“Without a doubt, marketing, advertisement and the attempt to sell your skills and services is a must for any business to survive. However, I firmly believe that where an established corporation is truly developed on mutual trust, respect, integrity and a win-win-for-all type of attitude, there is essentially not much sense in merely promoting your services. In other words, the establishment of mutual trust is only possible through an experience and must be earned, as opposed to being exposed to rather empty promises.
After more than 40 years of practice in the heating and cooling industry worldwide, I have seen and heard all kinds of HVAC selling strategies. In this message, I decided to share some tips and raise more awareness on some scare tactics and misleading sales practices in the heating and cooling market. I will touch on my own observations coming across overwhelming encounters with cases of misleading sales tactics used by some Ontario heating and cooling contractors to convince homeowners in buying new heating and air conditioning equipment. In fact, I have been trying to raise awareness on this issue for well over a decade, as I had witnessed too many homeowners falling victim to fraudulent sales practices, which is always quite disheartening to see; especially when it involves the more vulnerable members of our society who put their full trust and their hard-earned money in the hands of con artists. From door to door sales people with little or no knowledge on HVAC, posing as the “Gas Company staff” and misleading homeowners into signing overpriced contracts for equipment that did not need replacing, to false and attention-grabbing advertising claims, it seemed that for a while there was a systematic increase in HVAC fraud, that started in Toronto and was growing elsewhere in the province and across the country. Finally and following countless and growing cases of HVAC fraud reported by Ontario homeowners over the years, Ontario righteously took some steps in the right direction in 2016 through 2018 and specifically aimed at targeting HVAC contractors who fraudulently convinced homeowners – especially seniors – to make unnecessary purchases through door-to-door sales. Bill 59 made various amendments to the Consumer Protection Act and made some attempts in regulating the HVAC market. I still, however, come across many consumers being frightened into purchasing a new furnace – falsely warned that their existing furnace is leaking dangerous gases that could explode or poison the residents. You should always stay cautious about such exploitations of misleading sales and any scare tactics in an industry like HVAC, where safety is key.
Before I continue, I want to emphasize that I do not believe in selling one’s skills by making critical remarks of competing parties. The intention, also, is definitely not to promote distrust. This message is only intended to shed more light on dishonest sales practices of different kinds, in the Toronto heating and cooling market, so that – hopefully – I don’t have to come across another single mom who was charged 10 folds the real market price of a furnace, while her existing furnace was only 1 year old and on another financing contract, there was nothing wrong with it and now she is left paying 2 financing contracts, one of which is quite hefty.
Or perhaps you may come across ads that focus on cash back promises to thousands of dollars in factory or government rebates, 100% satisfaction guarantees, etc. just to grab your attention. Believe me when I say that many of such claims could possibly actually end up to your disadvantage and if you pay close attention, putting two and two together, you, too, would come to agree with me. In fact, some of these advertisements are so appealing, that they would only be possible if the HVAC company ends up paying the customer out of its own pocket and ruin any likelihood of its survival. Sometimes you have really got to stop and think; if it sounds too good to be true – chances are, it is!
You would also be surprised how many Toronto Heating and Cooling small businesses I have come across, who have sold a significant number of “free” 10-year-labour warranties to their customers (which was perhaps the only reason they got the deal) and by simply altering the title of the company (to something very similar I might add) have ended all obligations to these clients. Legally, there is absolutely nothing that can be done with this regard and the company gets away with it. In one instance I recall where a heating and cooling business named, say, ‘X Heating and Cooling Ltd.’ later modified the legal name to ‘X Cooling and Heating Ltd.’ – yet still having the very same contact information, as well as management. Obviously the similar name modification is only intended on the account of all of the previously executed advertisements and branding efforts, and sadly no legal action could be taken with respect to honouring their previous commitments.
Fortunately, in some cases, the fraudulent parties did pay the price. Some cases made it to the media and in some cases, they were hit with a fraud conviction and/or faced a class action lawsuit. And some may have underhandedly gotten away with misleading practices. And in those unfortunate cases, it may not prove too difficult for the principle owner of the business to survive in an industry, where an average household may experience few encounters with HVAC companies – especially when some of these companies are known to have changed their legal business names on a regular basis.
