Summer minisode series: Talking innovation with Rinnai

Zach Wojtowicz (00:05):

What’s up, everybody? Zach Wojtowicz here with our summer minisode episode series, where we’re talking to some of our vendor partners. Today, we’ve got Rinnai, we’ve got JC and Craig in the studio. Fellas, how are we doing today?

Craig Williams (00:15):

Doing great.

JC Kimes (00:16):

Doing great.

Zach Wojtowicz (00:16):

Great. Good to see you. Welcome to Omaha, Nebraska.

Craig Williams (00:19):

Thanks for having us.

Zach Wojtowicz (00:19):

Yeah, of course. And I even hear you’re going to get a little bit of College World Series. In Omaha, we’ve got the College World Series in the summer. So …

JC Kimes (00:25):

Yeah, looking forward to it. First time out here, and like we were talking about before, I’m from Virginia, so go Hoos go.

Zach Wojtowicz (00:31):

Yeah, right. A little plug. Fantastic. Love it. Love it. Well, we wanted to bring you on today to talk a little bit about Rinnai and just the way you prioritize quality and innovation in your product offerings. Obviously, we serve the residential construction industry, and Rinnai is a well-known name. So, tell us a little about yourself and tell us a little bit about your company.

Craig Williams (00:49):

Yeah, I’ll go first. So, my name’s Craig Williams. I’m the national director for residential new construction with Rinnai, and I’ve been with Rinnai for about nine years. And recently came into this position several months ago. But I was a former Rinnai customer, three years before that, and then got recruited by the company. I was a custom home builder on the Gulf Coast, loved the product, never had any issues with it. It was fantastic. Didn’t know much about the business, and then when I learned about the business behind the brand, came here as quickly as I could and been one of the best decisions I’ve ever made.

Zach Wojtowicz (01:21):

I love it. I love it. How about you?

JC Kimes (01:23):

Yeah, so I’m JC Kimes. I’m the residential new construction sales builder for the Northeast, pretty much covering Carolina’s North up along the coast. And really, really focusing on those builders, custom, semi-custom, really fits the dynamic well with CBUSA and Buildertrend.

Zach Wojtowicz (01:39):

Yeah. So, let’s talk a little bit about that. You’re getting used to the Buildertrend ecosystem. You’re working with CBUSA for a long time. So, tell us a little bit about that partnership and a little bit more about how Buildertrend and Rinnai’s partnership is evolving. And what are you guys bringing to our customers?

JC Kimes (01:57):

Yeah, absolutely. It’s been fantastic. We’ve been with CBUSA now for some time, and then, obviously, with coming over with Buildertrend as well. It’s really a great partnership. We’re getting exposure to a lot of semi-custom, custom home builders throughout the United States that are higher end. And it really fits our mold well with Rinnai because we’re a higher end product, we feel, in the water heating business. And it’s been fantastic because we’ve been presenting a lot of opportunities to go out and grow our business using that platform of look at us showcasing primarily the gas water, but now we’ve moved over into the electric option as well. That we’re also talking about today. It’s been a fantastic partnership.

Zach Wojtowicz (02:36):

That’s amazing to hear. We’re really excited to talk about it. When our builders are deciding on what products that they want to put in their homes and working with their customers, there’s a lot of education that goes into choosing important aspects, especially in the heating air, HVAC water heater. It’s the stuff that you really want it to work, you don’t want to have to deal with it. Tell us a little bit about how Rinnai is really bringing quality to their customers. Why should a builder choose Rinnai over other water heating companies?

Craig Williams (03:07):

Yeah, that’s a great question. And we joke internally that homeowners don’t ever think about hot water until you don’t have it. So, we have a mantra, “Quality is our destiny,” and it’s literally on every doorway in our factory, in our office, because we live it, we breathe it. And so the concept is that if it’s your destiny, you’re always chasing quality, and you never achieve the true quality. It’s always something we strive for to make greater and greater, and we’re really known for that. We have less than a half a percent defective rate, which is above even what’s called considered world-class.

Zach Wojtowicz (03:42):

Pretty good.

Craig Williams (03:43):

So, it makes it really easy to go to work for Rinnai and wake up every morning because you know you’re selling a quality product.

JC Kimes (03:49):

And the biggest thing is, there, we’re out there to truly captivate our customers. We are a brand partner. We’ve got sales folks on the ground that are working directly for Rinnai, and we’re not saying we’re perfect, but with what Craig mentioned, being “quality is our destiny” at under a 1% warranty rate. It really does separate us out there in the field. And when there is things that do maybe arise, we are on top of it, on the ground ready to go. And if we don’t have the answers, which a lot of times me and him don’t, we’re finding them through our great team back at corporate office.

