This episode is brought to you by C&E Insurance Company, a leading insurance company that provides a broad range of standard and specialized property and casualty insurance products and services for businesses and professionals throughout the U.S., Canada, and Europe, and is backed by more than 120 years of experience and approximately $45 billion in invested assets. Welcome, everyone, and thanks for joining us on our ongoing series of Getting to Know Our Clients. My name is Daniel Perzee, Vice President at Durant Jemesa, and today we're excited to speak with Matt Mazzi from Mazzi Heating and Air. Matt, welcome to Studio One.
Thank you. Thanks for having me. Excited to have you. So to get us started, Matt, tell us a little bit about your personal background, where you grew up, anything that's pertinent to our listeners or for our listeners as they learn more about you, the person.
Yeah, I grew up in a small town here in San Diego in Lakeside. Grew up with my mom and dad. I have a younger brother and a younger sister and got a normal upbringing. My dad has worked in the industry almost his whole life, too, so I kind of grew up being taught heating and air conditioning.
Grew up around the trade, and my early years in high school, in 10th grade, I decided to leave high school. So at the time, I was taking astrology, trigonometry, and probably what happened today, but we met with my counselor. I knew what I was going to do. I knew I was going to go into heating and air conditioning, and so we had a meeting, and my counselor suggested to my parents that I leave high school and get my GED.
Probably not the best idea, because I left two weeks in my 10th grade year and never went back to school. Never got a GED, never went to any formal trade school, you know, college is anything. I went to work doing heating and air conditioning with my dad, and did that for a couple years, and ended up getting in a little bit of trouble with drugs, and actually ended up losing everything I had. Ended up homeless under a bridge in another small town here, El Cajon, and woke up one day and decided that I wasn't going to die a drug addict and walked to a local rehab here.
Mike, the Macalester Institute of Teaching and Education. Wow. I donate a lot of time to them today to speak and give money to the program, but got myself into rehab, and I got out of rehab, got back in the industry, and ended up starting Mazi Heating and Air Conditioning. So we're a three-generation company, my dad, me, and my son, and that's just a little bit about my background.
Great. I appreciate you sharing all that. Obviously, we've worked together a long time, so I'm aware of bits and pieces, but I appreciate your candor. Yeah.
That's much appreciated. So let's kind of shift gears. You're now in the business, working with your dad. Talk about that transition.
What was it like working with your dad? I think on that, how did the business begin to shift under your guidance? Yeah, so I took it over. I think it was 96.
We were doing about $400,000 a year as a company, and my dad, incredible, incredible, incredible guy, really good with the trade part of things, but not great with the business and things, with the marketing, the advertising. I'd gone to him a couple times and said, hey, let's create a marketing budget. Let's go out, and he was like, no, it's referrals only. We'll get plenty of work that way, and we saw things a little bit differently.
So when it came time for me to take the business over, and it was a hard changeover. It wasn't like he stayed and mentored. It was I took the business over, and he actually went to work for me. And I took it over in 96, and we started growing the business.
Today, we do over $20 million a year. But over the last probably 20 years, I put a lot of time and effort into it. But it was challenging at first with me becoming my dad's boss. So what I did is we kind of separated.
I put my dad in charge of the warehouse, and he ran the warehouse, ordering the equipment, doing all those things, and then I took over the business side of things. And because we had that degree of separation, things actually worked out pretty good. Wow. And the business just started to take off and grow year after year.
And what does that business look like? I mean, obviously, we know you're heating and air conditioning, but walk us through what your kind of bread and butter is. Yeah, bread and butter is residential heating and air. So really, about 95% of what we do is going out to an existing residential home, tearing out the old heating and air conditioning system and ductwork, and putting in a new system.
So that's really the bread and butter. And we do other services. We have solar that we do in combination with that heating and air and a few other things. But that's really the bread and butter.
It's residential only. We don't do new construction. We don't do commercial work in commercial buildings. We just do residential retrofit.
Okay, great. I appreciate that. And where are you guys located now? We're in El Cajon.
We have a lot of building, a 15,000 square foot building in 2015 in El Cajon. When we bought the building, we only occupied 28 offices, a huge warehouse. We occupied maybe half of it. It's a little scary the first year.
But what I learned is when you buy a building like that, we were restrained by a old building, which was 2,000 square feet. We bought that building, and within two years, we had every office full, and we grew by $12 million in gross sales. Wow. So that move allowed us to hire more people, have more resources.
