From Technician to Business Owner: What It Takes to Succeed

How do you build a successful HVAC business when no one taught you the business side? Many contractors enter the industry with strong technical skills but little training in running a successful company. That gap can make growth feel harder than it should, even for owners who know the work inside and out.

In this episode of Cracking the Code, Contractor University Business Coach, Bob Larkin breaks down what it takes to make the shift from technician to business owner. From understanding your numbers and pricing correctly to building a clear vision and growth plan. Learn why long-term success depends on learning the business skills most contractors were never taught.

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00:00:00:01 – 00:00:13:02

And they said, Bob, why? Why am I not getting any calls? This is bad. And it’s not so great that you didn’t put yourself in customer shoes.

00:00:13:04 – 00:00:43:18

Welcome to Cracking the Code. Today we’re kicking off a special series where we introduce you to the people behind the coaching program here at Contractor University. Many contractors reach a point where they realize that running a successful Hvac company requires more than great technical skills. Leadership, accountability, building strong teams and creating systems that drive consistent performance are just as important as repairing and installing equipment correctly.

00:00:43:19 – 00:01:07:21

That’s where coaching can really make a difference. Our guest today is Bob Larkin, one of our business coaches here at Contractor University. Bob has spent decades working with contractors and helping business owners focus on the habits and disciplines that lead to high performance results. Bob has a unique ability to take complex business challenges and simplify them into practical actions.

00:01:08:00 – 00:01:28:15

Contractors can apply immediately. But before we jump right in, make sure you like, comment, and subscribe to cracking the code so we can impact even more contractors in our great industry. Hey Bob, it’s great to have you today. Hey, David, how are you doing, man? I’m doing good. You’re on the east side of Georgia. I’m on the west side of Georgia.

00:01:28:15 – 00:01:51:12

And man, we are getting some rain, so hope we get through this. Okay. You’ve worked with contractors from many different markets and different company sizes. Anything from, you know, one and two truck operators, up to hundreds of trucks. So when you first start working with a contractor, what are some of the most common patterns or challenges you tend to hear them express?

00:01:51:14 – 00:02:14:17

Well, I think a lot of it you really have to understand where the majority of contractors in the industry come from and where most of them come from. Is this progression, you know, the individual graduates high school, they go to tech school, they learn how to fix air conditioners. They get a job fixing air conditioners, they get good at fixing air conditioners.

00:02:14:18 – 00:02:35:01

One day, lightning strikes, or they get mad at their boss. They quit and open their own company. Hi, David, you’ve been around this long time and you agree that’s where most of our industry comes from. I can testify to that. My grandfather went through that exact same progression in 1956. He was working for another guy. He kept saying, that guy’s an idiot.

00:02:35:01 – 00:02:58:17

That guy’s an idiot. And March 15th, 1956, he was working for an idiot. March 16th, 1956. He’s working for himself, a lunatic, because he didn’t really know anything about running the business. So yeah, that is typical of the progression that we see for sure. So where in that progression was that individual ever exposed to, say, a profit and loss statement?

00:02:58:19 – 00:03:23:21

No, never. Well, most of them at this point have never seen this one. And it’s not like they’re dumb. How are you supposed to be, you know, understand something you’ve never even seen before? And as a business owner, they’re expected to be an expert on day one. Completely unrealistic expectation. And a lot of, you know, a lot of people I work with.

00:03:23:21 – 00:03:50:12

And I actually fell in the smoke, you know, in my company, they feel like they’re supposed to know this. They don’t know it. They’re embarrassed and they don’t want to admit it. And, thankfully, in my company, I hired a controller who’s really good. He’s kind of my number two in the company, and he saw through my boss, and he basically beat me over the head until I learned it.

00:03:50:14 – 00:04:07:23

And I can tell you it was one of those sighs. It was like a switch flipped in my head. I’m looking at this stuff and I’m looking and I say this just this makes no sense to me. And then one day, after doing it over and over and over, it was like a switch flipped in my head. I said, oh my God, this is so simple.

00:04:08:01 – 00:04:25:01

How didn’t I know this? And I’ve seen that progression with coaching clients. I have, you know that in that part, you know, that part is the fun part, right? When you when you actually kind of get through and the fog kind of lifts and they’re like, oh my gosh, this, this is not as hard as I thought it was.