Zach Wojtowicz (04:21):

So, when we talk about that product development cycle, and the things that you’re doing, obviously, when people think water heaters, I had the exact same reaction. It’s like, I just moved a new house, my water heater sucks. I’m like “uhhhh” in the morning, I know I’m going to run out of hot water and you’re like, it’s on the back of my mind. But how is Rinnai innovating on its technology and what is the Rinnai difference? Obviously, it’s able to last longer and the warranty rates are great, but what else comes with that technology that you guys want to talk about?

JC Kimes (04:53):

And I think the big thing is the misconception out there with what tankless water heaters are. Its instant hot water. And I think, to your point, Zach, it’s an endless hot water heater, and it provides a different experience for our customers. And through the innovation process, we’re all about innovating now. I think that’s what our whole team is about. Our team back at the corporate office, we have a dedicated engineering team, a dedicated team for innovation, the lab that we have to do it. And we’re not going to put product out, but it really is through that partnership that we have with Buildertrend and CBUSA that allows us to continue to get that feedback, just like today out there in the market, at the meetings, to hear what’s needed in the marketplace that we need to bring out to better satisfy our customers.

Craig Williams (05:36):

That’s right. So, we have a whole innovation team, as JC mentioned, an innovation lab. And it’s all about making our current products even better and making it exactly what is going to be industry leading for our customers and intensifying that experience. But it’s also looking at new product platforms. There’s a lot of regulation driving electrification in some areas such as the West Coast of the United States, more than other geographic areas. And so, we’ve launched electric heat pump water heater. We’ve always been a gas appliance manufacturer, propane and LP, and I mean a natural gas, but electrification is new for us, but we put that same kind of “quality as our destiny” mantra and mindset behind it. And the innovation team has released new products to fill that market because it was a need.

Zach Wojtowicz (06:20):

Yeah. I think that’s the mark of any great business. You listen to your customers, you make sure that you’re hearing the feedback, and then going into the teams that are responsible for making that happen. Obviously, every business is in the business to try and get their consumers to continue to buy, but that reputation means you got to be able to deliver. Right?

JC Kimes (06:37):

And that’s one thing is, I think that’s hitting the nail on the head, is Rinnai’s not going to bring out products if they’re not going to be fully tested. We’ve had this heat pump water heater.

Zach Wojtowicz (06:45):

What a rarity. These days you hear the horror stories of the refrigerators, “Okay, this thing is going to last three years.”

JC Kimes (06:53):

Well, and that’s what’s out there. You hear that thought process, refrigerators going to last you three to five, a washer dryer may last you five to seven, a tankless water heater with Rinnai, it’s going to last you 18 to 20 years. So, you’re in a new home, you’re going to get double the length with a tankless water heater versus a standard tank. And where there used to be a major upfront cost difference between the two, that cost difference now has eroded. And I think out there in our world of new construction, there’s never been a closer proximity of pricing when it comes to having a tankless water heater. And by the way, it’s going to last you twice as long. And by the way, you’re never going to run out of hot water. That’s the big thing.

Craig Williams (07:31):

And it takes up a lot less space.

JC Kimes (07:33):

Yes, it does.

Zach Wojtowicz (07:33):

Yeah, I’ve seen some of the new ones. And, again, not to keep talking about my water heater. I’m over here trying to get a deal and it’s like, “Hey, scratch my back.”

Craig Williams (07:40):

I think I know where you can find one.

Zach Wojtowicz (07:41):

Yeah, mine’s like a monster. My utility closet. I’m like, what is this thing? It’s a monstrosity, not a Rinnai. It’s going to be very, very, the nicest looking water heater you’ve ever seen. What are some of the other products or projects that our listeners … We’re talking a little bit about what you guys do from the servicing and obviously the new and what’s available for market? What are you guys excited about?

Craig Williams (08:06):

So, I think the electric heat pump is probably what we’re most excited about because it meets immediate needs, but we have a long-term focus on sustainability and decarbonization to meet those trends and those needs out in the market. So, we’re exploring short-term products that we’re putting out like the electric heat pump, but we’re also looking at long-term blended approach with hydrogen units. Because there’s some test sites say in Southern California, and there’s other countries that are already mixing hydrogen with natural gas to get that carbon footprint down. So, we’ve got the products that are able to satisfy that.

JC Kimes (08:44):

And I think the other big key there is Rinnai has taken huge steps in the last few years. We’ve opened up a new plant down in Georgia, so we’re the only tankless manufacturer that is manufacturing product in the United States. That product right now is our non-condensing … Our Sensei product is still being made over in Japan, which we’re over a hundred-year-old company. But I think the thing there is “the quality is our destiny.” And we’ve just recently launched a new condensing line called the RX product out in the market. It really takes 24 SKUs down to six. Some people may be like, “Hey, what’s the big deal?”

