A standard profit margin in a non-retail business is 100 percent, which means you charge the customer twice what you spent on the part or material. This requires precise accounting and estimating skills, as prices are constantly changing. Know how much you spent on each part before you can highlight it properly. The total cost of the job also includes a labor surcharge, that is, charging more per hour for the technician's time than you pay him. These two margins can work together to make your company profitable.
Increasing materials by 100 percent usually increases labor force less, for example, by 25 percent. However, as a general guide, the typical profit margin for materials will range from 7.5 to 10%. However, some contractors raise materials by up to 20 percent, according to the Institute of Corporate Finance. Whether you spend most of your time repairing old HVAC systems, replacing parts, or installing new central air conditioning systems, it can be helpful to keep some materials and parts readily available.
From cold air conditioners to hot ovens, your HVAC business helps people feel comfortable, no matter the season of the year.