And so I would definitely tell the listeners, if you're thinking about a move into a building that works better for you, to do it. It's a little scary at first because of the financial commitments, but the best thing we ever did. Fantastic. So I guess what would you say makes Mozzie unique from other competitors right now?
What kind of separates you? It's our people. It's the quality of work. The most important part about running a business is the people that you hire.
Like, I don't, you know, obviously not a high school graduate. I don't have this, you know, crazy education. I mean, the only thing I'm really, really good at is hiring good people. And that's really what separates us from our competitors is, like, our install teams are the best out there.
You know, the customer service when you call in is the best out there. Once we get a customer, they stay with us year after year after year. We're not all about the dollar, right? A lot of our competitors, they pay their install teams, their service teams commission based on what they are able to charge the customer for.
That kind of breeds some dishonesty. You know, guys, the more they charge the customer, the more they end up keeping. And we don't do that. You know, everybody that works for us is hourly.
They're all highly qualified. And that really makes us different from the other heat and air companies out there. Interesting. Appreciate you sharing that.
So let's shift gears a little bit and talk about your philosophy on safety and maybe how that blends overall with the culture of the company. Yes, safety to us is super important. It's number one. Somebody gets hurt working for our company.
I mean, that makes me feel terrible, right? Because we've obviously failed it. We haven't had something in place that could have prevented that. So it's going to happen, even though we are a super safe company, thanks to you guys and your programs and what you guys do for us.
We did. We had an incident about five years ago. We had a guy fall through a ceiling. He was walking on a piece of wood that had a knot in it.
So he was on a solid surface, and that piece of wood broke, and he fell through the ceiling and got injured pretty bad. And it was, I think, one of the first, probably the first major injury we had and the only major injury that we've had. And through that experience with Cal OSHA, who we all fear, right? They can hurt you financially.
You know, even check your business down. We had a mandatory audit. And what was great about that is through the training that we got from you guys, I was always told, and Dan, you personally told me this every year, if there's an injury where somebody has to be transported to a hospital, you need to contact Cal OSHA immediately. They're your second call.
And that stuck in my head. And because I did that, when Cal OSHA came out to do their audit of the building and the audit of the site, they were very appreciative of that. The guy that came out asked me how I knew to call them so quickly. I told him, and he told me that most companies are trying to avoid Cal OSHA.
They don't make that call. And when that happens, they really hammer those companies. So we got audited by Cal OSHA. We actually had a no-change, no-fine audit job site and a 15,000-square-foot building.
We got an award from Cal OSHA for that, which is impressive. It just doesn't. The auditor that came out, his boss had to come out because he didn't believe him. That doesn't happen with Cal OSHA, I guess.
So, you know, safety to us is super, super important. You know, meetings, tailgate meetings, the training you guys give us really helps us with those things. The resources that you guys make available has really helped us. But safety is everything to our company.
Everything we do, we think about what could happen. What's the potential downfall? And, you know, I've been able to witness that over the many years we've worked together. And I can agree with you.
I mean, I think how you treat your employees, both on the front end in terms of the type of people that you're looking for to come aboard, I think you're very selective. But you're also very generous to your employees. And I think as a result of that, there's a lot of loyalty. And I think about that one incident, and I remember you being so impacted from that injury and wanting to take care of that person and the family involved.
And it was eye-opening for me. Yeah, we helped him buy a home because I knew he was going to be disabled for many, many years. So we helped him get a house down in Chula Vista. And, you know, because it's something that's horrible, right?
You don't want to see any of your people go through that, especially as close as we are to all of our employees. Right, right. And I think that's one of the main things that kind of separates you, but I've always admired that. And, you know, some advice I do is, you know, as we started to grow, we grew very quickly.
So we had a couple $6 million growth years. You know, the one thing that was difficult for us was to keep up on the safety. We had a run of smaller, like, hand cuts and stuff that we had to deal with. But the one thing I wish we would have done was you need to increase your safety programs as quickly as your growth.
And that's the one thing that we fell behind a little bit, but we got caught very quickly. But you definitely have to make sure. And then hiring with the quality people, we pair people about 30% more than our competitors do. And we end up getting a much higher quality employee that takes safety and workmanship and things like that more seriously.
So it's well worth paying somebody a little bit more because you're going to save it on the back end. Right. I would agree with that. Unfortunately, I think a lot of people have a different view when it comes to that.
