Cracking the Code Podcast
Author: Thomas Christian | Digital Marketing Coordinator at EGIA & OPTIMUS | December 8th, 2023

How to Increase HVAC Sales

How to Increase HVAC Sales and Improve Your Sales Process

Contractor University is to give a sneak peek of its new learning course focused on elevating your sales process! In this course, we aim to empower contractors with the knowledge and skills to enhance their sales strategies and achieve greater success.

Dive into a preview with Drew Cameron this week as he provides an insightful overview of what the course entails. It’s not just about refining your sales techniques; it’s about transforming your entire approach to sales. This course is designed to be a valuable resource for contractors at all levels, whether you’re a seasoned professional or just starting in the industry.

The sneak peek offers a glimpse into key aspects of the course, highlighting how it will guide you in developing the right mindset for sales success. Being intentional in your sales process is a fundamental principle that will be emphasized. Learn how to approach each interaction with a purpose, understand customer needs, and tailor your communication to build strong connections.

Communication is a cornerstone of successful sales, and this course delves into strategies to enhance your interactions with customers. From active listening to effective articulation of your value proposition, you’ll gain practical insights that can be immediately applied to elevate your customer conversations.

Furthermore, the course will explore techniques for overcoming common sales challenges and objections. By addressing these hurdles head-on, you’ll be better equipped to navigate the sales landscape with confidence and finesse.

Elevating your sales process isn’t about reinventing the wheel; it’s about refining it. The lessons in this course are designed to seamlessly integrate with any sales process you currently have in place. It’s a valuable addition that will enhance your skills, boost your confidence, and ultimately contribute to your success in the competitive contracting industry.

Don’t miss this opportunity to gain an edge in your sales endeavors. Stay tuned for the full release of Contractor University’s new course, and take the first step toward transforming your approach to sales!

Audio Transcription (In Beta):

On today’s show, learn the top five ways of how to increase HVAC sales with payment plans.

Now, as we all know, payment plans can be a great way to maximize your sales. Today, we have Drew Cameron here to talk about the top five ways to do this. Take it away, Drew. As we head into spring and summer and the heart of our season where we get the busiest in the HVAC industry. Certainly, it’s not the only time we’re busy, but it’s the busiest probably for most of us.

It’s, you know, it’s important to make due of the opportunities that we get, right? Everybody talks to me, uh, in my consulting and training business about adding more opportunities. And I don’t think that’s, you know, necessarily always the answer. We got to do a better job with the opportunities that we get.

Meaning we’ve got to convert them and payment options is one of the ways that you can maximize your sales and profits in doing so. So without further ado, let’s dive into the content and I’ll share with you my concept of the top five ways to maximize your sales and profits with payment plans. So Frank Becker was a friend of Dale Carnegie who wrote the book called How to Win Friends and Influence People.

And uh, Dale Carnegie said to Frank way back when he said, you know, you’re a better sales person. A better sales coach, better sales trainer than I ever was. He said, you should write a book. So he did. And the book was called How I Raised Myself and Failure to Success in Sales in 1937. And Frank said, in the book is show people what they want most and they will move heaven and earth to get it.

And so we’ve probably heard you probably all have heard that phrase in some form or fashion of your career But i’ve updated it and basically said show people what they want most why they shouldn’t be without it How they can afford it how they can pay for it and they’ll buy from you Right because that’s the key is you’ve got to be good at not only what you’re selling what you have to offer But also showing people how they can afford to get what you have to offer because I’m hoping it’s something different, better and more and at a premium price because you’re right price.

And so it also should be a different price. It’s not that we’re 2 or 3 or 4, 000 more than somebody else. We should be probably 000 different than somebody else. And so those differences that make the difference. But we have to show people how they can afford to get that. Right? Because if they want something different, better and more, they’re going to probably have to find a way to pay for that difference over something else that they can get from somebody else.

And so that’s what payment options do. And so to do that, we use what I call leverage. Leverage is basically financing its payment plans, right? A lever is a tool that makes the job easier. So what is leverage in my mind? It is a convenient, flexible investment plan that makes buying what you want today and owning what you want easy and affordable and allows what you save in energy and repair costs to offset the investment or at least pay for it, you know, possibly pay for the investment in its entirety.

So, the key to this, though, is to quit dropping the F bomb in the home, and what do I mean by the F bomb? The word financing. See, when you use the word financing, most people immediately are triggered with interest, and interest is obviously a turn off, and we want to turn people on to payment plans. So we need to use words, because words have meaning, words have power to choose wisely, we need to use words that will allow customers to embrace financing, not drive them away from it.

