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Selling HVAC Maintenance Contracts

Updated August 16, 2023

The HVAC industry is currently navigating a unique set of challenges shaped by both external economic factors and evolving consumer behaviors.

A recent DuraPlas Summer Cooling Survey revealed that a staggering 77% of Americans are actively seeking alternatives to their HVAC systems for cooling, primarily driven by the rising prices due to lingering inflation.

As the summer temperatures are predicted to soar higher than usual, the majority still aim to maintain their homes at an average temperature of 70 degrees. This juxtaposition of economic constraints and unwavering comfort demands underscores the importance of HVAC maintenance contracts.

For HVAC contractors, this presents both a challenge and an opportunity. The challenge lies in addressing the immediate concerns of cost-conscious consumers, while the opportunity emerges in the form of alternative cooling methods and maintenance contracts.

Over 45% of respondents are inclined to keep blinds and curtains closed, and nearly 40% want to use ceiling fans more frequently. This shift in consumer behavior emphasizes the need for HVAC contractors to adapt, innovate, and offer solutions that align with these new preferences.

Looking ahead, the importance of selling HVAC maintenance contracts becomes even more pronounced. As homeowners explore various cooling strategies, they remain heavily reliant on their HVAC systems.

However, a significant gap in understanding and maintenance could render many of these systems vulnerable during peak usage times. For HVAC businesses, this means that the future hinges on selling systems and ensuring their optimal performance through effective maintenance contracts.

By doing so, contractors can ensure:

  • Customer satisfaction
  • consistent revenue streams
  • A sustainable business model

Why HVAC Maintenance Contracts Matter

Consistent Revenue

HVAC businesses can predict their income with maintenance contracts, helping in better financial planning and stability, especially during off-peak seasons. Having 500 service contracts can translate to $350K worth of revenue for the HVAC business.

Repeat Business

These contracts transform one-time service users into loyal, repeat customers, ensuring a steady flow of business.

Customer Loyalty

  • Regular interactions through service contracts transition the customer relationship from mere transactions to trust-based associations.
  • Satisfied customers often become brand ambassadors, leading to word-of-mouth referrals.

Upsell Opportunities

  • Regular maintenance visits introduce customers to new services or products, from energy assessments to advanced HVAC solutions.
  • Consistent monitoring allows contractors to offer personalized solutions based on individual customer needs.

Building Trust Through Service Agreements

Reliability in Recession

  • A Safety Net: In economic downturns, businesses with a strong base of service agreements can weather the storm better, as they have a guaranteed source of income. Service agreements cultivate trust and a lasting customer relationship.
  • Long-Term Commitment: Service agreements reflect a business’s commitment to long-term service, assuring customers even in uncertain times.

Every Call is an Opportunity

  • Showcasing Expertise: Each maintenance call allows technicians to demonstrate their expertise, reinforcing customer trust.
  • Feedback Loop: Regular interactions provide insights into customer needs and preferences, helping businesses refine their offerings.

High Closing Rates

  • Trust as a Catalyst: Service agreements reflecting reliability and expertise can significantly boost the acceptance rate of other HVAC proposals. Having a service agreement in place can boost the closing rate of HVAC proposals by an impressive 80%.
  • Building a Portfolio: A strong base of service agreements can be a testament to potential customers about the business’s credibility and quality.

Benefits for Customers

Peace of Mind

  • 24/7 Assurance: With a maintenance contract, customers know they have a reliable partner round the clock.
  • Predictable Costs: Fixed maintenance contracts help customers budget their HVAC expenses better, avoiding unexpected costs.

Exclusive Perks

  • Priority Service: Contract customers often enjoy priority services, reducing wait times during peak seasons.
  • Tailored Solutions: Based on regular assessments, contractors can offer solutions tailored to individual customer needs, from energy-saving tips to equipment upgrades.

Cost Savings

  • Efficiency Boost: Regular maintenance ensures the HVAC system operates at peak efficiency, translating to energy savings. Lack of maintenance can reduce efficiency by 5% or more, as mentioned by ServiceTitan.
  • Longevity: Well-maintained HVAC systems have a longer lifespan, delaying the need for replacements. An average HVAC system should last between 12 to 20 years, as cited by FieldEdge.

Crafting Effective HVAC Maintenance Contracts

Mindset Matters

  • Transition from addressing breakdowns to preventing them. This not only ensures smoother operations but also reduces emergency call-outs.
  • Clearly articulate the value customers get from the contract, from cost savings to priority services.

Offer Choices

  • Recognize that customers have varied needs. From basic to premium, offer a range of contracts to cater to different segments.
  • Allow customers to customize contracts based on their specific requirements, enhancing satisfaction.

Financial Considerations

  • While offering deep discounts to attract customers is tempting, ensure it doesn’t erode your profit margins.
  • Clearly outline what’s included in the contract and any additional costs, ensuring no unpleasant surprises for the customer.
Crafting Effective HVAC Maintenance Contracts

5 Strategies to Maximize HVAC Maintenance Contracts for Rapid Business Growth

The recent findings from the DuraPlas Summer Cooling Survey show that consumer behaviors and preferences are shifting.

To help HVAC contractors navigate these changes and achieve rapid business growth, here are five strategies centered around HVAC maintenance contracts:

  1. Educate your customers and raise awareness.

    With 77% of Americans seeking alternatives to traditional HVAC systems, there’s a golden opportunity to educate them about the long-term benefits and cost-effectiveness of regular maintenance.

  2. Adapt your solutions to their current behavior.

    Recognize the rising trend of homeowners using blinds, curtains, and ceiling fans for cooling. Offer customized solutions that complement these methods while ensuring the HVAC system remains at its peak efficiency.

  3. Offer flexible plans tailored to their specific needs.

    Understand that every homeowner’s needs are unique. By offering a range of maintenance contracts, from basic to premium, you cater to a broader audience, ensuring higher uptake rates.

  4. Take advantage of new tech to manage your business.

    Use modern tools and software to streamline contract processes, offer real-time monitoring, and provide customers with insights into their HVAC system’s performance. This not only enhances the service quality but also builds trust.

  5. Prioritize customer satisfaction and service over short-term gains.

    In an industry where word-of-mouth referrals can make or break a business, ensuring customer satisfaction is paramount. Regular maintenance checks, prompt service, and transparent communication can go a long way in building lasting relationships.

By implementing these five strategies, HVAC contractors can not only address the immediate challenges posed by changing consumer behaviors but also lay the foundation for sustained growth in the future.

Christopher Grubbs

Christopher Grubbs

Chris is the driving force behind KGG's marketing initiatives. Boasting over a decade in digital marketing, Chris's expertise is deeply rooted in HVAC lines and IAQ products. In 2018, recognizing the pivotal role of online presence in today's market, he pioneered KGG's in-house digital and marketing services. For collaborations or to learn more, connect with Chris on LinkedIn.

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