micromind
Well-known member
Insurance is a pretty big expense too.
HVAC contractor pricing - no thanks
- Thread starter rattle_snake
- Start date
Insurance is a pretty big expense too.
American Locomotive
Well-known member
Every single time someone brings up HVAC contractor pricing, you always try and deflect about what some other trade is doing.I just got an estimate for $135k for some extensive exterior work, so I guess carpenters are getting rich on their obscene profits and markups too...
Oh, wait. This is the "hvac guy is ******* me" part of the site.
Need one section each for the other trades.
"Don't mind me reaching over the counter into the register, look at that guy down the street trying to rob the bank!"
If you don't like people constantly bashing the HVAC trade for charging too much, then simply post some real-world numbers detailing your actual cash inflows and outflows. Tells us your insurance costs, detail your "overhead" costs. Give us an actual itemized list for a job, detailing the supply house costs of the components, what you charged the customer for the components, what you charged the customer for labor, and how much time you had invested in the job.
Last time I asked you to do that, you said "No."
...and look, everyone is entitled to live comfortably and charge accodingly. But when we see contractors bid X amount for a job, find out that they paid Y amount for the equipment, did the whole job in Z hours, then add all the numbers up and work out we paid an effective labor rate of $500-1000/hr per man-hour, it really gives us some pause.
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engineer2
Well-known member
We are due for a new system one of these days. 100,000 BTU natural gas and 3 ton AC.
I'd like to move the condensing unit to the side of the house, but only have 36" from the side of the house to a sidewalk. Is that possible?
What magical refrigerant are they using these days?
I'd like to move the condensing unit to the side of the house, but only have 36" from the side of the house to a sidewalk. Is that possible?
What magical refrigerant are they using these days?
danski0224
Well-known member
I WISH I could get those jobs. But, nope. If I could, I would open my own shop and become filthy stinking rich and boast about it here.
And why in the actual **** would anyone, from any trade, actually do this? None of the complainers has done the same analysis to justify their wages.
And if someone actually did provide your analysis, would it change anything? Nope.
Some A-hole would say that I can get this widget on Amazon for $.03 cheaper, so the contractor is ripping me off.
Or, the people doing the work are only "worth" $20 an hour through some arbitrary judging process, so I am again being ripped off by The Man. Where is the outcry in Free Parking about that diesel mechanic that has mentioned making over $1k an hour on a job?
This is the only section of the board where people are consistently bitching about pricing or wanting price "breakdowns", yet the claimed price gouging issue is happening everywhere.
I am getting roofing estimates that are varying from $13k to over $20k for a 4/12 gable ended roof that's 21 squares (overhangs, not interior square footage). Some quick math is $60 per bundle (stupid high price for asphalt shingles) x 3 bundles per square x 21 is $3,780 for shingles. Even if underlayment, starter shingles, ridge vent and cap shingles are another $1,700.00 (probably not), there's ~$13,220.00 left on the my midrange $17,000.00 quote. Bring out a crew of 10 1099 workers, get it done in a day (that's what they do)... what do you think is a fair wage for them? Ten bucks an hour, because "anyone can do it" and "there's no skill"?
Obviously, roofers are getting rich, too.
Well, the "handler" is, because that person is only paying $15 an hour for labor...
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danski0224
Well-known member
No.
danski0224
Well-known member
And no one posts their "scope of work" with their price rant. For any job.
I can tell by reading the HVAC related postings that very few actually understand how it works, and how important airflow is for the system.
I can go out to most houses, and see oversized equipment and shoddy ductwork. Which is a shame, because there IS a disconnect in the prices and the quality of work delivered. Being in the industry, I can guarantee you that if the crew doing the work are employees, then the quality/time/training problem is with the business ownership.
I just saw a 1 year old system with a too big furnace, too big AC, too small ductwork, too small filter and they skimped on the condensate neutralizer, tied the evap and furnace condensate drains together and **** in the flue connection, leaving an orphaned water heater. Oh, and they single-piped the furnace flue and one of the couplings leaks condensate.
