Online Sales Killing Our Trade!!

[goldpau]

Here is the scenario: -

Customer asks us for a quote, we carry out site survey and quote installed system at say £1000, customer says yes interested can we send them some manufacturer specs, we email them specs and here it comes: -

err, we can buy that system for £350 on the internet - why you trying to rip us off? - charging us so much to install it - what a rip off!

we then explain that they are getting 2 qualified a/c engineers, our engineers have been on the particular manufacturers training courses, they will get 3 years warranty, we have running costs to cover (van, wages, diesel, insurance, office staff, now refcom membership, ongoing training to keep up to date with qualifications - all soon adds up!)

customer simply not interested - all they see is they can buy the system for £350 and want it installed for £100 coz well that is a reasonable price isnt it??

to further make you sick - customer then says well i can also buy an installation kit to install it (pipes, insulation, flarer, pipe cutter, electric cable etc)- it says they're easy to install (the same website offering the system is offering this easy diy install kit) so i will do it myself or ask my plumber mate to do it for me - not paying your rip off prices!

we then explain, its now illegal for you to do it yourself, you dont have the training, you dont know what your doing, you dont have a vac pump, you dont have pressure testing kit etc etc

in the end we dont get the job as their builder mate will do it for them instead!

so we have all no doubt come across this before, but in the last 2 months the amount of people doing this has gone through the roof, last year we probably had 3 people do this, this last week i have had 6 quotes all do this - really dont know what to do!!

It really doesnt help that some websites are selling all manufacturers systems (Mitsubishi, LG, Hitachi, Samsung, Toshiba, Fujitsu, Daikin) and selling them direct on crap margins (after all they dont need to hold stock as the wholesalers do it so they can afford to simply make £100 on the sale)

where does this leave us - the air conditioning companies??

not sure about everyone else but we have had a hard 18 months, we rely on the summer rush for installed work and rely on the profit we make on those systems in those 12 weeks to help us out when we install next to nothing in December / January - costs are always increasing (diesel, insurance) yet our margins are decreasing,

my uncle used to work on a/c in Spain for the last 15 years, 3 years ago the supermarkets started selling the systems at silly prices - is this the way we are going?

whats the answer?

you cant not give a customer model numbers / spec sheets as they just look on the manufacturers website and work out which model they need, they then find them cheap online then question why we have quoted so much to install it

anyone else noticed this has become a real problem?

sorry for the rant just really p**ssed off this week as had 6 quotes do this and had enough!

[goldpau]

and when will someone (government) stop internet sites from selling systems advertised as diy install (albeit with 5m of pipework) when the installation instructions tell them to purge the pipes and vent the refrigerant into the atmosphere which as we all know is illegal - we had one idiot who asked us to repair his system as he had realised he had vented all of the refrigerant in the system into the atmosphere when he was purging the pipes (he thought he had to wait until he could hear no more hissing!) - enough simply isnt being done - we have all had to pay for refcom membership now in order to stay 'legal' when some sites are selling systems advertising them as easy install and advising customers to vent refrigerant into the atmosphere - what a JOKE!

[Gary]

Life is change.

There are those who are reluctant to change. There are those who try to stop change.

Nonetheless, change happens and those who adapt survive and perhaps prosper.

That's life.

[Gary]

and when will someone (government) stop internet sites from selling systems advertised as diy install (albeit with 5m of pipework) when the installation instructions tell them to purge the pipes and vent the refrigerant into the atmosphere which as we all know is illegal - we had one idiot who asked us to repair his system as he had realised he had vented all of the refrigerant in the system into the atmosphere when he was purging the pipes (he thought he had to wait until he could hear no more hissing!) - enough simply isnt being done - we have all had to pay for refcom membership now in order to stay 'legal' when some sites are selling systems advertising them as easy install and advising customers to vent refrigerant into the atmosphere - what a JOKE!

Are you really expecting government to save you? Each new bit of legislation adds to your costs, driving up your prices, widening the gap, making online sales more profitable for both seller and buyer.

[Frosty]

I agree, it's a joke. Experienced engineers now have to gain F-Gas accreditation, but joe public can walk into Costco and pick up a DIY A/C unit charged with HFC refrigerant. Ok, the units come with quick coupling connections, but they are still charged with HFC refrigerants -the units surely have to be installed by F-Gas registered engineers...

[coolments]

Life is change.

There are those who are reluctant to change. There are those who try to stop change.

Nonetheless, change happens and those who adapt survive and perhaps prosper.

That's life.

So true.

Yes its crap and i used to say not interested thanks to people who bought there own kit and wanted it installing or fitted it themselves and it didnt work, now i dont turn any one down especially in the current climate and have took a few of these on.

