Pre-loaded with hvac trade overhead defaults. Enter your job costs — get your exact bid price and profit margin.
Equipment markup is a key revenue lever for HVAC — most contractors mark up equipment 20–40% on top of distributor cost. Use the calculator to model each job component separately for more accurate bidding.
HVAC contractors typically run the highest markups of any mechanical trade, and for good reason. The combination of expensive equipment inventory, refrigerant certification and handling costs, vehicle overhead for fully-stocked service vans, EPA compliance, and the complexity of both installation and service work pushes overhead significantly higher than most other trades. Industry benchmarks put HVAC markup at 25–50% on direct costs, with service and maintenance work routinely running 40–60%.
The HVAC business model has two distinct pricing environments: equipment installation and service/maintenance. Installation bids are more competitive and pricing is constrained by what homeowners will accept for a defined scope. Service and maintenance work carries much higher markup because the dispatch model, stocked service vans, 24-hour availability, and small-job overhead all drive costs that must be recovered on every call.
Equipment markup is one of the most significant profitability levers in HVAC — and one that many contractors underuse. Most HVAC contractors apply 20–40% markup on equipment (furnaces, AC units, heat pumps, air handlers) above their distributor cost. Premium equipment from recognized brands can often support higher markup because homeowners associate brand name with quality and are less likely to price-shop the hardware. Always mark up equipment — the time and logistics involved in sourcing, ordering, receiving, and handling equipment has real cost.
| Project Type | Typical Markup | Notes |
|---|---|---|
| Emergency service call | 60–100% | After-hours premium, minimum charge, urgency |
| Standard service / repair | 40–60% | Dispatch overhead, diagnostic time, parts markup |
| AC / furnace replacement | 30–45% | Equipment + installation, competitive but structured |
| New residential install | 25–35% | Defined scope, some competition |
| Commercial RTU / split | 18–28% | Competitive bidding, larger equipment |
| Maintenance contracts | 40–60% | Recurring revenue, predictable overhead |
HVAC overhead typically runs 15–22% of revenue — higher than most trades. The primary drivers are vehicle costs (a fully-stocked HVAC service van represents $30,000–60,000 in parts inventory alone), refrigerant inventory and EPA compliance costs, multiple technician certifications (EPA 608, NATE, manufacturer certs), and the administrative overhead of managing maintenance contracts and seasonal demand swings. If you run a 24/7 service operation, factor in on-call pay and after-hours premium costs in your overhead calculation.