I don't care what they paid, because they probably paid "market rate" and they would get roughly the same "quality" from most of the HVAC companies in my area. It is depressing to me because I have never been able to figure out to "sell" a better job- homeowners do NOT understand HVAC and most do not care. They only care about the price. The nearly incessant ads and billboards from companies that claim to deliver quality, do not.
I was referred to fix another issue, right next to the shiny new furnace and evap coil (I didn't get that $15k box swap job- not that I would do that kind of **** work), and pointed these things out to the homeowners within 5 minutes. I did suggest and install a fix for the orphaned water heater. Not sure if the installing HVAC company will address the other issues, but I stressed that due to their cast iron pipes underground, the lack of the code required condensate neutralizer is a big deal.
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engineer2
Well-known member
As long as newer condensing units are a quieter, it won't be too bad. Hopefully they can use the old line set.
danski0224
Well-known member
Never recommended to do this. Especially if you can't verify the absence of a concealed joint in the piping.
Only if you pay for the upper tier model, or an inverter. Cheap ones (lower tier) are still loud. Need to look at sound ratings in the specs.
red
Well-known member
And how long have you been on the internet?
Ok, now let's talk about what psychiatrists charge, cause people are going to need someplace to whine. Maybe an ignore button would work? That could work for both sides.
danski0224
Well-known member
karoc
Well-known member
I been doing HVAC since mid eighties, 12 of those years were residential. Try make living doing that, everyone wants discount, everyone wants seniors discount while there are two matching Cadillacs in driveway. None of them does their own lawns, have their yards mowed but they want discount, when they cleaning their motor home. Spring checkups, winter checkups, then they gripe at you when find something wrong as if you’re not supposed to. What heck is point for checkups, and service guy being responsible since he last one that service it. Give me break! They gripe when clean condenser coil and say “ You cleaned it last year” Turn it off when you’re mowing! Have appointment at 5 but they decide to run store expecting you to wait. Good grief, company that comes to you and puts up with public deserves to make honest living. Why I left residential trade went to commercial maintenance dept
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The fact is less and less people are willing or able to do trade work. There is an equaling of costs happening between what is considered white collar and skilled trades. Lawyers pay almost nothing to charge $400+ per hour and any part thereof and will charge excessively for any material they might use (envelopes, copiers etc...). Why? Because they can. All trades are charging way more than what they used to. Why would anybody show the cost breakdown to you, so you can decide if they are making enough money or ripping you off? As if that's your decision? Oh yes it is! If you don't like the price do it yourself.
American Locomotive
Well-known member
This isn't about lawyers, so it's pointless to bring them into it.
If it's an "equaling of costs" between white collar and blue collar jobs - can you please point to the white collar jobs that pay $250/hr, $500 or even $1000/hr? Because those are all effective labor rates I've seen HVAC contractors charge within the past couple of years.
Whenever I talk to someone who works for an HVAC company, I see they typically get paid $17-25/hr depending on experience. Chiller guys get paid a bit more. Their companies typically charge between $175-250/hr or more if they charge time+materials. But most often they just do straight quotes now without itemizing anything, and the effective labor rates are usually $350-500/hr, sometimes even higher.
Whenever I talk to a sole proprietor HVAC contractor/plumber with no employees, maybe the occasional "helper", I usually see their labor rates around $90-125/hr. They also typically provide the customers itemized bills detailing the cost of each part, and the labor on a separate line.
There is a huge disparity between those two scenarios, and you can't just hand wave it all away with the bigger company with employees and say "overhead + experience". Especially when it's some newbie fresh out of high school coming to your house to gas up your unit. Again.
HoosierBuddy
Well-known member
This is not a new phenomena.
HVAC markups have been near 100% with high labor costs for years...decades even.
The mom and pop shops I'm familiar with don't seem to be exactly getting rich at that price. The guys I know in the business work long hours....are super busy...and sometimes struggle to get paid for the work they've done, especially service work. It doesn't matter what you charge if the person you did the work for has no intention of paying you.
HOWEVER...my kids live in Indy....and up there they are dealing with these big HVAC companies and what they tell me is every service call or "tune up" special just ends up being a massive sales job where the tech uses fear tactics, gimicky sales promotions (10% off if you sign in the next 30 seconds) and outright fabrications to try to sell HUGE UNNECESSARY work to the homeowner.
