Are you selling tax incentives and rebates?

RoBoTeq

How many of you are selling up the current tax credits and local rebates that are being offered?

Since for any system to qualify for tax credits it must have an enhanced indoor blower motor, are you selling more variable speed motors or are you installing X15 motors without the variable speed features just to make the tax credits?

If you are selling based on tax credits and rebates, are you selling just enough to qualify for the incentives or are you upselling even higher efficiencies then are needed for the incentives? This most likely depends on your area's climate, so where you are located would help understand motives on this factor.

milk man

Kansas.

I am using tax incentives and a utility rebate to up sell. I've had some success with the tax incentive and very good sucess with the utility. I only need to make 14 SEER with the utility.

RoBoTeq

By upsell, do you mean to increase from a basic 13 SEER system to only what it takes to qualify for the incentives or upsell higher efficiency then is needed to qualify for incentives?

In my area of Eastern PA it just doesn't make financial sense to buy higher then what is required to qualify for the incentives. Even at that, the 16 SEER for qualifying cooling only systems for the feds tax credit as well as 16 SEER required for heat pumps to qualify for state credits puts systems in home here that really don't much benefit from the efficiencies that are required.

Some contractors, when installing gas furnaces, will install a qualifying 95+% gas furnace with over a $5,000 price tag to qualify for the full incentives and then install a 14 SEER cooling system with it.

milk man

Just enough to qualify. My employer will upsell higher than the minimum to qualify, but he's a much better salesman than myself. And deals with a better off set of people.

If I can quote a system that qualifies for a utility rebate I'll add a system that qualifies for the minimum requirements for the tax incentive.

As far as the $5000 furnace, I haven't done that but I don't know what some of the other guys have done. The subject has come up.

RoBoTeq

Since you have the opportunity to provide vs blowers to qualify for the tax and rebate incentives, do you also use that as an opening to upsell on IAQ products?

By explaining the IAQ values of the vs blower motor, it is a good lead in for 4-5" pleated filters, UV lights, humidifiers etc. Do you take that opportunity?

milk man

No. I'm not a very good salesman. I'd rather be turning a wrench.

RoBoTeq

We all have what we do best. Up until just a few years ago I too said I was not a good salesman. Turns out I've been practicing for sales all my life and other then the massive amount of administrative work involved, I'm pretty good at sales.

ThunderCow

We tried to advertise it, there are some local residential incentives here in austin, but no one responded. The best way for us is to bring it up after they already need a new system.

__________________
Air Conditioning Austin TX
AC Service Austin TX

Dinosaur

Here is one for you guys. Have a customer that bought an 80% furnace and 13 seer unit on price. Yesterday I got reamed by his accountant telling me I had to break down the installed costs for the customer tax brea. I immediately called the customer and told him he really needed turbo tax or a better accountant. Has anyone else had this happen?

RoBoTeq

If what you are doing to advertize is not working, do something different. The main thing about advertizing our industry is that you have to keep at it month after month after month. No one looks at their mail and says; hey, here's a good deal on replacing my furnace or cooling system, I think I'll check this out. Not unless their heating or cooling is not working do they care. So, your name must be in their hands month after month so that when their system does go on the fritz, you are there to consul them and take care of their problem.

RoBoTeq

Most of our industry is sold as installed product. Tell the accountant to take a flying leap or pay you to readjust your invoice to suit his/her desires.

Dinosaur

Agreed, and you hit another spot that we as HVAC People need to learn. Pay to adjust an invoice. We are our worst enemies, many of us don't bill for things like a new invoice, or charge for something that took time to research because Mr. Dumb customer lost his install papers including the final invoice. I got wise a few years ago after seeing office time increase from the CSR hunting for things to appease a customer. THe take here is if you want duplicate paperwork for your taxes, research fee is $251.00/Hr. Would you believe no takers but a return call to the customer in a week resulted in they found what they lost!

spending more office time

Dinosaur

Guys look yourself up on the internet. There are sites that have your name on them with incorrect info. We send out newsletters, or reminder cards. When the customer's need us we are remembered and they call from work. Internet is at their finger tips, they are computer people and they find multiple listings for us because of the free sites. They pull up a freebie that we know nothing about, get a wrong number and poof we are out of business with them because they dont get us. The other thing that happens is some theves like, Service Whoever, posts us and uses their own number, then they try to to pass our customers to us with a finders fee attached.