Way I see it is these people are a whole new breed and type of customer who up untill recently was never there and didnt consider AC as its too expensive, and I know if I go out and sort there F**k ups out it will be ok when i leave.
It may not produce enough profit for flash motors but it puts biscuits on the table in the hour of need, most of them bend over backwards for you, mounting the indoor and outdoor unit, knocking the hole through the wall, Etc, thinking it will save a bit more money, with a bit of negotiation you can make easy money and get a maintenance contract out of it, or you can tell them where to go and get nothing, either way they are not going to buckle and some one will do it for them their way.

The heating guys have been putting up with this for years, people buying gas fires, fitting them in them selves then asking for it just piping up now i geuss our time has come also to do it or lose out in this new section of our market.

Lets face it, its usually domestic people or small business owners that do do this, you dont see the big spending customers at it,,,,, yet.....!!!

[desA]

Life is change.

There are those who are reluctant to change. There are those who try to stop change.

Nonetheless, change happens and those who adapt survive and perhaps prosper.

That's life.

The issue is that this new paradigm conflicts directly with the conventional business model & its profitability. Not quite sure what a workable solution would be, or how the OP could survive if much of his existing customer base is biased this way.

Perhaps time to move into a different market segment & leave the DIY folks to fix their own problems. The margins for repair/fix must be very low.

[Andy W]

I have installed many diy systems just to fill in a couple of hours and to pay for my hobbies, I too do insist that the customer mounts everything and puts the hole in ready and I will do the rest, I have another to do next week.

I went out to an enquiry recently after some one had found me while searching for Fujitsu on the internet, she must be very interested I thought, I had a quick measure up and worked a rule of thumb price out there and then and she said it was way too expensive, she can buy it from e bay and will I tell her what bits she needs a draw up a parts list!

Regarding Refcom and diy systems, there is a Refcom registered company selling diy systems and renting out vac pumps, the sooner all system's are supplied without a charge of refrigerant the better, we should be pushing for this now, a small step forward.

[goldpau]

the problem we have is that we generally have a crap Summer and it doesnt really get hot for that long, whilst yes the heating guys have taken a hit on profits their business is an all year round business, lets face it our AC businesses arent all year round businesses - from my companies perspective we are lucky to get a few jobs over the Winter months (whilst yes we do get jobs such as refurbishment jobs, server room jobs we certainly arent busy with new work) as i said in my previous post we rely on making the money in the Summer to see us through the long dark Winter of maintenance work, that is how it has always been and until it warms up (prob not in my lifetime) that is prob how it always will be here in the UK!!

im not after a fast nice new car, at the moment its about surviving and paying the bills, We have already had to make 2x AC engineers and 1x office staff redundant, an AC engineer commands approx £30k a year, if this carries on the way it is £25/£20k a year is realistic in a few years time as people will just want installation only prices as they will buy the systems directly themself on the internet

i take the note on this mainly being a problem with smaller customers but this week a large big spending client whinged about our prices when they found the Mitsubishi models we quoted cheap on the internet, lets face it joe public dont appreciate the training, manufacturers training and on going training we AC guys go through, soon the phone will ring and it will be

'hello, we have an air conditioning system which we would like fitting, how much do you charge to install?'

then its just a case of cheapest price gets the job!

[rude]

stick to the service game and fix all the stuff ups by these ppl who think they can install them. Its easier money to be had and you not hanging off a drill all day making penetrations.

[Gary]

Things change.

There is an enormous amount of free information online. The vast majority of it is crap, but the newbies don't know that.

In any case, you can just imagine what this has done for book sales. Everyone wants information for free these days. That's just the way it is.

That's life.

[Magoo]

Sign of the times Iam afraid to say, Joe public can buy them at the local hardware store, cheap as chips and interest free terms. They always have a freind that install for naff all.
I make a dollar when system fails, and not polite with charging them as well.
Reset trips through Japan, splits come with carry straps and can be purchased from the grocery supermarket, there is granny packing here groceries and a split system in her car.

[Jethro Bush]

I'm interested to hear you say yours isn't year round wor. Is there not a domestic heat pump market in the U.K.?

[multisync]

This is where the regulations will help. The day's of Split bashing has long gone. The Japanese de-skilled it years ago and the Koreans drove the margins out. Hence an unskilled trade and low prices.

We need to try to force the split market to tighten up by ending quick release fittings, units come uncharged, no flares, no B&Q. (kinda like the old days for those old enough to remember ?)

[Gary]

While your at it, why not have fridges come uncharged?

[philfridge]

We would do the same ourselves to save a few quid , so you can't really complain you've just got to deal with it. I'm afraid that's how it is now. Anyone who says they don't search for the best prices is a liar.

