EMPLOYEE COMPENSATION STUDY

How does your compensation package stack up against other distributors?

Are your employees overpaid or underpaid?

How about the management team?

What benefits do other firms provide?

Get the answer by participating in the HARDI 2012 Compensation Study.

If you are like most distribution firms, you’re running lean these days with just enough personnel to get by. Hiring and keeping good employees is essential to the profitability of your business, especially in today’s economy.

When it comes to hiring employees, you must consider your overall employee compensation plan (not just your wage scales but your benefits packages as well), in comparison to other distribution firms. And, when doing so remember you are not just competing for the best employees with other HVACR distributors, you are also up against distributors in other industries in your area.

The 2012 Compensation Study will provide a detailed review of compensation and benefit programs for approximately 2,000 distributors from 30 distribution organizations.

This large, diverse sample will provide a wide range of compensation information not only for our industry, but also for 20 sales volume categories and more than 100 geographic areas, including 50 metro markets.

Participating HARDI Distributors will receive invaluable information covering topics including:

• Executive Compensation
• Employee Compensation
• Sales Commission Plans
• Inside/Counter Sales Policies
• And Benefit Programs such as healthcare, retirement and time off

The 2012 HARDI Compensation Survey will be made available to all HARDI Distributors in early January with a completion deadline of March 1. Survey results will be available in May.

Reporting to the HARDI Compensation Survey is confidential. All surveys are sent directly to and the results compiled by The Profit Planning Group, an organization dedicated to helping businesses understand the financial side of their operations.

If you are interested in receiving the 2010 HARDI Compensation Survey, please contact the HARDI offices at 614-345-4328.

All HARDI Regions Up in August, But Trends Indicate Tough Fourth Quarter

September 30, 2011
Contact: Susan Little
(614) 345-4328
slittle@hardinet.org

All HARDI Regions Up in August, but Trends Indicate Tough Fourth Quarter
Columbus, Ohio - Heating, Airconditioning and Refrigeration Distributors International (HARDI) announced North American HVACR average distributor sales for August 2011 up 7.9% from the same month last year, an improvement from last month’s 4.9% growth, but not enough to stem a sixth-month decline in the annual distributor growth rate. HARDI’s Monthly Targeted and Regional Economic News for Distribution Strategies (TRENDS) Report showed growth in all eight North American regions, three of which experienced double digit improvement compared to August 2010. US-only distributor sales growth averaged of 8.1% for the month.

Despite concerns from manufacturers and others of inventory depletions within the channel, inventory levels were reported up in every North American region for the fourth consecutive month. Days Sales Outstanding (a measure of how quickly customers pay their bills) saw its best improvement of the year with a 6% decrease from the previous month. Distributor productivity reflected by sales per employee backtracked for the second consecutive month continuing to indicate that July and August failed to meet most distributor expectations.

“The economy is in a definitive Phase C (slower growth) trend and so is the average HARDI member, but not without some positives. Looking at the latest data release, the ongoing improvement from 2010 sales numbers is encouraging to see despite its slowing rate. Another promising trend that has developed over the past three months has been the drop in Days Sales Outstanding. The Average Day's Credit Sales in Accounts Receivable has fallen by an average of around ten days since June (from 56 days to 46 days). Quicker payment turnaround leads to improved cash flow, something we can all appreciate and should be striving for in a Phase C economic environment,” said HARDI economist, Andrew Duguay of the Institute for Trend Research (ITR).

“This might have been our Western region’s best month in about two years in terms of growth rate, and all of North America exceeded my expectation for what I saw as a challenging August,” said HARDI Executive Vice President and C.O.O. Talbot Gee. “But with impossible fourth quarter comparables to last year’s record months in November and December during the tax credit bubble, August sales up just 7.9% should signal distributors and their suppliers to prepare for a potential negative year end growth rate.”

“Despite eye-popping growth of R-22 unitary sales, overall unitary volumes are failing to keep pace with last year,” said Gee. “I fear we may have underestimated the R-22 impact, but over-estimated total unitary volumes for 2011 which is likely to depress distributor sales dollars and margins.”

