Sheet metal & Air Conditioning Contractors’ National Association

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Stay Profitable in an Unstable Economy

Jul 18, 2018

 

George L. Welsch 250x253

When asked how his firm is preparing for a cyclical downturn in the economy, SMACNA member George L. “Butch” Welsch told The ACHR NEWS magazine, “The most important thing we have done to prepare for a recession is to change the mix of our business from predominantly new residential construction to only 30 percent new residential construction, and 70 percent service, replacement, and architectural sheet metal.”

Welsch Heating and Cooling doesn’t do an overall price increase when it sees a recession coming because of its volume and the fact that many of its customers are existing customers or come from referrals, he explained.

Mr. Welsch added that he teaches a class on the HVAC business where they study the effect of volume and pricing. “One of the points I make is as your volume decreases, you need to raise your prices to avoid losing money. Unfortunately, when work slows down, many contractors tend to lower their prices.” Read the full article here...