The Benefits of a Fortified HVAC Preventive Maintenance and CapEx Program

The Benefits of a Fortified HVAC Preventive Maintenance and CapEx Program

About Our Client Partnership and Creating a Plan Together

A Large 180-Site Industry-Leading Retail Chain with a National Footprint

Our client’s facilities team was tasked with selecting an HVAC vendor who could build a fortified HVAC preventive maintenance program, develop strong asset management, assist in strong reporting, and offer in-depth knowledge to support mindful CapEx budgeting decisions to maximize the HVAC facilities budget.  When our partnership began, they felt the incumbent vendor was sending excessive amounts of HVAC quotes, trending towards more reactive strategies and an increased spend, hurting their budget.

How We Worked Together to Execute a Strong HVAC Preventive Maintenance Program

CLS Facility Services was contracted to build a fortified HVAC preventive maintenance program. Here’s what we did:

• Quarterly Structure — These programs are conducted on a quarterly basis for all store locations to ensure that all equipment is maintained and functioning optimally, filters are changed four times annually, and units are inspected proactively in order to minimize emergency service calls and costly trips for deficiencies.
• Cleanings and Component Changes — Condenser coil chemical (power wash) cleanings and belt changes are proactively built into the program — once annually — in order to ensure optimal HVAC unit performance as well as to avoid trip charges, emergency calls, and the cost of conducting these repair reactively (which can be three to four times what’s necessary).
• Filters — Quality filters are being utilized to ensure strong air quality and protection of the HVAC assets.  Utilization of pleated filters is implemented across all PMs nationwide.
• Program Uniformity — Technicians are held to a uniform HVAC scope of work nationwide in order to foster accountability for all aspects of maintenance being completed thoroughly on each HVAC asset.
• HVAC Asset Lists — Full asset management is developed for the retailer and updated on each maintenance cycle, detailing the manufacturer, make, model, serial number, age, and repair history of each piece of HVAC equipment.  The client’s Facility Management Team has transparent access to their detailed HVAC Equipment List in order to maximize asset management, budget proactively, and work with CLS to make educated decisions on influential spends.
• Vendor Stability — Technician turnover is minimal, meaning that the same technicians are performing work on equipment from cycle to cycle to ensure consistency, knowledge of the site and equipment, and accountability.
• Consistent Pricing — Cost adjustments are nominal year over year and the HVAC maintenance program is priced cost competitively with minimal inflationary price increases that align with the retailer’s facility maintenance budget.
• Consultation You Can Trust — CLS provides informative feedback on quotes, key HVAC decisions and technical details from staff who are a combination of former HVAC technicians or account leaders with 25+ years of industry experience.
• Educational Training — The client and CLS have educational training sessions 2-3 times annually, educating the Facilities Management Team on HVAC component functions, key terminologies, and identification of key HVAC items that are unique to their stores.

Steps to Reduce Maintenance Costs

• Not to Exceed — A small HVAC “not to exceed” is built into each maintenance cycle for each store location. This empowers technicians to proactively make simplistic repairs on units — such as replacing contactors, replacing a belt, replacing batteries in a thermostat — in order to avoid costly return trips required with quoting these minor repairs. Due to trust in the partnership, this NTE is only utilized on around 16% of all maintenance.
• Service Call Avoidance — CLS account managers will reach out to client sites to check their comfort level as well as get information on thermostat readings or functionality in order to either avoid the service call altogether (if applicable) or even downgrade an emergency to a standard call if feasible.
• Quote Review — CLS does a thorough review of all HVAC preventive maintenance quotes and reactive maintenance “service call” quotes in order to vet whether the suggested item is a proper spend for the client. If a quote is deemed unnecessary or minor, this spend is voided in order to maximize the HVAC budget accordingly.

Maximizing the Benefits of a Dynamic CapEx Approach

By building detailed asset management of the entire fleet of HVAC equipment, CLS is able to review the data on more than 900 HVAC units in order to help the retailer to budget to replace a select number of units proactively each year, depending upon the budget available on an annual basis.

Detailed surveys are launched to quote unit replacements for optimal store locations and assets, create definitive budgets for proactive replacement, and to help weigh the cost-benefit analyses of proactive replacement depending on lease status, budget, store revenue, and overall unit importance (oftentimes stores relying on just one or two HVAC units are prioritized, as failure of that unit is detrimental).

HVAC units are ordered and replaced proactively to avoid large costly maintenance repairs, increase energy efficiency, and to maximize the new warranties of newly-replaced HVAC assets.

The Short and Long-Term Benefits

In the end, this very proactive HVAC program has created an elite ability to budget accurately and to avoid large numbers of costly reactive maintenance spends. The client’s Facility Maintenance Team has full visibility to their HVAC budgetary goals and a proactive approach to foster future success.

• While many retailers boast HVAC equipment lists with an average age of 12–15+ years old, this retailer’s average HVAC unit is approximately eight years old.
• This leading retailer demonstrates a dynamic ratio of “Reactive-to-PM Spend” ranging from 0.5:1 to 2:1 over the past eight years. Many competitive retailers show a 3:1 or even 5:1 ratio, due to reactive spending, costly return trips, inability to perform proactive replacements, and proactive PM approach.
• This retailer displays a very low number of emergency calls to replace broken belts or to clean clogged coils due to these services being performed proactively throughout their HVAC PM program.
• Due to the younger age of HVAC equipment, this retailer annually saves thousands of dollars in temporary cooing and temporary heating rentals, as repairs are minor, lead time on repair materials is voided, and units are in better overall health.
• Utility cost savings are elite, as younger units have far greater energy efficiency and foster savings.
• R-22 and old forms of refrigerant are never needed with this retailer’s HVAC equipment, as zero units in their fleet of more than 900 HVAC assets contain these HVAC repair elements.

It’s All About the Ability to Be Proactive — and to Budget Proactively

While price and hourly rates are important, strong preventive maintenance execution, elite asset management, thorough vetting of quotes, and strong CapEx planning are what truly foster savings.

In a true facility maintenance partnership, the retailer and facility maintenance empower one another to work together to budget proactively, define needs, and to customize a program to meet the retailer’s goals and needs. In an industry full of annual turnover in partnerships, we are forever grateful for tenured partnerships and the ability to be a partner — and never a vendor.