00:04:25:01 – 00:04:41:23

I don’t know why I’m so scared to do this. Well, I think you gave the analogy that I use all the time now is I’ll ask one of my coaching clients this. And you know, the first time you looked at a wiring diagram, you understood it completely, right? And of course, the question there, the answer is no. They didn’t.

00:04:42:01 – 00:05:04:12

But now they, you know, most of them can look at the wiring diagram and it’s second nature. They don’t even think about it. It’s the same way with, profit loss statements of accounting. Once that switch flips in your head, it’s a piece of cake. The other two things I would say that I deal with in the house is what I said.

00:05:04:14 – 00:05:29:15

Understanding your numbers. How to adequately price a job or price your, service call service labor. Right. Using your numbers. Well, you got to know your numbers, and you got to have good numbers to be able to do that. And most, most of the people I first start working with, they don’t really know how to price their numbers, and they can’t figure out why they’re not baking enough money.

00:05:29:17 – 00:06:01:20

And that’s a lot of what we deal with. But then it goes to me, the very basic basics of everything is having a vision, knowing where you’re going. And, you know, I’ll explain to my, coaching Clyde’s when I say a vision, what I’m really saying is just let’s start with five years. Just think about what you want this company to look like in five years and completely define that.

00:06:01:22 – 00:06:22:20

What facility are you going to be in that’s in dream a little bit. That’s okay. How many employees are you going to have? How many service techs? How many installers, how many trucks? What’s your revenue going to be? What your gross profit. What your net profit. What you define all that. Okay. Now we know where we’re going.

00:06:22:22 – 00:06:44:22

And figuring out how to get there from where you are now is really just. A conversation about a math problem. That’s all it is. It really is. It’s expressing the vision that you have for the business and making sure you can communicate that to the rest of the team. You get them to buy in to helping you get there, because you’re not going to do it by yourself.

00:06:45:00 – 00:07:16:19

You’re just not right. It takes teamwork. And I’ve got there one other thing that’s a pretty big one, you know, that I usually see common problem. See for contractors is in their marketing. The first thing to me about marketing in this industry is you have to put yourself in your home on issues, and that’s not as easy as it sounds, because as contractors, the problem is we know too much and we sometimes assume that our customers do too.

00:07:16:21 – 00:07:40:20

So here’s a common a common mistake I see in coaching goals. It’ll be your shoulder, your shoulder season of the year, and they’re slow. And they’ll set up a coaching call with me. And they’re panicking a little bit because they’ve got no business, and they’re trying to figure out how to get some business. And I put together an ad that’s honestly beautiful.

00:07:40:22 – 00:08:00:14

It’s great. It really looks good. And they got a just a killer price on a new system. And they throw that ad out out there and they hit the calls and they said, Bob. Well, Bob, why? Why am I not getting any calls? This is bad and it’s not great. And and I said, but you didn’t put yourself in the customer’s shoes.

00:08:00:16 – 00:08:22:02

That’s a reason. And getting the calls is because the 70 degrees outside. And you’ve got to understand, there’s a ten in this industry that we tend to not understand, to most of our customers, as an industry, we don’t matter.

00:08:22:04 – 00:08:51:17

Until we do, if it’s working, they’re not thinking about us. We’re out of sight, out of mind. So that beautiful ad that my, client threw out there, they might have they might have seen it, but it never even registered in their mind because they’re not in the marketplace or don’t like, they shouldn’t be in the marketplace. And that’s one of the biggest things, is understanding your customer and what they’re thinking.

00:08:51:18 – 00:09:25:00

That’s how you deal. Rachel. So thinking about those companies that that consistently perform at a high level, what what habits or disciplines do you see that sort of separate them from the average contractor. So what are what are the high performing guys doing regularly that others aren’t? Well, well, what is what we just said, you know, you know, put yourself in your home, in your customer shoes and knowing how to reach them, educating them, just like you just said.

00:09:25:02 – 00:09:42:08

Most homeowners don’t realize that the average life expectancy of a heating their system is 12 or 15 years beyond that, they don’t even know how old their system is. If you ask them, they’ll give you something else, like, like five years and you, you know, go down in the basement, take a look at it. That thing’s 15 years old.

00:09:42:10 – 00:10:03:08

You know, that’s the situation. And they don’t understand the type of, industry they were in and what we’re dealing with. That’s a lot of what I did in the companies I hold is just be very upfront with our customers. This is a crazy business. I mean, and, my partner Jackson Jacksonville, I think to find it best, he said, you know what?

