Business owners want to know two things: No. 1, how their service ranks among the competition and No. 2, how they can gain an edge on the competition. But before a great business owner, manager, or leader can expect to better their service they need to know how to evaluate it.
Key Performance Indicators (KPIs) are industry measurements that have been compiled from the best companies in a given industry. They’re designed to be guidelines that a company strives to achieve over time. The HVAC industry has KPIs for all aspects of the contractors’ and dealers’ businesses.
KPIs in the HVAC Industry
- Revenue and revenue growth. Revenue growth measures the performance of the company in terms of sales. The following must be considered: The total sales of the dealership, the total sales of the comfort advisors, the average sales ticket of the comfort advisors, and the comfort advisors’ average ticket.
- The performance of the service and installation departments. The following should be considered: The first time completions of the service techs, the number of callbacks, the installation of equipment completion time, and the execution of the service process in the customer’s home.
- The operational performance of the company. The following should be considered: The overall cost of operations (SG&A) is less than 30%. Ideally, this would be in the 27-29% range.
- The overall profitably of the company. The following should be considered: The bottom-line performance of the company, and whether the company is at 10-15%, 5-10%, 0-5%, or 0% or less.
The key is to line up their actions and efforts with the areas of improvement. This enables them to be part of the solution, better understand their role in the process, and know what the company owner’s priorities are. The crucial factor is to consistently improve these goals.