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Business Observer Friday, Mar. 16, 2018 6 months ago

Air in There

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The so-called good problem of too much growth, too fast, was a real-life crisis for a Southwest Florida company. The solution requires discipline — and tough choices.
by: Mark Gordon Managing Editor

The smashing success at Louis Bruno's air conditioning company — from startup to $15 million in annual sales in three years, for one — masked deep issues that nearly destroyed the business.

The Naples-based company, founded as Bruno Air Conditioning, had the sales growth, combined with nearly 200 employees and some 7,000 customers across Southwest Florida. It hit those marks from 2012 to 2015.

Yet customer service during the rapid run-up in business cratered. Says Bruno: “There was a lot of pressure put on our processes.”

The collapse led to numerous customer complaints, which culminated in the Better Business Bureau revoking the firm's accreditation. The BBB, in a 2015 note, cited “a pattern of complaints from consumers alleging that the business misdiagnosed or misrepresented issues related to repair or replacement, which led to higher costs or estimates for the consumers.”

Bruno, who launched the business from his dining room table, says the up, down and now getting back up saga has humbled him. In a series of slow-burn, tipping points, the BBB downgrade was one of the biggest stings.

“I took some long looks in the mirror,” says Bruno, 29. “I realized I had a lot to learn.”

One way back from the bottom, he says, was to hyper-focus only on current customers, including going back to fix past and lingering problems. In doing so, the company's revenues have essentially plateaued for the past two years. Bruno projects the same in 2018, around $18 million in sales.

And in a move registered with the BBB, Bruno Air Conditioning changed its name to Bruno Total Home Performance Sept. 1. The name reflects expanded services, including plumbing, electrical, some general contracting, roofing and storm protection work. The company, which works mostly from Naples through Sarasota, now also offers several versions of expanded warranties. This new entity had more than 100 BBB five-star rankings through February.

While growth has purposely stalled, the new version of the business — with multiple revenues streams, dozens of new employees, a new branding campaign, new website and more — has a big sales target: $100 million in five years.

“This company has the ability to become one of the top home services business in the country,” says longtime industry consultant Mike Robinson, a former HVAC services business owner who thought so highly of Bruno he joined the company, as general manager and COO, last year. “I know what it takes to get there.”

New vision

Robinson represents a big piece of Bruno's humble pie. Robinson got into the business more than 25 years ago, buying part of an HVAC company in Wisconsin. He later sold that business to Service Experts, a national company, and became an executive there.

Bruno and Robinson met in late 2016 at a training conference in Nashville, where they were both were presenters. Robinson saw Bruno speak, and he was impressed with the young executive's story, and composure. “I had never seen someone that young, with that kind of success and foresight,” says Robinson.

Robinson asked Bruno if he could come to Naples and check out the operation in person. It was on that visit that the duo bonded over ideas and strategies. It was also there where Robinson saw the company's crumbling infrastructure. “The biggest issue is he just grew too fast,” he says.

Close behind that, says Robinson, was a lack of middle managers who could both hold field technicians and call service operators accountable and work in sync with Bruno. “Every army needs good captains and majors under the general,” says Robinson. “Louis is a good general, but he didn't have the people around him who could translate his vision.”

Next man up

That vision, the duo decided, started with modeling the Next Man Up mantra of the NFL when it comes to employees. In Bruno's world that means if someone doesn't excel at the job — for a high wage — then the company will find someone else to do it.

“Everyone understands that in the NFL, if you don't do your job there a lot of people who will,” Bruno says. “Now we have people who know if they don't perform there are 50 people right behind them who will work hard and take their job “

Bruno delivered the NFL message to the employees at a company-wide meeting in early 2017. “We're going to the moon,” Bruno recalls he said at the meeting, “and we only want people who want to go to the moon.”

In the months after that meeting, the company's payroll dropped from around 180 people to 105. It was a combination, says Bruno, of people who “self-selected” to leave and those who were asked to leave for performance and attitude issues. The employee base in early 2018 is back up to around 200 people.

And those people, part of the new version of the company, are well-paid, Bruno says. Field technicians, says Bruno, can make $50 an hour, which is up from the Southwest Florida typical pay for that position of $28-$29 an hour. Air conditioner unit installers he adds, can make six figures a year.

Robinson, who handles day-to-day decisions, says the NFL mantra would be incomplete without setting strict guidelines and expectations for every employee. That's something he spent a lot of time doing at several previous career stops. “The key,” he says, “is to focus on quality and perfection, every call.”

There's a real-life feel to that call to arms: a free second opinion is automatically triggered any time a field technician makes a recommendation for a customer to spend at least $700. For that, a senior-level HVAC technician comes out to the property or business to make sure the first employee made the right call.

It's a costly add-on, but Bruno says it has helped add a level of integrity to the company's process in the field — something it lacked and got pinged for during the growth years. And it works, too, he says. “When a technician knows there is a guy coming from behind him to check his work,” Bruno says, “he actually works much better.”

Bear market

Bruno learned a valuable management lesson in Robinson's pursuit-for-perfection message, in a reverse engineering kind of way. That's because in talking with Robinson, Bruno realized there were too many times he looked the other way on leadership decisions, and was “too empathetic” with people while the money poured in.

Now, Bruno says, he knows that “even if there's a slight variance in the expectation, that adds up to an inconsistent customer experience.”

Bruno has utilized the advice of business experts before. When he launched the company, for example, he established an advisory board of leading Fort Myers and Naples business executives and entrepreneurs. The group included Larry Lipman, chairman of Lipman Produce.

That version of the company, while only six years ago, is significantly different from Bruno Total Home Performance. The new version, beyond the array of added services, includes an updated corporate brand and logo. It also comes with a mascot: a big fuzzy teddy bear.

Taken together, the changes, says Bruno, represent what he believes is his best shot to remake the business so it will last for decades. “We can't continue doing what we've always done,” Bruno says, “if we want to get where we want to go.”

At A Glance

Bruno Total Home
Year Revenue Growth
2012 $70,000
2013 $2.4 million 3,328%
2014 $15 million 525%
2015 $15 million 0%
2016 $18 million 20%
2017 $18.47 million 2.6%
Source: Bruno Total Home Performance

Reading room

When Louis Bruno re-wrote a business plan for his re-named company last year, Bruno Total Home Performance, he re-read some of his favorite business books. “These three books taught me a lot about motivating, leading and incentivizing people,” says Bruno.

Bruno's top three:

• “How to Win Friends and Influence People,” by Dale Carnegie;
• “Good to Great” by Jim Collins; and
• “Think and Grow Rich,” by Napoleon Hill

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