Going Beyond Equipment Replacement

Going Beyond Equipment Replacement

In the HVAC Industry, we always have and always will replace equipment. Equipment replacement is the foundation of a retrofit service company and is the trigger that generates the bulk of sales in most HVAC organizations. But wait, there’s more! Let’s take a look at a golden opportunity available to each of you at equipment replacement time, and find out how to capitalize on this new product.

What is This Product?

Is it air filtration? Could it be humidifiers or zoning systems? Or is it perhaps a new Wi-Fi thermostat?

While nice or even essential in some homes and businesses, these accessories fail to assure the installed system will perform close to the level of efficiency printed on the equipment’s yellow sticker. 

The answer your customers are looking for is a bundle of services called system renovation.

Bottom line, system renovation is what you find when you pull your head out of the box, look around at the entire system, do a little testing, and discover what it will take to modify the system. This assures your system will deliver the comfort and efficiency you have promised your customer.

System renovation is the hottest product our industry has to offer. It enables a service company to achieve a 30% improvement in efficiency over the same equipment replacement installed by competitors who often ignore system renovation.

 

System Renovation Details

While past articles often mention system renovation, most calls and emails request a more detailed description of what it takes to renovate a system when changing out the existing equipment. So here you go…

You typically don’t have to replace the entire duct system -- that is rarely the case. At NCI, we’ve found that only 5% of renovated systems need a full duct replacement.

Successful system renovations become very surgical. A few well-diagnosed repairs and adjustments will make the biggest difference in the measured performance of a system that will pay off big time for your customer’s comfort, safety, and efficiency.

 

Before the Sale

Some inspection and testing will be required of you before the sale is made. This work is normally done by a selling technician or salesperson who may lean on a technician’s expertise before a sales agreement is drawn.

  • Test the Existing System as Found - Measure static pressure, airflow, and temperatures and make the necessary calculations to rate the performance of the system.

Inspect the duct system and find restricted ducts, restrictive transitions, or disconnected ducts that need attention.

  • Be sure to educate your customers by inviting them to participate in the testing. Typically, this takes a little over an hour. During this time you educate and create a desire for your customers to buy the renovation. This time replaces the effort you have previously spent bragging about the virtues of your company and reviewing the utility, government, or manufacturer’s brochure. Customers are far more interested in their own system and needs than what the industry believes is best for them.
  • Diagnose the system from the inspection and test information. Diagnostics is really done while the inspection and test data is gathered. Allow 15 minutes to overview the work with your customer and discuss their budget.
  • Prepare a scope of work and proposal. Be brief, your customer doesn’t need much detail to try to shop for the low bidder. Comparing equipment efficiency and lowest prices are a no longer part of this conversation. You have just changed the game.

 

Typical System Renovation Scope of Work

The typical residential HVAC system renovation consists of the following tasks that nearly always require an installer and a helper together for an eight-hour work day.

  • Repair obvious system defects that are identified while testing and during inspection. Time and materials vary. Most of this work is included in the tasks below.
  • Cut-in one new large return duct in a central hallway or living area. This relieves high static pressure and significantly increases system airflow.
  • Replace several 6–in. supply ducts with 8–in. diameter duct and add balancing dampers when accessible. It may be easier to install a few new supply ducts. This gets more air to the rooms that have low airflow, relieves excess static pressure, and increases system airflow.
  • Upgrade the filter system. Most filters are far too restrictive. Typically the filter in a system should have a pressure drop of less than 20% of fan rated static pressure. Most filters have 2-3 times the amount of acceptable pressure drop and are too restrictive. Filter pressure drop can be reduced to increase system airflow. This can be done by installing a less restrictive filter or adding more filter surface area. Most of the time, adding filter surface area is required.
  • Clean or replace cooling coils. As with filters, coils may need to be cleaned. Sometimes they become too restrictive for the system fan and must be replaced.
  • Adjust the fan speed. If needed, adjust fan speed to assure the required system airflow. Frequently the fan will need to be replaced with a beefier aftermarket fan and motor that can adequately handle the filter, coil, and duct system.
  • Test, adjust and balance the system. Once repairs are completed, balance the system to assure each room has sufficient airflow.
  • Adjust refrigerant charge. Once airflow is correct, then charge the system.
  • Optimize combustion efficiency.  After airflow is adjusted, properly adjust the heating equipment combustion and venting if a fuel-fired appliance is used.
  • Complete the system commissioning. Take final temperature measurements, make performance calculations, then publish the final report and review it with the customer.

The New Product

What you’re selling becomes an increase in operating system efficiency from the national average of 57% to 85% or 90% operating system efficiency.

A few highlights of this new product:

  • You discover it through inspection and testing. You design it and build it.
  • Gross margins are often near 70% and it’s the best product your customers can buy for the money.
  • This has no set price in the market, but is your custom product that has no competition. 
  • Only about 10% of the cost of a renovation is material, so most of the cash stays in your company.

Combining system renovation with equipment change-outs eliminates your competition. Your customers will learn from your testing that if they buy a furnace rated at 95% efficiency or an air conditioner rated at 20 SEER from your competition, the system will be lucky to work at 60% of it’s rated efficiency. They’ll understand that you can do so much better for them. We call that closing more sales.

Rob “Doc” Falke serves the industry as president of National Comfort Institute an HVAC based training company and membership organization. If you're an HVAC contractor or technician interested in a free System Renovation Testing Procedure, contact Doc at [email protected] or call him at 800-633-7058. Go to NCI’s website at nationalcomfortinstitute.com for free information, articles, and downloads.

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