3rd Annual HARDI-JP Morgan Mid-Season HVAC Distributor Survey

HARDI recently completed the third annual Mid-Season HVAC Distributor Survey in partnership with JP Morgan Equity Research.  More than 100 HARDI HVAC equipment distributors reported a generally sobering 2011 to date with moderate expectations for the future.

Distributor members who participated in the survey received the results and full JP Morgan analysis two weeks ago.  The report is now publicly available, click here to view and download the report. 

Some highlights of this year’s survey results include:

• 65% of distributors  see 2011 residential demand flat or down compared to last year
• 95% of distributors experiencing  customers opting to repair vs. replace and 55% believe the repair rate is higher than last year
• 79% reporting higher inventory levels compared to last year
• 67% of distributors indicate said they wanted to see the government ban R-22 “dry-shipped” units despite 11% of members anticipating these units exceeding 30% of their total unitary sales in 2011
• 95% of participants indicate a  direct negative impact from the reduction in the $1,500 federal tax credits and 69% have seen a decline in 14+ SEER unitary sales
• With 81% indicating a need  for the federal government provide additional  incentives for HVACR retrofits

The survey goes into detail on Residential End Market Demand, Commercial End Market Demand, Inventory Levels, Raw Material and OEM Price Pressures, and Government Policy Measures.  Questions about the results of this annual joint survey should be directed to JP Morgan’s Stephen Tusa at (212) 622-6623, or HARDI’s Talbot Gee at (614) 345-4328.

2011 Annual Profit Report Available Now!

Order the 2011 Profit Report

$500 - HARDI Members
Click here to order online
Click here for a printable order form

$1000 - Non-HARDI Members
Click here to order online
Click here for a printable order form

What is the Profit Report?

This report presents a detailed but straightforward analysis of financial and operating characteristics of 102 participating HARDI firms. Results are presented in tables and graphs designed to provide a comprehensive guide for analyzing profitability.

Methodology

Surveys were mailed to all members to collect detailed financial and operating data. Completed surveys were returned directly to Profit Planning Group for analysis. Individual responses were kept strictly confidential by Profit Planning Group. Neither HARDI nor any other firm had access to any individual firm’s survey or results.

This report is organized into the following sections:

Executive Summary
An overview of study results including a graphical presentation of key results.

Detailed Results
An analysis of return on investment and financial and productivity ratios.

Business Segments
Participants were classified by percentage of product sales using the following rules applied in order.
A/C & Plumbing.......................... HVAC+heating+plumbing greater than HVAC+heating+sheet metal sales
Sheet Metal & A/C ..................... HVAC+heating+sheet metal greater than HVAC+heating+plumbing sales
A/C Specialist............................. HVAC+heating greater than 50% of sales
Controls & Refrigeration............. controls and parts + refrigeration greater than 50% of sales

Regions
Geographic regions are examined. Participants were grouped according to regions specified by HARDI.

Trends
An examination of changes in performance over time for key results and ratios.

Quartiles
A “range of common experience” is presented for business segments with sufficient sample.

Ratio Calculation
A summary of ratio calculations

Testimonials:

"It's the best management and benchmarking tool we have."
          -Jim Morris, President, Shore Distributors

“The annual HARDI profit report is one of the most important tools we use as a company.  It has helped us measure our performance against our peers and gives insight as to which metrics can be tweaked to improve our bottom line. We can truly say that this report has made us a better company.”
          -Frank & Michael Meier, President & General Manager, Meier Supply

"It is time for the 2011 Profit Report and we are again looking forward to measuring our company to others in our industry.  We have participated in this report every year that it has been available and have benefited a great deal from the information that we get from it.  It helps us determine where we are doing the right things and where we need to make improvements.  Unlike theoretical numbers to compare to, the Profit Report details actual data furnished by those in our industry.

