Question 1.

Provide a summary of Comfort Systems USA Industry analysis based off this information. Information below:

3.2 Industry Analysis

3.2.1 Description of the Industry

NAICS Code 238220 states that "This industry comprises establishments primarily engaged in installing and servicing plumbing, heating, and air-conditioning equipment. Contractors in this industry may provide both parts and labor when performing work. The work performed may include new work, additions, alterations, maintenance, and repairs." The HVAC, which stands for Heating, Ventilation, and Air Conditioning, market is relatively fragmented. The industry is comprised of numerous companies, mostly small local mom and pop shops but also includes a large number of multinational firms. When Comfort Systems USA was founded, it comprised of 12 major companies that were engaged in the HVAC business. As time continued, Comfort Systems USA continued to acquire more businesses to help them continue to carve out a bigger market share. They now are comprised of 35 operating companies and operate in over 114 different cities across the United States. Raw and construction materials are the major supplying industry for this focal market. The major buying industry for HVAC equipment and services is very diverse. 33% of Comfort Systems USA's business revenue comes from the Industrial sector, 15.8% from education (schools), and office buildings make up another 13.3%. The needs for HVAC cover every market from residential to commercial needs. The current HVAC global market is $240.8 billion, and by 2030 its projected to be $367.5 billion. The US Market size is currently $84.5 billion and it's expected to grow by 3.4% from 2020-2025.

3.2.2.1 Market Size

The current industrial sales revenue in the US market for HVAC is $84.5 billion. The market is comprised of about 106,000 different companies, and employees roughly 505,000. The annual growth for the HVAC market for businesses from 2015-2020 was only 0.8% and for employment was 1.9%. The expected annual growth for 2020-2025 shows that number of HVAC businesses to grow 2.0%, and employment to grow 3.0%. There is a trend of new entrants to the market which is going to further increase employment but also increase competition. The US Market revenue is small compared to the global market, which nets $240.8 billion in revenue per year. The HVAC industry is mostly a service-oriented industry with no international trade, as goods are not passed from one country to another. This means that both imports and exports are low and steady. The majority of industry participants are domestic, small- or medium-sized operators. However, there are some multinational companies that offer heating, ventilation and air-conditioning and refrigeration services in a wide variety of markets, including industrial, municipal, multifamily and commercial. Multinational construction companies include both foreign-owned operators in the United States and domestically owned companies offering services abroad. One example of a multinational company would be Daikin Industries. They are headquartered out of Japan, but have a market capitalization of $41.59 billion in the United States.

3.2.2.2 Market Growth Rate

The Industries average revenue growth rate from 2015 to 2020 was -0.8%. While the revenue growth rate was negative, the profit margin actually increased by 0.1%. Multiple different sources have claimed that the HVAC industries growth rate is anywhere from 3-6% CAGR. There are multiple drivers for this thought. As the world recovers from COVID as it will increase consumer spending power, and increase disposable income. As we are already seeing, the housing market is booming due to it's record low interest rates. The need for new HVAC units in the residential area has been steadily increasing month over month. Also, the need for HVAC units that are able to filter out the virus has increased tremendously. Multiple different companies now offer high efficiency units that are capable of filtering out air borne viruses. There is also the Global Warming factor that needs to be considered. As shown on the graph below from Statisa, as the world has progressively gotten warmer, there has been a significant increase in number of cooling degree days (using A/C unit to cool). In 1950, it averaged about 850 days cooling days while in 2019, we have hit 1500 days. In less than 100 years we have almost doubled the amount of our A/C usage in order to keep our homes and businesses cool.

3.2.2.3 Industry Trends

1) Are there any changes recently or expected in the near future in terms of the total number of firms in the industry, location distribution of the firms, abnormal industrial dynamics (such as merger and acquisition, new entrants, and declining incumbents), etc?

A. Although the pandemic of 2020 did affect the industry as almost any other business.

B. Industry is expected to increase in the following years. As the contrustion and developing of new building facilities rise so will the entrants of new HVAC companies.

2) Are there any new products, production processes, technology innovation (improvements) present recently or expected in the near future?

New technology innovation and advancement in the HVAC industry is very common. Almost essential to have the latest most renowned system that is energy effient most of the techiniques employed by HVAc techs have not changes significantly. Using smart technology as we call it now such as apps allowing us to control any system at any given time and at any given place; with the one and only purpose to save money and save our planet.

3) Are there any changes in the scope of the market such as the pace of globalization; product/business diversification of current large companies?

Close to zero changes in the scope of the market. The majority of the industry does business domestically. With no international trade and mainly focuses in domestic business.

Question 2.

er/Downloads/Introductory%20Email%20Assignment%20.pdf Profile & Instructions: Assume you are a salesperson for a Hamilton-based company that designs and implements web sites for businesses. Assume that you have identified, researched and qualified a new prospect for your web site design services, and have learned the following about this prospective customer The prospect's company is named Lawn & Order Landscaping, and they provide residential and commercial outdoor landscaping services in Hamilton. Lawn and Order is a small but growing company and is owned and operated by David Lain. You have seen many of their crews working in the Hamilton area, which suggests the business is doing well, and you can see that their services are highly rated (5 stars) on customer review web sites. Lawn and Order currently has a web site, but it is just a single page and is poorly done. By contrast, they are running a radio ad that is professional and effective, as is the Lawn and Order company signage and sales literature that you have seen in the market. Lawn and Order recently won a Hamilton Spectator award as Top Landscaping Company in the Hamilton area, and has been recognized by Homestars.com (a home improvement services review web site), as a "Top Pick" in the landscaping category. The company you work for, Dynamic Web Creations, distinguishes itself by offering high quality web sites at affordable prices, and has successfully designed and launched over 20 web sites in the past 2 years. The company has several happy customers in the home services industry and specializes in designing mobile web sites. Dynamic Web Creations was recently ranked by Digital Business Magazine as the #1 web site design company in Ontario for Value and Design Capabilities. Your task: I Write an introductory Pre-Approach email to the owner of Lawn and Order Landscaping, David Lain. The goal of your email should be to introduce yourself and your company, generate interest, and secure a follow-up phone call. Be sure to follow the format and advice referenced in the 'Building Customer Relationships Chapter 7 slides and discussed in class,General Description: This assignment tests the student's ability to write a professional introductory business email to a prospect as follows: You are a B2B sales rep. The company you work for specializes in e-commerce - high end web development. (See complete profile and instructions at the end of this assignment). Your key objective is to secure an introductory telephone call or meeting with a prospective customer that you've never met or spoken with before. Through your initial research, you have identified a company that you feel would be a great prospect (See complete profile and instructions at the end of this assignment). Compose your email to the buyer/contact at this company designed to meet the above objective. Evaluation Criteria: Be sure your email contains the following elements to ensure the best possible success: 1. Subject (2 marks) 2. Introductory statement (3 marks) 3. Benefit statement (5 marks) 4. Ask / Call to action (5 marks) 5. Your contact information (include name, Student # and class) (2 marks) 6. Grammar / spelling and creativity (3 marks) Hint: Be sure to follow the format and advice referenced in the Top 10 Email Do's and Don'ts slides referenced in the Chapter 7 PowerPoint and discussed in class. This can be found the Chapter 7 Module in Canvas. Expected format: Submit this email (in word document format) to the Canvas folder labelled Introductory Email Assignment. Please type your answers directly into a new document (do not include the full assignment questions in your document or it will be flagged by the Originality Checker). Your email should be no more than one page in length. Late submissions: Will receive a grade of zero, unless exceptional circumstances have arisen that have prevented on-time submission and the instructor has been notified in advance