Who knew that a nursery rhyme could teach us good business? Which rhyme? The one about an untenable balancing act:
Humpty Dumpty sat on a wall. Humpty Dumpty had a great fall. All the king’s horses and all the king’s men couldn’t put Humpty together again.
The HVAC business lesson? Assess your risks before you take on a challenge. Humpty didn’t. One business expert called the egg a “serial risk taker” whose lack of foresight about the wall and his defiance of the odds scrambled his enterprise for good.
Now, about your HVAC enterprise . . . What do you risk by adding geothermal installation to your line-up of services?
FINDING THE RIGHT BALANCE WITHOUT CRACKING
If making a list of pros and cons helps you decide, we’ll get you started on the pro side. Here are eight good business reasons for expanding your operation to include geothermal systems.
- Diversification of Services – Extreme air temperatures drive the demand for conventional HVAC services. Summer and winter see an uptick in work; spring and fall see a downturn. In contrast, geothermal heating and cooling relies on the earth’s stable and consistent temperature. It knows no season. The result? The demand for geothermal installations remains relatively consistent throughout the year.
- Energy Cost Savings – Consumer interest in saving money is always high. Energy.gov reports that geothermal systems cut consumer energy bills up to 65%. The long-term energy cost savings makes geo an attractive investment for homeowners and businesses.
- Tax Incentives – State/provincial, local, and federal tax incentives and rebates help today’s home and business owners afford this renewable energy. The current 30% federal tax credit made possible by the Inflation Reduction Act incentivizes homeowners to opt for geothermal heating and cooling.
- Competitive Advantage – Offering geothermal installations can set your HVAC business apart from competitors who don’t provide this service. The result? You gain a competitive edge in the market . . . and the market is growing. Precision Business Insights valued the geothermal heating and cooling market at $9.5 billion in 2022. They project a growth rate of 7.5% between 2023 and 2029.
- Higher Profit Margins – The specialized nature of geothermal installations means fewer competitors in the market. The demand for specialized skills can allow geothermal installers to command higher rates for their services.
- Long-Term Customer Relationships – Geothermal systems do require some maintenance and servicing. This provides opportunities for long-term customer relationships and recurring revenue.
- Energy Independence – Described as “inflation-proof,” geothermal systems reduce a property’s dependence on fossil fuels. They give homeowners greater energy security and insulation from fluctuating energy prices.
- Environmental Responsibility – A growing segment of today’s consumers are mindful of the environment and the need for renewable energy. The high efficiency of geothermal systems leverages this appeal for “eco-friendly” solutions.
By adding geothermal heating and cooling installations to your HVAC business, you can increase your revenue while you position your business as a forward-thinking and environmentally responsible service provider in the industry.
DON’T FORGET YOUR HELPERS
Oh, one more thing . . . the nursery rhyme tells us that Humpty had a network of helpers at his disposal, “all the king’s horses and all the king’s men.” IGSHPA’s membership of leading geothermal industry experts can help you too.