How to Grow a Heating and Air Conditioning Business

So, you've worked hard to build a successful HVAC business but now you're hitting roadblocks. You're experiencing operational bottlenecks, inconsistent marketing results, and difficulty retaining customers.

Well, you're not alone.

Plenty of HVAC business owners struggle to scale and reach the next level of growth. That's because, without the right strategies, even the most thriving businesses can stall.

To help you overcome these hurdles, we've created this guide. It provides actionable strategies to help you scale effectively. From building a solid business foundation to aligning your team with incentives, we cover everything you need to grow your HVAC company.

Develop A Strong Business Foundation

Every successful HVAC company is built on a solid business foundation. So, let's take a look at some key strategies you can use to lay the groundwork for a profitable future.

Create a business plan

Your business plan should serve as a roadmap to success, yet many HVAC business owners forget about their plan once they've created it. To reap the full benefit from your plan, you need to treat it as a living document that evolves alongside your business.

Your business plan should include:

• Services offered: Clearly define what HVAC services you'll provide. Are you the go-to expert for high-efficiency commercial systems? Or do you focus on installations for eco-conscious buyers? To be successful, you need to define your niche clearly.
• Target market: You need to identify your ideal customers and develop a deep understanding of your target market. Do your customers value energy savings over upfront costs? Or will they pay extra for 24/7 emergency response? When you have a comprehensive understanding of your audience, you can target them effectively and drive up your sales.
• Revenue goals: Include realistic yet ambitious revenue targets in your HVAC business plan. Consider things like how many service calls per week you're aiming for, and what your ideal conversion rate will be. Most HVAC businesses drift aimlessly without clear goals. Your business plan should keep you going in the right direction.

Invest in licensing & certifications

Too many HVAC business owners treat licensing and certification as a legal checkbox. In reality, it can give you a serious competitive advantage.  

Some of the most important licenses and certificates for HVAC professionals include:

• State licensing: First, you need to check if there are any HVAC licensing requirements in your state. If there are, you'll need to meet them. Yet, don't just treat this as a legal requirement. State licenses are a good way to build trust among your audience, and you should display them on your website, emails, and proposals.
• EPA Certification: If your HVAC technicians handle refrigerants, they'll need to be certified by the Environmental Protection Agency (EPA). There are different levels of certification, so you and your team need to obtain the appropriate level to serve your customers safely.
• Other certifications: Obtaining certifications from Air Conditioning Contractors of America (ACCA) and North American Technician Excellence (NATE) help you establish additional expertise and credibility within the industry. If your competitor isn't certified but you are, customers are more likely to choose your business.

Set competitive pricing

Your pricing model is arguably the most important element of your business foundation. At the end of the day, a customer's buying decision is largely based on fair pricing. So, use these methods to create a winning pricing structure:

• Research market rates: Research competitors in your area and assess the going rates for various HVAC services. This will give you a good baseline for your own pricing.
• Value-based pricing: Compete on value instead of price. This could mean emphasizing customer service or offering a performance guarantee. The idea is to build a brand that offers more value to customers than your competitors without breaking the bank.
• Flexible pricing models: Consider offering options like service contracts and membership plans to generate steady income and encourage loyalty among your customer base.
• Seasonal pricing: Your demand isn't the same year-round, so why should your pricing be? Adjust your pricing and charge premium rates during peak seasons, and incentivize customers to book off-peak services at a discount. This is a great way to maximize profits.

Optimize Your HVAC Marketing Strategy

Starting an HVAC business is no small feat and marketing might not be at the forefront of your mind as you begin. However, a strong marketing strategy is essential for driving growth and gaining customers. So, how can you develop an effective plan? Let’s break it down.

Build an SEO-optimized website

Your website is often the first point of contact for potential customers. Naturally, you'll want to make it user-friendly and visually appealing—but that's not all. You also need to make sure it's optimized for search engines.

Why? When your site is well optimized, it's more likely to rank higher in search results, driving more traffic (users) to your site.

As a result, more potential customers will engage with your site and you'll start converting high volumes of traffic into booked jobs.

• Use a mobile-friendly design: In 2024, more than 61.5% of all global internet traffic came from mobile devices. So, if your site isn't designed for speed and ease on mobile devices, you'll lose customers before they even see your offer.
• Use HVAC-related keywords: Lots of HVAC companies target broad, high-competition keywords like "HVAC repair". The problem is that the competitiveness of these search terms makes them hard to rank for. Instead, focus on local, service-specific keywords like "Emergency AC repair in [city]". Ranking for terms like this is guaranteed to bring in traffic and sales.
• Create quality content: When it comes to SEO, high-quality content is non-negotiable. You should create well-written and highly valuable content about HVAC topics you know your audience is interested in. This positions you as an expert within the HVAC industry, improves your trust and credibility, and boosts your search engine rankings.
• Optimize page speed: 53% of mobile site visitors say they leave a page if it takes more than three seconds to load. Clearly, if your site is slow, customers won't be converting. To speed up load times, you can use tactics like compressing images and minimizing code. This will improve both user experience and SEO.

