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The 7 Essential Steps for Launching Your HVAC Business

The 7 Essential Steps for Launching Your HVAC Business

Raina Becker // June 5, 2024

Are you thinking about starting a new business? Or perhaps you’re looking for something to inspire your entrepreneurial spirit. Try venturing into the HVAC space. 

But why start an HVAC business? Is it worth it? 

Well, for one, the HVAC industry is highly lucrative. The US HVAC market was valued at $30.41 billion in 2023. Analysts expect that figure to reach $49.7 billion by 2030. Such strong growth indicates a healthy, thriving industry. 

Second, an HVAC startup is a relatively safe bet compared to other ventures. That’s because there will always be a demand for HVAC systems and services. And that demand is rising due to changing weather patterns and the growing real estate market. In fact, the HVAC industry is practically recession-proof. 

That should definitely pique your entrepreneurial spirit. The only question now is how to start an HVAC business. 

We’ve got that covered. 

Read on and learn what it takes to launch a successful HVAC business. 

Understanding HVAC Business Startup Costs 

Running out of cash is the primary reason startups fail. This finding makes total sense. Any business starved of cash will eventually die. 

So, ensure you have enough money to see the venture through from the very start. You can bootstrap the startup, take out a business loan, or bring in partners/investors. But first, figure out how much you need. 

HVAC startup costs vary from business to business. But generally, you’ll be looking to spend money on: 

  • HVAC tools, equipment and supplies
  • Work gear
  • Office space
  • HVAC software
  • Business licenses, permits and insurance
  • Advertising and marketing
  • HVAC technician salaries

Break down your startup expenses into one-time and recurring monthly costs. Check out SBA’s fillable PDF spreadsheet for calculating small business startup costs. 

As a rule of thumb, you should have enough funds to run the new business for at least six months. Ground your financial projections in reality. It can take several months for a new HVAC business to become profitable. 

7 Essential Steps for Launching Your HVAC Business 

Starting a new business can be daunting. But once you break the process down into manageable steps, it becomes easier and doable. On that note, here is a step-by-step guide to starting an HVAC business: 

Step 1: Draft an HVAC Business Plan 

Create a document describing your HVAC business, its goals, and how to achieve them. Include at least these three key elements in your HVAC business plan: 

  1. Executive summary: Write a brief description of your HVAC business - location, operations, mission, etc. - and include a list of the HVAC services you plan to offer.
  2. Market analysis: Describe your target customers. Also, explain how you plan to compete other HVAC contractors in the market.
  3. Financial plan: How will your HVAC business source startup capital? And, crucially, draw a clear path to profitability that shows how you'll make money.

A solid business plan is basically your roadmap to success. It paints the big picture by blending your HVAC business ideas, strategies, vision, and goals. 

These three sections are critical to direct your business’s future. But there are other sections as well. A ready-to-use template can help ensure you don’t miss any vital information. 

RELATED ARTICLE: Commercial HVAC Services vs Residential HVAC Services 

Step 2: Register Your HVAC Business 

Pick a unique, fitting name for your HVAC business and register it

You can register the business as a sole proprietorship. However, it’s likely better to go with an LLC. 

An LLC creates a distinct legal entity for your business. It protects your personal reputation and finances from business-related liabilities. Plus, it saves you money in taxes and provides additional business perks. 

Since HVAC companies are local businesses, they are registered at the state level. Depending on your state, you may register your HVAC LLC with the Secretary of State’s office, a business bureau, or a business agency.

Step 3: Get the Necessary HVAC Permits and Licenses 

Apply for state-issued business licenses and permits. Most states require HVAC contractors to have special certifications to earn their business licenses. Common HVAC certifications include: 

HVAC licensing requirements vary widely between states. Check what your state demands of HVAC technicians and businesses. 

FROM ONE OF OUR PARTNERS: Digging into HVAC Technician Training with ForgeNow 

Step 4: Insure Your Business 

Get your HVAC startup insured. Insurance is not a legal necessity for HVAC contractors (unless you have employees). But it is essential for protecting your business from legal liabilities, property damage, and financial losses. 

