Am I getting overcharged or ripped off? Why is the top complaint about residential Air Conditioning and Heating companies PRICE? And how do we prevent it?
“Am I being ripped off?” An age old question. One that has plagued the contracting business since its inception. Probably before the Pyramids. The occasional (yet regular) news stories about air conditioning technicians or plumbers who provide false information to home owners doesn’t help the industry reputation. Over time these type of controversial newsworthy stories have naturally put people on edge with their local contractor.
Customer concerns are not without merit. The local A/C tech or plumber holds a lot of power as the professional. With the rise of customer review services, yelp, Google reviews, YP, BBB as well as the uprise in other social media platforms the cream has more or less risen to the top where most (not all) larger contractors tend to have a fairly stable honest staff. If you really look at those scary news stories about dishonest repair technicians you’ll notice most are NOT from well known companies and you could PROBABLY find negative reviews online with only an inch worth of research. Yes, at times even the best and most established contractor will make a mistake. We’re all human after all. The perfect diagnosis wasn’t made or they didn’t really hear all of the customers needs and therefore didn’t provide the perfect product resulting in some but not a lot of negative feedback about service. Compared to the whole of all that they service this would amount to very little.
Instead, if you look at the vast majority of complaints from established top contractors you’ll see a pattern. There will be many positive reviews with some scathing reviews that are not about service but about PRICE. Customers who get a repair on their home are likely to have charges ranging from several hundred dollars to several thousand depending on what is needed. The majority of people who receive repairs move on without giving ANY online feedback. No complaining and no rave reviews. This leaves a lot of power in the hands of those select few who do leave feedback as more and more consumers use online reviews to guide their buying. The overall pattern found in the negative feedback from those select few has a singular focus…… Its price.
The #1 complaint for mid-sized or large residential air conditioning and plumbing service companies is NOT about the service or quality BUT about PRICE.
So are all mid sized or large residential air conditioning and plumbing companies ripping off the public? Are their just a few loud wackos that always come out of the woodwork? ‘Internet trolls’ just having their way? What can be done to improve contracting companies’ reputations? What can be done to prove whether the industry is or is not ripping customers off?
A few problems here are that the industry is not commoditized. That is to say that there is no central hub for pricing. There is too much difference between companies and customer desires for this kind of radical change to level the playing field. We are not selling widgets. There is also an element of fear in a consumer especially when they have not worked with you in the past. The customer does not know what to expect. With repairs the final price for work is never discovered until after a proper diagnosis.
What should the residential contracting industry do to work against and prevent these complaints?
Here are my suggestions for how the industry could emerge from these issues. Transparency. This is going to sound crazy but I think it would help. If a customer asks about your cost. “Gee that sounds high?” Don’t dismiss the question.
Tell them up front exactly what the cost is and why. It doesn’t have to be down to the penny but I think saying something like “our price is $1,000 for the repair. Standard gross margin is 50% for this work. We then have to spend roughly 35% on advertising and overhead leaving us about 15% net pretax profit……. next?” This kind of clear bluntness is honest, forthright and hides nothing. People respect that. I’ve seen this done in the car industry and diamond industry. I’ve respected those companies that showed me the price that they bought my car and showed me what they paid. I’ve recommended those companies far more often than those that play shadow games.
At mission air conditioning, we will gladly show you the cost of our charges and provide the rational for how we run our business. Have you tried this in your business or have suggestions on how to present this info better? Shoot us a question or comment we would be glad to discuss.
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