Mr. HVAC Contractor, “It’s the Economy Stupid”

The other day in an effort to practice what I preach, as well as to give the professional contractors a first opportunity, I requested a quote from a local HVAC contractor (who does not know me) to replace my current 12 SEER Air Conditioner with a new 14 SEER (R410a) Heat Pump System.  The fact is I can pick up the phone and call a couple of contractors that will be happy to do my install for time and material, but I feel that I owe it to the all-inclusive contractor to at least see if he is within a reasonable range.This turned out to be an interesting test.  Let’s face it, I report the stories of others and from time to time, it is a good idea for me to wade into the pool to get a dose of reality myself.When Mr. High Profile contractor came to my home, I explained that I am wanting to make a change and then proceeded to explain to him that with economy as tight as it is, I really wanted to do this on a very tight budget.  He understood and started measuring my home and existing ductwork.  He told me that he needed to ask me some questions to determine my “True Need”.  I knew what was coming and played along.  He first launched into the “What is important to you” questions.  I always find that one funny, because, let’s face it, Comfort, Reliability, Value, Personal Health, really, which one of those are you going to say NO to?  The point of his quiz is to get me in the habit of saying “Yes”.  It is a sales trick as old as the hills.

Next, he started explaining the difference between the system that I have and the one that he was proposing.  He then gave me chapter and verse on the savings I will achieve and the payback ratios that follow.  I nodded and acted like everything he was telling me was magic.

Finally, we came to the quote, and before I tell you what it was, let me tell you what I currently am replacing.  I have a 12 SEER R22 2.5 Ton outdoor air conditioner and a 3 Ton Air handler with 15 KW of Auxiliary Heat.  I have a new Trion Air Bear Filter and BlueTube Germicidal UV light that can be reused.  I am aware that I will be needing a new lineset.

The quote was first delivered as “Your payment will only be $179 per month, if I can get that set up, can you live with that?”  Here was another request for a “Yes” answer.  Because, if I say “Yes”, he probably has me.  If I say “No”, then I feel bad that I can’t make a $179 payment.

So now I have to explain that I want his “Cash” price.  As an insult to my intelligence, he takes his quote page and writes $179 x 60 mos = $10,740 and then says, “If I can come down to $7,800 would you sign tonight so that we can get started tomorrow?” BTW… his quote included their “new super duper” filter assembly.  I asked him why I could not use my existing filter and was told that it was “Not Compatible”.  You have no idea how hard this was for me to control myself.  I then asked him if he remembered the part of our conversation where I said I was concerned about the state of the economy and wanted to really go basic if possible.   He proceeds to tell me that he has only offered me their most basic system and if I was interested he would be glad to show me the upgrades.

I finally had to peal him off of my leg and tell him that I would need to get back to him.  He told me that if I was unable to commit this evening, he could not guarantee this price.  Again, you have no idea how hard it was for me to contain myself.

Now, let me tell you the reality and the back story to this event.  I have located and purchased the Heat Pump System that I wanted and paid $2,922. and have solicited the services of a local contractor to replace my unit for $1,000.  Before I go on, let me explain that $1000 to you.  My contractor has offered to do this replacement at that price and his logic was that it will take two of his employees 8 hours to complete this change-out.  He charges $40 per hour per man for installation.  That comes to $640 of labor with $360 of incidental cost built in.  The reality is that he pays his employees about $17 per hour for their time.  That means that his actual cost is about $375 with benefits included.  That means that this contractor will make about $400 for his 8 hour day for this project. That is $50 per hour and that is reasonable.  I have a total of $3,900 invested and saved $3,900.  How about that?  50%, right on the nose.  When was the last time you took an evening and made $3,900?  When was the last time you invested in a market and got a 100% return on your investment?

Folks, these are not easy financial times.  The very fact that there is a trade discipline that would try to separate you from your very hard earned money during these hard economic times just screams “Wrong”.  As you go forward with your projects and in many cases you are not making these purchases because you “want to”, but because you “have to”, know that there is relief out there in the form of direct purchase and project control.  You may have to be a little pro-active and flexible, but always remember, when it comes to “Your” project; “You” are the one in control.

Mr. HVAC Contractor, don’t take it personal.  It is not “The Economy” it is “My Economy!”