by Richard Harshaw
What should an HVAC contractor be able to expect from the sales rep who calls on him or her from his major brand supplier? I will, in this article, paint a picture of what a superb sales rep should be able to do for a contractor.
First, a superb sales rep (I’ll use the acronym SSR from here on out to save my fingers some wear and tear on my keyboard) knows that you create the pool of profits from which everyone in this business drinks. You, of course, derive your livelihood from what you do, but so does that sales rep and the company he works for. The factory that supplies that distributor with equipment depends on the profits YOU generate. The suppliers to the factory (metals, refrigerants, motors, etc.) depend on those profits too.
Because of that, an SSR will focus all of his or her efforts on you and your business. An SSR will be so devoted to you and your success that his employer may sometimes wonder who he works for—you or the distributor! An SSR will go more than the extra mile to help you and your business succeed. Because of that, an SSR will learn this trade so he or she may help you in EVERY area of your business.
An SSR will possess strong business skills, helping you develop and write a marketing plan that will help you generate leads, and then help you learn how to convert those leads to appointments and then to sales at high margins, keeping your installers busy almost all year and attracting the kind of business you are looking for.
An SSR will help you write a business plan that will help you grow safely and strongly for years to come.
An SSR will help you find, hire and keep excellent installation and service talent so you have the people to do the jobs you need to do quickly and right the first time.
An SSR will call upon you often enough to be a key partner in your business, but not so often as to become irritating, and will always be just a phone call away, 24/7.
An SSR will know his or her product line inside and out, frontwards and backwards, and will know how to help you apply that product line to any job you encounter.
An SSR will be a good communication conduit between the factory and distributor and you, passing vital information up and down the line as needed to keep all parties in sync and productive.
An SSR will be a leader among leaders, calling out and developing the best in you and your management team.
An SSR will be a team player, throwing the ball when asked, blocking when required, even carrying the water, all to help you score big.
In short, an SSR can be one of the most important elements in your successful business and will only fully enjoy his or her success when you enjoy yours.
If that is the kind of sales representative you have calling on you, thank your lucky stars. If it is not, maybe it’s time to look around and try to find one.
It really does take two to be Number One!
Question from last month’s readers to Mr. Harshaw:
Question: Where do loans go?
Mr. Harshaw: A loan is a liability so it goes on the BALANCE SHEET. But repayment of the loan is a cash flow issue, and it gets tricky on how to score that on the INCOME STATEMENT (or P&L to some folks).
Because a loan is money that is not yours, when you pay it back, the repayment of the PRINCIPAL goes on the balance sheet as you shift the liability to a paid-off asset over time. But the INTEREST is YOUR money and so it must be reported on the Income Statement under your Overhead section.
Example: You borrow $20,000 to buy a new truck. So, you record $20,000 under “Long Term Liabilities” on the balance sheet. Now, in year one, you pay the lender $7,000 in payments—let’s say $4,500 in interest and $2,500 in principle. You would record a reduction of $2,500 on the balance sheet under “Long Term Liabilities” and an expense of $4,500 under Overhead on the income statement. You would also increase the value of fixed assets by the amount of principal you retired. Each year, the amount of interest drops while the principal repaid goes up until, after 4 years (in this example), the loan is repaid—the Long-Term Liabilities no longer has an entry for Toyota Financing.
Does that clear it up for you?
Send questions for Mr. Harshaw to LLACKEY@AC-TODAY.COM