Leverage local SEO

Local SEO is often overlooked, yet it’s a powerful way to connect with customers in your area. It focuses on optimizing your visibility in local search results to attract nearby customers.

For example, let's say your HVAC company is based in Boston. An example of local SEO would be to create a service page for your site called "Air Conditioning Servicing In Boston".

Then, when customers Google this phrase, they're more likely to see your site in the search results and land on your page.

Here are some methods to optimize local SEO effectively:

• Google Business Profile (GBP): Think of your Google Business Profile (GBP) as your company's online storefront. Once you've created it, optimize it by updating service areas, adding photos, posting updates, and responding to reviews.
• NAP consistency: If your Name, Address, and Phone Number (NAP) aren't consistent across your website, directories, and Google listing, it can seriously hurt your rankings. So, you need to routinely check these details and make sure they're the same wherever they appear.
• Local content and keywords: Don't just create generic service pages. Instead, create hyper-local content that speaks directly to your customers, such as "The Best Heating Solutions for Oregon Winters".

Use paid advertising

You should also make the most of pay-per-click (PPC) advertising. Most HVAC companies treat paid ads as an afterthought, but the truth is, they're a highly effective way to capture high-intent customers.

Here's how you can use PPC to grow your HVAC business:

• Google Ads: Google Ads allows you to create targeted campaigns for specific HVAC services and locations. By showing ads to users in your area who are actually interested in your specific offerings, you'll attract relevant audiences and reduce wasted ad spend.
• Retargeting: Lots of HVAC companies lose web traffic because their customers check prices, compare services, and then forget about them. The solution? Retargeting ads. These ads are one of the best ways to win back customers by offering incentives like discounts. The more often your customers see you, the more likely they are to convert.
• Seasonal campaigns: Many HVAC businesses run the same ads year-round—but this is a big mistake. Instead, you should adjust your PPC strategy based on seasonal demand. For instance, you can use ads to target search terms like "AC not working" in the summer, and "heating not working" in the winter.
• Google Local Services Ads: You should also consider paying for some Google Local Services Ads. These ads appear at the top of search results for local service queries and show trust indicators such as user ratings. Trust us, if you're not there, your competitors will be.

Encourage customer reviews

Your HVAC customers could be one of your best sources of digital marketing.

This is because online reviews have a significant influence on the buying decisions of potential customers. In fact, 74% of customers read at least one review before buying a HVAC service.

You can encourage your customers to leave reviews by:

• Creating a system where you follow up with customers after they've used your HVAC services. This involves contacting them and asking them to leave a review of your business.
• Engaging with both positive and negative reviews in a professional manner. This demonstrates your commitment to satisfying your customers and shows other users that you genuinely pay attention to reviews.
• Showcasing positive customer reviews on your website and in your marketing materials. By doing so, you signal that you value customer feedback and encourage other users to leave reviews.
• Requesting reviews on Google and other platforms. You can do this by sharing the review link provided in your Google Business Profile.

Align Your Team With Profit Sharing And Incentives

By fostering alignment through profit sharing and performance-based incentives, you can increase employee motivation, reduce turnover, and improve your company's overall performance. Let's take a look at why it's so important and how to get it right.

Why team alignment matters

When your employees share a common vision and understand how their roles contribute to business goals, they're more engaged and productive. In fact, a well-aligned team leads to better customer service, seamless operations, and significantly improved efficiency.

Implement profit sharing

Profit sharing is an amazing way to motivate your employees and foster a sense of ownership.

By offering a percentage of your company's profits in the form of a profit sharing bonus, you can align your team's interests with the success of your business.

This approach rewards loyalty, promotes collaboration, and reduces employee churn.

Set performance-based incentives

Performance-based incentives reward employees for specific achievements within the business.

For example, a performance bonus could be tied to metrics like customer satisfaction scores or operational efficiency.

Here are some other employee incentive ideas you could use to drive results while maintaining quality standards:

• Provide incentives for upselling energy-efficient systems or maintenance contracts.
• Reward teams that complete jobs on time without sacrificing quality.
• Offer bonuses to technicians who consistently receive positive customer feedback.

Enhance workplace culture

While bonus plans and performance-based incentives have many benefits, they need to be implemented transparently. Your employees should clearly understand the criteria for rewards in order to trust and embrace the process.

If you get this right, you'll build trust and encourage collaboration among your team members.