Plus, some HVAC clients prefer to contract insured HVAC businesses. 

Consult a business insurance provider to determine the right policy for your business. Insurance options for HVAC contractors include: 

  • General liability insurance
  • Professional liability insurance
  • Equipment insurance
  • Property insurance
  • Commercial automobile insurance (for company vehicles)
  • Workers' compensation insurance

Step 5: Acquire HVAC Tools and Equipment 

With the paperwork out of the way, it’s time to equip your business. Having the right tools for the job makes all the difference in how efficiently you get the work done.  

Before you launch, get all the necessary HVAC tools, equipment, and safety gear. Your tool kit should include a selection of basic hand-held tools, power tools, and specialized HVAC tools. 

Here’s a list of must-have tools for HVAC contractors: 

  • Screwdriver set
  • Plier set
  • Wrench set
  • Hammer
  • Tube cutters
  • Power drill
  • HVAC/R thermometer
  • Core removal tool
  • Multimeter
  • Psychrometer
  • Manifold gauge set
  • Work gear (safety boots, hearing protection, goggles, masks, gloves, etc.)

Your tool kit must support the full range of HVAC services you plan to offer. Also, do not compromise on the quality or specifications of your tools. Use proper, high-quality tools on every HVAC job. Doing so ensures efficiency, quality work, and safety. 

There’s another very important tool for HVAC contractors—HVAC software. This essential tool helps you manage all your HVAC operations. Using HVAC software improves business efficiency, saves costs, and minimizes risks. 

You want a robust HVAC management solution with these capabilities: 

  • Automated scheduling and dispatching
  • Integrated accounting (billing, invoicing, transaction logging, etc.)
  • Detailed reporting and insightful analytics
  • Built-in customer relationship management (CRM)
  • Payment processing

Step 6: Get the Word Out 

Once everything is set up, your HVAC company is ready to hit the market. But you won’t get any customers if they don’t know the business exists. You must promote the brand to your target market and attract potential HVAC clients. 

As a startup, here’s what you can do for HVAC marketing: 

  • Build and launch a branded HVAC website
  • Claim and optimize your Google Business Profile
  • Create business pages on social media (Facebook, Nextdoor, LinkedIn, etc.)
  • Hand out pamphlets in your local area
  • Take out print ads (billboards, bench ads, local magazines, etc.)
  • Look for advertising opportunities at local events such as trade fairs, charities and parades
  • Advertise your business online via search engines and social media
  • Cold-call or email potential HVAC clients

RELATED ARTICLE: Our Best Tips for HVAC Email Marketing 

Step 7: Grow Your HVAC Business 

An entrepreneur’s work is never done. Once your HVAC venture gets off the ground, it’s time to consider elevating the business to the next level. 

Business growth could mean many different things depending on how your business is doing and its long-term goals. Think along these lines to grow your HVAC business: 

  • Find new sources of HVAC leads
  • Expand your HVAC services portfolio
  • Develop new competitive strategies
  • Update your business plan to seize new opportunities
  • Venture into new markets/locations
  • Hire additional HVAC technicians to handle more work

FROM ONE OF OUR PARTNERS: HVAC Technician Training: What to Look for When Hiring 

How You can Start Launching Your HVAC Right Now 

Now that you’re aware of the basic steps to get your HVAC business off the ground, you can use these immediately actionable tips to begin your progress: 

  • Start research to write the elements of your business plan. The more definitive your research, the better your plan will be.
  • Brainstorm a unique and relatable business name. Run it by friends or colleagues to ensure it's easy to pronounce and remember.
  • Review your assets as they apply to your start-up costs. Include any existing equipment, vehicles and savings that will go toward the business. Then, you can calculate your remaining startup costs and apply for enough funding.
  • Get the business certified, licensed and insured.
  • Acquire the necessary remaining tools and gear for HVAC jobs.
  • Launch a startup marketing campaign
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