To the homeowner whose furnace or central air conditioner has died, the Heating, Ventilation, and Air Conditioning (HVAC) industry can feel like a confusing stew of acronyms and specialized terms. How the industry is organized and who is responsible for dealing with equipment failure can be hard to figure out. This article introduces the different types of companies in the industry and identifies the role that each plays in responding to consumer concerns.
If you drew a diagram of the HVAC industry in the United States, you would see its $32 billion in annual revenue split among three types of companies: manufacturers, wholesale distributors, and contractors. Homeowners are generally most familiar with manufacturers (big brands such as Trane, Carrier, and Lennox) and contractors (the dealer who installed their heat pump or the local contractor that serviced their furnace). Most homeowners are probably least familiar with wholesale distributors who play an important role. To get the highest level of support for a recurring heating or cooling problem, you need to understand how the three kinds of companies work together.
HVAC manufacturers design and assemble the equipment that heats and cools most homes. Their brand names (and their customer support phone numbers) are backed by substantial advertising budgets and pasted on the equipment itself. Following an equipment failure, homeowners often turn to those numbers first. However, because heating and cooling systems are “applied sytems,” satisfactory functioning of the unit is determined not only by the quality of the equipment but also by the quality of its installation and maintenance. As a result, the manufacturers’ customer service lines typically only help homeowners with two tasks:
- They can tell you whether your unit is still under warranty;
- They can help you find a factory authorized dealer (heating contractor) in your area;
While this information is useful, it’s just a starting point.
There are an estimated 75,000 residential heating contractors in the United States, more than 90% of whom work in companies with fewer than 20 employees. The residential market (as compared to the commercial market) is attractive to these smaller companies for two reasons:
- service and maintenance is a more predictable and steady source of revenue than new installations;
- profit margins tend to be substantially higher on residential service and retrofits than on new installations. (source)
Despite the impulse to call the manufacturer in times of trouble, your installing dealer or another licensed heating contractor is the true starting point when your furnace or air conditioning system fails. But if it fails repeatedly (especially early in its life), ask your contractor to get your distributor’s field service rep involved. If they won’t, the manufacturers’ customer support staff may be authorized to provide you with the field service rep’s contact information upon request.
Distributors buy heating equipment wholesale from the manufacturers and resell it to dealers and contractors within a geographical region. A region may encompass part of a state or several states. A single distributor will typically specialize in a few “lines” of equipment, such as Carrier or Trane, but they will not carry all brands. With a few exceptions, distributors are independently owned businesses; while they work closely with the manufacturers, they are not owned by them.
Many of the larger manufacturers and distributors have dedicated employees who provide technical support and training to dealers and handle warranty and other consumer complaints. These employees go by various names, but “field service representative” and “technical service coordinators” are commonly used. Field service reps may be employees of the manufacturer or they may be employees of the distributor. In the worst cases of equipment failure, they work with the installing dealer and the homeowner to troubleshoot problems, document service history, and when necessary, escalate issues to the manufacturer. The field service rep typically has substantial industry experience and a job description that includes maintaining the manufacturer’s brand image. As a link between the manufacturer and the customer, the distributor wants you to be happy.
Where does the buck stop?
Responsibility for equipment failure is shared between the three types of companies. If you have a serious recurring problem with your HVAC equipment, it is critical to get your local field service rep involved. This person has the relationships (with local contractors and the manufacturer) and the mandate to find a resolution to your issue.