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Investment Payback

BY Marianne Wilson

With the economic crisis forcing chains to reduce expenses and control costs, it has become more important than ever to increase the payback of every building investment. The heating, ventilation and air-conditioning system is no exception. Choosing the right system can reduce operational costs, save time during installation and maintenance and improve the customer/employee environment while also helping a retailer meet sustainability initiatives.

A critical factor for retailers to keep in mind before investing in an HVAC system is the type of refrigerant it uses.

“I would recommend going with an R-410A system now, before R-22 is phased out,” said Bobby DiFulgentiz, product specialist-commercial rooftop units, Lennox Industries, Richardson, Texas.

Chlorine-containing R-22 units will be produced until 2010, and the refrigerant itself will be made until 2020. But production caps are expected to significantly increase the cost of R-22 refrigerant, and, in turn, the cost of servicing R-22 equipment, according to DiFulgentiz.

“Installing a new R-410A system eliminates concern over future availability, as well as the problems of finding components as R-22 units become less common,” he added.

Here are some other recommendations from DiFulgentiz to keep in mind before investing in an HVAC system:

  • Consider total cost of ownership: Don’t be penny-wise and pound-foolish. Choosing a system with a lower life-cycle cost will have a much more significant impact on the bottom line than choosing equipment with the lowest up-front cost. To determine the actual financial impact of a system, take into account such projected expenses as annual energy use, installation and maintenance cost, and financing, along with the up-front cost of the equipment. “A system with a lower cost of ownership will save money now and for the next decade or longer by reducing a facility’s energy usage, the number of labor hours needed for installation and maintenance,” DiFulgentiz said.
  •  Select a high-efficiency, ENERGY STAR-qualified model. Such units can help reduce energy costs significantly over a standard efficiency system while providing a high level of performance. Also, look for innovative developments, such as multi-stage air-volume (MSAV) supply-fan technology. “Systems with a higher IPLV (integrated part load value) rating can help reduce energy use year-round, especially during the spring and summer when only part-load operation is needed,” said DiFulgentiz.
  • Seek out efficiency rebates. Many regional utilities offer rebates to make high-efficiency equipment more attractive to commercial customers. Call the local utility for details on what is available in an area. City or state energy offices may also offer incentives for high-efficiency equipment.
  • Focus on indoor air quality. Many HVAC systems only regulate humidity with temperature control. A unit that measures both humidity and temperature allows for more accurate and effective building control. Additionally, most HVAC systems provide ventilation based on assumed occupancy rather than how many people are in the room at any given time. Installing a demand-control-ventilation (DCV) system with a carbon-dioxide sensor provides an accurate reading of the occupancy level, controlling the amount of fresh air introduced based on output from the CO2 sensor. By providing the right amount of fresh air, a DCV system helps control energy expenses.
  • Investigate advanced control systems. These systems make it possible to improve energy efficiency, simplify troubleshooting, and also monitor and control a wide range of fire- and life- safety systems, access and security-control technology, lighting-equipment and maintenance-management programs on the same network.
  • Stress reliability. Features such as high- and low-pressure switches that protect compressors from unnecessary wear and tear will minimize repair expenses. Also, look for equipment that arrives ready to install on the job site. Field-installed accessories increase labor hours and the likelihood of errors during installation.

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Dillard’s 3Q loss widens

BY CSA STAFF

LITTLE ROCK, Ark. Dillard’s reported a third quarter net loss of $56 million, or 76 cents per share, compared to a net loss of $11.3 million, or 15 cents per share, for the same period last year.

Dillard’s ceo, William Dillard, II, stated, “The oppressive economic environment clearly weighed heavily on our results during the third quarter. We continue to take aggressive action to navigate these challenging times. We announced the closure of 21 under-performing stores during 2008, dramatically reduced capital spending for 2008 and 2009 and are executing appropriate operating expense reduction measures throughout the Company. These efforts are not only designed to position ourselves to weather near-term economic uncertainty but also to position Dillard’s well for the long term.”

Net sales for the quarter were $1.508 billion compared to net sales of $1.633 billion last year. Sales in comparable stores declined 9%.

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Fred’s sees 3Q income growth

BY CSA STAFF

MEMPHIS, Tenn. Fred’s reported net income of $6.1 million, or 15 cents per diluted share for the third quarter 2008, an increase of 32% from net income of $4.6 million or 12 cents per diluted share in the year-earlier quarter.

Fred’s total sales for the third quarter of fiscal 2008 were $418.0 million compared with $419.9 million for the same period last year, with the year-over-year decline of 0.4% reflecting the company’s store-closing program. Excluding stores closed in 2008, total sales from ongoing stores increased 4% over the third quarter of last year. On a comparable-store basis, third quarter sales increased 1.4% versus 1.1% in the year-earlier period.

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