Long lead times won’t last forever, will they?

Pre-Covid lead-times for applied HVAC equipment used to be easy. 6 to 8 weeks for some rooftops, a few weeks longer for AHUs and complex fan systems. COVID and supply chain craziness wrecked all that reliable supply. Now, a large HVAC supplier has lead times on products that look like elephant gestation periods! (18 months, google it)

Our Yaskawa line of drives has improving delivery dates, but still out from what they used to be, the reason? Tiny components! Chip makers have been catching up on demand that frankly caught them by surprise.

Yaskawa Drives for HVAC

We recently helped a chocolate factory with a drive problem, and sourcing a drive was trickier than usual, but we solved the problem. Thanks Yaskawa!

I hear from our suppliers in general that supply chain problems are getting better, and a year from now we won’t be talking about lead time problems. Until then plan ahead and expect the unexpected!

Recognition for a job well done

Engineered Systems magazine article photo

Congrats to the ACI Mechanical and HVAC team for their recognition as an Ambassador of Energy Efficiency. The award comes from engineers and contractors recognizing the contribution that our team has made. Recognition is my love language, just ask my wife Margaret!

We love helping building owners save energy, and our mission statement “Helping Building Thrive” says it in three words.

Selling products from stock works

Reznor unit heaters in Portland on our shelves

“You can’t sell from an empty wagon”, said Bob Nichols, the owner of Allied Refrigeration in Long Beach, CA told me when I was a young sales engineer at Johnson Controls. It was 1989 and I was blown away with this distributor’s high value, high service model. Bob passed in 2012, but his words stuck with me.

Part of the 40,000 square foot warehouse in Seattle

Thirty years later, as I get to make decisions with our leadership team about how to service customers, it is clear to me that being a hybrid manufactures rep and commercial HVAC distributor works. We increased our on-hand inventory over $1M as supply chain disruptions ran up the lead-times for products. It turned out to be a great idea to buffer longer lead-times with real on-hand products. We are selling more of nearly all of our products because we actually have it.

Thanks for the tip 33 years ago Bob!

#hvac #supplychain #customerservice

Why trade shows and trade meetings matter

I am always learning new things from others in the HVAC business. For example, at the SMACNA Annual Convention this week I learned a lot from Steve Taylor. He is probably one of the smartest engineers in our business. He balances practicality and energy savings with high building performance. Here is a slide from the conference where he aggregates the real causes of COVID transmission:

The words are smaller related to their actual transmission effectiveness, from Steve Taylor PE, Taylor Engineers

The summary: Vaccines work, and keep your distance if you can. Also, adding lots of outside air to a building really does not have any effect on transmission! This was a surprise to me, but his explanation of the science proved it.

My point of this blog is two fold,

1. If you don’t go, you don’t know. I was not expecting to learn what I did from Steve Taylor.

2. Relationships matter, we all know it, but going and talking with others in our commercial HVAC business helped all in attendance. Thanks SMACNA for an outstanding event.

Bob and Keith in their ACI Mechanical uniforms!

#smacna #hvac #taylorengineers #acimechanical

Positive review on growth in PNW, despite costs

Cle Elem river in Suncadia

Growth is happening at a quick rate in the Pacific Northwest. Natural beauty is all over the place. It costs more to live here, but people want to be around the mountains and water.

Microsoft, Amazon, Google, Boeing, and a host of others want to be where high quality employees can be found. We have seen high costs in construction, yet the work keeps coming.

Hermanson Commercial Construction Cost Index Q3 2021

Supply chain disruptions and steel prices contribute to the higher prices here, and expectations are the increase level off. My friend who leads a large retailer supply chain group says it might not get better until 2023!

At least I get to work through these problems in a beautiful place.

Mt Rainier from the road to Paradise

Supply chains and privately held companies in HVAC

Photo by Pixabay on Pexels.com

Who knew months ago that supply chains would be disrupted in HVAC the way we see today? It is not just HVAC. I ordered a replacement car last month for my leased car ending December 2021. The new car won’t arrive until December! Good timing.

Most of the factories we represent at ACI Mechanical and HVAC Sales are privately held, and had fewer product availability problems, than publicly held firms. In my opinion it is because private companies Like Loren Cook Co. and Price Industries are not afraid to have real inventory on hand. We stocked up on Gree Mini Splits and VRF last year, and it is paying off with customers buying our products, in part because we simply have the products on hand! We just sold out of all of our 50 foot line sets, just because we had them.

Gree Mini VRF In Stock
Gree and Kinghome on hand

We like to follow the old saying “You cannot sell from an empty wagon”.

Core Values

Our company has implemented EOS, the Entrepreneurial Operating System, founded by Gino Wickman. It’s a great tool for Vision, Traction, and Accountability. One of my favorite parts of the program is a deep dive into company Core Values.

These values already existed, and answer the question, “What is important to the people at ACI?” Here are the results:

Our employees all agreed, these values reflect who we are!