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If you’re considering expanding your business that provides services related to heating, ventilation, and air conditioning (HVAC), now is a great time to do it. Why? The Bureau of Labor Statistics (BLS) reports that this particular field is growing at a rate of 15 percent, a number that is more than twice as high as the national average (closer to a 7 percent).
The same is true for entrepreneurs who want to improve their shop that provides plumbing services. According to the BLS, jobs in this field are expected to increase by a whopping 16 percent between the years 2016 and 2026, a rate they declare is “much faster” than the 7 percent average.
Some of this growth may be due to the expected increases in residential construction, a factor that IBIS World says directly relates to demands in plumbing and HVAC—great news for the 117,776 businesses in these industries as of October 2017. IBIS also notes that people are more capable of affording these types of services now than when compared to some years past, which helps with industry growth as well.
What type of business can you create that falls into one these fields, giving you access to greater profitability thanks largely to its impressive growth rate? Here are a few options to consider based on the occupations that fall under this particular Standard Industrial Classification (SIC) code:
What is the average earning potential of a plumbing business and how much do HVAC companies make? ValuAdder, an online business valuation tool, says that the typical business within this SIC code that employs roughly six full-time employees has annual earnings of around $700,000. Further, these types of businesses tend to be small and privately owned.
Many factors impact a plumbing or HVAC business’s ability to earn, some of which include the strength of its marketing efforts and the number of repeat customers. Flexibility and willingness to bend to market trends matter as well. Thus, if you’re wondering how to make money in HVAC, these are all things to consider.
When you’re in the expansion phase of a plumbing or HVAC business, many of the costs revolve around obtaining the necessary equipment and materials to do the job. Your exact needs will depend on which products and services you offer and what types of problems your clients want you to solve.
As noted by The Balance, there are many other, normal expenses that occur regularly in business, making it critical to budget for these as well. This includes setting aside money for taxes, building mortgage or lease payment (if you have a location outside your home), insurance expenses, payroll, and fees needed to pay the professionals who service your business. This may include a public accountant or tax advisor, an attorney, or anyone else you regularly hire to take care of business issues on your behalf.
Additional recurring costs include any professional association fees, marketing costs, and expenses relating to your fleet of vehicles. You also want to make room in your budget for unexpected costs that may crop up from time to time.
To run a successful business, you first need a plumbing or HVAC business plan. This plan will tell you where your current business stands in addition to where you want it to go. This makes it easier to direct all of your business decisions in a way that makes it easier to stay true to your company and what you want it to achieve.
Comprehensive HVAC contractor business plans cover topics such as:
Identifying these factors gives you a better idea of where you company is strong and where it can improve. Creating a written HVAC business plan also gives you a document that you can provide funding lenders, which helps to better understand your vision and potentially qualify your company as a lower financial risk.
Choose BFS Capital as your financial lending provider, and you will have access to a variety of funding options. These include if you’re seeking a construction or equipment small business loan to further establish your office or ensure that you have the right tools on hand.
If you want to expand your plumbing or HVAC business, you may want to look to merger and acquisition loans, lines of credit, and working capital loans to obtain the finances you need to grow. Merchant cash advance loans can also be of value in these types of cases, giving you access to flexible funding with payback options based on your future credit sales.
In addition to building and equipment purchases and updates, plumbing and HVAC small business loans and merchant cash advances can be used for other purposes. For instance, if business is traditionally slow during certain months, you can use these funds to pay your insurance or increase your cash-flow. This can help cover payroll, taxes, and all of your other expenses during this less-busy season.
Funding obtained from these sources can also be used to:
Though some plumbing and HVAC business owners still obtain small business loans via traditional lending sources, these often take weeks (if not months) to finalize. Not with BFS Capital. We will notify you of your loan status within as few as two business days.
Additionally, because we’re available to you 24 hours a day, 7 days a week, you can apply for your HVAC small business loan or your plumbing business merchant cash advance when it is most convenient for you. We’ve got you covered whether it’s 11 p.m. because you had to wait until your workday was complete and your family obligations were met; or it is 4 a.m. because you want to get your application in before heading out for the day.
The future is looking bright for businesses within the plumbing and heating and cooling fields. Here at BFS, we’ll do what we can to keep that light shining.
Simply answer a few questions about your time in business, monthly sales and business type, and your application will be submitted for review.
Once you fill out your application, one of our funding advisors will contact you.
When approved, you’ll have the money in your hands, for any business use, in as few as 2 business days¹.