Why new construction can bankrupt your HVAC company

@michaelcesaroni

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SoundTikTok sound · original sound - michaelcesaroni

Promoted product

Horizon HVAC

Why it worked

The video effectively highlights a common pain point for HVAC business owners by contrasting the low-margin, high-competition nature of new construction with the potential for higher profits and brand building in service-based work. The direct call to action encourages engagement and positions the creator as a source of valuable business advice.

Summary

The speaker explains why new construction can be detrimental to HVAC companies by highlighting that they often compete on price with other shops, leading to low profit margins. He also points out that builders own the equipment and the homeowner doesn't know the HVAC company, leading to a lack of repeat business and referrals.

Structure

1Introduction to the problem of new construction for HVAC companies
2Explanation of competing on price vs. selling value
3The builder owning the equipment and the lack of homeowner relationship
4The difference between being busy and being wealthy in HVAC
5Call to action to comment 'SCALE' for more information

Product placement

Horizon HVAC (appears, logo on shirt and sign, does not change video content)

Call to action

Comment the word SCALE on this video if you want to know where the real money's at in HVAC

Original caption

Break it down #hvac #trades #sales

More from @michaelcesaroni

On-screen text

Why new construction can bankrupt your HVAC company OKAY SOMEBODY WANTED ME TO BREAK NEW CONSTRUCTION CAN BANKRUPT MOST HVAC COMPANIES MORE THAN SLOW ME GET INTO BIT A BUILDER HANDING THEM 40 PRINTS AND THEY'RE LIKE I'VE MADE IT KEEP ME BUSY YEAR ROUND YOU'RE ACTUALLY SIGNING UP FOR 1 YOU'RE NOT YOU'RE COMPETING FIVE OTHER SHOPS QUOTED THE SAME EXACT AND THEY'RE NOT GONNA GO WITH THE HIGHEST PRICE WITH THE CHEAPEST SO WHAT ARE YOU ACTUALLY BATTLING A 10 OR 15% PROFIT MARGIN A SWAP OUT AT SOMEBODY'S HOME YOU CONTROL THE JOB YOU CAN DETERMINE WHETHER YOU'RE MAKING 30 40 50 OR EVEN 60% PROFIT MARGINS THE BUILDER OWNS YOU HAVE BUILDER GRADE EQUIPMENT YOU HAVE FROZEN SCOPES NO ADD NO MEMBERSHIPS ONCE THEY SELL THAT THEY'RE NOT GONNA CALL THE STICKER THAT'S ON THE THE ATTIC THEY'RE GONNA CALL THEIR LOCAL HVAC COMPANY NOT YOU IT'S GONNA BE SOMEBODY ELSE UP BECOMING THE BUILDER'S BANK SWAP OUTS YOU GET A 50% DEPOSIT UP FRONT GET PAID IN FULL WHEN IT'S THE DAY THE INSTALL YOU'RE OUT AND YOU'RE TALKING MAYBE FIVE DAYS IN THE BIGGEST THERE'S NO CUSTOMER YOU'RE WORKING FOR A GC THE HOMEOWNER THAT'S BUYING THAT HOUSE THEY WILL NEVER YOU CAN PUT AS MANY STICKERS UNIT THE UPSTAIRS UNIT THEY'RE NOT GONNA THEY'RE GONNA CALL THEIR HVAC COMPANY THERE'S NO MAINTENANCE THERE'S NO REFERRALS THERE'S NO REVIEWS THERE'S NO REPLACEMENTS IN 15 YEARS THE WORK AND THEN YOU WALK AWAY WITH NOTHING THAT COMPOUNDS NEW CONSTRUCTION IS A COMMODITY TRADE SERVICE AND SWAP BRAND ONE WILL MAKE YOU BUSY THE MAKE YOU WEALTHY TO COMMENT THE WORD SCALE ON IF YOU WANT THE REAL MONEY'S AT IN HVAC

Transcript

Okay somebody wanted me to break new construction can bankrupt most HVAC companies more than slow season. Let me get into it a bit. A builder handing them 40 prints and they're like, I've made it. Keep me busy year round. You're actually signing up for. One, you're not selling. You're competing. Five other shops quoted the same exact job and they're not gonna go with the highest price. They're gonna go with the cheapest. So what are you actually battling? A 10 or 15% profit margin on a swap out at somebody's home. You control the job. You can determine whether you're making 30, 40, 50 or even 60% profit margins. Two, the builder owns. You have builder grade equipment. You have frozen scopes, no add-ons, no memberships. Once they sell that, they're not gonna call the sticker that's on the attic. They're gonna call their local HVAC company, not you. It's gonna be somebody else. You end up becoming the builder's bank. With swap outs, you get a 50% deposit up front and you get paid in full when it's the day the install. You're out and you're talking maybe five days. In the biggest one, there's no customer. You're working for a GC. The homeowner that's buying that house, they will never. You can put as many stickers on the outside unit, the upstairs unit. They're not gonna. They're gonna call their HVAC company. There's no maintenance, there's no referrals, there's no reviews, there's no replacements in 15 years. You did all the work and then you walk away with nothing. That compounds. New construction is a commodity trade. Service and swap outs build the brand. One will make you busy, the other one will make you wealthy. I want you to comment the word SCALE on this video if you want to know where the real money's at in HVAC.