We participate in other surveys as well, but I can say that the HARDI Profit Report is the best at providing the information that we are looking for in a report of this kind.  I highly recommend this report to any company that wants to measure their performance against their peers.  It is well worth the work and small price to participate."
          -Freda Moore, President, Wichita Sheet Metal Supply

"The yearly reports have been good for us to use to see where we were either “high, low or in the middle” on expenses, ratios or productivity indicators. We have been challenged to get our house in order in some areas.  We recommend HARDI members use the service if they want to locate areas where they are strong and where they are weak, then set action plans in order to improve their operations."
          -Alan Loeffler, President, Federal Corporation

"We have been participating in the profit report for a number of years and find the report we get back of very good value. It is clear and concise and includes lots of tips for improvement. I would highly recommend every wholesale member to participate as the input is not overly difficult and the reward is great in the form a very detailed report."
          -Peter Olierook, President & C.E.O., Don Park

"The HARDI Profit Report is a valuable tool with regard to assessing your company's strengths and or weaknesses against your competition."
         -Jeff Schmidt, President, Mar-Hy Distributors

“We use the profit report many times during the year for reference, but we use it at end of year reviews and planning to measure our progress both internally, and against our peers. It gives us great perspective on the industry  averages and best practices metrics”
          -Richard Cook, President & C.O.O., Johnson Supply

Expert Analysis

Alan Beaulieu Cheif Economist

Andrew Duguay Economist

Alan Beaulieu

Alan Beaulieu provides economic forecasts with 96% accuracy.  One of the country’s most informed economists, Alan Beaulieu is a principal of the ITR® where he serves as President. He is co-author of “Make Your Move”, a book on how to increase profits through business cycle changes. Alan is a principal and Managing Partner of ITR Capital Partners and is an active member of its Investment Committee. Most recently, Alan is the host of Make Your Move, a business radio talk show heard Monday afternoons on the VoiceAmerica™ and World Talk Radio™ Networks.

Mr. Beaulieu has been providing workshops and economic analysis seminars in 5 countries to literally thousands of business owners and executives for the last 20 years.

Pronouncements from the Institute for Trend Research and/or Mr. Beaulieu have appeared in/on:
the Wall Street Journal, New York Times,USA Today, Knight Ridder News Services, Business Week, Associated Press, The Washington Times, CBS Radio, CNN Radio, Sirius talk radio, KABC, NPR affiliate WLRN and numerous other outlets.

Andrew Duguay

Andrew Duguay is an economist with the Institute for Trend Research where he is involved in the practical application at the individual business level of changes in the economic environment. Mr. Duguay is providing insightful, accurate analysis for companies throughout the US and in Canada. This analysis allows client companies to make timely decisions that will enhance their short and long term financial and competitive positions. His writings have appeared in several trade journals.

Andrew graduated from Gordon College with a degree in Economics. Before joining the Institute, Andrew studied economic development in China, and also worked on a resource development team for a non profit in Jackson, MS. Andrew is an active volunteer with Peer Servants, a nonprofit organization that provides financial and technical assistance to independent microfinance institutions in the developing world.

Interactive Regional Forecasting Webinar

Alan Beaulieu, HARDI’s Chief Economist and President of the Institute for Trend Research (ITR), discusses the economic outlook for the housing and commercial sectors, presents aggregated sales data for YOUR region, looks at state and local data in regional discussions, and offers management recommendations applicable to where we are in the business cycle.  Andrew Duguay, an economist also from ITR, will join Alan in in the discussion. 

The session is REGIONALLY FOCUSED!  After a brief overall assessment of the current markets and noting potential business trends, the conference leaders will go through each of HARDI’s seven regions with specifics.

It's INTERACTIVE!  There will be ample time for open discussion and questions either over the phone lines or you can key in your query during the program.  All questions will be read aloud and answered during the allotted time.

 

Participation Fees 

The webinar is completely free for all HARDI Distributors who participated in at least one of the Monthly Sales Trends Reports this year and HARDI Premier Supplier Members. See Chart Below:

Company Type	Registration Fee
TRENDS-Participating Wholesale Distributors	Free
Non-Participating Distributors	$300
Premier Suppliers	Free
Sustaining Suppliers	$75
Suppliers	$300
Subscribing Manufacturer Reps.	Free

 

Register for the IRF Webinar 

To register for the IRF Webinar or if you have any questions, please email bdangelo@HARDInet.org, or call 888.253.2128.  Premier members and participating wholesale distributors will automatically receive webinar participation informaiton via email.