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  1. #1
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    Exclamation Help Starting hvac business

    I'm wanting to start my own business in the next 2-3 years. It'll be residential/light commercial. I've been in the field for 7 years doing mainly installs but service the last 2 years. Anyhow, I know I'll need a couple grand for speciality tools and I'm thinking maybe 10-12 grand for a decent van. My questions are, what all do I need to start my own business? What special licenses or fees will I have to get? Would a 30 grand business loan be too much or not enough? Id like it to be just me in the company for the first year. What computer programs do you use for billing and storing customer info? Thanks guys. Any info is appreciated.

  2. #2
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    i started my business 3 years ago. I am also a plumber. you need:

    - incorporation, probably sub S type - consult a business lawyer
    - insurance, minimum 2 million total
    - workman's comp, but waive yourself as an officer of the corporation (cheaper rates)
    - your state or locality may require a contractor license. call your AHJ to find out
    - dont blow cash on special software. use MS office excel. keep track of all income, and break down expenses by tools, truck, fuel and maintenance, stock, etc.
    - get a GOOD, professional CPA
    - get (2) 3 drawer minimum file cabinets
    - get a laser printer
    - get a dedicated computer system. I use a laptop that stays in the office
    - backup regularly

  3. #3
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    In Ohio you will need to be licensed. There are 3 types of licenses you will need to obtain to work on the equipment in our trade, HVAC, refrigeration, and hydronics. A plumbers license would be needed if you plan on doing any plumbing work.

    To qualify you need:

    Be at least 18 years of age.
    Be a United States citizen or a legal alien-must provide proof of being a legal alien.
    Either have been a tradesperson in the type of licensed trade for which the application is filed for not less than five (5) years immediately prior to the date the application is filed, currently be a registered engineer in this state with three (3) years of business experience in the construction industry in the trade for which the engineer is applying to take the examination, or have other experience acceptable to the appropriate section of the board.
    Never have been convicted of a disqualifying offense as defined in S.B. 337.
    Pass the examination in the trade.
    Carry minimum $500,000 contractor liability coverage.
    Pay the applicable fees.

    All in all you will have about $500 in the licensing.

    The minimum $500k in insurance won't meet most commercial property requirements, I carry $2mil and even that is a little low for my industrial accounts. $2mil with a few riders cost just under $2k/yr.

    Plan on $10k for a used van with shelves and ladder rack.

    Another $5k minimum for tools to get you started, you will build that quickly over the first year.

    You will want to form an LLC to protect you and yours. $100 or less to file with the state.

    You will need to invest in Quickbooks and I highly recommend taking a class on how to use it, or hire a bookkeeper.

    You will need an accountant, we pay around $1k year but our bookkeeping is spotless so it's easy (less $$) for our accountant.

    Then you have van and tool insurance, payroll fees, cell phone bill, big city licenses (Columbus has their own licenses at $350/yr), and a host of small stuff that adds up quick.

    The biggest piece of advice I can give you is DO NOT take out a loan. You either start with nothing and build or you start saving up now to make the jump. I would not take out any type of loan unless it's to buy equipment for a large project which you have a signed contract for and you know you will be paid in 30 days. You don't need to start behind the 8 ball. Besides, it's hard to get a business loan unless you have perfect credit and put up collateral, like your house. No way I would risk that.

    Any questions just ask, I am 3yrs into my own business and just now beginning to see the light.

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  5. #4
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    Thread Starter
    Thanks guys. I think the thing holding me back now is I have 2 young kids and don't wanna be working 24/7. Once both are in school I think I'll be more capable of handling all the hours. I have a question for you guys. Are you glad you started your own business or do you wish you would've just worked for a contractor?

  6. #5
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    youll NEED a license, bond, file DBA or what ever your state requires to operate as a business. Honestly started my business with $700 bucks to my name, it sucked. I worked out of my wife's VW passat station wagon for 8 months, humiliating to be honest, but it didnt stop me. Just finished my second summer in business, I got money in the bank, 2010 service van, lots of stuff that I didnt have in the beginning lets just say that. I probably wont be able to keep up with the work load next year, best damn move I ever made, most ballsy too. Could have lost it all several times in the first year.


    But you had better be ready to take your work home and be available all the time, if you got kids its gonna add to the stress. Good luck

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  8. #6
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    Quote Originally Posted by Tech2104 View Post
    Thanks guys. I think the thing holding me back now is I have 2 young kids and don't wanna be working 24/7. Once both are in school I think I'll be more capable of handling all the hours. I have a question for you guys. Are you glad you started your own business or do you wish you would've just worked for a contractor?
    To be perfectly honest, when is a good time to make that leap? I always had an excuse not to do it, "I just bought the house" "Now I have a car payment" "Now I am married"... Truth be told you will never have an "ideal" time to leap off that cliff.

    I was just married, still making $35/hr with killer bennifits in the union, my wife was pregnant with our first child, and to top it all off she was going to become a stay at home mom and we were going to give up her $40k/yr job to make it happen. It was quite possibly the worst time in my life to try and start a business.

    Someone I met who was hugely successful with his own excavating business and started his business under very similar circumstances told me this... "When your back is against the wall, you fight the hardest"

    He was spot on.

    It has been one of the most rewarding things I have ever done outside of having children... Two now to be exact.

    You will need to eat, sleep, and breath your company for the first couple of years, at least I did, but now things are smoothing out and I have time to relax. I am still on call 24/7/365 but that is the easy part.

    Can you put a price on being able to wake up everyday and making time to hang out with your kids and wife in the morning before you leave the house? Or being home at a decent hour, or making your own schedule to spend time with your family? I used to get up and 5:30am and not return until 5pm working for someone else. I got to see my baby son maybe 2hrs a day before doing it all over again. I literally missed the first two years of his life because I was busy making someone else rich. That stress almost killed my marriage and me.

