AIR CONDITIONING Opportunities abound for all
Ron Lloyd, managing director of Coolstop looks at the threats and opportunities ahead.
W
ho remembers the dark times of the seventies? We experienced no electricity, redundancies and rubbish
on the streets. The boom times of the ‘80s followed, but then the ‘90s hit with the housing crisis and recession and the naughties brought us the financial crisis of 2007. If that wasn’t enough, the new uncharted Covid landscape that is like a walk on the dark side of the moon. How does anyone prepare for this? The world has changed as we know it in these
‘unprecedented times’. At least that’s what we all seem to have heard during these last few months. But what does this really mean for any of us working in the refrigeration and air-conditioning industry that we all love and enjoy? It is important for us all to look at the opportunities and threats facing us today. This will give us clarity and a better understanding of the future and how best we can plan for the future.
Some might say we don’t have a pandemic –
instead, we have an infodemic that could quite easily blur our vision. Do I see a blurry vision of the future only when I’m not wearing my glasses? I see this time as a great opportunity. What are these threats this so called
‘Infodemic’ could be telling us? We live in a commercial type ‘Armageddon’ landscape – we see huge contractions in the building industry, the decimation of the high street, restaurants struggling to cover lost business and less than 75% of pubs reopening as they struggle with the Covid consequences. Manufacturing came to a standstill with supply being hit as a result of trying to recover from these enforced shut downs around the world. The list just seems to go on. Now that we all feel the doom and gloom can we really see any opportunities ahead of us? The post Covid landscape may look rocky and uncertain at present but look at what we have. The unveiling of the £3 billion green investment by Chancellor Rishi Sunak as part of the great British Covid recovery plan. State funded initiatives that could give the economy a well- earned leg up after the catastrophic impact of a global lockdown. This investment aims to help the UK build back greener and help the UK meet its target of net zero carbon by 2050. Within this plan the Chancellor earmarked
24 September 2020
£1 billion to improve energy efficiency in public buildings including schools and hospitals. On top of this a domestic opportunity with homeowners having the opportunity to receive a voucher of two thirds of up to £10,000 to improve energy efficiency. Other money will be set aside to look at decarbonising social housing on a large scale. Looking at this, our industry has the opportunity to potentially have work with over 650,000 homes. All hail the rise of the air source heat pump! An opportunity which we all know the government has dabbled with for many years – could this really be the time to expand this area and take it seriously?
With the demise of gas and a desire to make the world we live in a more green and sustainable environment this could give the heat pump a real opportunity to enter the main stage. This market has been growing steadily for many years. In 2018, Europe reported sales accelerating at around 13% before any new incentives were introduced to support the economy. Air sourced units saw growth of over 19% followed closely behind with mono-block system sales of over 18%. This has also been supported at a European level by the Building Regulation Directive with the objective of limiting the average energy consumption in new dwellings. As public awareness of heat pumps began to rise in the UK, this market would see sales growth in excess of 19%. In 2018, the media was saying that domestic air-conditioning could become common in UK homes. Did we all really take this view seriously or just brush it off thinking the real future was commercial and the rise of the super office environment? Let’s rewind and pause for a moment – where are all the office workers now and where will they be in the future? Large firms have recently been saying their staff won’t be returning to the office for at least six to 12 months. With hot weather becoming commonplace and a recent hot lockdown have helped drive people to try domestically installed air-conditioning. Or is it just that we have more people working from home and this could become the new norm? Whatever the reason, we are beginning to experience a rise in domestically installed air-conditioning as a result of this pandemic.
Since 2006, significant changes in the air-conditioning market have been driven by ever-changing climate with more regular hot seasons hitting highs not normally experienced in the UK. The majority of air-conditioning for many years has been commercially driven with larger systems including VRF type systems and dependent on prevailing construction trends. The buoyant market of large office spaces and commercial work areas has dominated the air- conditioning market for many years. However, the leisure industry has also been growing in demand for more cooling in hotels, pubs and restaurants.
Fast forward to 2020 and now look at our situation. Who would have thought a pandemic and a change of working practices could set the stage for a change in how we are use air- conditioning?
As lockdown continues to ease and work begins to come back to life this could give us an optimistic outlook and opportunity for our industry for the coming months. We may see a shift in the type of equipment being installed alongside the opportunity to service and maintain equipment that has been idle since lockdown began.
At Coolstop, we are preparing for two possible scenarios as an agile wholesaler. The first scenario being a V shaped recession where we will begin to recover at a slower pace than the initial decline from the summer. The second scenario could be a W shaped recession that could possibly include a second wave of infection and a subsequent recovery in quarter one 2021. As a successful independent business, we feel keeping close to our customers is important to understand their needs and prepare for every eventuality. Whatever scenario faces us, we will still need to install equipment, we will still need to service equipment and as a result the necessary supplies will be ever more important. As an industry continuing to move out of lockdown and return to some kind of normality, there will always be opportunity for us all. As Tony Robbins a well know life coach and motivational speaker once said: “Expect change. Analyse the landscape. Take the opportunities. Stop being a chess piece; become the player. It’s your move!”
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