HVACR Business

DEC 2017

Help hvacr contractors master the critical components of business management.

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We sat down with Ken Goodrich, owner and CEO of Goettl Air Conditioning. Recently, Goettl made a $10 million investment on a mixed-use building that will become its headquarters and state-of-the-art technician training center. Goodrich discussed growing up in the industry, the art of acquiring companies and the need to give back to the community. 1. How did you get started in this industry? I was recruited by my father, at the age of 10, to hold the flashlight for him while he worked on air conditioners. By the time I was old enough to drive, I was proficient as an air conditioning technician and ran service calls. 2. Is this what you always wanted to do? No. I grew up in Las Vegas and it can be miserably hot on those roofs. I decided that wasn't the way I wanted to make a living, so I went to college and got a degree in finance. When I interviewed for finance jobs, I'd get offers that were half of what I was making in HVACR. I couldn't wrap my head around making half the pay, so I just decided to start my own business and go with what I knew. 3. So, you actually started your own company? About the time I decided to return to HVAC, my dad fell ill and passed away. I purchased the business from my mother, it was called Racee Air Conditioning. I went to work on building an enterprise rather than a family business. 4. How did that business evolve? Over the next 10 years, I had my struggles learning how to run a business and understanding how to implement business systems and processes, as well as creating management teams and leading people. Eventually, I built a fairly successful company, which attracted an HVACR industry consolidator in 1997. 5. What did you do next? I sold the company and worked for them for a couple of years. Being a part of a larger company exposed me to operating processes, acquisition strat- egies and new perspectives on how bigger business is done. I was intrigued to see if I could take that knowledge and apply it to another company. 6. So, you started another company? In 2001, armed with my new-found perspective, I started putting some businesses together in Las Vegas and Phoenix, and we grew sizeable in those markets. We had five locations and ended up selling them to the same buyer as last time, in early 2008. I became the division vice-president, then the president of the Western Division for several years, when the opportunity presented itself to purchase Goettl Air Conditioning. It was something I could not pass up, as Goettl has been a part of my career since I started. 7. What intrigued you about acquiring Goettl? Goettl was the brand of the first air conditioner I shined the flashlight on for my dad when I was 10-years-old. Goettls were designed to operate in the high ambient temperatures of the Sonoran and Mohave Deserts. So, when I was growing up and learning the business, my dad installed Goettls. 8. How many businesses have you acquired? In my career I've acquired 60 or more businesses. In my latest venture, I have acquired four, one in California, and three in Las Vegas. We currently have branches in Las Vegas, Phoenix, Tucson and Corona, Calif. 9. Are there more plans to grow? Yes. We're aiming to significantly increase our footprint throughout California. Our next move is toward Sacramento, and then going further into Los Angeles. We're in what they call the Inland Empire, Riverside County area, which is hot weather. But, we want to expand that office to service further towards the coast and the L.A. county border. 10. How do you ensure you're not too big? I'm the guy who says, "Okay. We can go now" or "We need to slow down a little bit", and it's all based on performance metrics. We count 22 things every single day. We talk about the cause and the effect of why those numbers are right or wrong, and what to do about it. If we're not routinely hitting those metrics, we slow down and regain our focus. 11. What's the key to acquiring a company? e number one thing you have to start with is leadership — leadership inside the branch or the business. Usually, when I find struggling companies, it's because they're struggling with management. 12. How do you fix that? We establish a culture of achievement, customer service, accountability and teamwork. We create that culture, and then we accelerate the performance of the business. If I had to break it down to one thing, its leadership. 13. Once you install leadership, what's next? You have to find the talent. is is one of the key reasons for the new Goettl University, because we're not only going to train our technicians and installers, we're going to train our next management teams. Leadership skills and management skills will be part of our curriculum. 14. How are you setting up that curriculum? We've recruited two industry trainers and they're currently preparing the curriculum for all the key, basic understandings of the trade, and repairing and installing air conditioning systems. We've also taken that to the next level whereby we're really close to being done McDonaldizing our business. 15. Can you explain that? We have every repair, every type of installation documented — pictures and a training curriculum on each and every one of them, so that we can bring a guy in who has some experience, and then we're going teach him to build a Big Mac our way, so to speak. 16. Can you tell us about your sponsorship at the College of Southern Nevada? When the economy was down in 2008, they were looking at programs to cut out, and the HVACR school was one on the chopping block. I really respect the head of the program, Dennis Soukop. He's put out some great people and done so much for the industry, I couldn't let the program fail. I created a $250,000 endowment to basically show the college and the governor that the program had meaning and supporters. 17. What else has Goettl done to help the school? We've also done an endowment for $100,000 to help veterans who graduate from the program. It gives them their first set of tools of the trade. ere are two other scholarships: one is the Son of a Gun Scholarship which you're eligible to receive if you're the son of a contractor and want to learn the trade. 18. Why is it so important to give back like that? It's incumbent upon all business owners to give back to the communities in which they earn their livings. It's also an effective way to rally your team around things other than the business to create a good work environment. If we rally the team around giving back to the community, helping the veterans or helping the homeless, it builds a stronger team. 19. How important is a company culture? It's everything. Culture is one of the key elements to a good turnaround. It's the leadership and the culture. 20. How do you ensure you're getting the quality you expect from your team? I clearly defined who we are and communicated that to the team. I defined our vision and our mission, and we established best practices to achieve these things. We also developed a culture of accountability to ensure we delivered an outstand- ing customer experience each time we are in a home and we motivate our team to achieve our goals. 22 HVACR BUSINESS DECEMBER 2017 www. hvacrbusiness .com QUESTIONS >> with KEN Goodrich 20

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