Rethinking commercial building energy sales

RSS
Mechanical contractors have been selling energy-saving and water-saving retrofits to commercial building owners based on utility savings or on ROI. Commercial building owners, however, have different and far more powerful hot buttons that contractors should push. The pitches must be targeted because CEOs have different concerns from supermarket execs who have different problems than landlords.

Green mechanical contractors need to rethink how they go about selling energy- and water-efficiency improvements to commercial building owners. Completely.

I recently had the pleasure of hearing Mark Jewell, president of the Energy Efficiency Funding Group, speak at the Mechanical Service Contractors of America conference in Carlsbad, Calif. He’s the consultant who helped the EPA write the specs for Energy Star for Commercial Real Estate. Jewell received his B.S. in Economics from The Wharton School of Finance and Commerce at the University of Pennsylvania, and he knows as much about financing energy efficiency improvements as anyone in the country.

He says we’ve been doing it all wrong.

Jewell gave MSCA attendees a 90-minute taste of his 48-hour training course. Energy efficiency products and services all require effective selling, he says, and, while they are often promoted, they are rarely sold.

Contractors have long been told not to sell simple payback because it’s so often more than three years. Return on Investment is often said to be better. But Jewell pooh-poohs ROI and even another formula, internal rate of return.

What sales professionals have to do, Jewell says, is connect the dots in the heads of customers in larger ways than just reducing their utility bills. For example, in the K-12 school market, school administrators get state money based on daily attendance and, while it varies from place to place, it’s worth about $40 per student per day. Energy retrofits that improve comfort and indoor environmental quality have a proven track record of attracting and keeping people in buildings. If a school has 1,000 students and attendance increases by 5%, that would mean $2,000 a day or $400,000 a year in increased state aid for that school. That connects the dots in the mind of the school administrator. The reduction in utility bills becomes secondary.

These sales tactics are industry specific because a CEO with a corporate campus has different concerns than a grocery chain operator who has different concerns from a multi-family housing landlord.

The CEO with a corporate campus may be spending $2 per square foot on utilities. Even if you can cut the bill in half, that’s $1 a square foot. It’s a line item so small that it doesn’t attract the CEO’s attention. The company, however, may be spending $200 per square foot on personnel. What if you can improve productivity by 1%? By 5%? It’s usually even more. A retrofit at Lockheed improved productivity by 15% and reduced absenteeism by 15%.

Sounds like we’ve been quoting the wrong numbers to customers.

Unlike the CEO, a landlord has different concerns. Utilities are often 30% of the P&L for a landlord, so the reduction in utility bills is important. But there’s more. If energy costs to tenants go down, the landlord can increase the base rent. The improvements lower the landlord’s share of operating expenses. His vacancy rate goes down. His asset value goes up so the building has a higher resale value.

If you save $1 at a hospital, Jewell says, it’s the equivalent of getting $20 in new revenue. If you cut a grocery store’s energy bill by 25% — which Jewell says is easy since most of them are energy hogs — it’s the equivalent of increasing sales by $59 per square foot.

Laboratories run on research grants. Saving $350,000 by reining in an out-of-control fume hood means that's one less grant that the lab director has to get.

Other customers have different drivers. Some customers are buying carbon offsets and need to reduce their carbon footprint. Some customers need to make improvements for regulatory compliance. Some want to emulate the best practices of similar facilities. Others want to avoid obsolescence. Sometimes they want to avoid budget cuts or save a staffer’s job.

Sell the user interface. Jewell pointed out that new car customers rarely look under the hood anymore. They actually want to know how their phone connects to the car and if the car parallel parks itself. Same with a building. Don’t talk about fan speeds or controls. Sell the user interface.

Sometimes efficiency sales have unexpected results. Jewell related that a dairy barn switched from fluorescent lights to LEDs. It turns out the cows never liked the fluorescents. After the lighting change-out, milk production increased 6% and more than paid for the retrofit.

Do your homework on your prospects so you can properly present the financials that are most important to that particular audience. Connect the dots for them.

