Understanding the purchasing preferences of HVAC contractors, who primarily purchase parts and equipment through wholesale distributors, can help inform how best to respond to the changing business environment.
HARDI, the national association for HVACR distributors, commissioned market research firm Farmington Consulting Group (FCG) to survey over 1,000 HVAC contractors on buying preferences, current inventory levels, brand preferences, rebates and more.
During a presentation at HARDI’s annual conference held in Atlanta Dec. 7-10, FCG President TJ O’Conner shared the results of the survey which was conducted in October and November.
The survey responses presented in HARDI’s “2024 Voice of Contractor Report” were largely from contractor business owners/executives (61%). About 71% of the survey respondents are made up of residential contractors, while 28% of the survey respondents are made up of commercial contractors.
About 21% of the respondents have annual sales revenue of between $1-$1.9 million, with the average contractor logging 65% of sales revenue from residential HVAC, 30% from commercial HVAC and 5% from commercial refrigeration. Compared to 2023, over half of the contractors reported “positive growth” in each segment: residential HVAC sales (62%), commercial HVAC (59%) and commercial/industrial refrigeration (54%).
Where do these HVAC contractors choose to make their purchases, and why?
HVAC Contractor Purchasing Preference
The average HVAC Contractor makes approximately two-thirds (68%) of their total HVAC purchases from their primary distributor.
- The “smallest-sized contractors” (contractors with a single service truck/van) surveyed make 74% of their total HVAC purchases from their primary distributor.
- The “largest-sized contractors” (20 or more service trucks/vans) make 58% of their total HVAC purchases from their primary distributor.
- Residential contractors make 71% of their total HVAC purchases from their primary distributor.
- Commercial contractors make 58% of their total HVAC purchases from their primary distributor.
Interestingly, 42% of HVAC contractors buy the majority of their parts and supplies from a different distributor than the distributor they buy the majority of their equipment from.
Which Channel Do HVAC Contractors Prefer to Buy From?
Wholesale Distribution: The average HVAC contractor makes 69% of their total HVAC purchases through wholesale distribution. Since HARDI’s initial 2020 Voice of Contractor Report, there has been a four-percentage point increase in wholesale distribution’s total market share with contractors.
- Residential contractors make a higher percentage of their total HVAC purchases through wholesale distribution (72%) than commercial contractors do (61%).
- Heavy commercial contractors make 54% of total HVAC purchases through wholesale distribution.
Factory Stores and Manufacturer Direct: Commercial contractors make a significant percentage (31%) of their total HVAC purchases through factory stores/directly from the manufacturer.
Online Marketplaces: The average HVAC contractor makes 5% of their total HVAC purchases through online marketplaces, such as Amazon, Parts Town, SupplyHouse.com, HVACDirect.com and more. There has been a two-percentage point increase in the online marketplace’s total market share with contractors since HARDI’s 2020 report.
Contractors’ Top 5 Factors When Selecting a Distributor
- Product availability/inventory levels
- Pricing
- Delivery service (timely & accurate)
- Counter/branch association service & relationship
- Equipment manufacturer/brand represented
According to the report, the attribute over the past year that increased the most in importance to contractors when selecting a distributor to purchase from was the counter/branch associate service & relationship.
Approximately two-thirds of HVAC contractors (68%) said the counter salesperson/inside salesperson most influenced their purchasing decisions on parts and supplies, largely because of their product and industry knowledge, followed by response time.
The attribute over the past year that decreased the most in importance to contractors when selecting a distributor to purchase from was equipment manufacturer brand.
Lead Photo: aydinmutlu via iStock