Right. Because there’s people out there like Dave Ramsey and Susie Orman and these other financial advisors that tell people don’t finance it. Don’t finance anything. Well, that’s the worst thing that they could tell them because using other people’s money is how the rich get richer. Right. And it’s not surprising that maybe some people are trying to tell you not to use it because.

Maybe they don’t want you to join the rich people. I don’t know. Right? Just kidding. Just saying. So, leverage, though, is a tool that allows you to make, uh, allows you to take what you make valuable, right, through your presentation and your sharing of findings and options with customers, and make it affordable, more desirable, and obviously more attainable to the people that you’re talking to.

So it’s a lever. It just allows you to do your job in an easier fashion. So what types of, uh, leverage are out there for using leverage? Right. There’s credit cards. That’s a form of financing, as well as open ended revolving financing. And you can get these through all your lenders. I’m going to provide you a lending resource here that includes all of this here shortly.

Closed end financing, home equity loans, HELOCs, right, home equity line of credit, an FHA 203 loan, 401k loan. You can take a loan out of your own 401k to pay for your, your, your apartment and put the money back. That way you avoid the penalties and the interest. Taxes. Advanced check approval. There’s some people out there that will do advanced checks.

You don’t necessarily have to have good credit to do that. You just have to not owe that entity any money. Then there’s leasing, which is catching fire right now. It’s been very popular always up in Canada, but it’s now coming down to the United States quite a bit. And then there’s, obviously you can take a loan from a friend, a family, or possibly from your boss at work.

And then you could refinance or basically put a mortgage new mortgage on your house So those are all the forms of leverage that we have to be aware of To help our customers think about right because if they even get sometimes get turned down with our financing or they don’t have credit on their credit cards We have to open up their mind to other forms of uh money financing If you will that they can get on their own through other people that we have nothing to do with but we should be the person who says here’s what other people in your situation do When credit gets a little bit tight and we know credit’s getting a little bit tight out there in market.

So we have to think about the bottom half of the screen to drive people towards, um, uh, other methods of payment that they may have access to. So why utilize leverage? Well, we talked about increasing sales. Well, it does create more opportunities for marketing, which I’ll talk about a little bit later. It allows you to reduce the sticker shock with small monthly payments because, I mean, think about this.

How often do you personally cut checks for 10, 15, 20, 30, 000? Hardly ever, personally. And so, most of your customers don’t have that money sitting around either, right? So, small payment options, when you lead with them, reduces that sticker shock. It’s also the most expensive home improvement project, and yet it’s the least planned, right?

Because it’s something that kind of pops up on them. It’s not something that they plan for. Yeah, you can plan for, you can plan for an addition or a remodel or new windows, right? But when something dies, right, when the machine dies, you’ve got to replace it and you’re not planning for it. So I want to think it over in customers minds usually means how am I going to pay for it?

And so when you get that stall and that objection is because they’re not sure how they’re going to pay for it. But if you led with payment options, you’ve already made that, you’ve already made the answer obvious. It makes the investment feel valuable and attainable. As I said a moment ago, it’s not only desirable and valuable, but now I can get it.

I can get what I want. And people love payments. 90 percent of all cars are financed and 70 percent of all HVAC projects are financed. So why aren’t we leveraging it for our purposes? We need to do it and we need to do it better. We can help people get the experience that they desire, not just the one that they can afford.

And 60 percent of the people who did buy, uh, HVAC through financing said it made the purchase more affordable. And on average, they spend 115 percent more than without it. So it gets a higher average ticket as well. It helps you shift the mix of product to higher end product too. You’re ultimately going to get happier customers because they can get more of what they want and they can get the things that they want, not just the things they can afford.

And with happier customers, we’re probably going to have more happy customers because we’ll also get more reviews, more repeat buyers, more referrals, and it’s a win win win for everybody in that way. It also is going to increase company cash flow because you’re going to get your money as soon as the job is done.

And you’re going to increase your sales volume by figuring out how to increase HVAC sales. Like I say, not only are you going to get a higher closing ratio, what I call a connection ratio, but you get that higher average ticket as well. And that ultimately increases net profits. And that’s what we said we want to do. We want to know how to increase HVAC sales. We want to increase profits.

But, as recovery advisors, we also can increase personal income and that of the owners too by knowing how to increase HVAC sales. And everybody on the team, right? Because everybody always employed. Nobody’s sitting on the sidelines. Leverage also increases marketing and sales performance, right? It increases the number of opportunities, right?