 

Discuss this Blog Entry 113

on Sep 17, 2013

For me this is an excellent article, I like it!
http://www.yachtbooker.com/Yacht-Charter-greece.html

on May 28, 2014

Very interesting topic will bookmark your site to check if you write more about in the future. Stone Cleaners

on Nov 3, 2014

Filmmaker Ravine Change , Datascrip said " Reedlike soul sophistication and hybrid ink method printer, gives author evaluate for its users to play the situation illustrator wild and sensual , " if you need the driver printer, you can check at driverresetter.blogspot.com
They all go together with Epson\'s built piezo-electric subject proverbial as PrecisionCore that, per the company\'s spokespersons, doubles photograph grade whereas doubling if you need the driver printer, you can check at 2downloaddriver.com
From the leaked it , mentioned the Samsung Collection Set 2 performed with sib SIM , 4.5 in. WVGA direct ( 480x800 pixels ) and a quad-core processor 1.2 GHz , quicker than their predecessors that the if you need the gadgets info, you can check at gadgetsdrunk.blogspot.com
Request the exclusive angle , not notable manifestly his sincere write , yet by worldcarfans , weekday ( seventeen / 04 ) , if you need the last info about car automotive, you can check at yourautocar.blogspot.com
Canon Pixma Mp560 Driver For Windows, Mac OS X, and Linux Download, but let me to review the printer first. The days of dropping three hundred bones on AN all-in-one printer square measure dwindling, whereas $150 devices just like the Canon Pixma MP560 square measure quickly taking their place on retail shelves. The MP560 appearance nice ANd offers helpful options like an auto-document if you need the last info update about technology, you can check at echokita.blogspot.com
To any raise human publication caliber, PIXMA MG7570 adopts a 6-color mortal ink scheme with the element of achromatic ink tank to spicery up the vesture sound in B&W someone printing, understandably sharing the hatched and shining if you need more info about geophysics, you can check at rahmatprinterdriver.blogspot.com

on Dec 20, 2013

The developments reduced the landlord’s discuss of working costs. His opening amount goes down. His resource value goes up so the developing has a greater resell value. free netflix account

on Feb 14, 2014

I do not even know how one begins to go through 15,000 webpages of rules to comprehend how this will impact entrepreneurs and Americans. Plus, something theoretically is absolutely different than something in activity. M88

on Feb 23, 2014

A strengths-based information of your overall actions style; guidelines on how you like to link and be conveyed with; your perfect perform environment; methods to make sure your atmosphere is motivational. bubblegum casting

on Feb 24, 2014

Soy amante sobre Algunos videos juegos en lineas, juegos igual que los populares angry birds, son mis elegido, siempre estoy en el web site juegosdeangrybirdsspace.mx Angry bird hunting Este entretenimiento es muy placentero, adonde pondras a demostracion tu punteria disparando a los angry birds que vendran volando por el ambiente, y no ha transpirado cuantas mas angry birds que golpee, puedes conseguir puntos en el juego Con El Fin De avanzar en mas emocionantes etapas posteriores. Apunta bien y ser extremadamente agil Con El Fin De permitirse tirar a los pajaros que vuelan extremadamente veloz en la decorad o. Vamos a procurar?

on Oct 11, 2014

This delivers us to the toe and the end of a brief conversation on proverbs the Malaysian taste without in contact with only one Malay term on your aspect. famous proverbs

on Oct 16, 2014

Thank you for some other informative website. The place else may just I get that kind of information written in such a perfect method? I have a venture that I am simply now running on, and I’ve been at the glance out for such info.
https://www.rebelmouse.com/ultimateherpesprotocolreviews/

on Oct 24, 2014

Positive site, where did u come up with the information on this posting? I'm pleased I discovered it though, ill be checking back soon to find out what additional posts you include.
https://www.rebelmouse.com/languageofdesirereviews/

on Oct 29, 2014

Thanks for a wonderful share. Your article has proved your hard work and experience you have got in this field. Brilliant .i love it reading.
https://rebelmouse.com/michaelfioresecretsurveyreview/

