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What Does It Cost to Start an HVAC Company?

Starting an HVAC company is not a cheap endeavor and there are many factors to consider.

Starting your own HVAC company can be a very rewarding experience. Not only will you be your own boss, but you’ll also have the satisfaction of helping people stay comfortable in their homes during the cold winter months and cool during the hot summer days.

However, starting an HVAC company is not a cheap endeavor and there are many factors to consider. These factors include the type of business you want to start and the equipment you need. This blog will take a look at some of the major expenses that you can expect to incur when starting your own HVAC business.

Cost of Equipment for HVAC Company

One of the most significant expenses when starting an HVAC business is the cost of equipment. If you are planning on starting a full-service company that offers installation, repair, and maintenance services, you will need to invest in a variety of tools and pieces of equipment.

These can include everything from ladders and screwdrivers to furnaces and air conditioners. The cost of this equipment will vary depending on the quality and brand that you choose. You can expect to spend several thousand dollars on these items.

HVAC equipment is a significant investment for any business, but it is especially important for startups. Not only does HVAC equipment have a high initial cost, but it also requires ongoing maintenance and repairs. As a result, the cost of HVAC equipment can quickly grow and eat into the company’s profits.

HVAC equipment is also a crucial part of the company’s infrastructure, and without it, the company would not be able to operate. As a result, HVAC equipment is a crucial consideration for any business owner. It is important to factor in the cost of HVAC equipment when developing a business plan.

Types of HVAC Equipment

There are a wide variety of HVAC systems on the market. The type of system that you choose will have a significant impact on the cost of your equipment. For example, ductless mini-splits are becoming increasingly popular due to their energy efficiency and flexibility. However, ductless mini-splits are also more expensive than traditional HVAC systems.

Size of Equipment

Another factor to consider when purchasing HVAC equipment is the size of the equipment. The size of the equipment will impact the cost, as well as the amount of space that you need to store the equipment. For example, a small business might be able to get by with a single furnace, while a larger company might need multiple furnaces to heat their office space. As a result, it is important to consider the size of your business when purchasing HVAC equipment.

Ongoing Maintenance

In addition to the initial cost of equipment, you will also need to factor in the cost of ongoing maintenance. HVAC systems require regular maintenance in order to function properly and avoid costly repairs. As a result, it is important to budget for the cost of routine maintenance when starting your HVAC business.

One-Time Expenses

There are also a number of one-time expenses that you will need to consider when starting your HVAC business. These can include the cost of permits and licenses, as well as the cost of marketing and advertising.

Cost of Advertising for HVAC Company

Another important expense for your HVAC business will be advertising. You’ll need to let people know that you exist and that you’re ready to help them with their heating and cooling needs! There are a variety of ways to advertise your business, including online, in the newspaper, and on billboards. The cost of advertising will vary depending on the method you choose, but you can expect to spend several hundred dollars per month on this expense.

HVAC is an expensive business to advertise. The HVAC company owner should look at the cost of advertising and other strategies for the company to grow. The company’s salary will also be a factor in deciding how much to spend on advertising. HVAC businesses need to heat and cool their customers’ homes which makes HVAC a high-demand business, so the owners must be careful not to overspend on advertising.

Types of HVAC business Advertising

  1. Television
  2. Radio
  3. Print (newspaper and magazines)
  4. Online (paid search, directories, and banner ads)
  5. Billboards and Outdoor Advertising
  6. Word of Mouth
  7. Personal Selling

HVAC businesses should start off slowly and carefully plan their advertising budget. Personal selling is the most important form of advertising for HVAC businesses. The best way to get word of mouth is by providing excellent customer service. If customers are happy with the service they receive, they will tell their friends and family about the company.

Cost of Insurance for HVAC Company

HVAC companies should also factor in the cost of insurance when determining their overhead costs. As an HVAC contractor, you’re often working in a client’s home, moving, maintaining, or installing heavy systems and dealing with electricity. HVAC contractors insurance will help protect your business against the many risks and liabilities you face as an owner, including jobsite injuries, theft of tools and materials, property damage and more.

HVAC insurance is a must for any HVAC business. Insurance premiums will vary depending on the type of coverage you need and the size of your business, but you can expect to pay several hundred dollars per month for a good policy.

The cost of HVAC insurance also depends on the size of the company and the number of HVAC units they have. For a small startup, HVAC insurance can be as low as $500 a year. For a large company, HVAC insurance can be much higher. The average salary for an HVAC technician is $50,000 a year. HVAC companies typically grow 10% to 20% each year. Insurance for HVAC companies typically costs 2% to 3% of their revenues.

HVAC Contractor Insurance Includes:

Business personal property covers the loss or damage to office or business equipment including computers, office furniture and more.

Building property protects your storage buildings and other structures you own.

Business liability helps protect you against costly claims and lawsuits due to personal injuries, property damage, and more.

Completed operations covers bodily injury or property damage claims that occur after a project is completed.

Mobile equipment provides broad coverage for your tools and equipment, whether you’re at home, on the job-site, or taking a lunch break.

Installation floater protects valuable equipment or materials – like ac systems, furnaces and more – while in transit, awaiting installation, or being installed at the job site.