[Gary]

This is where the regulations will help. The day's of Split bashing has long gone. The Japanese de-skilled it years ago and the Koreans drove the margins out. Hence an unskilled trade and low prices.

We need to try to force the split market to tighten up by ending quick release fittings, units come uncharged, no flares, no B&Q. (kinda like the old days for those old enough to remember ?)

If you can somehow kill the online sales of mini-splits, the public will go to self-contained systems. You are NOT going to win this war even if you manage to win the battle by betraying your neighbors.

Stop trying to ruin things for everyone else and find something constructive to do.

[AbsoluteWDJ]

Life is change.

There are those who are reluctant to change. There are those who try to stop change.

Nonetheless, change happens and those who adapt survive and perhaps prosper.

That's life.

I couldn't agree more.....Reason and common sense has to prevail. Everyone shops around online to gauge a price on whatever item they wish to purchase.....If you believed split a/c would be any different.....Adapt!

[multisync]

While your at it, why not have fridges come uncharged?

Because they are self contained hermetic units.

[multisync]

If you can somehow kill the online sales of mini-splits, the public will go to self-contained systems. You are NOT going to win this war even if you manage to win the battle by betraying your neighbors.

Stop trying to ruin things for everyone else and find something constructive to do.

Firstly You do not understand our market yet suggest you can predict what is/will happen. Secondly and far more importantly It's interesting that someone who sells training is against engineers being certified as trained..Perhaps because your training isn't one of the approved ones...Sour grapes ??

[Gary]

Because they are self contained hermetic units.

Why should that stop you? If they came uncharged, people would be forced to use your services. Isn't that what you want?... a license to steal?

[al]

Embrace it as another oppourtunity, you don't need to install them maybe just offer a commissioning service? pressure test and vacuum, fixed price? hourly charge to repair any leaks or faulty units? We're probably not too far from someone offering multidecks with remote condensers and flexi lines in between..............

al

[The Viking]

Kids, Kids, KIDS!


Please stop these silly personal attacks or your spades will be taken away.
If you don't behave you will not be allowed to play in the sandpit anymore, you might even have to play on the swings with the girls!

[Gary]

There have always been DIYers and contractors have successfully competed with them. What has changed? Government mandates, regulations, licenses, fees, micro-management, taxes and more taxes... to the point where contractor's costs have gone through the roof and they are looking for ways to survive. All in the name of environmentalism.

Government is the problem, not the solution. Governments everywhere are killing our trade.

[desA]

This thread does seem somewhat ironic.

On the one hand you have government squeezing the contractor to death with over-regulation, on the other hand, the end-user can purchase, install, pollute & everyone supports them wholeheartedly in the name of so-called free-market principles.

Something seems amiss, all round.

[multisync]

Why should that stop you? If they came uncharged, people would be forced to use your services. Isn't that what you want?... a license to steal?

The government -EU- has now made it illegal to work on refrigerants without proper training.
Refrigerators however are deemed hermetics (see the DEFRA website for explanation of the regulations) hence fridges are not within the regulations as they stand.

Within the regulations it states unlicensed people should be prevented from working on refrigerating equipment if coming into contact with the refrigerant. Much is the same way we are allowed to work on a gas boiler unless we are going to interfere with the gas side.

Hence fridges should come pre charged -as would window rattlers- but not splits.

I have gone to a self install to find the flare nuts finger tight. This would have been a 'preventable refrigerant loss' if he was prevented from 'self installing'

The law may well be an ass but I support this one and shall continue to do so..

[multisync]

There have always been DIYers and contractors have successfully competed with them. What has changed? Government mandates, regulations, licenses, fees, micro-management, taxes and more taxes... to the point where contractor's costs have gone through the roof and they are looking for ways to survive. All in the name of environmentalism.

Government is the problem, not the solution. Governments everywhere are killing our trade.

It's all a conspiricy

[multisync]

This thread does seem somewhat ironic.

On the one hand you have government squeezing the contractor to death with over-regulation, on the other hand, the end-user can purchase, install, pollute & everyone supports them wholeheartedly in the name of so-called free-market principles.

Something seems amiss, all round.

Des,

Indeed we can go two ways.
1 Forget about regulation and go back to the good old days of venting etc
2 Increase the regulations to include the self installers etc

I'm happy for either but not as you say this half hearted effort..

[littleyapper]

it's time to use your institute of ref get them to explain to the government about the diyer's ... i think the laws are for equip above 3kgs of gas so we are powerless below that... but canvas the government .. if nothing else they are looking for more revenue and they might just tax those type units....

