HVAC Install / Replacement Job Pricing Calculator

An install can look like a big number and still leave little behind once overhead, commission, and the finance company's fee come out of it. Put in what one replacement job costs you, and what you want to keep, to get the selling price that covers it all — plus the gross margin and markup that price works out to.

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Example numbers — use your own. The starting values are placeholders so the form isn't empty. They are not industry averages, benchmarks, or recommended margins.

Direct job costs

Costs you have only because this job runs.

Equipment cost ($) — placeholder What you pay for the condenser, air handler or furnace, coil, and thermostat. Materials and parts ($) — placeholder Line set, pad, disconnect, whip, duct transitions, fittings, refrigerant, and so on. Labor hours on site (per person) — placeholder How long the crew is on the job, including drive time if you pay for it. Crew size (people) — placeholder Loaded labor cost per hour, per person ($) — placeholder Wage plus payroll taxes, workers comp, and benefits for one hour — your cost, not your bill rate. Permit, disposal, and misc ($) — placeholder Permit fees, old-equipment disposal, equipment rental, anything else spent only on this job. Subcontract ($) — placeholder Electrician, crane, duct shop, or any other sub you pay for this job. 0 if none.

Taken out of the price

Each of these is a % of the selling price, not a % of cost. Together they must add up to less than 100%.

Overhead (% of price) — placeholder Yearly overhead ÷ yearly revenue, from your P&L: rent, office staff, trucks, insurance, marketing, software. Sales commission (% of price) — placeholder Paid to the salesperson or comfort advisor on this sale. 0 if none. Financing fee (% of price, optional) The dealer fee the finance company keeps if the customer finances. Leave at 0 for cash jobs. Target net profit (% of price) — placeholder The share of the price you want left after every cost and overhead. Your choice, not a benchmark.

Results

Direct job cost —

Selling price for your target net profit —

Gross profit —

Gross margin % —

Markup multiplier on direct cost —

Overhead covered —

Sales commission —

Financing fee —

Net profit —

What this means

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Price at three net profit levels

Same costs, overhead, commission, and financing fee. These levels are just examples to compare, not recommendations.

Target	Selling price	Gross margin	Net profit	Multiplier on direct cost
10% net profit	—	—	—	—
15% net profit	—	—	—	—
20% net profit	—	—	—	—

The math

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How the price is worked out

First add up the direct job cost: equipment + materials + labor (hours × crew size × loaded cost per hour) + permits, disposal, and misc + subcontract.

Overhead, commission, the financing fee, and your net profit are all a share of the selling price. So the direct cost has to fit in whatever share of the price is left:

Price = direct job cost ÷ (1 − overhead % − commission % − financing fee % − net profit %)

If those four percentages add up to 100% or more, there's nothing left to pay for the equipment and labor, and no price works. The calculator tells you when that happens.

Worked example

With the example numbers above (all placeholders):

Labor: 10 hours × 2 people × $40 = $800.
Direct job cost: $6,000 + $800 + $800 + $250 + $400 = $8,250.
Taken from price: 25% overhead + 5% commission + 0% financing + 15% net profit = 45%, which leaves 55%.
Price: $8,250 ÷ 0.55 = $15,000. That's 1.82× direct cost.
Where it goes: $3,750 overhead, $750 commission, $2,250 net profit. Gross profit is $15,000 − $8,250 − $750 = $6,000, a 40% gross margin.
If the customer finances with a 5% dealer fee: $8,250 ÷ 0.50 = $16,500 to keep the same 15% net.

Gross margin, net profit, and markup

Gross profit here is the price minus everything this job alone costs you: the direct job cost, the commission, and the financing fee. What's left has to cover overhead and your net profit, so your gross margin works out to overhead % + net profit %.

The multiplier is price ÷ direct job cost. A 1.82× multiplier is an 82% markup — and markup is not margin. The HVAC markup vs margin calculator converts between the two.

Things this leaves out

Callbacks and warranty labor. If installs tend to need a return trip, add those hours to the labor.
Rebates and tax credits. Price the job first; utility rebates or credits the customer claims don't change your cost.
Sales tax. How sales tax applies to equipment and installs depends on your state. Ask your accountant.
Financing on part of the job. If only some customers finance, run it twice — once at 0% and once with the fee — and decide how you'll price each.
Your own pay. If you don't pay yourself a wage through payroll, your net profit is also your paycheck.

We don't quote typical HVAC install margins or overhead percentages here, because we haven't found a solid public source for them. That's what the anonymous Owner Numbers survey collects, so owners can compare against real peers.

Related tools

Already sold the job and want to see what it actually made? The HVAC job profit calculator works backward from the price you charged. For service and repair tasks priced from labor hours, use the HVAC flat-rate price calculator. To see the monthly payment on each option and what the dealer fee takes, try the HVAC financing payment calculator, and lay out three system options with the good / better / best proposal builder. To find your loaded labor cost, use the HVAC break-even hourly rate calculator.