| Sell an HVAC Business |
 When a business owner decides to sell her business, she will want to
maximize profits and transition seamlessly into the next phase of her
life. This article will focus on 5 things HVAC Contractors need to
accomplish (or implement) prior to the sale of the business to make it
as smooth and profitable as possible.
1. Keep a database of all customers. As the business is built and grows, occasional coupons and general mailers should be sent to past customers to keep the company's name at the forefront of the customer's mind. Like a doctor when a person is ill, an HVAC Contractor becomes a site for sore eyes when the temperature peaks in August and the air conditioner breaks. If the contractor has developed a solid relationship with clients and reminded them about available services via brief mail ads, that contractor has a great chance of being the one that gets the call when a unit breaks. Moreover, a savvy buyer is going to want to know that they are buying into a well documented list of clients. Not having this information can cost sellers potential dollars while they own the business and when they attempt a sale. 2. Place a sticker on all machines installed/serviced. When the machine breaks, a homeowner will instinctively take a look at the machine, regardless of how technically inclined they may or may not be. When they see the contractor's name and phone number on the machine, that company has a better chance of getting the call when the machine breaks or needs serviced. Thus, gross sales will rise, and if the company is running efficiently, so should the profit margin. Since the selling price is contingent upon the profit margin, the higher the margin, the higher the asking price. 3. Examine options for horizontal integration. Many of the creature comforts enjoyed in the home are serviced by different specialists. Electrical issues require an electrician, plumbing issues require a plumber, etc. By growing into all areas of home maintenance, an HVAC contractor can be the one person that is called when a home owner needs help or wants to make some changes around the house. After the purchase of these other core competencies, the owner should begin to see an increase to her bottom line as overhead is saved. That increase in the bottom line will mean more dollars at the time of the sale. Alternatively, the HVAC contractor that has not integrated horizontally can have her broker approach other specialties as potential buyers. 4. Provide service contracts to customers. This will be an enticing feature for buyers because they will have a greater assurance that the business will continue in the future. Much of the purchase of a business revolves around the management and avoidance of risk. Securing servicing contracts will help to minimize risk to the new owner and make the business much more attractive.
5. Maintain competitive pricing. Most customers will simply shop around until they find a price they are comfortable with. This is obviously a problem during daily operation of the company as it can easily stifle business, but it can also be a major concern down the road during a sale if the prices have not kept pace (increased) with others in the industry. If the prices are remarkably low, the potential buyer may be reluctant to buy into a market where they risk losing customers immediately due to sticker shock. |
