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)
- Sales: $2K (around 10%)
- Project management: $500
- Trucks: $500
- Misc costs: $1.5K (insurance, software, payment processing, etc.)
Total overhead: $7K: Net margin: 10%
10% net margin at the end of the year isn't egregious.
That’s how a typical small-mid HVAC shop runs. The best HVAC shops can make these numbers be much more competitive. How do we make it better:
- Bulk order equipment
- Streamline direct labor
- Use virtual site visits instead of in-person sales calls
Do all that and you can bring a $20K install down close to half, while paying installers better and speeding up electrification.