Matt Kemp is the general manager of the Advanced Products Group (APG), a division of Aireco Supply, Inc., which is responsible for servicing the engineering and mechanical contractor communities involved in bid/spec and design-build commercial HVAC/R projects in the Washington D.C., Maryland and Virginia markets.
The world of Variable Refrigerant Flow (VRF) is bigger than ever. At last count, we’ve identified at least 22 different manufacturers and resellers of VRF. This increasingly large world can however be a double-edged sword.
The good news: Manufacturers indicate that VRF is resonating within the marketplace. More manufacturers also equal more demand for projects utilizing the technology, which translates to a growing opportunity to close sales. The projects we are seeing now are changing in both size and scope. VRF is no longer being treated like a niche product and is increasingly being used as the basis of design as a total building solution.
The bad news: With manufacturers entering the VRF arena creating competitive pressure, market share will be difficult to capture and maintain.
The rising demand for VRF technology also attracts contractors looking for new ways to grow their business and increase revenue. Contractors entering the market without the necessary training or experience can have far-reaching effects. Improper VRF installs and poorly performing systems reflect negatively on the technology as a whole and can threaten industry growth.
As the world of VRF grows, we must grow with it. To keep VRF headed in the right direction, I see a few key strategies coming to the forefront:
- The industry is only going to get bigger; make relationships. As additional VRF manufacturers enter the marketplace, relationships become more important. The quality of support and training are the two largest differentiators among manufacturers; we need to make the most of these. The ability to train locally with effective and experienced technical personnel will set us apart from the rest of the field.
- Focus on energy efficiency. VRF manufacturers will continue to increase efficiencies, and as national and regional standards tighten, the ability to simultaneously cool and heat especially in shoulder months (with only 2 pipes) is a market-changer. We need to stress this feature of VRF to our customers.
- Stay away from value-engineering. With the sheer number of manufacturers, many blend together. Companies are trying to stand out by offering not necessarily the best product or the best design, but the cheapest price. As a result, we’re seeing value-engineered projects where the technology is misapplied or under-sized, ultimately leading to an unhappy customer who may face a costly fix.
- Educate the marketplace on the cost of copper. There is a misconception that more linear footage means higher copper costs. Copper is sold by weight so linear footage isn’t the sole determinant of cost. Mitsubishi Electric’s 2-pipe, small-diameter soft copper pipe runs can account for a significant material and labor savings over their 3-pipe competitors. Knowing and educating your customers’ estimators to this fact will improve your close rate and help your customers be more profitable!
How are the rest of you navigating the increasingly busy waters? Let us know in a comment below.