How to Start an HVAC Business? An Ultimate Guide to Follow

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If you’re thinking about starting an HVAC company, you’re probably in one of the two categories.

Either you’re a qualified HVAC technician planning to start your own business, or you’re an entrepreneur striving to manage a successful HVAC company.

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However, you need to be both an entrepreneur and an HVAC technician to run a successful business in a technical industry such as HVAC.

Therefore, to help you learn how to start an HVAC business, we’ve created this guide with detailed steps.

Let’s dive in!

Learn How to Start an HVAC Business in 11 Steps

1. Enroll in an HVAC certification program

Before working as an HVAC technician, you must first obtain HVAC certification from an accredited institution or training course.

    1.1. United States

    According to the Clean Air Act, all professionals in the United States who service air conditioning units and refrigeration equipment must be certified by the Environmental Protection Agency (EPA).

    1.2. Canada

    In Canada’s most provinces, refrigeration and air conditioning technicians must obtain a business license from a regulatory authority under the provincial government’s jurisdiction.

    1.3. United Kingdom

    Before working as an HVAC contractor, you should complete a bachelor’s degree and an apprenticeship. Several college courses are available to help you find work as a trainee.

    1.4. Australia

    Before you can get an air conditioning service license from the ARC (Australian Refrigeration Council), you must first complete a certificate program and then an apprenticeship.
    Although not required, a certificate from organizations such as HVAC Excellence or NATE (North American Technician Excellence) can provide you with extra credentials. It makes your customers feel more confident in your abilities.

2. Get your HVAC contractor license

While HVAC certification validates your knowledge and skills, an HVAC contractor license authorizes you to service HVAC systems.

Most places require you to acquire an HVAC business license, which is a legal document, but the process varies based on where you live:

  • Each state in the United States has its own requirements for obtaining an HVAC license. This typically means you require formal HVAC certification in addition to a few years of experience working as an apprentice. Without a trade license for HVAC, you risk facing severe fines and penalties.
  • HVAC contractor licenses are not required in the United Kingdom or Canada. But, Canadian technicians who work in air conditioning and refrigeration must be accredited by a government-approved program.
  • Anyone working with air conditioning or refrigeration equipment in Australia must have a Refrigerant Handling Licence

3. Create an HVAC business plan

A successful HVAC company starts with a business plan. You will define the following in that document:

  • Local competition
  • Target market
  • Marketing plan
  • Business structure
  • Financial obligations
  • Revenue projections, and so on 

Taking the time to create an HVAC business plan keeps you focused. It helps you secure startup loans from financial institutions or other investors.

Market research is another critical aspect of a business structure and is required to determine the viability of your HVAC business. You must be aware of the number of other HVAC businesses in your service area. Additionally, you must know the number of residences and franchises with which you will compete, the prices charged by your competitors, and other details.

You’ll also want to decide the service area you’ll cover, the distance you’re willing to drive to a job site, and the working conditions. The decision regarding whether you will provide emergency repair services or only work during regular business hours is necessary too.

Look carefully at the business websites of the companies that appear on the first page of a Google search for HVAC services; that’s where you want to be.

To work on your digital marketing strategy, a platform like KWFinder can help you identify the keywords your competitors are using so you can outperform them.

Now is the time to determine your finances, which is one of the most important parts of developing a business plan. To make it simpler, to distinguish between the funds you spend on personal expenses and those for your business, you’ll need a separate bank account.

Take the time to calculate your income. Ensure that the rates you set are competitive, allow you to maintain your HVAC business, and enable you to pay yourself a reasonable salary. Be sure to take your years of experience into account when determining the rate.

4. Buy HVAC business insurance

The job of an HVAC professional has significant risks. Lifting a unit might injure a worker’s back, and leaking air conditioners can ruin a client’s floors. Healthcare, litigation, and repair expenses are all covered by HVAC insurance. Laws may also mandate certain insurance coverage, such as workers’ compensation.
The most typical installation-related hazards are covered by the following insurance policies:

  • General liability insurance
  • Workers’ compensation insurance
  • Commercial auto insurance
  • Contractor’s tools and equipment insurance
  • Professional liability insurance
  • Property insurance

5. Determine HVAC business startup costs

The cost of starting an HVAC company is high, and failing to keep track of all business expenses is one of the biggest mistakes you can make.