Besides transparent incentives, there are other ways to improve workplace culture, such as:

• Recognition programs: Acknowledge and celebrate individual and team achievements publicly during meetings and through internal newsletters.
• Team-building activities: Organize events like workshops and outings to strengthen bonds among employees.
• Open feedback channels: Encourage employees to share ideas or concerns about incentive programs to ensure continuous improvement.

Use technology to track performance

Growing your HVAC business takes a huge amount of time and effort. So, manually tracking performance and awarding incentives is simply out of the question. Instead, you can use ShareWillow to automate these processes for you.

With ShareWillow, you choose how often you want to pay bonuses and set thresholds your employees need to reach before your plan pays out. This ensures rewards are based on measurable outcomes rather than subjective evaluations.

Once it's set up, you can simply share your plan with your team and they can view all the details on a single dashboard. This makes it easy to create a motivating compensation plan with 100% transparency, where your entire team can see how they're progressing towards their goals.

Enhance Customer Experience & Retention

Of course, gaining new customers is vital to growing your HVAC business. However, retaining your existing customers is just as important.

So, how do you keep customers coming back? The key lies in providing a positive and memorable customer experience. Here are some strategies to help you achieve this goal and boost retention.

Improve customer communication

Effective communication is a guaranteed way to increase customer satisfaction. When you offer multiple channels for support, you're able to cater to different preferences and make sure your customers always feel heard.

To improve communication with your customers, you should:

• Offer 24/7 support: Implement a system that provides round-the-clock customer support. This could include chatbots on your site for instant responses to common queries and email support with guaranteed response times.
• Communicate proactively: Always keep your customers informed about service appointments, system status, and maintenance needs. You can use SMS notifications for appointment reminders and send email updates on service progress.
• Provide personalized interaction: When it comes to customer satisfaction, a little bit of personalization can go a long way. So, train your staff to provide a personalized service that makes your customers feel valued.

Implement a maintenance membership program

Maintenance membership programs offer customers regular care for their heating and cooling systems for a monthly or annual fee. They create a consistent revenue stream for your HVAC business while improving customer retention.

If you're interested in setting up a maintenance membership program for your own HVAC business, here are some tips to make it as successful as possible:

• Use tiered membership levels: Offer different levels of service to cater to various customer needs and budgets. For example, you could have a "Basic" tier that includes annual tune-ups and priority scheduling. For a higher fee, you could offer a "Premium" service that includes bi-annual maintenance and discounts on repairs.
• Set up automated scheduling: Use software to automatically schedule maintenance visits for your members.
• Provide member perks: Offer members exclusive benefits to incentivize sign-ups and renewals. This could include things like discounts on new equipment installation and waived service fees.

Provide special promotions and discounts

Special offers and discounts are effective tools to attract new customers and encourage existing ones to explore additional services or upgrades.

Here are a few effective options:

• Seasonal offers: Offer promotions that align with the changing needs of customers throughout the year. For example, you could offer AC tune-up specials in the spring and furnace inspection deals in the fall.
• Referral programs: Referral programs can help you encourage word-of-mouth marketing by rewarding customers who refer new clients. You could offer a discount on their next service or a cash bonus for successful referrals.
• Bundle deals: You could offer exclusive bundle deals to your existing customers that combine multiple services at a discounted rate. For instance, an AC and furnace tune-up bundle that costs a lot less than it would to buy each service separately.

Streamline Business Operations For Efficiency

To grow your HVAC business successfully, your operations need to be as efficient as possible. Streamlining processes helps reduce costs, improve service quality, and enhance the overall customer experience.

While this can seem challenging, we have a few tried and tested strategies you can use to streamline your HVAC business operations.

Invest in HVAC software

Running an HVAC business involves countless tasks each day. From scheduling services to managing customer accounts, it can become seriously overwhelming if you try to do it all manually. That's why you should invest in HVAC software that can automate key processes like:

• Scheduling: Use HVAC software like ServiceTitan to optimize technician routes, reduce travel time, and maximize the number of jobs completed each day.
• Invoicing: Improve cash flow by automating invoice generation and payment reminders. 90% of e-invoices are paid on time compared to 66% of paper invoices, so digital invoicing is definitely the way to go.
• Customer management: Use a CRM to track customer history, preferences, and equipment details. This allows you to offer a truly personalized service which is essential for customer retention.
• Mobile access: Equip your HVAC technicians with mobile apps for real-time updates, access to digital forms in the field, and instant communication.

Hire & train skilled technicians

Your workforce is the backbone of your business. So, it almost goes without saying that the best way to streamline operations is to hire top talent and provide them with the best training possible. Doing this will ensure your technicians deliver high-quality service, maintaining customer satisfaction.