on Nov 2, 2014

I can set up my new idea from this post. It gives in depth information. Thanks for this valuable information for all,..
https://rebelmouse.com/thetruthaboutcellulitereview/

on Nov 6, 2014

I just want to let you know that I just check out your site and I find it very interesting and informative..
foods to help lower blood sugar quickly

on Nov 8, 2014

I would like to thank you for the efforts you have made in writing this article. I am hoping the same best work from you in the future as well. Thanks...
https://youtube.com/watch?v=WxJ7m2dwncQ

on Nov 9, 2014

Only aspire to mention ones content can be as incredible. This clarity with your post is superb and that i may think you’re a guru for this issue. High-quality along with your concur permit me to to seize your current give to keep modified by using approaching blog post. Thanks a lot hundreds of along with you should go on the pleasurable get the job done.
https://www.rebelmouse.com/girlfriendsystemreview/

on Nov 12, 2014

Positive site, where did u come up with the information on this posting?I have read a few of the articles on your website now, and I really like your style. Thanks a million and please keep up the effective work.
https://rebelmouse.com/onlineallureformulareviews/

on Feb 24, 2014

As well as much appreciated pertaining to supplying the excellent content sometimes appears on this blog site and the entire information is so visible on this weblog. soundclouder

on Oct 13, 2014

Remember that there are some entry problems that can be set by yourself and don't require an experienced broker. When the property proprietor is aware of what he's doing and it has someone else to help, then doing the perform yourself can be a great choice. Keep in thoughts that they are large and the rises are incredibly tensioned. additional reading

on Nov 1, 2014

This initial site includes numerous amazing stuff could help to make for yourself would like to consider continuously. Legal Witchita Falls

on Oct 22, 2014

Despite the factor that some ignore online hackers and rely only on their abilities, Black Ops II guidelines have interested a big extensive range of gamers due to their extensive range of functions. http://ihackz.biz/castle-clash-hack-cheats-tool/

on Nov 21, 2014

Hello I am so delighted I located your blog, I really located you by mistake, while I was watching on google for something else, Anyways I am here now and could just like to say thank for a tremendous post and a all round entertaining website. Please do keep up the great work.
text your ex back order

on Mar 14, 2014

your perfect perform environment; methods to make sure your atmosphere is motivational. bubblegum casting

on Mar 27, 2014

Estos y otros interrogantes, hacen parte de este especial donde se muestran las últimas tendencias y el futuro de la fotografía digital. accountant london

on Mar 29, 2014

Our objective is not simply to be best-in-class; we want our consumer encounter to competing that of big e-commerce gamers in other sectors. Togel Online

on May 3, 2014

Unlike the CEO, a property owner has different issues. Utilities are often 30% of the P&L for a property owner, so the decrease in. NY criminal attorney

on May 4, 2014

Iimportance from technological innovation to perspective to religion; the right of conscious and the. calgary website development

on May 5, 2014

Office of Community Wellness contacted me in 2007 to become the speaker for their Healthier Kid Starts with You baby death rate attention strategy. see post

on Oct 2, 2014

Camping Bestival and Bestival - in addition to Elevation, the evergreen Comedy Ski jolly in the Alps. In complete, Get Comedy reveals enough. anonymous

on Oct 30, 2014

Interesting post. I Have Been wondering about this issue, so thanks for posting. Pretty cool post.It 's really very nice and Useful post.Thanks
http://www.theofficialwebsite.co/dr-david-desire-system-review/

on May 15, 2014

Nice one for writing this. I honestly sense that I know books about this rather than Employed just before. Your site actually moved somethings so that you can light source we certainly not may have seriously considered prior to when checking out the idea. part of Keller Williams

on May 23, 2014

I'm pleased I found it though, ill be checking back soon to see what other articles you have. Leipzig fair hotel

on Sep 1, 2014

The Buddhist way to all of this is quite genuine, really. Buddhism understands of that from the perspective of ego the opportunities of lack of way of life is generally difficult. steve holman f4x

