“Better to cry once over the price than to shed many tears over quality” – Wise Urdu Proverb
We were recently asked to quote for decommissioning some old air conditioning and ventilation equipment in a large popular restaurant in NW London and replace this up to date energy efficient equipment. The restaurant is one of several owned by a family that have been in the trade for over 40 years.
The original request came from the son of the founder as he is increasingly taking over the day to day responsibility of running the empire. His view is that they have a thriving business whose reputation depends on the quality of the food and the comfort of the customer. So, naturally in time for the summer, they should consider investing in equipment that will continue to keep bums on seats for the optimum amount of time to maximise revenue – you see a comfortable customer is more likely to sit for longer, eat and drink more, and most importantly likely to return time and time again.
At the agreed date and time we attended the site and were greeted by the founder. He advised us that his son was abroad and added that his son shouldn’t have invited us because:
· The founder knows someone in the industry that may be able to get second-hand equipment at a low price, and
· The contact will do the work cheaply for cash.
This was our queue to make a swift exit. You might ask why we didn’t compete on price. Well there are a number of reasons:
· Air conditioning and ventilation equipment does not fit easily into the one-size-fits-all category. Would you put a motor-cycle engine into your car just because it is cheap? Similarly for air conditioning, the equipment must be selected by reference to the space that requires conditioning and the function that this serves. By installing second-hand equipment you lose this flexibility and are setting yourself up for future problems.
· In most cases you don’t know the service history of second-hand equipment, and if it has been poorly maintained in the past, you will not experience optimal performance.
· The cost of new equipment is in fact a relatively small part of the overall price for a project that requires design / supply / installation. The more significant part is the technical know-how of the designers and engineers that install the equipment. Be wary of the competence of those that offer to supply old equipment.
· Technology in this industry is changing at such a rapid pace that newer equipment is far more energy efficient than its predecessors – i.e. it will cost less to run. Depending on the equipment chosen, there could also be 100% tax relief and also interest free funding (from the Carbon Trust).
· At Aire Serv we pride ourselves in providing a first class service. We are fully insured, provide warranties, are legally qualified to perform the work, AND LIKE TO PAY OUR FAIR SHARE OF TAXES. Be wary of those that want to do cash deals – will you see them again once the systems breakdown? Will they declare VAT and pay their share of income and corporation tax? Would you rather save a few pounds now, but pay more taxes later to make up for the shortfall arising as a result of tax dodgers?
Last Sunday my wife and I were invited to dinner at this same restaurant. We noted that the air conditioning and ventilation system had still not been upgraded. As the summer has finally arrived, it was 26°C and customers were commenting, in particular from the conservatory area where my guess is that temperatures probably reached 38°C. Do you think they will be returning anytime soon?
So, if you’re tempted to do a cash deal for some cheap kit, think twice – WHO IS REALLY GETTING THE GOOD DEAL, you or the counterparty? If it’s not you, then come and talk to us.
Member since: 23rd August 2010
Prashant is a Director of Aire Serv, a leading international air conditioning, ventilation, heating and commercial refrigeration business, and is responsible for the NW London region.