So I said it would increase the opportunities that you get, but it increases by 25 percent because if you include it in your marketing, you’re going to appeal to more people once they see in the marketing that you offer payment options and the payment could be as low as X. And I’ll show you some examples of that here in a little bit.

You’re going to increase that connection ratio or closing ratio by another 25%. Right. And so if I was closing, you know, 30, 40 percent before, you know, you could drive that up to about 65, 75 percent closing ratios across all your leads. You’re gonna increase your average ticket by a third, basically 30 percent increase in sales on each sale because people spend more money.

Another way how to increase HVAC sales? You’re gonna increase complete system sales instead of selling components. And that’s great because now we have fully matching technology that works the way that it should with matching warranties and guarantees too. Increase complete system sales by up to 20 percent increase, uh, close 75 percent plus by offering payment options Meaning when I see people that are not maximizing their performance as a salesperson Closing as many opportunities and you’re not going to close 100 But you should close around 75 to 80 percent of what you run, not just what you put, but of what you run.

And payment options is, uh, and help people see what’s affordable, is how you get that last little juice from the squeeze out of what you’re running, as far as leads. We don’t have to run any more leads. And you can sell easily over 2 million a year of finance business as an individual salesperson. I have salespeople selling well over 2 million a year on financing.

Um, and so some selling over 5 million total book of business, but at least 2 million of it can be financed or more. But if you really maximize things, you squeeze the juice out of every opportunity without just running 5, 6 leads a day. If you run basically 2 leads a day. You should be able to sell easily 2, 000, 000 worth of finance business in addition to probably at least another minute or so worth of cash and check business and credit card business.

So, how to increase HVAC sales with payment plans? Well, in my opinion, they are utilizing multiple platforms. As well as payment options and we’ll talk about how to do that. We’re going to work it into our market I’m going to show you how to do that. We’re going to work it into our pricing tools We’ll talk about that and we’re going to use what we call leading language, right?

Because words have meaning words have power So I want to lead people with financing And then we’re going to train our people on how to utilize leverage and share payment options because you have to have that skill It’s no different than the sales skills, but it’s a skill. I’m not just presenting what you offer as far as products and services, but it’s also how do you share the money so that it makes sense.

So, let’s take a deeper dive on each one of these. Utilizing multiple payment plans, uh, payment options, and, and platforms. And so, utilizing that means deploying multiple lenders and, uh, for, you know, for the cost of those lenders, right? Because some of the plans have a dealer cost. There’s also multiple different plans as far as APRs and length of term, as well as approval rates that you get through multiple lenders.

And that varies all the time. They change their programs, you know. Throughout the year, their cost structure throughout the year and their approval rates throughout the year. Things are tightening up right now that are out there in the market. And so, we need to have multiple resources at our disposal, not just one, through our manufacturing.

Because that is getting tighter and tighter. The ones through the manufacturer right now are getting really tight out there. So I’m going to share with you, uh, a platform where you can still get over 90 percent financing approvals. Various levels of reduced APRs, meaning the, uh, you know, the annual percentage rate of interest, uh, with varying terms.

We want to have different levels of those rates and different lengths of those terms, too. Uh, uh, because I’m going to show you how you can bake that into your pricing in here shortly. So we want to have long terms, at least up to, you know, 20 years, some of your lenders will offer, you know, 10, 15, 20 years with a low annual percentage rate, and that’s going to allow you to get the lowest payment possible for your customer, because that’s what you want to lead with, not just the 0%.

I’ll talk more about that later, right? No interest and or low, low interest and no payment options. Deferred payments and deferred interest options. Revolving plans, I talked about that because there are revolving and there’s close in. And so approval on a revolving plan is where they don’t just approve you for what you’re asking for.

They approve, approve you for as much as you qualify for a closed end deal. If you get approved for just what you’re asking for, the nice thing about a revolving plan is that, uh, they have what is called the open to buy. And so if you don’t use all the financing where you start to pay down the financing, then you can work with your lender to say, okay, what of my customers out there?

They maybe financed the system or something a year or two, five years ago, have money still left open on their account. And your lender can give you access to that and then you can market directly to those people and allow them to maybe buy something else. So maybe you sold HVAC this time around, maybe some generator or water heater or air quality stuff the next time around.

Then there’s also what I like to call leasing, uh, but it’s a form of renting if you really think about it. But you rent or lease to own and then you can buy it out at the end of your term So you want to have a lender that offers that that allows a customer to stay liquid keep their cash on hand And pivot and have the freedom of life that they desire and what you’re seeing is that Millennials and gen z’s really are buying into the leasing And once it kind of catches market fire, uh, it will catch fire with kind of all the other generations too.

