Yeah, really trying not to advertise. But add disclaimer. Thanks for letting me know it's a bit much. I tried to tone it down. Let me know if it's better or i should delete.
streamline labor: Aligning pay incentives with installers, ensure right parts and materials, make sure customer are not indecisive on the first day, mimic the 15% of installs that are side jobs as much as possible.
Virtual site visits aren't 100%. But allows us to get a price quickly, and check electrical capability. It's a bit of a test for customers, if they are interested in snapping 5 or so photos, they probably won't buy from us.
Half the time, we then go out for a site visit in-person but we're only visiting 50% of the customers. It's less expensive, however our conversion rates go down because we're not winning the customer with our personality, etc.
If we can verify directly from photos and go straight to contract, we send out a install manager to confirm after the signature. Basically, if some giant obstacle that will stops the install, we can cancel at no cost to the customer and we do that all very quickly so they can select another bid if that happens.
Solar is tough, I am a renewable energy engineer from Australia and yes, we can half the cost of solar as seen in Australia. I think Australian are simply less fussy and legally charged than governments and home owners in US and simple installs.
I now believe large central PV will likely be more successful here. 40% of electricity is often coming from solar and wind in CA and we can just keep doing that and we'll be fine.
Most don't have a payback if the cost of electricity is too high. Let's make them lower cost up front and lower running costs so it's a no brainer when replacement is due.
2-3 hours planning, parts list, client management,
4-6 hrs to run electrical,
2-4 hrs to mount condenser,
4-8 hrs for medium line set,
4-8 hrs air handler, duct, platform integration,
1-2 hrs with thermostat and condensate protection,
1-2 hours nitrogen testing and pull vacuum,
1 hr documenting photos for incentive programs,
1 hr spending time educating customer about the system.
Messing up a parts order and figuring out a solution 4 hrs too often.
Total: 28 hrs, or 2-3 days of 2 people depending on the travel from their shop to customers home. I agree. Let's get that down to 12-16 hrs or single day and the best shops and installers can do that.
CA Labor law allow about 6-7 hrs of work on site as installers often have to start at their shop.
$3-4k of labor cost for small-mid size. Best might be be 2-3K labor cost. Minor equipment 1-2K, permit and testing required $1K. Then 50% gross margin is the target, net costs $2.5K indirect labor, $2K sales cost, project management, trucks, insurance, software, 10-20% net margin.
Some are trying to cut HVAC install costs in half, and a lot of people are already working on it including Jetson (where the author works) and disclaimer my company Electric Air.
Average install is about $20K in California (varies by state). Here’s how that usually breaks down:
- Equipment: $3–5K for a basic swap (some go up to $10K for single system)
- Direct labor: $3–4K (about 15–20%)
- Materials: $2–3K
- Permits and testing: around $1K total
That leaves about a 45% margin to cover overhead:
- Indirect labor: $2.5K (installers when not installing, install managers, attending city inspector visits, call backs when installers make mistakes)
Ground source is often the only choice here. While air source can technically work well down to these temperatures, much of the available equipment doesn't suit some homes.
You are right! I was unfair. The customer was clear they wanted ManJ calcs.
It's not the customer's problem to reduce cost. The high cost is the customer's problem through even if they are not to blame. And given I have a first hand experience in the cost stack of HVAC company, I would happy to share how a HVAC contractor thinks.
Yep, the cost is in the trip is a big factor but sounds like it was their choice to try to sell you. You did the right thing by asking them do the calcs before they came out. Millions of questions are time consuming and costly but better than someone rushing into and pausing mid project with in-decision.
We (I'm cofounder of Electric Air, HVAC contract) have had people pause on day one of install, and that ends up costing the company $10-20K due to delays. Mostly because there isn't something for the team to do for that day or two while we scramble to line up the next customer.
If we’re trying to bring down cost the this is the issue with so many contractors coming out. The cost of sales is about 10-15% of the installation in the US. So thats $2-3k in California per heat pump
Try to get an install for $600 like in Japan when you have to pay $2k to find the customer.
Let’s have a lower cost sales process. Review 12 companies online, pick top 3, ask them to come out.
We account for duct losses at Electric Air when sizing. It’s baked into industry standard Manual J sizing calculators and other methods. ManJ isn’t perfect find for this purpose.
In this case, contractor should have advised the heat pump would not keep up and recommended a different solution.