on Sep 19, 2014

One neat thing about being the first company to purchase the trucks is that Robichaud is pretty much involved in any design changes that may be made to the vehicle. some usb stick tipps

on Sep 30, 2014

It has no way of it. But there is another aspect of interest that not only can understand it, but already knows about it. There is a saying in the Zen customized, “Birth and lack of way of life are the outstanding problem.” That is where actual Buddhist work out needs primary. use this link

on Oct 1, 2014

I had been working on! It also shuts the feeding ports when they put enough weight on the ring. It turned out much more practical than I thought! Aside from just letting him chew on the links, I also used a chain of them to hook up toys to the stroller bars, so he could freely play with them but they won't drop to the floor. Just remember to buy spare filters, light bulbs and the powercable. venus factor real reviews

on Oct 1, 2014

It is then our intention to start the transition at two per month. Logistically it takes time to swap out a technician to a new van and we do not want to overwhelm ourselves, although the sooner we switch the sooner we start saving. http://www.amazon.com/BIOGOLD-100%25-GARCINIA-CAMBOGIA-EXTRACT/dp/B00MQ00DUY

on Oct 4, 2014

What other contractor can say they were involved in the design process of an all-electric service vehicle? Not many! Robichaud is a great example of a contractor on the cutting-edge of technology. Sell house quickly

on Oct 24, 2014

There is no reason why a plumber can’t lead the way and set the example. The electric motor is two to five times more efficient than a diesel engine. Higher efficiency means less energy consumption. Less energy consumption means lower costs and less pollution. Nitro Shred Supplement

on Oct 1, 2014

I also used a chain of them to hook up toys to the stroller bars, so he could freely play with them but they won't drop to the floor. Just remember to buy spare filters, light bulbs and the powercable. look at here now

on Nov 10, 2014

I hunted for housing information, and I came across a real estate news Internet site,San Diego Housing Blog.The housing analysis and real estate news reporting on this website is excellent, the news coverage and cartoons are great, and the real estate educational materials are fantastic. I suggest using this Internet site to survey its many features.
OC Housing News

on Oct 2, 2014

Thanks again again! You wanna make a terrific point. Displays the beauty through wonderful report here. click for more

on May 27, 2014

As Frank Blau and others chimed in with some really nice sentiments about what we historically owe to people like George, I finally decided to tell my story because it is such a prime example of why these guys have been so important to all of us. In short, I sit here right now a grateful beneficiary of the business practices these far-seeing men showed us so that we've become a real industry, as opposed to one filled with capable technicians who are hapless, helpless, business-ignorant chumps. site

on May 27, 2014

i love exploring the site. thanks for the information. http://africanmangosdiet.com

on Nov 8, 2014

exploring the site. thanks for the information.چت

on May 29, 2014

Sometimes they want to prevent price range reduces or preserve a staffer’s job. tickets

on Aug 27, 2014

Last season, Brazil generators placed Ceres lovely sorghum on more than 3,000 hectares (7,400 acres) - about the size of nine New York Town Central Recreational areas. joey atlas' naked beauty symulast method method

on Sep 17, 2014

I recently came across your blog and have been reading along. I thought I would leave my first comment. I don't know what to say except that I have enjoyed reading. Nice blog. I will keep visiting this blog very often.
rebelmouse.com

on Oct 15, 2014

I think this is an informative post and it is very useful and knowledgeable. therefore, I would like to thank you for the efforts you have made in writing this article.
More Info

on May 31, 2014

Soy amante sobre Algunos videos juegos en lineas, juegos igual que los populares angry birds, son. home improvement contractors

on Sep 27, 2014

Good artcile, but it would be better if in future you can share more about this subject. Keep posting.
how to erase herpes

Please or Register to post comments.

What's As I See It?

Robert Mader's Blog

Contributors

Robert Mader

Bob Mader is the editor of CONTRACTOR magazine, Green Mechanical Contractor magazine, and Radiant Living magazine. He has been writing about plumbing, mechanical, green building and HVACR topics for...
Blog Archive

Sponsored Introduction Continue on to (or wait seconds) ×