So you’ll also want to make sure that you, uh, you tap into a local bank, maybe it’s your bank or a credit union, because there, sometimes you can help a customer refinance their home or get a mortgage and they can get better rates by opening an account on file with the bank and have a direct debit from their account.

And so sometimes you can kind of work with your local vendors because their community chat, uh, charter. requires them to give back to the community. And so if you work with them and set up a plan and say, Hey, here’s what we want to tap into, uh, then what they might do is work with you directly. To help those people that don’t get approved and maybe have a day or two on their credit They’ll get through your financing to help you Get them approved because obviously heating and cooling is innate as is hot water and power if you’re doing generators So you want to make sure you train your people to offer payment options to improve the customer experience You want a regular review what’s available in the marketplace and update your plans because like I said the rates change the terms change the approval rates change And so you want to make sure you have, uh, you know, the latest, greatest thing.

And I always tell companies, you know, review this program at least once or twice a year. You want to make sure you make it easy for customers to get pre approval if they want and have a web application right on your website, or you can do phone approvals as well. Some of your lenders do that. And then you can leverage innovation and payment technology to drive purchases.

And so some of us had some lenders that had applications on our phones or our tablets. And so, uh, web apps and payment options like that allow you to be transparent and have maybe one point of application, but get access to a myriad of lenders. I’ll show you, share one of those with you here shortly. You want to make sure you appeal to all buyer types, right?

A credit, B credit, C credit, uh, those who are looking for a credit card, those who are looking for leasing, and all the different credit profiles, like I said, to get those approval rates maximized. And then choose your payment partners that help you to grow, right? That they’re working with you, that you’re not squeezing you and making life difficult for you.

Because again, when credit gets tough for them, they get tough on you. So what do we have to do? We have to make sure that we appeal to all the buyer types that are out there. Of course, you know, the cash buyers, they have the cash, they’ll pay upon completion, right, give you money, or they’ll give you a check upon completion.

We don’t have to worry about those, but we need to make sure that we let people know that, yes, of course, we accept checking, uh, credit, excuse me, checking cash upon completion. Most people don’t do it that way, um, but that’s the way I leave it, and I’ll talk about that in the last segment. In addition to that, we have to appeal to the crashes buyers.

They may have the money, but they’re hesitant to write the check. And so that’s where we offer, uh, free payments for 12 months and you know, 0 percent option for 12 months Then you have the, uh, the people who want to use other people’s money. They may or may not have the cash. And so you offer them to do same as cash, right?

SAC. And that’s where we can offer equal payments. There’s no fee for the consumer. Obviously, there’s a dealer cost to you with all of this. And of course, those people can also use credit cards. And we’ll talk about leveraging credit cards a little bit later. But even Warren Buffett, true story, financed his system 36.

He bought an Amana system for his home in Nebraska and he basically said, I’d be a fool not to use something else. How do you think I got so rich? Is what he said to the, uh, contractor who sold the system. And I met that contractor who sold that system. Payment buyers, they want or need the lowest monthly payment tag.

And that’s going to be the large, uh, largest chunk of your base. It should be when you get good at this. And if you basically are saying, all my customers pay cash. Exactly. All your customers. There’s a lot of people who would do business with you if they saw that they could and could afford to do it.

Okay. We also have to appeal to the credit challenge. Okay. These are the people that, uh, you know, they’re not going to get approved on the, you know, the best plans. So they basically, uh, are about 30 to 40 percent of the market out there and they don’t get that a lender, right? They get turned down. So you need a second look.

We’ll look at the B, C, and D paper. You also have to appeal to those that want to take advantage of leasing, right? And so some people are not committed to that, you know, to living in the space, let alone basically spending all their money for something that they know they’re probably not going to stay in for 15 to 30 years with a 30 year mortgage, right?

And so living in this shared economy, what we call the sharing economy, gives people the flexibility through leasing or renting to some extent. Um, flexible life with the freedom to have the life that they desire by leasing it. I don’t have to come up with any of the money and you cover all of the costs for everything for, let’s say 10 years.

I get my new system, all parts of labor covered for 10 years. All maintenance is covered for 10 years. All filters are covered for 10 years. Humidifier pads, UV light bulbs, everything is covered for 10 years. I don’t have to think about anything except a small monthly payment and a lower utility bill.

That’s the beauty of leasing. And then at the end of 10 years, I can buy it out, or if I decide to sell the house, I can disclose it, transfer the lease to the home buyer that’s buying the house, or I can just get a new system and pay the new small monthly payment. So, lots of flexibility there on leasing.

