance program can actually be seen as a negative when you go to sell your business.
Additionally, over time as more of your revenue is derived from your existing, profitable membership program then less has to be poured into the marketing leads machine. And who doesn’t like getting more while spending less?
It’s an easy trap to fall into: only focusing on the demand season. But don’t forget to step back and understand that the only way to build a valuable, long-term business is by looking at the forest and all the trees in it. And your Membership program is a great place to start.
GUEST EDITORIAL
30 | CONTRACTING BUSINESS | MARCH 2024
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Once we get past the shipment cliff, we can expect a 10-year run where demand will grow each year.
What to Expect in 2024
Understanding the HVAC residential replacement market is largely an exercise in history and math. Because I looked at history and math in 2020, I was alone in proclaiming 2020 would be a good year, despite COVID. Indeed, 2020 set a new record for shipments. Using the same approach, 2024 is likely to see additional contraction in the replacement market.
Looking Back
Until 2020, 2005 was the record year in the history of the industry. AHRI reported that shipments jumped 16% from the prior year, resulting in 8.6 million unitary air conditioners and heat pumps hitting the market. In 2019, the summer arrived late. When this happens, some replacements are deferred for a year. In an early summer or a very hot one, replacements are accelerated and pulled from the next year into the current one. So again, the result was 9.3 million units shipped in 2020, despite COVID and the resulting supply chain issues. The 9.3 million units included replacements and new construction.
After 2005, the industry contracted through 2009 and was flat in 2010. We went from 8.6 million units in 2005 down to 5.2 million in 2009 and 2010. This was a 40% contraction that is referred to as the shipment cliff. We plunged headlong into it in 2023 and will not emerge until late 2024 or 2025. Through November, shipments were down 16%. Remember, the shipment number includes new construction. Given that single family, detached housing starts grew by 140,000 in 2023 and multifamily grew by 103,000, the replacement market contraction was down closer to 24% for the year.
COVID did impact the cycle. There were a significant number of deferred replacements in 2020 that showed up in the first half of 2021. In the latter half of 2021 we began seeing early evidence of the shipment cliff, though it was largely hidden due to price increases. Because of the robust first half of the year, 2021 outpaced 2020 by 9%. In 2022, shipments were largely flat from 2021, finishing up nearly 2% and setting a new record.
The shipment cliff has more room to run. That is the history and the math. Contractors cannot replace what was not installed.
The replacement market is under additional stress due to the focus of private equity (PE) firms on change outs. PE was caught off guard by the shipment cliff and the finance types calling the shots on PE are not likely to fully comprehend that
HVAC replacements will be in decline for another year or two. They are putting enormous pressure on their subsidiaries to sell change outs. But again, you cannot replace what was not installed 15 years ago, more or less.
Contractors looking to exit by selling to PE will find it tougher due to higher cost of capital for the PE firms. Buyers do appear to be more cautious about acquisitions. Deals are becoming harder to execute.
Consumers are dealing with a lot of fear, uncertainty and doubt. Household budgets are strained. People are growing more worried about personal safety, which also makes them hold on to their wallets. We’ve had dramatic prices increases from COVID, SEER2, and expect another 20 to 25% from new A2L refrigerants. Many consumers will defer replacements and other expenses as long as possible. They will invest in affordable luxury and safety.
Focus on Service, Efficiency, Marketing
Service and replacement contractors need to get good at service. They need to make money at it. They cannot cut back on marketing and advertising.
Tumultuous times present opportunities. For example, when PE firms push out founders, many of their techs will be open to new opportunities. Failing competitors and contractors who get tired of the game will also present opportunities for tuck-in acquisitions that are too small to interest private equity. This will be a time to focus on efficiencies. Watch the nickels without cutting muscle.
This is also a time for contractors to expand their service offering. They can take advantage of consumer desires for safety and affordable luxury with connected home and security.
Above all, contractors need to remember that they control their own destinies. They can decide whether to participate in any recession, or not.
Due to the effects from the Tonga volcano eruption, this coming summer and possibly the summer after that will also be hotter than normal.
Once we get past the shipment cliff, we can expect a 10-year run where demand will grow each year.
Find entire article at bit.ly/whattoexpect2024
For help growing your business in tough times, band together with other contractors in the Service Roundtable. Learn more at www.ServiceRoundtable. com.
Matt Michel is a member of the Contracting Business Hall of Fame. You can reach him at mmichel@mail.com or 214.995.8889.
32 | CONTRACTING BUSINESS | MARCH 2024
THE RANT BY MATT MICHEL
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