HVAC Calculator
HVAC Shop Profitability Calculator
Calculate annual gross profit and operating profit from your complete shop financials.
HVAC Shop Profitability Calculator
Calculate annual gross profit, gross margin, operating profit, and operating margin from your shop financials.
Your estimate
This estimate depends on the completeness and classification of the figures entered. It is not a substitute for a complete income statement or professional accounting advice.
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Save a direct link to this calculator so you can rerun the scenario when your costs, capacity, or goals change.
- Return to the exact calculator
- Rerun it with current business inputs
- Keep the planning tool handy
Find out whether the shop made money
Enter one complete twelve-month period to see what your HVAC shop produced after direct job costs and overhead. This is the shop-level companion to a job margin calculator: it answers whether the company as a whole was profitable.
Use the same four lines as your profit-and-loss statement
Start with annual revenue. Enter materials and equipment, loaded field labor, subcontractors and permits, and any other cost that exists because jobs were performed. Those are direct costs. Then enter annual overhead: the costs of keeping the doors open, including a realistic wage for the owner’s work.
Use loaded field labor, not wage alone. Include payroll taxes, workers’ compensation, benefits, and other employer costs your business actually bears. Classify each expense once so it is not counted in both direct costs and overhead.
Read the results
Gross profit is revenue minus direct costs. Gross margin shows that result as a percentage of revenue and helps you evaluate the work and pricing. Operating profit is gross profit minus overhead. Operating margin shows what the shop kept after paying the costs required to operate it.
If operating profit is negative, the shop did not cover its operating costs for the period even if revenue was high or the bank balance increased. If the result is positive only because owner pay is missing, add a replacement wage and run it again.
Practical example
Ridgeline’s $840,000 of revenue less $587,040 of direct costs produces $252,960 of gross profit, or a 30.1% gross margin. After $216,000 of overhead, the shop’s operating profit is $36,960, or 4.4% of revenue. Enter your own twelve-month figures to get the number that applies to your company.
Limitations
This is a planning estimate based on the figures entered. It does not adjust for accruals, taxes, debt principal, cash timing, inventory changes, or accounting classification choices. Reconcile the result to a complete income statement with your bookkeeper or accountant.