Podcast Summary: To The Point - Home Services Podcast
Episode: Smart Pricing Strategies to Help Grow Your AC Company
Release Date: January 14, 2025
Host/Guests: Chris, Chad Peterman, Travis Rinky, Patrick Kelly
Produced by: RYNO Strategic Solutions
Introduction
In this episode of To The Point - Home Services Podcast, host Chris welcomes a unique lineup of co-hosts, including Chad Peterman and Travis Rinky, to engage in an insightful conversation with Patrick Kelly, President of Sano—a burgeoning HVAC company poised to reach the $5 million mark by the end of the year. The discussion delves deep into Patrick's journey from military service to entrepreneurship, emphasizing smart pricing strategies, sales techniques, and effective operational management to foster business growth.
Patrick Kelly's Background
Patrick Kelly's multifaceted background is a cornerstone of his business philosophy. A former Marine Sergeant, Patrick served two tours in Fallujah, Iraq, honing discipline and resilience that later translated into his civilian career. His athletic prowess extends to Brazilian Jiu-Jitsu, where he achieved a black belt and competed at high levels, including a second-place finish in the 2017 Pan American Games.
Notable Quote:
Patrick Kelly [00:00]: “A lot of people need to listen to the customer more... providing options that make the most sense to what they want is going to make you pretty successful.”
Transition from Military to the HVAC Industry
Upon honorably discharge in 2009, Patrick faced the daunting challenge of reintegrating into civilian life amidst an economic downturn. Initially insecure and skeptical about job opportunities advertised on platforms like Craigslist, he landed a position with Service Champions—a prominent Southern California HVAC and plumbing company.
Notable Quote:
Patrick Kelly [11:01]: “I did work technically at a gas station, but it was a car wash, auto spa.”
Sales Strategies and Achievements at Service Champions
Patrick's tenure at Service Champions was marked by rapid growth and sales excellence. Starting with no prior HVAC experience, he mastered the technical aspects while simultaneously excelling in sales. By leveraging mentorship from seasoned sales professionals like Sean Stevens and Jim Dotson, Patrick refined his ability to guide customers through the sales funnel effectively.
Notable Quote:
Patrick Kelly [21:39]: “...always communicate in a way to kind of herd the homeowners to the finish line.”
Patrick's dedication paid off as he consistently won monthly and annual sales awards, driving significant revenue through strategic upselling and exceptional customer rapport.
Transition to Management and Challenges
After a decade at Service Champions, Patrick recognized the limitations of his role as a sales technician and sought to move into management. Partnering with Victor at Absolute Air, Patrick took on the role of Sales Manager, overseeing a team that scaled operations from $2 million to $9 million. However, he faced challenges in backend operations and data management, prompting him to seek further growth opportunities.
Notable Quote:
Patrick Kelly [27:29]: “...I didn't know what a GM was supposed to do... but we sell. Sold the heck out of calls.”
Starting Sano and Implementing Smart Pricing Strategies
The onset of the COVID-19 pandemic catalyzed Patrick's decision to establish his own company, Sano. Initially focused on maximizing installation volume by undercutting competitors, Patrick quickly realized that this approach was unsustainable. By shifting his mindset to prioritize quality over quantity, he adjusted pricing strategies to reflect the superior service and installations his company offers.
Notable Quote:
Patrick Kelly [35:59]: “I changed my mindset to, to not just looking to do as much work, but to do quality work that's good for the customer and good for us as a business.”
This strategic pivot allowed Sano to increase revenue while reducing operational strain, facilitating the acquisition of additional resources and expanding the team with highly skilled professionals.
Maintaining a Competitive Edge
Operating in a saturated Southern California market, Sano differentiates itself through personalized customer service, exceptional installation quality, and strategic pricing. Patrick emphasizes the importance of staying within one's lane and focusing on delivering unmatched value rather than directly competing with larger conglomerates.
Notable Quote:
Patrick Kelly [40:27]: “We stay in our own lane... we get very personal with our clients, we really listen, we really take care of them and we do good work.”
By leveraging competitive analysis and continuously refining marketing strategies—including increased ad spend, enhanced online presence, and community engagement through platforms like Yelp and Wrangler magazines—Sano maintains its relevance and appeal in a challenging market.
Building Company Culture
A pivotal element of Sano's success is its strong, intentional company culture. Patrick underscores the significance of supporting employees' personal and professional growth, fostering a collaborative and positive work environment. Hiring a capable General Manager, Patrick ensures that operational and analytical aspects of the business are managed effectively, allowing him to focus on strategic growth.
Notable Quote:
Patrick Kelly [48:29]: “Having two of us here, like, it would be cool to hang out with a guy like that. But when it comes to business, I needed somebody that was the opposite of me.”
This approach not only enhances operational efficiency but also cultivates employee satisfaction and retention, contributing to the company's sustained growth and reputation for excellence.
Future Plans and Growth
Looking ahead, Patrick plans to capitalize on data-driven insights by fully integrating Service Titan for comprehensive reporting and performance tracking. This initiative has already yielded a 14% increase in maintenance memberships, demonstrating the effectiveness of targeted metrics and continuous performance monitoring.
Additionally, Sano is expanding its fleet and increasing marketing investments to drive further growth. By maintaining a focus on quality, customer satisfaction, and strategic expansion, Patrick aims to propel Sano beyond the $5 million milestone.
Notable Quote:
Patrick Kelly [43:59]: “We're finally going to go into a year with data that allows us to drive this business as to where before. It’s just, you know, we get what we get and to do the best with it.”
Conclusion
Patrick Kelly's journey from Marine Sergeant to HVAC entrepreneur exemplifies the power of discipline, strategic thinking, and unwavering commitment to quality. By implementing smart pricing strategies, fostering a supportive company culture, and leveraging data-driven management, Patrick has successfully navigated the competitive Southern California market. His story serves as an inspiring blueprint for service industry professionals aiming to scale their businesses sustainably and ethically.
Final Notable Quote:
Patrick Kelly [56:12]: “Everything I've done, competitive wise, was always to be the best... I'm willing to put in the work.”
Key Takeaways:
- Customer-Centric Approach: Actively listen to customers to tailor solutions that meet their specific needs.
- Quality Over Quantity: Prioritize high-quality services and products, even if it means handling fewer transactions.
- Strategic Pricing: Adjust pricing strategies to reflect the value and quality offered, ensuring sustainability and profitability.
- Data-Driven Management: Utilize comprehensive reporting tools to make informed business decisions and track performance.
- Strong Company Culture: Foster a collaborative and supportive work environment to enhance employee satisfaction and retention.
This episode offers valuable insights for home service professionals seeking to implement effective pricing strategies and operational practices to drive business growth sustainably.