Increasing Profitability Through Energy Services

1. Increasing Profitability Through Energy Services A Comprehensive Program To Deliver Energy and Sustainability Services

2. Increasing Profitability Through Energy Services

3. Module 5: Closing the Service and Retrofit Sale

4. Field level-set • Are you feeling pressure to cut or cancel some agreements? • Are you seeing new competitors? • Are retrofit payback periods compressing? • Owners more skeptical than ever? “I never used to have to sell”

5. I’m way under quota Just landed a big one! “A salesman’s motivation is determined by where he/she is on the panic-euphoria continuum.” - Harry Archung, EMCOR Mesa Energy Services Euphoria Panic

6. Do you understand what your customer is going through? • Vacancy rates approaching 20% nationally • Commercial refinancing: $800B in 2 years • Tremendous pressure to cut costs • FMs and PMs feeling the heat • Canceling and cutting PMAs

7. Where do they turn? • BOMA: BEEP Program - 30 low cost ways to improve efficiency • HVAC version at the webinar page: airadvice.com/lp/msca_webinar

8. What Is BOMA “telling” them? Top 5 HVAC low cost items: • Adjust temperature control & schedule • Adjust ventilation • Reduce after hours usage of HVAC & lighting • Optimize start-up time and equipment sequencing • Adjust dampers

9. To close, you need to understand… • - Who decision maker really is • - What is their pain? • - What are you really selling? • A differentiated service • (or) • A commodity How you can change the buyer’s motivation and decision criteria

10. OK, there is plenty of pain…got a cure? They need help addressing their pain

11. The doctor is in…. Reduce energy costs through your PMA’s

12. Using Energy Service Agreements to renew & close service and retrofit business

13. Set the bar higher for your competition Modifying PMA scope to ESA scope WILL reduce utility bills

14. Why do people buy PMAs? • Habit? • They know they should? • Kind of like auto maintenance, every 3-5k miles What if you were told that oil change could increase your gas mileage by 10-20%?

15. PMAs - How do you differentiate today? • Better trained techs? • Reputation? • Tools? • Price? If it has worked in the past will it work in the future?

16. What’s an Energy Services Agreement (ESA)? It includes all the stuff you do today, plus… • It provides an Energy Star rating for the building • It establishes an Energy Usage Index for the building • It identifies controls issues • It identifies low cost ways to improve performance It addresses the decision maker’s pain!

17. Silver Program Current PMA program Energy Star Benchmark Gold Program Utility bill analysis Outdoor temperature T, RH, CO2, Lighting measurement Utility bill reduction report Executive summary Seasonal ESA Scopes of Work (Examples)

18. New service offering matrix

19. Real-world sales scenario • Prospect in Denver looking for PMA • Owner occupied • Dealing with Facility Manager • 3 bids

20. Building Profile • Operated 80 hours/week • 97,992 square feet • Heating System: Electric Resistance • Domestic Hot Water: Gas • Economizer: Yes • Cooling System: DX / Packaged Unit • Utility Bills: $175k electric, $3.7k gas

21. The service provider’s strategy • Change buying criteria • Offered Benchmark at no charge • Used to educate FM on offering • Gained better understanding of the bldg and pain points • Competitors went “business as usual” Bought the Gold Package

22. First Gold Report • Benchmark results • Sensors • Low cost/no cost list

23. Time-based Sensor Data Lighting Temperature Carbon dioxide

24. Energy conservation measures identified • Temperature control • Temperature schedule • Ventilation control • Lighting schedule • HVAC controls • Lighting control strategy Provided clues regarding VFD replacement

25. Gold Report outcomes • Built credibility by identifying real savings • Identified retrofit opportunities resulting in: • Small labor and equipment opportunities • Potential larger opportunities • Service provider used report to get to owner Drove the need for an audit to get to ROI

26. Audit Results

28. Audit Report results • Simple payback • Cost of doing nothing--Larry

29. Tools • Data loggers • Report generator • Outdoor weather data feed • Energy Star™

30. Pricing strategies are a function of • Strategy: • Cost recovery vs profit center • Retrofit lead generation • Nature of additional work uncovered • Targets: Customers up for renewal vs prospects • Marginal cost analysis • First to market

31. Why Energy Services? • It’s in the middle of your fairway • Small modification to current PMA model • You already have priced-in a truck roll • Change the buying criteria • Renew and get new service agreements • Justify retrofits Differentiate

32. Next webinar:

33. Next steps, additional resources Visit airadvice.com/lp/msca_webinar for downloads: • Scope of Work samples • Top Low-Cost/No-Cost Energy Saving Measures, HVAC version

34. Next steps, additional resources Look for email in 1 day with link to webinar site: • Recorded version of this webinar • Info and articles for download • Register for upcoming sessions

35. Next steps, additional resources Want help incorporating energy into your service agreements? Call us or send us a service agreement. • Call Meagan Crowder at mcrowder@airadvice.com or call 303-954-8613