Are small businesses struggling in 2025?

What’s hurting appliance & HVAC parts right now

1. Supply Chain Disruptions & Delays
   • Small businesses are struggling as parts, especially from overseas, are subject to delays from shipping, factory shutdowns, or raw material shortages. Small business struggling to find solutions during these times is a common issue.
   • Some critical components (compressors, heat exchangers, semiconductor chips, specialized fasteners) are harder to get, so lead times are longer. As a result, small businesses are struggling due to these constraints and find it challenging to meet customer expectations. Small business struggling with these issues often face operational challenges that affect their ability to maintain smooth operations. The pandemic has further highlighted how small business struggling in managing these challenges may impact their sustainability and growth.
2. Rising Raw Material & Component Costs
   • Metals like copper, aluminum, steel are up in cost and volatile. Since many HVAC and appliance parts depend heavily on these, that drives up production cost.
   • Transitioning to new materials or components (for example to comply with environmental or regulatory standards) often means more expensive components, tooling, and new supply arrangements.
3. Regulatory / Environmental Changes
   • New rules are phasing out older refrigerants (like R410A high GWP ones) in favor of newer, lower-GWP refrigerants. This transition isn’t trivial: the new refrigerants often require different handling, safety protocols, equipment adaptation, which adds cost and delays.
   • Energy-efficiency regulations, emissions standards, safety/regulation compliance (for instance around flammable refrigerants) mean parts manufacturers and installers have to adapt, retrain, certify, etc.
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4. Labor Shortages and Skilled Technician Gaps
   • Fewer skilled HVAC/R technicians means slower installation, repair and service, increased wages, and sometimes quality issues.
   • As seasoned techs retire (“silver tsunami”), there are fewer coming up with the skills needed for new refrigerant types, smart systems, etc.
5. Tariffs, Trade Policy & Import Costs
   • Tariffs on imported appliance parts or raw materials make sourcing from outside more expensive.
   • Trade‐policy uncertainty means manufacturers and distributors are less able to reliably forecast cost and availability of imported components. This uncertainty makes inventory management harder.
6. Technological Change & Product Complexity
   • Appliances and HVAC systems are increasingly “smart” (IoT, sensors, controls, connectivity). That increases the complexity of parts (more electronics) and thus vulnerability to component shortages, needing more specialized parts and replacements.
   • Also, with increased regulatory demands (efficiency, refrigerants, emissions), older parts/technologies are being phased out, which means parts for older equipment may become scarce or more expensive.
7. Inventory & Forecasting Risk
   • Because of the uncertainty in demand, regulations, material costs, etc., forecasting is harder. Ordering too much of old-parts risks obsolescence; too little means backorders, delays, lost sales.
   • Holding costs for parts inventory are nontrivial (storage, capital being tied up, risk of damage or obsolescence). More so when parts are specialized.
8. Consumer Price Pressure / Affordability Concerns
   • When costs go up, businesses often either have to raise prices (which can reduce demand) or squeeze margins (which hurts profitability). With inflation and cost of living rising, many customers are more price sensitive.
   • Some may defer repairs or replacement, especially for non-urgent parts, or choose less expensive, aftermarket options. This shifts demand patterns (OEM vs aftermarket) and can impact margins.

What this means for you

• Focus on aftermarket parts or retrofits — older equipment needing compatible parts might still offer an opportunity; being able to source or produce those can differentiate.
• Communicate lead times clearly to customers, manage expectations. Delay is a big source of frustration; even if parts are delayed, letting customers know helps retain trust.
• Support Local business instead of purchasing online.