    I would never ever go back to that. I would rather die poor and happy than rich and miserable. But that's me, I left a very stable, very rewarding job to do this, and I don't regret it one bit.

    FYI, I took Friday and Monday off this weekend to go deer hunting and watch football with my son. Three years ago, working for someone else, I would have never even thought about doing something like that. This is the kind of thing you can't put a price tag on.

  9. Likes trippintl0, Tech2104, Showcase liked this post
  10. #7
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    Going into your own business IS a big decision, and it might mean working more hours than when working for someone. After your long work day you now have a few hrs of "office work" to do. If there was a "lack of knowledge problem" during the day ,you now have research to do and studying to do. And if you have to track down parts the office hrs add up.
    I went into my own business after getting aggravated at my past Boss's for not wanting to listen to my knowledge that I gleaned from Carrier, Fedders, RSES,and a few others. Like the one boss that I had, he was brazing brass MPT by MSAE fittings onto old steel throw away freon drums and USING the now converted freon tanks in fuel oil systems as a "day tank". He was using 15% silphos , I mentioned that a minimum of 35% silphos is required. He told me to "mind my own business", the next day I showed my Boss the Engelhard, Harris, and All-State brazing Guides and boy o boy did he get a sour look on his face.He told me that I was going to install these "oil storage tanks" in the bldgs in the Industrial Park, and I said "Not me!" And boy o boy did he get a sour look on his mug.
    I'm happy with my decision to go into my own business.I do miss some family functions, thats just a fact of life in this Profession.

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  12. #8
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    Quote Originally Posted by zw17 View Post
    To be perfectly honest, when is a good time to make that leap? I always had an excuse not to do it, "I just bought the house" "Now I have a car payment" "Now I am married"... Truth be told you will never have an "ideal" time to leap off that cliff.

    I was just married, still making $35/hr with killer bennifits in the union, my wife was pregnant with our first child, and to top it all off she was going to become a stay at home mom and we were going to give up her $40k/yr job to make it happen. It was quite possibly the worst time in my life to try and start a business.

    Someone I met who was hugely successful with his own excavating business and started his business under very similar circumstances told me this... "When your back is against the wall, you fight the hardest"

    He was spot on.

    It has been one of the most rewarding things I have ever done outside of having children... Two now to be exact.

    You will need to eat, sleep, and breath your company for the first couple of years, at least I did, but now things are smoothing out and I have time to relax. I am still on call 24/7/365 but that is the easy part.

    Can you put a price on being able to wake up everyday and making time to hang out with your kids and wife in the morning before you leave the house? Or being home at a decent hour, or making your own schedule to spend time with your family? I used to get up and 5:30am and not return until 5pm working for someone else. I got to see my baby son maybe 2hrs a day before doing it all over again. I literally missed the first two years of his life because I was busy making someone else rich. That stress almost killed my marriage and me.

    I would never ever go back to that. I would rather die poor and happy than rich and miserable. But that's me, I left a very stable, very rewarding job to do this, and I don't regret it one bit.

    FYI, I took Friday and Monday off this weekend to go deer hunting and watch football with my son. Three years ago, working for someone else, I would have never even thought about doing something like that. This is the kind of thing you can't put a price tag on.
    Wow.....$35 and hour with good benefits !! In my 12 years in the trade, Eire Pa. and South West Florida, I've never heard of anyone at that high a pay rate. The best of the best Tech. here is $25 an hour. A service manager for even a large HVAC company managing like 18 techs would be $28 or possibly $29. The vast majority of guys make way less and some of them are quite good. That is a great gig but I'm left scratching my head as to of why I've never heard of nor seen it.

  13. #9
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    Quote Originally Posted by ARK Cooling View Post
    Wow.....$35 and hour with good benefits !! In my 12 years in the trade, Eire Pa. and South West Florida, I've never heard of anyone at that high a pay rate. The best of the best Tech. here is $25 an hour. A service manager for even a large HVAC company managing like 18 techs would be $28 or possibly $29. The vast majority of guys make way less and some of them are quite good. That is a great gig but I'm left scratching my head as to of why I've never heard of nor seen it.
    I bet you have never worked on a 400 ton chiller either.

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  15. #10
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    Quote Originally Posted by zw17 View Post
    I bet you have never worked on a 400 ton chiller either.
    just spit out my coffee... ....Ive never even seen a chiller....

  16. #11
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    If you plan on going residential, you need to look at all aspects of the job.
    What a lot of great techs forget is there's more hats to wear.
    I was thinking about going on my own a few years ago, but then my employer promoted me to estimator/salesman.

    Wow! My eyes were opened. It's a whole new ball game. You can sit with the customers and dazzle them with your brilliance, but if you don't know how to truly sell, or close a job, you're going to be looking at getting contracts for the lowest bid.

    You don't want to be the lowest guy, you MUST learn how to sell yourself. It's the most difficult thing for a tech to learn because for years you and your fellow techs thought salesmen were slack money suckers on the company. They are only out to fill their own pockets, and will rip off a homeowner in a heartbeat.

    This is not true in quality companies. Good salesman take pride in their designs, and love what they do. Unfortunately, from what I've experienced there are also quite a few bad salesmen, who's ideal goal is not to sell their company, but put down others. Basically the goal is to place doubt in the homeowner's mind.

    So, even though you had a better design at a better value, you didn't help the customer to understand the VALUE. In that case the other guy dropping bombs on you wins the bid, or you drop price to compete.
    "The only true wisdom is in knowing you know nothing" Socrates

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