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How do I Start an HVAC Business?

Proper HVAC systems are important to maintain good air quality.
Those starting an HVAC business need a business plan and references who can attest to the quality of work performed by the business operator.
An HVAC technician can install, repair, and provide maintenance on heating and air conditioning systems.
An HVAC technician may repair or install home boiler systems.
Article Details
  • Originally Written By: Tess C. Taylor
  • Revised By: C. Mitchell
  • Edited By: Bronwyn Harris
  • Last Modified Date: 06 July 2015
  • Copyright Protected:
    2003-2015
    Conjecture Corporation
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Starting a heating, ventilation, and air conditioning (HVAC) company is a lot like starting any sort of company, at least in terms of the basics. You’ll need a solid business plan before you get started, and training and experience working with HVAC equipment and machines is also really important. Many of the most successful business owners started out as technicians and laborers, but training is also offered in many trade schools and institutes. In addition to know-how, you’ll also need good parts; one of the most important aspects of owning a business is owning or leasing your own equipment. Finally, you’ll need clients. If you’ve been working in the industry for awhile you might already have relationships with some people and companies, but in order to expand and remain profitable for the long-term you’ll also usually need to bring in new business, which can take some work. As your company grows, you might also need to think about hiring employees, which brings a host of payroll and benefits concerns.

Create a Business Plan

Starting an HVAC business isn’t simply about hanging a sign stating you are open for business. Just like starting any service-related company, having a solid business plan and references of the quality work you perform is key to a successful new venture. A careful inventory of the level of services you are qualified to offer is a good place to start.

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Plans can vary depending on your situation, but they usually include things like costs, funding, and projections for growth and profitability looking forward a few years. You don’t necessarily need a lot of business expertise to craft this sort of document and it isn’t usually required — but it can be really helpful.

Formal plans often are required if you’re thinking of legally incorporating, though. Incorporation is a way to formally register your business as a specific entity, for instance a limited partnership or a private company. There are many reasons to think about incorporating, but in most places tax incentives are a major factor. The formal process of incorporation is usually limited to paperwork, but it can be complicated and, if this is a path you’re thinking of taking, it might make sense to meet with a lawyer with business experience.

Licensure Requirements

Most jurisdictions require HVAC technicians to have and maintain “service licenses,” which are basically credentials that represent a basic level of training and experience. The specifics can vary from place to place, but in most instances you must get proper HVAC training from an accredited school in order to obtain a license to practice HVAC contracted services in your locality. If you intend to actually perform services as a business owner, this is something you need to keep in mind, and it’s equally important for owners who will be delegating the work to hired contractors or staff. Whoever is doing the work needs to have the proper credentials. It would be not only irresponsible but in many cases also illegal to provide HVAC services to customers without the correct training and licensure.

Broad Importance of Experience

Experience is important for more than just getting a license, though. A familiarity with the way the systems work is one of the most important things you’ll need when you start an HVAC business. Some of this can be studied and learned in a formal academic setting, but a lot of it is built from on-the-job experiences. If you don’t already have a lot of hands-on HVAC experience, you might consider doing some basic work or repairs for friends or colleagues in exchange for a reference or testimonial of your performance as a contractor. Not only are references important, but these experiences will also build your portfolio and boost your confidence.

Invest in Quality Equipment

It's also important to obtain the equipment needed to perform this type of work. Some of the tools of the trade may include a work van, temperature and pressure gauges, hand tools, gas and air measurement equipment, and duct and tubing connectors. In most cases it’s perfectly acceptable to do some work on your own time using your own equipment while you work for another HVAC vendor, but it is never a good idea to use your employer's equipment or vehicles to perform work for your own clients. In addition, it's important to provide yourself and anyone who works for you with safety equipment and commercial liability insurance in case of any accidents or problems.

Solicit and Maintain Clients

Clients are one of the most important parts of any successful businesses. You may not have a long roster of clients when you first start an HVAC business, but you should make it a goal to slowly build your base and forge new relationships as time goes on. If you have previously worked in the field you may bring a number of contacts already, but even so it’s important to look towards the future when it comes to growth. Thinking about advertising and promotional deals is often an important part of this.

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Discuss this Article

pitman9
Post 5

As a tech turned business owner 27 years ago, I would suggest changing the training order. The first training I would recommend would be taking business classes. I spent far too many years floundering around, behind in my taxes, late paying my vendors, shorting my family.

About 13-14 years ago I came to the realization my business hadn't taken me to where I had envisioned, nor would it without changes. I went to a homebuilder/remodeling show and attended all the business seminars I could. I read several books on managing a business. In short, I gathered a lot of information on managing a successful business over the course of more than a year.

Fast forward to today. My taxes are

all current. I get discounts from vendors for prompt payment. My vans look very good with professional vinyl. I had enough in the bank to pay cash for the last one van including all the vinyl, shelving, etc.

The change didn't come from being a better technician. It came from learning how to calculate my break even point, how to charge what we needed to charge to stay in business and make a profit and how to get new clients and keep them with us all while making more money.

I highly recommend anyone considering starting a business, any business, to get business training first. There's a reason why 95 percent of all small businesses fail in the first five years, and it’s usually not because the owner is a lousy technician.

cupcake15
Post 4

@SauteePan -I agree with you, but you have to make sure that you are buying a healthy HVAC business with a good reputation. The reason for selling the business can tell you a lot about the health of the business.

For example, if the business has been around for a long time and the owner is retiring, then it is a good sign. However, if the owner is selling because he was in the red all of the time then it may not be a business worth buying.

You also have to consider the reputation of the owner because if it is negative you will be better off buying a different business because his reputation will continue to follow you.

SauteePan
Post 3

@Suntan12 - I know what you mean. I think that anyone looking to break into this field should consider buying an HVAC business that is for sale. This way the business is established and you have a current set of customers that you can draw from. You also have a reputation in the market and you will know what the business is capable of bringing in from the income and cash flow statements.

A good business broker should be able to help you find the right HVAC business for you. Buying an existing business is always more expensive than starting your business from scratch, but you get the advantage of being able to hit the ground running which will make

you profitable right away.

By starting a business from scratch you will have to prove yourself in the marketplace and do a lot of marketing in order to get your clientele established which is going to take a lot of time.

suntan12
Post 2

@Icecream17 - I could not agree with you more. My aunt lives in Miami and she had a problem with her air conditioner and had to have it repaired immediately. It was a Saturday and luckily they were able to squeeze her in because the repairman said that they were almost completely booked.

My aunt had to pay a premium because it was a weekend appointment, but it was well worth it because using a fan is just not going to cut it especially when the temperature outside is over 95 degrees.

icecream17
Post 1

I would imagine that an HVAC business is really in demand because people can’t live without their heating and air conditioning. I know that here is South Florida if your air conditioning is not working, you pay whatever you have to to get it fixed because the weather is so hot that it makes it unbearable without air conditioning.

I remember I once went to an attraction in Key West that had no air conditioning. I was sweating through the attraction and could only spend about 15 minutes in the home. It was the Ernest Hemingway house and not only did it not have any air conditioning, but it also had no ceiling fans because his wife thought that they were unsightly.

You really have to have central air in every home and business which is why I think that the HVAC field is perfect for South Florida.

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