Every business owner needs to find ways to operate efficiently and within their budget. Doing that can be particularly difficult if you own a small HVAC business, since you need to juggle the financial, operational, and customer service aspects of your business and may not have the means to hire someone to handle these things for you.
Here at Select Funding, we partner with HVAC business owners every day to help them get the business financing and equipment financing they need to achieve their most important growth goals. If you’re struggling to streamline your operations, here are seven ways to improve operations for your small HVAC business.
How Do You Measure the Success of an HVAC Business?
What are some of the metrics you can use to measure the success of your HVAC business? Here are a few things that may tell you whether your business is on the right track.
Sales Revenue
One of the most straightforward measurements of success is your annual sales revenue. If you track your revenue each month, you can make accurate predictions of your annual sales. You can also track year-over-year numbers to measure your growth.
Gross Profit Margin
While annual revenue is important, there’s an argument to be made that measuring your gross profit margin is an even better indicator of success. If you’re not careful with spending, it’s possible for your revenue to increase while your profit margins decrease, so we suggest looking at both. You can calculate your gross profit margin by subtracting your total cost of providing services from your sales revenue, and then multiplying that number by your sales revenue X 100.
Customer Retention
It costs far more to acquire a new customer than it does to retain an existing one, so it makes sense to track your customer retention as a measure of success. You can calculate your customer retention rate by taking the number of customers you have at the end of the period you’re measuring and subtracting new customers acquired during the same period. Divide the resulting number by the number of customers you had at the start to determine your customer retention rate.
7 Ways HVAC Business Can Improve Operations
There are many ways that HVAC companies can improve their operations. Some directly involve operations while others focus on areas that can impact operations. Here are seven to try.
#1: Manage Your Cash Flow
There’s no denying that proper cash flow management is an essential element of HVAC company operations. If your cash flow isn’t properly managed, you may find yourself struggling to pay your regular overhead expenses and completely unable to invest money in business growth.
You can improve and even out your cash flow by obtaining small business financing. With enough working capital in place, you won’t need to worry about paying your operating costs and you’ll have the cash on hand to pursue your growth goals with advertising or new hiring.
#2: Prioritize Staff Onboarding and Training
The operational efficiency of any company is largely dependent on having skilled employees who have the training necessary to do their jobs well. Employee training and onboarding might not be inexpensive but it can have a huge impact on your operations and growth.
One of the best uses of small business financing is staff training and onboarding. You can use the funds you receive to put a robust onboarding program in place. You can also use it to pay for existing employees to attend training sessions and keep their certifications up to date.
#3: Create a Positive Company Culture
Company culture is underrated when it comes to its impact on operations. When you take the time to create a positive company culture, your employees will feel appreciated and happy to be at work—and that flows through into every aspect of your business operations.
A positive culture can come from creating a pleasant office environment, making sure employees have the tools and equipment they need to do their best work, and improving employee retention. Considering how expensive it can be to hire and train new employees, it stands to reason that creating a culture that supports and nurtures employees can help you improve your operations, as well.
#4: Invest in HVAC Business Software
HVAC business software can help you with every aspect of running your business. While there are general business management software options to consider, your best bet is to invest in software that has been designed for HVAC companies.
You can use your small business equipment financing to do everything from creating work orders and invoices to tracking employees’ time and running your marketing campaigns. Whether you choose to have software installed or elect for a cloud-based option, having all the tools you need at your fingertips can work wonders for your efficiency.
#5: Create an HVAC Business Plan
You may have created a business plan for your HVAC company before you began operations, but when was the last time you revisited it? A lot of business owners think of a business plan as a one-time-only endeavor but regularly updating your business plan can do a lot to improve your operations.
Your business plan should include information about your business goals and how you intend to achieve them. You can use it to identify business processes that should be automated, outline your marketing strategy, and identify new service areas or customers to pursue.
#6: Focus on Customer Service
Good customer service and efficient operations go hand in hand. It might seem backward, but if you focus on providing your customers with a streamlined and enjoyable experience, it will actually require you to look at your operations and procedures and improve them with the customer experience in mind.
Ideally, your customers shouldn’t need to wait to get a quote from you, wonder when you’re going to show up to do the work they’ve requested, or be in doubt of when they’ll receive your invoice. By addressing the most common needs of your customers, you can also streamline your operations. Best of all, focusing on customer service may also help you get more referrals and increase your revenue.
#7: Document Everything
One of the most common operations issues in any business, including HVAC, is a tendency to develop business processes without documenting them. A lack of documentation can lead to inefficiencies even with experienced staff and make onboarding new employees a nightmare.
If you have multiple people doing the same tasks, you can start by having each person write down their process, step by step. Then compare and work to develop the best and most efficient process, documenting it along the way. Before long, you’ll have efficient business processes that are easy to teach.
How Can Small Business Financing Improve HVAC Business Operations?
A lack of adequate working capital can make improving operations difficult because each one of the seven improvements we’ve suggested above requires money to initiate. That’s where small business financing can come in handy. At Select Funding, we provide two types of financing for small HVAC businesses.
Small Business Financing
Small business financing can be used in a wide variety of ways to improve your HVAC business operations. We provide financing up to $1,000,000. You can get approved in just a few hours and get funded in as little as 24 hours.
Small business financing may be used to hire and onboard new employees, market your services in a new service area, pay for employee certifications, and even meet your ongoing operating expenses including payroll, rent, insurance, and utilities.
You can also use small business financing to even out your cash flow, removing some of the stress of running a small business and providing the breathing room you need to pursue your growth goals.
Equipment Financing
Equipment financing can also help with operations because when you have the equipment you need, your HVAC business can run smoothly. Select Funding provides equipment financing in amounts up to $1 million and you can get funded in as little as 24 hours after you’ve been approved, far less time than it takes to get equipment financing from a traditional lender.
Equipment financing may be used to buy HVAC software to streamline your operations. You can use it to upgrade your office computers and other equipment, buy the best tools for your HVAC professionals to use, purchase HVAC trucks for your business, or even redecorate your office space with new furniture.
Obtaining equipment financing can do a lot to streamline your operations, particularly in the area of customer service. Using up-to-date software and tools can improve the customer experience, helping you retain more customers and attract new ones.
Get the Working Capital You Need to Improve Operations at Your HVAC Business
Even the most diligent business owner can run into trouble if they lack the funds to improve their operations. We’ve provided you with seven ways to improve your operations and we’re also here to provide the small business financing you need to adopt them.
Do you need working capital to improve your HVAC business operations and fuel your business growth? Select Funding is here to help! Click here to learn about our HVAC small business financing and apply today.