00:10:03:08 – 00:10:44:07

We only have two speeds. Speed number one is how in the world are we going to get all this done? Speed number two is, 1 to 1. Will we going to do today? And that’s our industry. And, you know, our customers don’t really understand that. And if you tell them, look, if, you know, I don’t know how many fractions to industry are so precise that they can build a piece of mechanical equipment that will last 15 years, and somehow they’re able to design that thing where it only dies after 5:00 on Friday, a 4th of July weekend, you know, when it’s 102 degrees.

00:10:44:08 – 00:11:03:18

Yeah. Yes. And I tell I tell the customers said, you know what? When that happens to you, you’re my customer. And they do everything in the world to try to take care of you. But understand the box I’m in. I have hundreds of service calls with people with no cooling on my board. You know, me and my guys are working till two in the morning.

00:11:03:18 – 00:11:23:19

They’re, you know, every day trying to catch up. We’re going to do our best to get, you know, get to you, but understand where we are and I can’t give you the best price on a new system if you need one. But in March, I’ll give you a great price. Well, and we can do a better job on the job too, because it’s not near as hot in the attic.

00:11:23:19 – 00:11:46:09

We can spend more time and do the project properly. We’re not rushed, right? We’re not. The cost to do the job is actually less in the off season, if you will, because we’re not having to do a bunch of overtime. Right. It’s scheduled work. So yeah, there’s lots of benefits to figuring out how to get jobs done when it’s not hot outside or cold outside.

00:11:46:09 – 00:12:12:08

So for contractors listening today who want to grow their business, but they feel a little stuck. What’s one area you would encourage them to focus on improving right now? Okay, I’ll say two things. The first one is a kind of mission for is having a vision and just talk with five years, you know, define what you want this company to look like in five years.

00:12:12:10 – 00:12:35:20

And like I said before, figuring out how to get there is really just a conversation, a math problem. And that goes into a budgeting and planning process. And that’s really the it’s just a conversation and some math, you know, the way we did in our company, we did a budgeting and a planning every, first, usually first week in December.

00:12:35:22 – 00:12:54:12

And basically we would just have a conversation, you know, the first part of what was what went right in, our company and our business in this in the year we’re just finishing up what went wrong. We just had a conversation that’s okay. What’s going to be different about the next year? It was just a conversation. And we’re right.

00:12:54:12 – 00:13:27:09

All this stuff down. And then we figured out, okay, what’s our increase going to be. And then we we start building our play up, you know, from okay, if this is our increase in January of next year, that means our revenue is going to be this thing is going to be this amount escalation of this amount to service department, based on our average ticket sale or ticket size moving forward, that means we’re going to have to do this many jobs and install if our closing ratio is x, that means we’re going to need this many leads.

00:13:27:09 – 00:13:46:15

Where do those leads going to come from? We’re just having a conversation. No, we’re building a plan as we go. Do we have the people to do that many jobs? If not, how long is it going to take to find those people and buy the truck, etc., etc. then we just build every March and then we go back to the beginning.

00:13:46:21 – 00:14:10:23

Once we get it all built and we break it down to the week into the day. And you can do that for that five year plan is the same thing. The other thing that I wanted to mention, and this is some advice I always give the first time or most time I give first time. I have a, new coaching client.

00:14:11:00 – 00:14:33:05

And I’ll tell them, you know, the good thing about contractors university is there is more content here than I’ve ever seen in one place in my entire time of the industry. Would you agree with that, David? Yeah. There is no doubt that dredging or so you know, we’re here to help. That’s what this whole coaching program’s about. You know, as you know, as a member, you get a coaching call every month.

00:14:33:05 – 00:14:54:08

So, you will not get hung up. We will get you on hung. You will be moved forward. Thanks for sharing your experience and insights with us, Bob. And for those of you listening, if you’re part of Contractor University, you already have access to coaches like Bob, like you just said, who spend their time helping contractors think through these challenges and build stronger businesses.

00:14:54:10 – 00:15:09:05

Hey Bob, thanks again for joining us. All right. Appreciate it David. You bet. And thanks to all of you for listening to Cracking the Code, where we make Hvac business success as stress free as possible. Until next time, keep on cracking.