Here's how you can hire and train skilled HVAC technicians:

• Recruitment: Develop relationships with trade schools and offer apprenticeship programs designed to attract talent. It's a good idea to partner with local vocational schools to create a pipeline of skilled technicians for your business.
• Ongoing training: Create a continuous learning program that keeps technicians updated on the latest HVAC best practices and technologies. Regular training helps reduce callbacks and increases first-time fix rates.
• Certification support: Encourage your technicians to obtain industry certifications like NATE and offer to support them as they undergo their training.

Optimize inventory management

Managing your inventory effectively ensures you have the right parts available when needed. This reduces downtime, making your service far more efficient.

Here are our top tips for inventory management optimization:

• Use inventory tracking software: Invest in reputable inventory tracking software to automatically track parts usage, reorder points, and supplier lead times. This streamlines operations and also reduces costs. In fact, reducing overstocks and stock-outs can lower your inventory costs by 10%.
• Just-in-time inventory: Your HVAC business should partner with suppliers for just-in-time deliveries to minimize inventory holding costs.
• Mobile access to inventory: Give your HVAC technicians real-time mobile access to inventory levels from the field. This helps reduce unnecessary trips to the warehouse and can improve job completion rates.
• Regular audits: Carry out regular inventory audits to ensure accuracy and identify any slow-moving items. Regular audits are essential for reducing write-offs and lost sales.
• Predictive analytics: Use predictive analytics tools to analyze historical data and seasonal trends. You can then use this data to forecast inventory needs which leads to reduced excess stock and improved inventory turnover.

Expand Services & Scale Your Business

Growing your HVAC business doesn't just mean expanding your customer base and improving customer retention. For sustained growth, you need to create multiple revenue streams and build a highly resilient business.

To do this, you should diversify your services, target new markets, and expand your geographical reach.

Offer additional services

Expanding your service offerings can help you capture more market share and increase revenue per customer.

Some examples of additional services you could provide include:

• Air quality testing: Customers are more aware of indoor air quality than ever, making air quality testing a valuable additional service for your business. This can include air quality assessments, recommendations for improvements, and installation of air purification systems.
• Smart thermostat installation: The smart thermostat market size is predicted to reach $11.36 billion by 2027. You should capitalize on this growing trend by offering a smart thermostat installation service.
• Duct cleaning: You could also consider investing in specialized equipment and training your technicians to perform thorough duct cleaning.
• Energy audits: Help your customers reduce their energy consumption and costs by offering home energy assessments. You can then provide expert recommendations on how they can improve their energy efficiency.

Target commercial clients

If you're currently targeting only residential clients, you should consider expanding into the commercial HVAC market. By doing so, you can significantly boost your revenue and gain more stable, long-term contracts.

So, how do you shift your focus from residential to commercial clients? Let's take a look.

• Identify target industries: Focus on sectors with high HVAC needs like healthcare facilities, office buildings, hotels, and retail spaces.
• Develop commercial expertise: You'll need to invest in the necessary commercial HVAC training for your technicians and the specific equipment required for commercial systems. Bear in mind that commercial systems are often more complex than residential ones, and require specialized knowledge.
• Offer customized maintenance plans: Create a tailored service agreement for each business you work with. This typically includes things like regular maintenance schedules, emergency services, and system monitoring.
• Highlight energy efficiency: In the current climate, many businesses are looking to reduce their carbon footprint and bring down their energy costs. You can address this need by offering energy-efficient upgrades and retrofits to existing systems.

Open new locations

As your HVAC business grows, you should expand into new geographical areas to tap into other markets and achieve economies of scale. Of course, this is a big step for your company, so you need to get it right.

Here's how to do it:

1. Market research: Before you expand, you need to research potential new markets thoroughly. Consider factors like economic indicators, population growth, and competition.
2. Franchise or company-owned: Now, it's time to decide whether to franchise your business or open company-owned branches. Franchising can allow for faster expansion with less capital investment, while company-owned branches offer more control but require additional resources.
3. Standardize operations: Develop standard operating procedures (SOPs) that can be replicated across different locations. This helps to maintain consistent quality and efficiency across all your branches.
4. Leverage tech: Make the most of cloud-based software solutions to manage multiple locations. Cloud-based software allows for centralized management of scheduling, inventory, and customer data across all locations.
5. Build local partnerships: Establish relationships with local suppliers, contractors, and community organizations in new locations. If you do this, you can quickly establish a presence and gain credibility in new markets.

Final Thoughts & Key Takeaways

There are several crucial steps involved in growing your heating and air conditioning business. You need to build a strong foundation by developing a clear business plan and optimizing your marketing strategy to attract new customers.

On top of that, you should focus on improving customer experience and retention, streamlining your business operations, and scaling your business by expanding your services.

Team alignment is also important for business growth, and you can achieve this by implementing profit-sharing and offering performance-based incentives.

Using ShareWillow is the simplest way to implement and manage employee incentive programs. Get a demo today and see how the platform can help you to motivate and align your team.