[Animal]

I was explaining FGas to a Electrician I know, he knows a bit about Refrig and "Dabbles" He was telling me that it was all rubbish and he could carry on doing what he wanted, I sent him a web link so he could take a look, this was his reply
"food for thought mate looks like cost a packet for the course

bought 2 bottles of gas today 9 kgs 404a £55 and 10kgs 134a £70 no questons asked if i had a ticket"

How will it stop if anyone can walk in to a wholesalers and purchase Refrigerant?

[Gary]

it's time to use your institute of ref get them to explain to the government about the diyer's ... i think the laws are for equip above 3kgs of gas so we are powerless below that... but canvas the government .. if nothing else they are looking for more revenue and they might just tax those type units....

You shouldn't help your duly elected thieves/dictators, as it just encourages them. There is no greed like government greed.

You want the government to tax and control the DIYers (for your own personal gain). Taxes increase revenues while enforcement increases expenditures. What you end up with is maximum taxes and minimum enforcement.

[goldpau]

DEFRA ****S IT UP AGAIN!!

Why oh why have Defra awarded another companiy (Quidos) approval to control F Gas certification as well as Refcom??

Yes i understand competition is good, should lead to lower prices but this is turning out to be a joke!!

Gas people used to register with Corgi, they lost the license so now they register with The Gas Safe Register - one company makes it nice and simple, customer knows what to look out for everyone knows where they stand

Why is F Gas being treated differently? More than 1 registration body is only going to confuse everyone!!, the wholesalers of the refrigerants are going to be confused, the end user is going to be confused and wont understand - errr are you Refcom registered? No Sir we are Quidos registered - What the??

What is wrong with DEFRA?? USELESS!!

This is supposed to tighten up our industry and make people aware (with Gas make sure they are on the Gas Safe Register, with A/c / Refrigeration make sure they are Refcom registered) but it is fast becomming a joke!

No i am not in any way affiliated with Refcom - i just think this is seriously stupid!

[goldpau]

Yes i know about Part P and the fact there are several registration companies out there (NICEIC, Napit, BSI etc) but what have this lot really achieved?

Before anyone starts, my A/C company is an NICEIC Approved Contractor and NICEIC Part P Domestic Installer, i would probably estimate that 80% of domestic customers dont ask about Part P (when i enquire they say they dont know about Part P),

Part P has been in since 2005 so 4 years later and 80% of domestic people i come across dont know about it, whereas the 1 registration body for Gas (Corgi, now Gas Safe Register) has worked with nearly everyone knowing about it

My point - this whole exercise of F Gas is going to be a waste of time! Defra had a chance of aligning our trade with the same regulations as Gas but by awarding multiple registration bodies they have in my opinion truly ****ed this up!

[AbsoluteWDJ]

The wise man (Gary) from across the pond is speaking common sense. I think it was Jefferson who said ' A government big enough to give you everything you want, is strong enough to take everything you have.' I think this is the same for alot of Institutions as well! Try not to rely on them.

[Prince Vaillant]

OK here goes, i enquired a while ago about wholesalers being registered first with refcom to allow ground roots filtering of refrigerant sales, basically stopping joe public from gaining access to the refrigerant market. Refcom were not interested i feel because there wouldnt have been as much money in it, ie if wholesalers were only able to sell to an individual possessing a simple gas handling certificate this would end the problem. However after contractors spending money gaining gas handling certification and now refcom certification there is still no measures in place to stop refrigerant being sold over the counter to anyone, surely us as responsible wholesalers should be first i n line to police the dilution of our industry?

Crash helmet and earplugs now in place!

[airefresco]

It´s quite common here for people to buy splits in DIY stores here. In my mind, you have two choices. You can complain about it or embrace it.

What I have found is that many people won´t buy the units from shops without first getting a quote from a company. When you do the survey never mention a price. Tell them that you need to do the calculations or whatever in the office and you will forward a quote later. You should also mention (discreetly) that the units in the DIY stores are cheap rubbish, you can sell them the same thing and give a warranty and installation, but you would recommend that they don´t go that route.

Offer them a ridiculously low price on the same type of kit, then offer them something like Daikin or whatever. 70% of the time you will sell the Daikin, because people will question why it is 2 or 3 times more expensive and realise in the long run they are going to be saving cash. If they don´t then you put the cheap rubbish in and make 100€ or something. At least you make something out of it.

As for the people who do but the units and just want the installation. Then do it for a reasonable price and you´ll get it. Even if you charge 200€ say for one unit. They tell friends etc and it´s steady work, granted for not much money, but it´s better than nothing.

The thing that´s killing the trade is the over-the-top regulations. Why do you need to isolate the outdoor unit? Why do you need pressure test a system that only has 2 flare connections? I´m sorry but none of those are things are required for domestic installs. Bigger stuff yes, but not 2kw wall mount with 3m pipe.

You can´t buy isolators here and I have never ever once seen a nitrogen bottle here either. It´s just not done.