With summers seemingly getting hotter by the year, fixing AC systems surely ranks among the Carolinas’ best long-term business opportunities. Mike Fowler figured that out a long time ago and has built one of the largest HVAC companies in the Charlotte region.
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He expects consolidation will winnow the market from a couple hundred competitors to five or 10 major firms over the next several years, citing financial pressures, changing technologies and labor shortages. As a franchisee of British conglomerate Centrica PLC and its Direct Energy subsidiary, One Hour Heating & Air Conditioning is a likely survivor. Centrica had net profit of $580 million in the first half of the year.
Fowler, 58, is a classic small-business owner success story. He grew up in Mint Hill near Charlotte and graduated from West Charlotte High School, attended Central Piedmont Community College, then landed a warehouse job at United Parcel Service in 1977. He later became a driver, then moved into city management for the delivery giant.
He left UPS in 1995 to join his brother-in-law Dan King’s HVAC business, aiming to apply some big-company discipline to the fragmented home-services market. In 2000, King and Fowler reversed course, pulling out of the new-home installation market, a move that reduced annual sales from $8.7 million to $2 million.
In 2003, Fowler and a new partner, Charlotte investor Tommy Rea Jr., bought equity in the business, then acquired King’s interest in 2013. Sales have rebounded to about $14 million last year.
Affiliated with One Hour since 2004, Fowler added a second franchise, Ben Franklin Plumbing, in 2007 to provide customers more of a one-stop experience. The franchisor is also owned by Direct Energy.
The businesses now employ 100 people with wages ranging from $12 an hour to more than $100,000 annually for the most experienced technicians. The latter salaries reflect an 8% commission for sales of equipment and maintenance programs, Fowler says.
Finding skilled HVAC workers is a huge industry challenge, prompting Fowler to invest $150,000 in equipment for a training program at its Pineville warehouse in 2015. Ten have graduated from the program, receiving about six months of free training, 20 to 25 hours a week, in return for a pledge to work for One Hour for at least two years. The company also provides graduates about $1,500 of tools. Student ages have ranged from 18 to 37.
The company is recruiting a new class of 10 students, starting in October.
While many business people decry the lack of skilled workers, Fowler says the trick is to get personally involved in solving the problem.
“I know there are a lot of college graduates who aren’t making as much money as our technicians,” he says.