Welcome to IAQ Series #1The IAQ Business Model

Your Hosts for Todays Conference are:Gary Elekes in Nashville, Tennessee

Gary Oetker in Plano, Texas

Conference Objectives:

Review IAQ fundamentals in regards to sources of indoor pollution, solutions to IAQ problems and the business opportunity this represents.

Review the elements of the IAQ Business Model.

Review IAQ fundamentals and the IAQ business environmentReview IAQ business opportunityReview sales and marketing approaches to IAQ Review IAQ business measurements and recommendationsReview implementation of IAQ business modelAgenda for Conference

YesterdayLoose Homes & Natural VentilationIAQ Solutions Total Comfort & Duct CleaningToday Energy Conservation / Tighter HomesPressure Problems In HomeNew Technology & Improved StandardsGrowing Concern About Liability & LitigationThe FutureNew Construction TechniquesWhole House Approach to IAQOpportunities for Contractors to GrowIndoor Air Quality

Americans spend 90% of their time indoors50% of this is within their homeIndoor air pollution is 2 to 5 times worse than outdoor air pollutionHealth AffectsRespiratory problems50 million Americans suffer from allergies60% of all allergies are caused by mold12 million Americans have asthmatic episodes yearlyAsthma has tripled in the last 20 yearsIndoor Health

Biological ContaminantsPollenHouse Dust MitesMoldBacteriaVirusesPet DanderCombustion PollutantsGaseous PollutantsOther Sources such as Radon and AsbestosIndoor Air Pollutants

ContaminantsSporesEnzyme FilamentsToxic GasesTo Grow & ThriveDirt/Organic MaterialMoisture/HumidityIll effectsHealthStructural Damage to HomeMold

Humidity ProblemsOversized Cooling SystemsMismatched Indoor Coil (particularly with on high efficiency equipment)Pressure ProblemsLeaky ductworkLack of Return AirPoorly Designed Air Distribution SystemPoorly Installed Air Distribution SystemHVAC Contractor Practices Affecting IAQ

Pollutant Categories

BioaerosolsVolatile Organic Compounds (VOC)

Particulates

Source ControlEquipment CleaningDuct CleaningDuct RepairDuct Renovation

Cleaning the Air (Filtration)Various MERV Rated Air CleanersHEPA Filtration SystemsGermicidal LampsIndoor Air Solutions

VentilationFresh Air Intake HRVERV

Humidity ControlDehumidifiersHumidifiers

Indoor Air Solutions (cont.)

Various Methods of Air FiltrationGermicidal LampsVarious Methods of Ventilation (including HRV & ERV)Duct CleaningTesting & Diagnosing IAQ ProblemsDuct Repair & RenovationAir BalancingOther Related Trades (Home Insulation & Renovation)

Applicable HVAC Products & Services

IAQ Growth Potential

Existing Comfort AdvisorsBundled With Equipment Replacement Separate IAQ Offer

Service & Maintenance TechniciansAccessory Sale

Dedicated IAQ Sales People & Installation People

Sales Approaches

Marketing to Existing Customers (service strategy)Technician Set Sales Leads Direct Marketing to Customer Base Acquiring New Customers (advertising strategy)Conventional Advertising & Direct MarketingSpecial Offerings Applicable to Both AboveAir Testing (I.E. AirAdvice) Other ConsiderationsPricingCompensationMarketing Approaches

Sample IAQ Price Sheet

INDOOR AIR QUALITY OPTIONS

Retail PackageMonthly Investment

PACKAGE 1 BASIC

DUCT CLEANING

$ 2121.00 $ 1803.00

$ 36.06

PMAC 20C HI EFFICIENCY MEDIA AIR FILTER

UV LIGHT

PACKAGE 2 - DELUXE

DUCT CLEANING

$ 2872.00 $ 2441.00

$ 48.82

HUMIDIFIER

PMAC 20C HI EFFICIENCY MEDIA AIR FILTER

UV LIGHT

PACKAGE 3 - PREMIUM

DUCT CLEANING

$ 3371.00$ 2865.00

$ 57.30

HUMIDIFIER

ELECTRONIC AIR CLEANER (APRILAIRE 5000)

UV LIGHT

PACKAGE 4 - SUPREME

DUCT CLEANING

$ 3841.00$ 3264.00

$ 65.28

HUMIDIFIER

PURE AIR (PC020) OR AMAIRCARE 4000 HV HEPA FILTER

INDIVIDUAL OPTIONS

Multiple items discount of 15% may be applied to custom packages.

HUMIDIFIER

$ 751.00DUCT CLEANING PER SYSTEM

UV LIGHT

$ 595.00UP TO 15 OPENINGS$ 581.00

ELECTRONIC AIR CLEANER

$ 1,250.00UP TO 20 OPENINGS$ 690.00

PMAC 20C HI EFF MEDIA A/F

$ 836.00UP TO 25 OPENINGS$ 764.00

PURE AIR (PC020)

$ 2,400.00UP TO 27 OPENINGS$ 947.00

AMAIRCARE 4000 HV HEPA FILTER$ 2,400.00OVER 27 OPENINGS QUOTE

HUMIDIFIER PMAC 20C UV CLEANSER HEPA FILTRATION PURE AIR

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Sample IAQ Technician Spiffs

IAQ and Accessories Spiff Schedule11/04/03

UV Cleanser/single

$125.00

UV Cleanser/dual

$100.00

Dynamic Air Cleaner

$50.00

4 Pleated Filter (MF120)

$50.00

Duct Cleaning & Sanitizing

$50.00

Air Handler, Furnace or Condensor

$50.00

(10 SEER Excluded)

Plus Agreement

$10.00

Addtl Plus Agreements

$5.00

Cool Cap

$10.00

Surge Protector

$10.00

Sales Lead

$50.00 plus 1% of system only sale.

(Complete System)

Complete Duct System

10%

(Not Misc. Duct Work/Repair)

Equiguard

6%

Separate Department or Division

Easy when IAQ is sold separatelySeparate Department Income StatementTechnician Accessory SalesDuct CleaningDuct Repair & Renovation

How do you handle IAQ sales that are bundled with equipment sales?Measurement Considerations

Parts/Material20%Labor18%Equipment 0%Allocated Fringe Benefits 7%Sales Commission10%Total Cost of Sales55%

Gross Margin45%

Direct Cost Model - Duct Cleaning

Gross Margin Percentage40% to 50% Depending on mix of products & servicesSome IAQ products cost as much as the HVAC equipment

Gross Margin Dollars Per Day$300 to $750 per IAQ Technician (depending on mix of products and servicesBusiness Recommendations

DiscussInvolve PersonnelConcludeGet Buy-In on DecisionsCommitAll Hands in Team GoalCreateIdea to reality stuff!ExecuteAccountability to do WorkFeedbackMeasurements & ReportAdapt PlanAdapt as Needed Start from the top againHow To Implement

Questions & Answers