Assuming that you’re purchasing a used service van or truck and trying to keep your equipment costs down, the average startup cost in the HVAC industry ranges from $2,000 to $10,000.

However, if you buy everything at once, the cost could easily exceed $100,000. You’ll need the following to run your HVAC business:

  • HVAC tools used for sheet metal work, such as aviators or tin snips, drive bender or folding bar, shears, staple guns, crimpers, etc. 
  • HVAC tools for air conditioning service and maintenance work
  • Uniforms and caps with the company’s logo
  • Vehicle signage
  • HVAC business website 
  • Marketing materials, such as business cards and door tags to verify service with contact information
  • Supplies
  • A service truck or van large enough to carry all your tools and equipment
  • Workers compensation insurance
  • Liability insurance
  • General tools used in HVAC, such as an electrical tester, tape measures, battery-powered drill, Sawzall, etc.
  • Safety equipment

6. Make a list of services that you can offer

Decide what HVAC services you want to offer so you can buy the necessary equipment and begin pricing. The following are the most popular HVAC repair, setup, and maintenance services that you can provide:

  • Furnace repair
  • Air conditioner installation
  • Air duct cleaning
  • Tankless water heater installation
  • Emergency HVAC service
  • Furnace installation
  • Furnace tune-up and maintenance
  • Air conditioner tune-up and maintenance
  • Heat pump installation
  • Air conditioner repair

The service that you should probably sell the most is the one that you may have specialized in during trade school. Therefore, offer services you are skilled at and enjoy performing to make your job more rewarding.

7. Purchase HVAC tools and equipment

You can now focus on what tools and equipment to acquire now that you are clear on the services you wish to provide. You’ll need the following main pieces of HVAC gear in your bag:

  • Standard hand tools including hammer, screwdrivers, wrenches, pliers, nippers, staplers, gauges, drills, flashlight, tube cutters, and extension cord.
  • Mask, gloves, ear muffs, goggles, shoes, and other safety equipment.
  • Modern HVAC equipment varies based on the services you offer, such as leak detectors, phase testers, coil fin straightener, thermal cameras, caulking gun, core removal tools, megohmmeters, multimeter, nitrogen regulator, flushing solvent, and coolant.

8. Price your HVAC business services

To run a profitable HVAC business, you must set prices that cover your expenditures while also making your company successful. 

Here’s how to get started with pricing HVAC jobs:

  • Assess your competitors to learn about the average rates in your location.
  • Determine the markup required to meet your profit margin targets.
  • Decide what additional services you can provide to raise your total quote prices.

You can use the following pricing techniques for HVAC projects:

    8.1. Hourly rate pricing model

    Hourly rates can help you make more money on time-consuming or commercial HVAC contracts. This pricing strategy is helpful when you don’t know how long a project will take to complete.

    8.2. Flat rate pricing model

    You can determine a single, definite price for the entire job using flat rate pricing. This pricing method works well for your HVAC business when you know how long the job will take (for example, $350 for air conditioning service).

    8.3. Labor and materials pricing model

    It’s generally preferable to charge customers for installations according to the amount of labor you perform and the equipment you provide. You can more easily recoup your operating expenses with this pricing strategy.
    Once you have determined your service prices, make an HVAC pricing chart that details your service costs at flat rates or hourly rates. By using a pricing chart, you can quickly and easily give clients HVAC estimates that are accurate and consistent.

9. Advertise your HVAC business

Marketing is critical for gaining your first clients and operating a successful HVAC business. Here’s what you’ll need to get started with HVAC marketing to reach new customers:

    9.1. Market your company to increase branding

    A company’s branding gives it a look and a personality and communicates to all potential customers that it is a professional operation. Create a logo and select colors for your HVAC company’s website, uniforms, business cards, and all other marketing materials.

    9.2. Go door-to-door to reach new customers

    To spread the word about their businesses, new HVAC business owners frequently rely on word-of-mouth. Knock on doors and distribute flyers throughout your neighborhood to try and generate your first few HVAC leads.

