How to Use a HVAC Business Loan
When answering these questions, you’ll probably come across one common issue; the need for additional financing. When you have enough working capital, your HVAC business can pay for expenses that increase sustainability and growth.
According to a Lennox Business Coach, Gary Oetker, if you take the working capital and divide it by an average year of sales, it should amount to about 10-15 percent. If it’s less than that, you may have cash flow issues. If your goal is to grow your HVAC business, you should aim to be at a minimum of 10 percent, so you can invest your revenue back into your business.
If you’re ready to start growing your business, check out our list of ways that applying for a business loan can benefit your HVAC company.
4 Ways to Spend HVAC Business Financing:
1. Pursue HVAC Business Certifications
Depending on where your HVAC business is located, you might be required to have certain licenses and certifications to practice business in that state. If you’re serious about improving your business, you may want to consider investing in educational courses and licensing for you and your employees. This can be a fruitful way to utilize additional working capital.
If you’re debating whether to invest in additional training, know that it can often set you apart as someone who is competent in the HVAC business world. Certifications demonstrate that your team has certain skills and can increase the level of trust that your clients have in you.
2. Pay for Marketing Materials
To reach new clients, you should consider investing in a marketing plan. Not only can marketing help you reach more clients, but it will also allow you to be viewed as a professional, serious HVAC business owner.
Once you receive a loan or line of credit, you can create a website, pay for newspaper ads and truck signage, and attend networking events. These are all great ways to spread awareness about your business.
3. Build Your HVAC Technician Team
Expansion means an increase in workload, which more than likely means you’ll need to hire more employees. There may be times when the extra hands you’re looking to hire might not fit into your current budget. Consider offering an apprenticeship program, where you can mentor newcomers in the industry. When they complete the program, you can hire them as full-time employees.
By pursuing additional financing, your focus changes from worrying if you’re meeting payroll, and instead you can focus on building a talented team and providing excellent customer service.
4. Invest in New Technology
When you provide your heating and air conditioning services, you should consider energy efficiency, your company’s productivity, and how you can make your customers’ lives easier.
For instance, you could invest in HVAC software or app that helps you create schedules for your employees, store customer information, keep service records, and create pricing estimates. Having access to this software will help you conduct business in a more organized manner and will likely make scheduling services easier for your customers.
Are You Ready to Apply for an HVAC Business Loan?
Consider where you want your business to be a year from this National HVAC Tech Day. More than likely, the goals that you want to reach will be easier if you have additional cash flow available. If you want to incorporate any of these HVAC business tips into your plans, you should consider applying for a small business loan. That way, you’ll be able to afford these costs, without having to decrease spending from other areas of your business.
Have you utilized an HVAC business loan? If so, tell us about how you utilized the additional financing in the comment section below!
Editor’s Note: This post was updated for accuracy and comprehensiveness in June 2019.
Editorial Note: Any opinions, analyses, reviews or recommendations expressed in this article are those of the author's alone, and have not been reviewed, approved, or otherwise endorsed by any of these entities.