(09:15):

The big deal there is, from our distribution standpoint, we also have to look out for that as well. To where it’s easier for them now to stock our product. They don’t have to have four times as much product on the shelf. So, once again, all in that all-encompassed partnership with CBUSA, Buildertrend, that also goes down to our plumbing contractors and even to our distribution partners. Where we’re trying to make life, in a sense, simpler. And I think with the product now, with that new RX that’s out there that folks are starting to see and it’s really having a good traction to the market, it’s also hitting a 0.98 UEF, which is the highest in the industry. And as Craig mentioned, you go a lot of places like California and other markets, where you have to hit certain points to qualify by code. That’s one that’s been big in the industry and that 0.98 is the highest in the industry.

Craig Williams (10:01):

That helps a lot with a lot of the programs like Energy Star 3.2, Net Zero, and all that. So, that’s another part of that innovation is how do we keep giving these products to help our customers, the builders, achieve those goals and those milestones for them.

Zach Wojtowicz (10:16):

That’s really interesting, too. It’s one of those things that the reality is it’s going to continue to be more and more emphasized in “The Building Code.” And the United States building code obviously uses the international building code, which is quite a far ahead. So states are starting to catch up. So, being on the front end of that to make it easy for builders because I hear that a lot from our customers. It’s like having to be prepared for the future it can be a struggle because it’s also conditions around what my customers are willing to pay for. But you touched on the market, so you’re getting better energy ratings at a really, really great market price sounds, like a win-win across the board 20 years. It’s amazing.

JC Kimes (10:55):

It’s a no-brainer out there. And I think the big thing is, everybody now out there, when you say tankless water heaters, is like, “Oh, I want one of those. I want one of those.” There’s really no better time than currently out there in the market to look at a tankless water heater, especially in the builder network when you’re building these new homes, these developments. I mean, get us involved, get our folks at CBUSA, Buildertrend involved. We can help with sizing, making sure things are done right that you’re not overpaying or you’re oversizing. And that’s where we come in with our team on the ground every day, that’s supporting Rinnai directly and supporting our key partners like Buildertrend, CBUSA. That’s really the win all around. So, if you’re not currently out there looking at the product, and you’ve been doing it for 20 years, we challenge you, take a look at it, get us involved. Because through our distribution, our plumbing contractors, there’s no better time right now than to dive into tankless.

Craig Williams (11:47):

That was really what JC just described as the business behind the brand that I was referring to when I was a former Rinnai customer, and then learned about the company and all the support and the network. And that’s really the difference maker for us. We have a term, “Build trust,” internally. It’s actually one of our culture points. And that building trust is with our customers in saying, “Hey, we’re going to deliver the best quality product. We’re going to deliver that a good price point. We’re going to support that all the way through from start to finish.” And that’s how we approach the market.

Zach Wojtowicz (12:16):

I love it. Well, fellas, it was great having this conversation today, talking about all the things going on at Rinnai. For a final note for our listeners, where can they go learn more? What’s the best way to get in touch with the all?

JC Kimes (12:27):

Yeah, it’s a great point. Rinnai.us is a great, great resource for our customers to go on, look at the product. They can get information on what tankless is, how it’s beneficial, what our warranty is, which our warranty is really world-class with a 15, five and five on the labor for our customers. So, it’s another level of where they can go and really dive in deep. And there’s all kinds of YouTubes, we have a couple of influencers, key partners that go over a lot of those things. But in the end … But more importantly, if you’re out there and you’re a builder, get us involved and we can walk you through the process of finding what you need to satisfy your customer and give them the experience they want.

Craig Williams (13:10):

Yeah, we have a direct sales team that works throughout the US coast to coast. So, any builder could reach out to CBUSA and get in contact with the local regional person, and we can really help because every market’s going to be a little different. There’s different dynamics and such different codes, and we can really help navigate that and get the best product and the best solution for your builders.

Zach Wojtowicz (13:31):

Love it. Well, thanks again so much. Thanks Rinnai for coming on.

Craig Williams (13:34):

Yeah, thank you, Zack.

Zach Wojtowicz (13:35):

JC, Craig, it’s great conversation.

JC Kimes (13:35):

Thanks for the opportunity.

Zach Wojtowicz (13:37):

Of course. Listeners out there, make sure you check out Rinnai.us, and check our show notes for more information. Thanks for tuning in for this summer series. We’ll catch you next time.