5 Signs You’re Undercharging for HVAC Work

Most HVAC techs who feel constantly busy but broke aren’t lazy or bad at their jobs — they’re undercharging. The hard part is most of them don’t even know it. Pricing creeps in slowly, costs go up, and before you know it, you’re working 60-hour weeks and still not paying yourself enough.

Here are five clear signs you’re undercharging for HVAC work — and what to do about each one.

1. You’re booked solid but your bank account isn’t growing

This is the #1 warning sign. Your phone rings constantly, your schedule is packed two weeks out, and you can barely keep up — but at the end of the month, there’s nothing left after expenses.

Being busy isn’t the same as being profitable. If demand for your work is high but your margins are thin, the market is telling you something: you can charge more. Demand that high means you have pricing power you’re not using.

Fix: Raise your service call fee or hourly rate by 10-15% on new customers. Existing customers can stay on their current pricing for now. If you don’t lose any new bookings, raise it again in 60 days.

2. You haven’t raised prices in over a year

Equipment costs have gone up. Refrigerant has gone up. Truck payments, insurance, gas, parts — all up. If your pricing hasn’t moved in 12+ months, you’re effectively giving yourself a pay cut every quarter.

Most solo techs avoid raising prices because they’re afraid customers will push back. In reality, customers expect prices to go up — they see it everywhere else. Annual price increases of 5-8% are normal and rarely cost you customers.

Fix: Set a calendar reminder for January 1 each year to review and adjust your pricing. Bake it into your business like rent or insurance.

3. You never lose a bid

If every customer says yes, your prices are too low. That sounds backward, but it’s true. A healthy close rate for HVAC service work is around 70-80%. For bigger jobs like installs and replacements, it should be closer to 50-60%.

If you’re closing 95-100%, you’re leaving real money on the table. The customers saying yes would have said yes at a higher price too — you just didn’t ask for it.

Fix: Raise your prices until you start losing about 1 in 4 jobs. That’s the sweet spot. The lost jobs were usually low-margin anyway.

4. You don’t know your true cost per hour

Most solo HVAC techs price based on what their competitors charge or what feels fair. Almost none of them know what it actually costs to put their truck on a customer’s driveway for one hour.

Your true cost per hour includes: truck payment, fuel, insurance (general liability + auto + health), tools, software, phone, taxes (plan for 25-30% of net), unbillable time (driving, estimating, admin), and what you actually want to take home as pay.

Add it all up monthly, divide by realistic billable hours (usually 100-120 for a solo operator), and that’s your minimum break-even rate. Your customer-facing rate should be at least 1.5x that number — otherwise you have no margin for slow seasons or surprise expenses.

Fix: Sit down with a spreadsheet for one hour. Calculate your true cost per hour. If your current pricing doesn’t clear it by a comfortable margin, raise it.

5. You feel guilty quoting your prices

If you hesitate before saying the number, soften it with discounts before the customer even asks, or feel like you need to apologize for what you charge — you’re undercharging. Confidence in your price comes from knowing your numbers and knowing your value.

Customers can hear hesitation. When you sound unsure about your price, they assume the price is wrong (and negotiable). When you state it flatly and move on, most accept it without pushback.

Fix: Practice saying your prices out loud until they don’t make you flinch. If they still do, your pricing is probably accurate but your mindset isn’t. Remember: you’re not just charging for the hour of work — you’re charging for years of training, expensive tools, the truck, the insurance, and the fact that you show up when their AC dies in July.

The bottom line

If even one of these signs hit home, you’re probably undercharging. Most solo HVAC techs are. The good news is fixing it doesn’t require new customers, more marketing, or longer hours — it just requires a pricing review and the willingness to raise your rates.

If you want pricing tools, service call forms, and ready-to-use estimate templates built specifically for solo HVAC techs, the Solo Trades Pro Kit — HVAC Edition.