Just one case for instance. My middle son had the "tune up special" on his furnace. They check it over and supposedly make sure it's good to go for winter. They guy spent the entire time trying to get him to sign off on buying an entirely new furnace....just based on:
1. His furnace is 20 years old so OBVIOUSLY it's going to fail soon.
2. The igniter on his furnace was generic and had been nutted on with wire connectors rather than the factory plug....which the tech said "Was 'home made junk' and 'totally out of code and unsafe'"
So on one hand, HVAC techs and Vet techs, and Auto Techs, and everyone else is free to price their services anyway they want to, and it's up to us as consumers to decide if that represents good value for us. But if a company is sending out techs (possibly on commission?) and trying to scare people into getting unnecessary or premature work done, that's horse ****. My kid is pretty sharp and sent the guy on his merry way and will NEVER call that company again, but you know a lot of old ladies out there would totally fall for this sort of thing and wind up paying way too much for work they don't even need.
HVAC markups have been near 100% with high labor costs for years...decades even.
The mom and pop shops I'm familiar with don't seem to be exactly getting rich at that price. The guys I know in the business work long hours....are super busy...and sometimes struggle to get paid for the work they've done, especially service work. It doesn't matter what you charge if the person you did the work for has no intention of paying you.
HOWEVER...my kids live in Indy....and up there they are dealing with these big HVAC companies and what they tell me is every service call or "tune up" special just ends up being a massive sales job where the tech uses fear tactics, gimicky sales promotions (10% off if you sign in the next 30 seconds) and outright fabrications to try to sell HUGE UNNECESSARY work to the homeowner.
Just one case for instance. My middle son had the "tune up special" on his furnace. They check it over and supposedly make sure it's good to go for winter. They guy spent the entire time trying to get him to sign off on buying an entirely new furnace....just based on:
1. His furnace is 20 years old so OBVIOUSLY it's going to fail soon.
2. The igniter on his furnace was generic and had been nutted on with wire connectors rather than the factory plug....which the tech said "Was 'home made junk' and 'totally out of code and unsafe'"
So on one hand, HVAC techs and Vet techs, and Auto Techs, and everyone else is free to price their services anyway they want to, and it's up to us as consumers to decide if that represents good value for us. But if a company is sending out techs (possibly on commission?) and trying to scare people into getting unnecessary or premature work done, that's horse ****. My kid is pretty sharp and sent the guy on his merry way and will NEVER call that company again, but you know a lot of old ladies out there would totally fall for this sort of thing and wind up paying way too much for work they don't even need.
duneslider
Well-known member
So, here is my hvac rant, since that is what we have going on. I built a new house a few years ago. I am quite certain all the hvac guys doing the install were crack heads. Roughest looking crew that worked on the job. Outdoor ac unit was set by what looked like 16-17 year old crack heads.
No idea what any of those crack heads make but the owner seemed to be doing really well. We had an issue with the furnace not working fairly soon after install (bad valve), crack heads came to look at it and couldn't figure it out. Owner ran out late on a Friday night, diagnosed it and came back the next morning with a new valve and had it going.
AC stopped working and they sent 2 techs out, both were from Uraguay and were very well trained and knew their stuff, I speak spanish so once I spoke a little spanish to them we were long lost brothers and they chatted me up the whole time they were there. Basically, the system was way overcharged, they released a bunch of coolant, fixed some other stuff, told me there is a good chance the unit will fail early due to the poor install (that was comforting to hear), but I learned a lot and the guys knew their stuff. Their equipment was also very nice.
Continued to have some issues in the house. I requested the manual calcs from the 3rd party that did all that stuff. HVAC company did NOT follow the manual calcs so flow in the ducts was not good. I had to change a bunch of ducting to get it to perform better. Some I can't easily change due to it being in wall cavities. It is much better not but will never be as good as it should have been unless I want to tear into a wall or two.