Here are some examples of reported HVAC fraud and misleading HVAC sales that made it to the media:
Nowadays, with many quick money-making scams in every business, it is always recommended to deal with businesses that are accredited BBB members, so that the company would have a transparent record of interactions with any unhappy previous clients. This is especially recommended when dealing with contractors. In fact, being a BBB member, brings about a unique sense of responsibility for the company to try and put its best foot forward in all endeavors.
It is a reasonable and definitely a good deal to be offered a free thermostat or a discounted humidifier install, with the installation of an eligible air conditioner and a furnace system. However, the promise of a “complimentary” A/C with the installation of a heating system, or being offered $1,000 for your old furnace, etc. is a sign you are going to be paying, in fact, more! You could be sure of this by calling the company in advance to request for a ballpark quote after the complete installation! A countless number of these irrational heating and cooling offers provided on flyers, web sites, etc. are merely an approach for the sales representatives to enter your residence and make an effort to convince you into purchasing products and services for which you will be obligated to pay much more, after the installation is complete.
Try and keep an eye out for false claims. Below, are two of these examples that I have personally encountered:
(a) “Save $500 on your gas bill annually, by replacing your hot water tank with a tankless model”
This statement has no logic behind it and is only an eye-catching marketing strategy overly exaggerating the benefits of tankless water heaters. An average household’s annual gas consumption for heating water using a conventional hot water tank could hardly exceed $400. How could one then save $500, if one currently doesn’t pay more than $400? Please visit the Tankless Water Heaters reviews under the tips section to discover why replacing your hot water tank with a tankless unit may even not be a smart investment, afterall.
(b) “120% efficient furnaces”
The Law of Conservation of Energy was perhaps one of the very first concepts concerning scientific laws of nature: Energy is neither created nor destroyed and can only be transformed into one state from another. Referring to such a thing as a 120% efficiency furnace, implies that for every dollar paid towards heating your home, another 20 cents worth of energy magically appears. This is perhaps even more outrageous than the previous statement.
First of all, be positive that this claim is clearly outlined in your contract and with absolutely no strings attached. Second, make all or at least a considerable percentage of the payment after the job is done. If a company is confident enough to guarantee 100% of your satisfaction, it should have no problem receiving your payment after completion.
It is a necessity for a credible heating and air conditioning business to have an administrative office, a showroom and a warehouse to appropriately function and serve its new and existing clientele. If you wish to make a deal with a reliable firm, do a background check to learn more about the company, their operations and facilities and do not make assumptions based on merely a website that may look neat. When you are paying thousands of dollars to replace or newly install an equipment in your home, would you not rather giving your business to a contractor that has established a proper work environment and does not try to maximize profit by eliminating vital overhead costs?
Most unfortunately, I have known of company owners who employ unlicensed technicians to avoid the obligation of paying higher salaries and to ultimately maximize the business profits. Always request for a licensed technician and be sure to check his licence and check to see whether he has legitimately tagged the equipment you have purchased.
In some cases, this may be more than just a sincere promotion. So be very cautious! Many of such proposals are to force you into purchasing much more expensive services. I have heard a countless number of stories where the technician enters your residence, magnifies and over exaggerates or even completely fabricates a false issue, leading you to believe your furnace or air conditioner needs to be replaced for the safety of your family and ultimately charges you a relatively high price for the sale. Aside from being misled into making an unnecessary purchase, some homeowners may also make a false assumption that just because their initial service or diagnostic fee was very low, that their installation prices must also be low and not bother to shop around. Unfortunately, this assumption has turned out to be very costly for some homeowners. Or imagine this scenario happen in the midst of a very cold winter day, when you are told by a maintenance technician that your furnace heat exchanger is cracked, who further shuts down your gas and leads you to believe that you are exposed to danger and that you need a new furnace system to avoid any hazard. Unfortunately, our cold Canadian winters or even our humid summer season makes it difficult for most consumers to get a number of other professional opinions and perform a thorough ‘shopping around’ and these scare tactics are unfortunately sometimes used to make a quick buck.
You can check out this article published by the Better Business Bureau: Don’t Get Burned by Furnace Fraud
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