The cool thing about payment options is it allows customers to overcome what we call cash separation anxiety. And in this economy, everybody is being advised to hold on to your cash. Yes, the dollars are less, and yes, people are making the runs on the banks. That’s why people are holding on to their cash.

But if I need something, I want to hold on to my cash. But I need something, I got to, I got to take advantage of some way of getting it. Well, I also have to tie up my own credit. You’re making money available to me. That’s the beauty of financing. Optimist right here at EGIA gives you all of those things and more with 90 percent plus approval ratings.

So I highly suggest you look into Optimist financing. I’ll give you the website right there to kind of take a look at that. And they can get you set up quick and easy and get you basically a tool that is seamless. Soft credit pull up front, right, doesn’t ding the customer’s credit report, and then gives them the program that they will be approved at, like I said, 90 so, instead of them experiencing getting shot down and feeling bad, or you feeling bad, and that’s sometimes a little awkward.

I don’t have time to teach you how to handle that, but we do teach you that through the sales training here at EGIA. Uh, Optimist results in fewer of those terminals. So that’s going to always feel better for you and better for the customer. So, number two, work into your marketing, right? So what do I mean by that?

Well, number one, include payment options in your marketing for all buyer types, like we talked about in the previous section, right? All buyers, let people know that you have payment options against 0 percent as well. Uh, and we don’t need to talk about credit cards, but you could put a credit card into your marketing as well.

That should be on your website, that you accept credit cards. But you’re also going to promote buying with no money down and as little as X dollars a month. And I’ll show you how we do that here shortly. We’re also going to mention how by doing a small monthly payment, it can be offset by what you save in energy repair costs.

And so we talk about that right at the finance. And that way you get what you want today, and then you can let the time the utility company helped to pay for it. Because I always ask the customer, you know, how do you, how do you pay utility bill? They say on a monthly basis. I said, well, most people basically like to pay for what uses the energy on a monthly basis as well.

And that way we can take some of that money that you’re already pushing over to the utility company out of their pocket and put it to work for you. I mean, once you have a stock in the utility company, they’re getting a dividend. I mean, why don’t you take the money away from the utility company and put it to work for yourself, right?

That way you don’t have to pay for this. At the very least, what you save in Energy Repair Plus, not only offsets the investment, but it always covers the fee to borrow the money. So in essence, it’s a free loan. And we can incorporate that into our headlines, the buying copy, and what we call a Johnson box.

A Johnson box is a box that was created by this guy named Ron Johnson years ago, uh, for marketing. And it highlights in the marketing piece in a box, some bullet points of what you get. I’ll give you an example of all of this here momentarily. And so here’s a headline with a subheader in a letter that most of my clients do every year.

We provide to you an EGIA in the marketing mastermind that we do. And so get a new heating and cooling system at our cost and possibly for the last time. And it says subheader and you can buy with no money down pay as little as 47 a month net out of pocket, right? Because that’s going to be after energy repair cost savings or you can get 0 percent interest for 36.

Okay, and you also get a bunch of incentives worth 20, uh, 2, 300 and change. Now, I’ll show you what that means momentarily. In the body copy of the letter, it’s a two page letter. In the body copy of the letter, I have this, uh, language in there that highlights that and spends, uh, explains, excuse me, Uh, what the payment options are, right?

And so, you know, it was as a $121 a month, uh, as far as the system, uh, was gonna be, uh, gonna be the system for $121 a month. But that was before we applied the energy savings, you know, to the plan. And when we basically showed the customer in the, uh, the letter, uh, it basically becomes a net out of pocket at $47 a month.

And they can also basically take another plane if they want and not pay a dime in interest. So we promote both because we’re appealing to both audiences And then we also basically highlight again how energy repair cost savings cover that in the red copy. And so that’s a portion of the letter. The letter is, like I said, two pages of detail.

And then here’s the Johnson box. So Johnson box basically takes what we’ve said in the letter towards the end of the letter and highlights it in bullet points. And again, we highlight the financing right in the Johnson box. because that’s kind of just summarizing everything. So they read through the letter.

They now see the summary. And again, we highlight that. So it draws them to a conclusion. And then right after this box is what we call the call to action.

Awesome content right there. As always, be sure to share this on Facebook. And if you’re not a member, click the button below to get a 30 day free trial, give you access to all of our amazing content. Well, that’s our show for this week, folks. We’ll see you soon. Until then, bye bye for now.

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