Property of others covers the loss or damage to property of others that is in your care.

You can find more information regarding contractor insurance here.

Cost of Licensing and Permits for HVAC Company

Depending on the state you’re in, you may also need to obtain a license or permit before you can start operating your HVAC business. The cost of these can vary depending on the HVAC company and the location of the business. Typically they range from a few hundred to a few thousand dollars.

HVAC businesses are also required to grow at a certain rate in order to keep their license, which can be difficult for small businesses. Nevertheless, the cost of HVAC licensing and permits is necessary for those who wish to enter this field.

Below are the licensing laws for Ohio HVAC contractors, but you can find a state-by-state guide to HVAC licensing laws here.


HVAC Technician:

No licensure required

HVAC Contractor:

Licenses issued through: Ohio Construction Industry Licensing Board

License required:

HVAC Contractor

Must have five years of HVAC Technician experience to qualify to sit for the exam

Must carry $500,000 contractor liability coverage

The cost of renting or buying a commercial space

If you’re planning on starting a brick-and-mortar HVAC business, you’ll need to factor in the cost of renting or buying a commercial space. The price of commercial real estate varies depending on the location and size of the space you need, but you can expect to spend several thousand dollars per month on this expense.

HVAC businesses require a lot of space to store equipment and supplies, as well as to service customers’ HVAC units. HVAC companies can either rent or buy a commercial space.

Size and Location

The cost of renting or buying a commercial space will be different depending on the HVAC company’s size and location. HVAC companies that are larger and located in more populated areas will generally have higher costs than HVAC companies that are smaller and located in less populated areas.

Company Growth Rate

The cost of renting or buying a commercial space for an HVAC business can also be affected by the company’s growth rate. If the HVAC company is rapidly growing, it may need to move to a larger space sooner than anticipated, which could increase the cost of renting or buying a commercial space. The overhead costs will impact the company’s bottom line and, ultimately, the owner’s salary.

HVAC businesses provide vital services to both residential and commercial customers. Many HVAC companies are family-owned and operated, which means that the cost of renting or buying a commercial space is a significant factor in the success of the business.

The average HVAC company spends between $1,500 and $2,500 per month on rent, utilities, and insurance. The owner’s salary is also a major expense, as HVAC technicians are paid an average of $50,000 per year. In order to grow their businesses, HVAC companies must generate enough revenue to cover these costs and still make a profit.

For many HVAC companies, this can be a challenge, especially in the early years when they are just starting out. However, by carefully managing their costs and marketing their services effectively, HVAC companies can overcome these challenges and become successful businesses.

Renting a commercial space

Renting a commercial space has several advantages. First of all, it is generally much less expensive than buying property. This can be a crucial consideration for HVAC companies, which require a significant amount of start-up capital.

Renting gives you the flexibility to move to a new location if your business outgrows its current space. However, there are some disadvantages to renting as well. For example, you will likely have less control over the appearance and layout of your rental space. And if the building sustains any damage, you will be responsible for repairing it.

Buying a commercial space

Buying a commercial space has some different benefits. One key advantage is that you will own the property outright, giving you more control over how it is used and maintained.

Additionally, if the value of the property increases over time, you will reap the financial benefits.

However, there are some drawbacks to buying commercial property as well. The biggest downside is that it requires a significant amount of upfront capital. And if the value of the property decreases, you could end up losing money.

The cost of hiring employees for HVAC Company

Finally, you’ll need to factor in the cost of hiring employees. If you’re starting a small business, you may be able to get by with just a couple of employees.

If you’re planning on growing your business, you’ll need to add more staff to your team. The cost of hiring employees will vary depending on the number of workers you need and the salary you’re willing to pay them. You can expect to spend several thousand dollars per month on this expense.

HVAC businesses require a significant investment in personnel and are often faced with the challenge of finding qualified employees at a cost that won’t break the bank.

HVAC businesses need to be able to offer a competitive salary in order to attract and retain good employees, but HVAC business owners also need to keep their costs down in order to be profitable.

Fortunately, there are ways to save money on HVAC business costs without sacrificing quality or customer service. Hiring students and recent graduates, negotiating with suppliers, and taking advantage of online resources are all strategies that HVAC business owners can use to keep their costs down. By being mindful of the cost of running an HVAC business, owners can ensure that their businesses are healthy and profitable.

Average Cost

The HVAC industry is growing rapidly, and as a result, the cost of hiring employees has increased. The average salary for an HVAC technician is $50,000 per year. The cost of benefits and insurance can add an additional $20,000 to $30,000 per year. For a small HVAC company with just a few employees, this can be a significant expense.

HVAC businesses are often required to provide training for their employees. As a result, the cost of HVAC employees can be a major barrier to entry for new HVAC businesses.


Starting an HVAC business can be a very rewarding experience. However, it is important to be aware of the costs associated with starting and running an HVAC company. With careful planning and execution, your HVAC business can be successful and profitable.

If you decide to take the plunge, make sure to take advantage of industry leading software like Smart Service, that will help get your business mobile, keep track of invoices and inventory, and makes things like scheduling a breeze!