    9.3. Create your online presence

    Clients can easily find your HVAC business on the internet if you have an online presence. The more online presence your business has, including a website for your HVAC company, accounts on social media platforms, and Google Local Services Ads, the more customers are likely to contact you to book your services.

    When your HVAC company website is up and running, take control of your Google My Business listing and add your company to Google Maps. This increases your chances of appearing in local searches for “HVAC companies near me.” It is one of the most effective methods to get new clients.

    Set up a Facebook Business Page and an Instagram account that is linked to it. Fill the accounts with photos of your completed projects. You can write posts about proper heating and cooling system maintenance and refrigerator/freezer maintenance tips. 

    You can post information on the advantages of keeping your home and car’s heating and cooling systems well-maintained as well.

    9.4. Close in more sales

    By doing more than just HVAC installation and repair, you can increase your earning potential. To help your customers maintain their own HVAC systems in between maintenance visits, you can sell air conditioner filters and other necessary accessories.

    9.5. Increase word-of-mouth

    Every professional in the field service industry understands the value of providing excellent customer service. So, providing your clients with the best service you can is something you should prioritize.

    This can work to your advantage. When customers tell their friends and family about their experiences, they will have nothing but positive things to say about your HVAC business and services.

    For your HVAC company to survive and thrive in the industry, reviews and recommendations are essential. 

    Ask your existing clients, such as your friends and family members, to post reviews and testimonials about their experiences with your business on social media platforms.

    Ask them to recommend your HVAC company when they see anyone in need of HVAC services. These techniques will assist you in establishing trust with new clients and building a successful HVAC business.

    Whenever possible, hand out flyers of your services and your HVAC business cards. Get in touch with local construction firms and residential property managers so you can sign deals with building owners, homeowners, and tenants.

    The best way to improve the experience for customers is to pay attention to their feedback and make changes as needed. Therefore, pay close attention to brand management so you do not fall behind the competition. Cooperate and be friendly with everyone in your community at all times.

10. Reduce additional expenses

Monitor all expenditures very carefully. Just because you currently have the best deals available does not guarantee that this will always be the case.

As you assess your expenses, look for opportunities to cut costs. You can do so by stocking up on supplies in large quantities, obtaining manufacturer discounts for parts, or participating in loyalty programs to save money on fuel and other overheads. 

It’s possible that as you expand, you’ll be able to take advantage of more discounts with bigger orders.

11. Recruit professional and experienced HVAC technicians

It’s time to hire a certified HVAC technician when your workload becomes too great for you to handle on your own. 

Hiring HVAC technicians to handle fieldwork will free up more of your time so you can concentrate on sales, scheduling, brand management, and other aspects of managing and expanding your new business.

Here are some tips for discovering and hiring skilled HVAC technicians:

  • Determine if you want to recruit employees or HVAC contractors and subcontractors.
  • Create a fantastic job description for HVAC contractors, and post it on websites for job searching contractors or employees.
  • Prior to hiring a heating and air conditioning contractor, prepare some questions to ask them.
  • Verify the references and request police background checks.
  • Get ready to train your staff once they’ve been hired.
  • Pay your team well and create a positive atmosphere at work.

Optimize Your HVAC Estimating & Invoicing Process With InvoiceOwl

With just a few clicks, you can quickly generate, send, and track HVAC invoices and maintain a clients’ list who owe you money for the work done.

Frequently Asked Questions
  1. What is the cost of starting an HVAC business?

    For starting an HVAC business, a small business owner would require money ranging from $3,000 to $12,000. It basically depends on what tools and equipment you need to buy upfront.

    The following are common HVAC startup costs that you should factor into your budget:

    • Insurance for HVAC businesses ($600–$2,000)
    • Basic HVAC tools such as screwdrivers, tape measures, hammer, stepladder, electrical testers, wire strippers, pliers, wire strippers, and cordless drills ($200–300)
    • A van or truck big enough to carry equipment to job sites ($15,000–40,000)
    • Equipment for safety and personal protection equipment (PPE) ($35–$50 per person)

    Once you’ve determined your startup expenses, try applying for a personal or business loan from a financial institution.


