CEO Jim Luce (center), Brian Houser (to Jim’s right) and Peter Luce (to Jim’s left) accepting Mitsubishi Electric’s Northeast Distributor of the Year award in Arizona in February 2017.

Mitsubishi Electric CITY MULTI® condensing units on a rooftop for a job in Manhattan.

There’s the satisfaction of running a successful business, and then there’s the satisfaction of making wishes come true.

Jim Luce, President of Luce, Schwab & Kase, Inc. (LSKAir), is lucky enough to do both. His company, celebrating its 60th anniversary this year, is both a growing power in the New Jersey air conditioning market and a generous corporate partner to charities like Make-A-Wish Foundation and the Special Olympics.

“We’re very proud of our long relationship with both Make-A-Wish and the Special Olympics,” Jim says. “We got started with Make-A-Wish as part of a program through Luxaire, where a percentage of sales we made—often more than $10,000—would go to benefit the foundation. We’re not part of the Luxaire program anymore, but we’ve continued to make significant contributions to the local Make-A-Wish for more than 15 years. And we’ve had a very strong relationship with Special Olympics every year.”

Though Jim and his team have never played a direct role in the wishes Make-A-Wish grants, he views involvement with the organization on a local level an important reflection of the deep roots LSKAir has in the community.

Changing Industry

Founded in 1957 by Jim’s father, George, along with partners Bill Kase and Frank Schwab, Luce, Schwab & Kase, Inc. started out selling refrigeration equipment to commercial clients. Before long, the company’s leaders started to see the value in pivoting away from refrigeration toward air conditioning.

“It was an opportunity-based change,” Jim says. “When they started in 1957, not many people had air conditioning in their homes or buildings. In the 1960s and certainly in the 1970s, the perception of air conditioning started to shift from seeing it as a luxury to seeing it as a necessity. We started off with mostly commercial air conditioning clients due to our background in refrigeration. We always enjoyed a good relationship with mechanical contractors who worked in refrigeration, and as we pivoted toward air conditioning, they would recommend us for jobs they were working on.”

He continues, “Over time, we developed and changed into a provider of residential and commercial HVAC equipment as well as refrigeration. We always try to stay on the leading edge of technology in our industry, which has moved us from traditional air conditioning equipment to VRF technology.”

In 1984, LSKAir took on the Mitsubishi Electric ductless line of air conditioning that was already popular in many parts of the world, but just beginning to be known in America. VRF, which stands for variable refrigerant flow, is an air conditioning concept that has been popular in Europe and Asia for some time and is becoming more and more prevalent in the United States, Jim says. VRF uses refrigerant as both the heating and cooling medium, like a ductless system. It is perhaps most popular in Japan, where most of the office buildings use it and where Mitsubishi Electric, one of the premier suppliers and a partner of LSKAir, is headquartered.

“VRF has really gained a significant standing in the United States as a factor in the air conditioning market today,” Jim says. “We’re continuing to see major growth because of the ductless systems. Whether we’re doing hotels, schools or other commercial buildings, the concept is the same.”

One of the best selling points for VRF is that it can simultaneously heat and cool different sections of a building. This makes the system very energy efficient by shifting the cooling and heating capabilities to where they are needed. The hyper-heat systems, pioneered by Mitsubishi Electric, can heat a building, even in a New Jersey winter, without the need for a backup heating system, like a boiler.

“We focus a lot of our sales and marketing efforts on engineers and design-build contractors,” Jim says. “This VRF equipment has significant engineering advantages, and getting the engineering community behind our product has been critical to our growth, as well as our partnership with Mitsubishi Electric, which is number one for market share in the VRF market.”

Longevity and Community

Jim is justifiably proud of the longevity of his family business. He grew up in it, of course, and has been working there since he graduated from the University of Connecticut in 1982. In 1992, he bought out the interests of Frank Schwab and Bill Kase, consolidating ownership. In 2006, his father, George, retired, and Jim took over as President. Now in its second generation as a family business, LSKAir is well on its way to a third generation, as Jim’s sons, Jimmy and Peter, are both working there as well.

“It’s exciting to have my sons working here with me,” Jim says. “They’re making a great contribution and it’s good to see the family business continuing to grow.”

Jim credits the longevity in the community and the ability to make changes when needed for the success of his business, which has grown substantially in the last decade. When he first started in 1982, LSKAir was less than a $4 million business. It grew steadily over the years, but since the recession in 2008, it has more than doubled. A decade ago, it was a $25 million business, but thanks to embracing new technology the company has grown to more than $54 million in sales with 50 employees. Its headquarters are in Fairfield, N.J., with branches in Middlesex, Mt. Laurel and Lakewood. With the high population in a small geographical area, Jim says those four locations are strategically located to service customers from New York to New Jersey to Pennsylvania.

“As a distributor, you need to be looking over the horizon to see where the opportunities are going to be,” Jim says. “If it means embracing technology, that’s what you have to do. We’ve made some hard choices in that regard, like moving to VRF technology instead of traditional HVAC technology. Because of that, we’ve had a lot more opportunity for growth.”

He adds, “Every product line has a life cycle. If you want to stay in business, you must ask yourself, ‘What’s the next thing, what do you need to do to stay ahead? Where will you be with the products you have? What do you need to change or add?’ As an independent distributor, we can change and pivot and adapt to changes in the marketplace very quickly, and that’s helped us thrive.”

The Right Size

With the company’s growth in recent years have come increasingly large and challenging jobs. Recently, LSKAir sold an HVAC system in the new 22-story William Vale Hotel in Brooklyn, working closely with the design-build contractor in laying out the job every step of the way.

“We’re the first line of defense in making sure every job goes right,” Jim says. “We go in and diagnose problems—electrical, circuit board, pipes. Whatever it might be, we must figure it out. We have challenges every day in some very complex projects. We work with Marriott, Hilton, universities, hospitals. These are critical applications—the jobs just must work. We’re proud of our ability to solve these problems and make sure the client is happy.”

“Another thing that’s very important to the success of our business is metrics,” Jim continues. “I use a variety of metrics to measure profitability, operations, asset management and employee utilization. I’m constantly comparing our performance to other wholesalers through the data I receive from HARDI (Heating, Air-conditioning & Refrigeration Distributors International). Without the use of modern metrics, I believe it’s impossible to run a successful distribution company today with all the competition.”

“Our business is still technical enough that it can’t be sold by do-it-yourself stores. We bring value, knowledge and experience. Every day we go out, look at jobs and solve problems. Mitsubishi Electric is a wonderful partner, and of course the organization wants us to sell, but more than that it wants to make sure every job works, that every customer is happy,” he explains.

With its four locations around New Jersey, Jim says he’s satisfied with the size of his business—at least geographically. Under his stewardship, LSKAir has grown large enough to handle some of the most demanding jobs, while remaining a small, family-owned, community-oriented organization. It’s that dedication to the community that has made Jim and his team so active in local charitable work.

“I think in a family business like ours, the beautiful thing is you get to know all your employees,” Jim says. “We try to help one another in fundraising activities, whenever someone needs something. I also have employees who come to me with their own charities and fundraisers and I try to support them where we can. I want our employees to feel like we’re making a difference, that we have a responsibility to help others.”

He concludes: “At the end of the day, I’d say I’m most proud of the relationships I have with our employees. I’m also proud to have my sons involved in this business, as well as making our team’s work enjoyable, helping our employees’ families, and knowing our customers. I like to feel we’re also helping the community. Our brick and mortar is in the community; I like to know that we’re contributing to the well-being of the community.”