Yeah, they do. They want to cut corners on labor, and that's the last place you should cut is on paying your employees well. You're not going to get the same quality employee that you would get if you just pay a little bit more. So speaking of labor and the big bad word of inflation and just the economy in general, how are things in today's economy relative to your operation?
You know, any challenges that you guys are encountering? What's maybe the toughest challenge right now? It's actually getting products. Like getting heating and air units is probably the toughest challenge.
And right there with it is getting labor, too. Like finding people that actually want to get out there and get dirty, climb a 115-degree attic. Those two are probably hand-in-hand. But then inflation is difficult because the average cost of a heating and air system in San Diego in the last two years has gone up about 22% to 24%.
Wow. We live in San Diego, so the weather is usually 75 degrees. It's a place where you don't need heating and air all year long. There's a couple months in the summer and a couple months in the winter that you use it.
So that's certainly becoming a challenge for us because your average heating and air system cost fully installed used to be about $8,500. And now it's, you know, that was about two or three years ago. And now it's running about $15,000. Wow.
The same system. And my fear is when do consumers say, okay, look, for $20,000, I'll be hot two weeks a year, two weeks a year. Right. It's San Diego, right?
It's going to be beautiful in a month. So that's one of my concerns. But I still think that people that have heating and air systems, I still think with that cost, they're not going to go without it. At least that's my hopes.
I think you're right. I think you're right. So kind of last piece of this is just to talk about you and I and just our connections. We've worked together since, believe it or not, 2005.
So it's been a good 16-year run. Plenty of ups and downs in that window. Can you kind of share with our listeners how your partnership with us, in particular Rancho Mesa, has benefited Mozzie and anything that you've gleaned from the partnership? I was thinking about it when we sat down here.
I would say, I mean, number one, probably the most impressive part is your presentation every single year to us as a team where you sit down yourself and break down the different insurances, what the benefits are, the ads we should go with, and break down what the meanings are of these things. That is so helpful every year. It makes it so that we understand what the policy looks like, understand what things are important, what the different costs are, and helps us build what I think is the perfect policy for that time, right? As we've grown, things change.
We need different coverages. We need a lot of different things. And every year, the presentation that is given makes it so simple for us to make a decision on what things we really need to do as a company. And then some of the other things are, like, Jim Lump, like, the support your support staff, Kim.
I mean, everybody here that we've worked with for all these years, like with Jim on the workers' comp side, being able to get updates on things, being able to just, if I have got a question about something, contact him. And on the medical side, on anything workers' comp related, it has just been absolutely amazing. The other thing I appreciate, too, is the competitiveness. Every couple of years, at least, we put this thing out to other insurance companies because, you know, as a businessman, I think you have to do that, right?
You've got to see what's out there, and every single year, you come back, and there's an adjustment that needs to be made, or I've got questions about something. Every year, you guys come back and are super, super competitive. So, but, yeah, without you guys, we wouldn't be aware of it today. And then the training programs, like all of the stuff that you give us included in the package every year, access to all of the sexual harassment training, all of the programs that you give us that we're able to use on the inside have, number one, saved us a bunch of money, but number two, you know, helped us get where we're at.
We appreciate that. It's nice to hear because oftentimes we don't get the summary like you just provided of, you know, how we operate and what we try and do separate of the insurance as well. The professionalism and the consistency is just amazing, and that's something that every year, I don't have to worry. I know May of every year, you're going to sit down with me, you're going to go over the coverages, we're going to pick something, and we're off and running for another year.
I don't have to worry about it, I don't have to think about it, and that's huge when you're trying to run a company. Like I said, it's the same people every year, which I love. You know, make a phone call, it's to the same people, there's that consistency. When we ask for something to get done, if we need a certificate of liability or we need additionally insured, it's handled immediately.
It's one email and it's done, so it saves us so much time. Well, we're fortunate to have a great team behind us, and like I said, I appreciate those words. Well, thank you so much for taking time. We could probably spend another 45 minutes of an hour chatting, but I really appreciate you taking time because I know how busy your schedule is, and it's nice to have you back in our office.
It's been a long time. So thank you, and best of luck, Tomasi, and I'm really excited. Thank you very much. All right, thanks, Matt.
This is Alyssa Burley with Rancho Mesa. Thanks for tuning in to our latest episode produced by Studio One. For more information, visit us at RanchoMesa.com and subscribe to our weekly newsletter.