gibhvac

Time Out!! I think we have gotten away from the original posting from robotech. Im unclear of his point, but I thought I read his post asking who is upselling higher efficient equipment using tax credits and rebates when it isnt necessary? First thing I have to say is- there is nothing wrong or questionable for making a profit off of our customers- or using tax credit incentives and rebates to make it more appealing to the customer ? It is in no way a scam. Yes the customer has to buy a higher SEER rated system at a higher price, but the customer will receive the tax credit and the savings each month on their electric bill which will eventually pay for the investment. Personally, I give options to my customers- using the Best, Better, Good, Budget options really works well for my business- I make sure everything is laid out and emailed to the customer with model numbers giving them access to tax certificates for making sure they get the correct match ups. Dont forget the reason for the tax credits. Was it not created to give incentives for consumers to spend money to boost the economy, and in turn saving energy as well as operating cost? In the end, the customer wins- and the HVAC contractor profits so his or her business can continue to service its customers. www.acquotepro.com

RoBoTeq

After having reread my OP, I can see where your confusion comes in for my intent. I was attempting to be a little covert about the subject I was mostly interested in, which is installing variable speed ECM motors over X13 ECM motors.

As many threads do, this one has taken a turn I did not anticipate, but it is a good one.

I agree 100% to sell as much, as efficient and with as many options as the market will bear. What I was trying to ascertain in a round about way was whether contractors were opting for the X13 motor just to hit the tax incentives and rebates or whether they are looking to enchance the quality of the air, ie; filtration, sound, dehumidification etc. by using the more expensive variable speed ECM motors.

This may become a moot point as furnace and A/H control boards become more sophisticated in doing the air control functions that are currently on the VS motors.

Since it was mentioned, I would also like to take another turn by asking how many contractors use the Good/Better/Best marketing range. I don't really like the implications that a consumer may have to settle for less then they need due to finances.

I prefer that each consumer feel that they all get the "best" system suited for their needs, and that includes their financial situation.

Sjpasi

Robotech, spoken like a true wholesale rep. Consumers needs are inclusive of their budget. Giving options with educational data allow them to make true, educated decisions.

Just because people may not buy the most expensive unit you sell your customer doesn't mean that isn't their best option. The better question is Why do manufacturers charge thousands of dollars more for equipment that is only a little more efficient. Because they can?

RoBoTeq

Well, you have my intentions very wrong, but in business we should always try to make the most for our products and services so we can more effectively grow and conduct our business for the future.

Since I teach selling the lowest capacity equipment to do the job and prefer to refer to what others call "good, better, best" as all being the best for certain applications, I don't see where I am speaking like a true wholesale rep. Neither of those teachings increase my bottom line.

I don't question why manufacturer's charge what they do, I just sell what they make at a mark up according to what their product costs my company. If a product is overpriced from the manufacturer, it will be difficult to sell at the wholesale level and the pricing will either be adjusted to sell by the manufacturer or the product will be discontinued for not being worth what it costs to make it.

Sjpasi

You Said... "I don't really like the implications that a consumer may have to settle for less then they need due to finances.

I prefer that each consumer feel that they all get the "best" system suited for their needs, and that includes their financial situation"

Robo, Well I "teach" as well... And also "Do". We own two ac companies in two states in the Southeast. We subscribe to the theory that we educate and let our customers decide. We don't care what they buy. No more than a restaurant owner cares what their customers eat when they arrive in the dining room. We just want them to be a customer AND be satisfied. Do we give specials? Of course, just like a restaurant, we have our favorites. But in the end, it's their decision.

We use a program called ACquotePro. It pretty much automated our processes in selling... As a matter of fact, we don't even like to think of our process as selling... It's more like decision guiding through education. All the while giving our customers the ultimate decision. You can read about it at www.acquotepro.com.

What area of the country are you in?

RoBoTeq

I'm in eastern PA at this time.

It sounds like you have a good marketing program going. I too do not consider myself to be a salesman. I am more the guy who provides what my contractors need based on their intentions and my guidance. This is also how I worked when I was a contractor providing comfort systems to my customers.

The difference in the wording is just marketing. It's all in how it's presented.

HeyBob

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