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Thread: PM Forcast

  1. #1

    PM Forcast

    Hello all,

    I usually just read the threads but today I want to get some ideas from the folks in this forum about how much breakdown service and replacement work planned maintenance will generate in a year. The company I work for does about 350k in PM work a year ranging from semi annual filter change and brief inspection on a single RTU at a strip mall, to quarterly mechanical room pm visits at 500,000 sq feet office buildings and everything in between. We have contracts with roughly 225 clients at 350 sites. We have 14 HVAC/R techs and 50 total emplyees. Thanks in advance for all the input.

  2. #2
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    Quote Originally Posted by brianmurph View Post
    Hello all,

    I usually just read the threads but today I want to get some ideas from the folks in this forum about how much breakdown service and replacement work planned maintenance will generate in a year. The company I work for does about 350k in PM work a year ranging from semi annual filter change and brief inspection on a single RTU at a strip mall, to quarterly mechanical room pm visits at 500,000 sq feet office buildings and everything in between. We have contracts with roughly 225 clients at 350 sites. We have 14 HVAC/R techs and 50 total emplyees. Thanks in advance for all the input.
    There's a very wide range, a PM could generate .50 on the dollar or 100 to 1. 350K in PM work could be easily handled by 2 techs and a helper. Are your PMs "loss leaders" or do you make a profit on them. Just curious.

  3. #3
    We make a profit (gross around 30%) on PM's. Our techs do resi work as well as refrigeration as well as breakdown service for clients with out contracts. Maybe I need to be specific. With the clients that we do PM work for, what amount of breakdown service and replacement work will be generated with in those accounts, not company wide. Thanks again.

  4. #4
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    Quote Originally Posted by brianmurph View Post
    We make a profit (gross around 30%) on PM's. Our techs do resi work as well as refrigeration as well as breakdown service for clients with out contracts. Maybe I need to be specific. With the clients that we do PM work for, what amount of breakdown service and replacement work will be generated with in those accounts, not company wide. Thanks again.
    In my experience, which is by no means all encompassing. I've ranged from 3 to 1, to 8 to 1. Timing is everything though. We do no residential, I would be curious as to how their numbers played out.

  5. #5
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    For forcasting purposes we generally used .5 on a dollar for additional work generated from a PM contract. That was an overall average after many years of trending. Contracts were always sold at a profit. This also depends on how your reviewing your numbers and how your burdens are applied in the GL. That being said, along with the condition of the equipment you could range from zip to whatever you could imagine.

  6. #6
    Absrbrtek thanks for your input. I have a better handle on what to forcast. Even though I work on the commercial side we do residential work as well. Any ideas on what every dollar in PM on the residential side will generate. Again thanks for the input.

  7. #7
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    Dear Brianmurph,

    We have found that after years of trending the commercial/industrial side ratio is approximately 0.75 to 0.65 repairs/replacement to 1.00 P/M service contract.

    The residential side is a bit less at 0.45 to 0.32 repairs/replacement to 1.00 P/M service contract.

    We do a considerable amount of sales pitch to our Clients, but not so much as to make them feel we are pushing repairs and replacements down their throats.

    Just curious, are you researching for “personal reasons”? Maybe starting out on your own?????If so, my number one advice to you is be well finacied….in layman’s terms have enough cash to work for a full year without taking a penny from your new company!

    Hope this helps………………

    Respectfully Submitted,
    John J. Dalton CM

  8. #8
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    I have never tracked residential work, sorry.
    Quote Originally Posted by brianmurph View Post
    Absrbrtek thanks for your input. I have a better handle on what to forcast. Even though I work on the commercial side we do residential work as well. Any ideas on what every dollar in PM on the residential side will generate. Again thanks for the input.

  9. #9
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    Curious

    Quote Originally Posted by john dalton View Post
    Dear Brianmurph,

    We have found that after years of trending the commercial/industrial side ratio is approximately 0.75 to 0.65 repairs/replacement to 1.00 P/M service contract.

    The residential side is a bit less at 0.45 to 0.32 repairs/replacement to 1.00 P/M service contract.

    We do a considerable amount of sales pitch to our Clients, but not so much as to make them feel we are pushing repairs and replacements down their throats.

    Just curious, are you researching for “personal reasons”? Maybe starting out on your own?????If so, my number one advice to you is be well finacied….in layman’s terms have enough cash to work for a full year without taking a penny from your new company!

    Hope this helps………………

    Respectfully Submitted,
    John J. Dalton CM
    Do your figures include a large portion of full maintenance? I see much higher returns on test & inspect type work.

  10. #10
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    May 2004
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    Dear Krzyd,

    Sorry I should have qualified the figure I posted. Yes, 87% of all our commercial/industrial P/M service contracts are full service contracts, while the rest are essentially filter replacement, inspect, and advise ones. Our residential P/M service contracts are a bit less at 65% full service contracts and the remaining ones filter replacements, inspect, and advise ones.

    Respectfully Submitted,
    John J. Dalton CM

    PS: We do not push residential clients in the lest bit.

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