Thinking of launching your own HVAC business but too hesitant to make the plunge? Well, allow us to introduce to you a few tactful approaches you'll want to consider before making the switch!
Change is always an adjustment and making the move from doing the labor to running the business will bring on a tremendous amount. You’ll need to figure out how to separate your time appropriately. While you may still be doing work in the field, you’ll also now be responsible for administrative duties, business development work, and much, much more behind the scenes tasks that you may not have considered. Which is why you should carefully select which path is most compatible for you!
1. Forming a Partnership
Starting a business can be a ton of responsibility, and there can be many benefits to sharing some of that burden with a partner. But choosing a business partner is a big decision and not one that should be taken lightly.
You should ask yourself these questions as you weigh whether starting an HVAC business with a partner makes sense for you:
- Do you fully trust this person?
- Is he or she as committed to the business as you are?
- Will you share responsibility 50/50 or handle it a different way?
- What will you do if something goes wrong?
As you ask yourself these questions, you should be able to determine whether the partnership route makes sense or not. In some cases, it doesn’t. Consider your strengths and what you could improve on, does your potential partner excel in areas you don’t? While working together may equate to sharing the burden, that’s only true if your partner is as committed to the business as you are. In some cases, having a partner might lead to more headaches if you can’t agree.
2. Should You Join a Franchise?
In addition to considering whether you want to have a partner, you might also consider whether you want to be part of a franchise. Like a having a partnership, there are certainly some benefits to becoming part of an already-established business. According to the U.S. Bureau of Labor Statistics, about half of small businesses fail in their first five years. It is hard for new businesses to quickly build successful reputations in order to support growth. By joining a franchise, you eliminate that concern and gain excess to their existing resources. That’s because you’re essentially adopting the reputation of an already known company. You will benefit from the support of a proven, existing business model, as well as guidance from people who want you to succeed. Inevitably, there are pros and cons to every option. With a franchise, you are paying a percentage of your revenue back to the franchiser. Besides buying into the franchise, which is certainly never cheap, you will always be paying part of your profits back to the franchiser. If you feel like you have what it takes to make it on your own, then perhaps this won’t be desirable to you.
3. Starting the Paperwork
Now that you’ve decided whether you want to hire a partner, become part of a franchise, or branch out on your own, it’s time to start the fun part-paperwork! From applying for licenses to filling out business forms, the paperwork can feel endless at times. But it’s also important that you do things the right way to ensure you get your business off on the right foot.First and foremost, you must apply for your state contractor’s license. The National Association of State Contractors Licensing Agencies is the best resource to turn to for specific information on what’s required in your state. You will also need to begin the process of applying for insurance. As an HVAC business you should have both worker’s compensation insurance and general liability insurance. Lastly, you should identify whether your state requires you to acquire a contractor’s bond. This bond protects your clients should you not complete a job, and some states do in fact make them a mandatory when doing business.
As you can see, there is a lot to think about when considering to start your own HVAC business. It is a big decision and one that should be carefully weighed. However, by weighing the benefits of each situation, you should be able to narrow down your options to make the best decision for you.
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