Chad Peterman, President of Peterman Brothers Heating, Cooling & Plumbing, has always been deeply connected to his family business. Established in 1986 by his father, the company began as a small, local HVAC service provider in Greenwood, Indiana. As a second-generation leader, Chad didn’t just inherit a business; he inherited a vision. He knew early on that he wanted to grow Peterman Brothers into something bigger—something that would make his father proud and set the standard in the HVAC industry.
Growing up, Chad witnessed firsthand the grit and persistence it took to run a successful small business. He spent summers learning the ropes from his father and got a firsthand view of the challenges small businesses face daily. When it was time for him to take over, Chad was determined to honour his father’s legacy by not only sustaining the business but scaling it to new heights.
As Chad stepped into his role as president, he quickly realised that leading a company through rapid growth came with its own set of unique challenges. After an initial period of impressive expansion, growing from $50 million to $90 million in a year, Chad discovered that fast growth doesn’t come without consequences.
When the company was expanding rapidly, it was easy to make mistakes. Chad admits that during this period, hiring practices were less strategic—more people were added to the team to keep up with demand, but not all were the right fit for the company culture. Operational inefficiencies began to surface, and managing costs became increasingly difficult. Small business acquisitions also posed issues, as these companies, while valuable, didn’t always integrate smoothly into the existing company model.
Moreover, with the onset of slower growth in the economy, Chad had to take a hard look at the company’s financials. Gross profit margins, conversion rates, and overhead costs needed to be more closely monitored. It was clear to him that in order to sustain the growth and maintain profitability, a new strategy was required—one that focused on efficiency and long-term planning.
The turning point for Chad came when he decided to focus less on rapid expansion and more on strategic growth. His first step was rethinking the company’s approach to acquisitions. Rather than continuing to buy smaller companies with their own challenges, Chad shifted to a “greenfielding” model. This involved opening new branches from the ground up, staffed by people who had been trained and developed within Peterman Brothers. It allowed the company to maintain its high standards, ensure a seamless cultural fit, and build a solid foundation in new markets.
Chad also revamped the hiring and training processes. He established an internal school to develop talent from within, focusing on aligning new recruits with the company’s core values. Instead of relying solely on experience, he sought out individuals who had the right attitude and willingness to grow with the business.
With a renewed emphasis on leadership development, Peterman Brothers began identifying future branch leaders early and providing them with hands-on training. This strategy allowed the company to open new locations with leaders who understood the business inside out. In fact, the company’s success in new markets, such as Louisville, Kentucky, was largely attributed to having the right people leading those branches.
Chad also became more data-driven in his approach. He fine-tuned the company’s focus on key performance indicators (KPIs) like gross profit margins and conversion rates. By improving operational efficiency and better aligning costs with revenue goals, Peterman Brothers became more profitable and resilient to economic fluctuations.
Beyond operations, Chad recognised the power of building a personal brand. Through his podcast, Can’t Stop the Growth, he shared his journey, leadership lessons, and experiences, which not only helped recruit new talent but also created a community around the business. This outward-facing strategy allowed Chad to attract like-minded people who wanted to grow with the company, leading to better hires and long-term retention.
Key Takeaways for Business Owners
Chad’s journey offers valuable insights for business owners looking to scale their companies strategically:
- Be selective with hiring: Don’t rush into hiring just to fill gaps. Make sure new hires align with your company culture and values to avoid inefficiencies later on.
- Focus on profitability over revenue: As Chad learned, it’s not just about growing revenue—it’s about increasing profit margins and operational efficiency. Regularly evaluate your conversion rates, average tickets, and gross profit margins to keep the business healthy.
- Know when to pivot: Instead of continuously acquiring smaller companies that don’t align well with your operations, consider building from within—what Chad refers to as “greenfielding.” This allows for greater control over company culture and operational standards.
- Invest in leadership development: Identify future leaders within your company early, and provide them with the training and mentorship they need to succeed. A strong leadership pipeline is crucial for sustainable growth.
- Build a personal brand: A strong personal brand can attract talent and new business opportunities. Share your story, expertise, and values with your audience, and people will want to be a part of your journey.
- Use data to guide decisions: Monitor key performance indicators like conversion rates, gross profit margins, and customer retention rates. The numbers don’t lie, and they will help you make more informed decisions about where to allocate resources.
- Adapt to market changes: Economic conditions can change quickly, so it’s important to remain flexible and adjust your strategy accordingly. As Chad discovered, slower growth periods call for a sharper focus on efficiency and cost management.
Chad Peterman’s story is a powerful reminder that running a successful business is not just about growth—it’s about building something sustainable. By staying true to the company’s core values, investing in people, and constantly fine-tuning operations, Chad has positioned Peterman Brothers as a leading player in the HVAC and plumbing industry.
As Chad puts it: “The more you give, the more you get.” For him, giving back to his team, his community, and the industry has only led to more success in return.
