Renewal Notice

by Katie Lee

When it comes to annual HVAC maintenance, are retailers getting what they pay for? Here is the experience of one large, national retailer.


When we think about heating and cooling, we often find ourselves only worrying about the HVAC units that support our facilities at two different times of the year. The first is when we see the invoices for preventative maintenance services, and the second is every time our systems are in need of repair. Oftentimes we view the preventative programs with the thought of trying to skip a year to save the expense. In most cases, we press on with the service and consider slashing the budget the following year.

Fast-forward 12 months and the same renewal letter comes for the same preventative maintenance program and the cycle continues. The thought that comes to mind this time is “Did the units get maintained during the year?” or “Am I getting what I am paying for?”

This annual routine is very common and many people continue to renew their preventative programs never really knowing if the work is being performed or without understanding what condition their equipment is in. Now, imagine a national retailer with thousands of sites going through the same process year over year, never knowing if the program they paid for was completed or if it was benefitting them at all.

HVAC3Recently, a large national retailer wanted to start a discussion regarding the state of its HVAC preventative maintenance program that was currently being done by another vendor. Over the past few years the retailer had no true sense of whether or not the preventative maintenance visits were being completed. Service calls were average in number, and the complaints seemed to be in line with their historical data, so there weren’t any red flags to suggest there might be a problem with the program. When the retailer began planning for the next contract they became concerned when the incumbent vendor was unable to provide the most basic information relating to the actual assets being serviced.

A new vendor was contracted to develop and manage a complete asset collection process and HVAC preventative maintenance program for 800 of the retailer’s facilities to identify how changes to its program may benefit the entire portfolio. Developing a program of this size usually starts with a complete review of the HVAC assets for all locations involved. However, since neither the retailer nor its current supplier was able to provide this data, the new vendor had no choice but to incorporate this asset collection as part of its initial assessment.

A program was developed for the retailer consisting of four separate but equally important components. First was the preventative maintenance portion of the program, including changing filters, cleaning coils, checking pressures and the general maintenance of the equipment.

From the preventative maintenance visit, the next three components fell into place. During the preventative maintenance inspection all asset information was collected and summarized for the retailer. This information provided them with a detailed report of all their assets and also served as a means to determine the final pricing for the complete preventative maintenance program. Also during the preventative maintenance visit, each unit was put back into operation and if repairs or replacements were needed to bring these units back to working status, they were priced and sent to the retailer for approval.

The last part of the program was to completely rank the overall condition of all assets to better understand what units were potentially in need of replacement.

Once the program was completely developed and the retailer gave final approval, the vendor began engaging both corporate and store level managers to officially roll out the program. Contacting the store level managers turned out to be a very important component, as it allowed technicians to get buy-in from the store managers so all parties were accomplishing the same goal. The managers were able to provide the optimal time of day and/or week to have the units serviced, which allowed the maintenance crew easier access to the store managers for check in/check out.

Once given final approval, all preventative maintenance work was completed in 8 weeks and it became obvious that the prior preventative maintenance program was not being monitored or completed properly.

The results of the program are as follows:

• Performed preventative maintenance inspections and coil cleaning for 800 retailer locations. The total number of units inspected was 4,062 (average of 5 units per location). 242 units were not working upon arrival.

• 231 out of the 242 units were in need of repair. Quotes were provided to the retailer and repairs were made within 5 days of inspection.

• 11 out of the 242 units were in need of replacement. Quotes were provided to the retailer and the units were replaced within 16 days of the inspection.

• Asset data collected from all 4,062 units was summarized and forwarded to the retailer. Each unit was given an overall ranking based on its condition.

• A review of the equipment ranking determined that 162 units should be considered for proactive replacement in the next budget year. Proposals for the replacement of these units were provided to the retailer.

At the end of the first year, an evaluation of the program was performed to identify the benefits of having an HVAC preventative maintenance program in place. It was clear that the retailer was experiencing many locations that did not have all of the HVAC units operating, which most likely lead to hot/cold spaces throughout the locations. Maybe not enough to create service requests from the store managers, but perhaps enough to result in a few uncomfortable sections of the store, which could alter the customer’s buying experience.

The retailer now has a complete list of all HVAC assets for these 800 locations, along with a prioritized list of units that should be considered for replacement in the upcoming years.

The reactive service calls from the stores dropped by 12% after the preventative maintenance inspections were performed. This drop was probably the most dramatic as the number of service calls in the last few years was considered to be average by the retailer.

John Haley is the director of HVAC programs for Ferrandino & Son, Inc. Email him at [email protected].

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