  2. What are the skills, education, and certification required for small business owners in the HVAC industry?

    There are several types of HVAC certifications, including

    • EPA Type I Certification (for servicing small appliances)
    • EPA Type II Certification (for servicing high-pressure systems)
    • EPA Type III Certification (For servicing low-pressure systems)
    • Universal EPA Certificate
    • NATE (North American Technician Excellence) offers professional-level certifications for HVAC professionals. Areas of certification include:
      • Air Conditioning (AC)
      • Gas Heating (GS)
      • Oil Heating (OL)
      • Air Distribution (AD)
      • Heat Pumps (Air-to-Air) (HP)
      • Hydronics Gas (HG) (service only)
      • Commercial Refrigeration (RC) (service only)
      • HVAC Efficiency Analyst (Senior Level) (EA)
      • Hydronics Oil (HO) (service only)
      • Light Commercial Refrigeration (LC) (service only)

  3. Is it hard to start an HVAC company?

    Let’s face it, starting a new HVAC company may be daunting. All of the preparation that goes into starting a new business may make you feel ambivalent and apprehensive. But following the step by step procedure that we discussed in this blog can help. The above-discussed procedure will provide you with all the information necessary for the easy establishment and long-term profitable success of your company.


  4. How do I start my HVAC side hustle?

    If working for yourself is your ultimate objective and you want to start an HVAC side hustle, then here are a few preliminary steps to starting your business:

    • Obtain the required certifications
    • Choose the business structure
    • Get a Contractor License
    • Open a new bank account for your HVAC business
    • Get necessary business insurances

  5. How do I get HVAC customers?

    The cornerstone of any prosperous business is marketing, and with it, your HVAC company can draw in a growing number of customers. Fortunately, several effective marketing strategies can be easily used. With little inconvenience to your regular business operations, you can employ these strategies.

    • Create a program for HVAC customer referrals.
    • Utilize SEO, content marketing, and pay-per-click advertising
    • Implement video marketing
    • Use social media to promote your HVAC brand
    • Use HVAC flyers and distribute them to nearby residences
    • Develop the most effective HVAC Website

  6. Where can I find HVAC leads?

    From lead generation websites to referral programs, you can find new leads using a variety of methods. But here, which initiatives would yield the highest rate of return on your investment is the true question at hand. You need to steer clear of price gaugers and draw in clients who have big tasks and are more likely to hire you again for subsequent work.
    So, here are some lead generation strategies to help you find quality leads.

    • Develop your social media presence
    • Plan out your SEO
    • Start paying for adverts
    • Create a online review portfolio
    • Offer incentives for referrals
    • Hire marketing staff or contract out the task
    • Networking with people and businesses can also help

  7. How do I scale my HVAC business?

    As a business owner, you are aware of the significance of scaling your business to meet the rising demand. But how exactly can you go about doing that? Here are some tips that can help:

    • Increase the effectiveness of your marketing and advertising activities by focusing more on SEO, PPC advertisements, running promotional campaigns, and providing discounts.
    • Offer new products or services that augment your current offerings.
    • Utilize the appropriate tools and technology to streamline your business processes. It includes the use of automated ordering and billing software, GPS vehicle tracking, cloud-based software, and customer relationship management software.
    • Provide top-notch customer service and high-quality products.
    • Boost your knowledge and abilities.

Use an HVAC Estimate and Invoicing Software to Scale Your Business!

Starting your own HVAC business requires extensive planning and organization. However, if you take a comprehensive, systematic, and strategic approach, your own HVAC business will be up and running in no time.

Get your business plan in order by working your way through this guide. Strive to enhance your competitive advantage to boost your reputation while keeping your customers, business goals, and strategies in mind.

Start off right by signing up with HVAC estimating and invoicing software, such as InvoiceOwl, to optimize your work processes and scale your business.

It will enable you to create multiple, error-free invoices, purchase orders, and estimates effortlessly with complete automation.

InvoiceOwl can also track your payments and generate analytical business reports. So, you won’t have to do these tasks manually and would rather spend that time establishing strategies to realize core business goals.

Author Bio
Jeel Patel
Jeel Patel
Founder

Jeel Patel is the Founder of InvoiceOwl and is the main curator & writer of the content found on this site. With ideals of quality, commitment, and perseverance, he believes in creating lasting business relationships with the clients.

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