So, while I do know there are some great hvac people out there, I don't think most are trained well enough to do a great job but even the crack head contractors are charging as much as the great ones. Over my life, my experience with hvac guys has been more bad than good. I even worked for Trane (commercial controls side).
No idea what any of those crack heads make but the owner seemed to be doing really well. We had an issue with the furnace not working fairly soon after install (bad valve), crack heads came to look at it and couldn't figure it out. Owner ran out late on a Friday night, diagnosed it and came back the next morning with a new valve and had it going.
AC stopped working and they sent 2 techs out, both were from Uraguay and were very well trained and knew their stuff, I speak spanish so once I spoke a little spanish to them we were long lost brothers and they chatted me up the whole time they were there. Basically, the system was way overcharged, they released a bunch of coolant, fixed some other stuff, told me there is a good chance the unit will fail early due to the poor install (that was comforting to hear), but I learned a lot and the guys knew their stuff. Their equipment was also very nice.
Continued to have some issues in the house. I requested the manual calcs from the 3rd party that did all that stuff. HVAC company did NOT follow the manual calcs so flow in the ducts was not good. I had to change a bunch of ducting to get it to perform better. Some I can't easily change due to it being in wall cavities. It is much better not but will never be as good as it should have been unless I want to tear into a wall or two.
So, while I do know there are some great hvac people out there, I don't think most are trained well enough to do a great job but even the crack head contractors are charging as much as the great ones. Over my life, my experience with hvac guys has been more bad than good. I even worked for Trane (commercial controls side).
dcg9381
Well-known member
My guess is that many of the HVAC shop owners around here are multi-millionaires. Not so much the guys doing the work.
But just like plumbing, electrical, and automotive, you work your way up to managing the bills for a living. And then if the economy shifts, you've got some hard decision to make. HVAC seems to be a solid business in TX regardless of the economy though.
Those quotes are not out of line for my area either. You need a small mortgage to replace HVAC if you're a consumer.
There was no english speaking going on during my HVAC install. And I got up in there, made them come back twice to patch things up that had holes. Then the inspector caught some crimped vents. We work with the owner that speaks perfectly good english. The guys doing the work, not so much....
danski0224
Well-known member
How is this different from automobile repair?
I'm paying retail labor rates at or exceeding $200 an hour for a "book time". T&M, as in paying for each hour worked is rare.
I get an itemized list of parts used, where I pay retail. Judging by quality or OEM available parts on Rock Auto, I'm being hosed here, too. Typically, I can't supply my own parts, either.
The technician doing the work might have an hourly pay rate of $40 an hour in my area, so a labor burden of what, $80 an hour, and the retail rate is pushing 3x that.
When I looked at non union residential HVAC employment back in 2008 or so, it was 20 - 35 an hour, and you had to walk on water for the 35 rate... and basically provide all of the tools at either end.
The retail rate charged to the customer was much higher.
It has been uncommon to actually work on a T&M basis in my experience. Those are usually quite specialized circumstances. The employer can lose out when things go really good.
I don't know what my employer bills out the employees at. It has to be a minimum of 100-125 an hour to break even on wages, bennies and taxes.
Some of the customers require itemized billing. It can be risky if the customer thinks it's cheaper to do T&M and then there's a problem. A fixed bid is usually a better choice.
danski0224
Well-known member
And the counterpoint is:
How can a homeowner be so stupid and actually believe that they are getting something of value for the advertised $19.95 - $49.95?
That isn't enough money to start the truck and drive it a few miles, much less do any work.
Yes, this is a deceptive practice and yes it gives the industry a black eye.
It also makes it REALLY difficult to charge a fair rate to do an actual maintenance service without requiring upselling because the customer then counters with the above pricing... and then ******* here because they got nothing but a hard sell for new equipment.
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There are a lot of white collar companies charging in excess of $400/hr, (engineering, accounting, lawyers etc...) the employees are not making that and neither are the residential HVAC techs. I don't know what the resi companies around here are charging. I didn't work in the resi field. I have my gas and refrigeration licenses, which take a 5 year apprenticeship for the refrigeration and a similar amount of time for the highest gas license. I worked doing industrial refrigeration and gas service. No installations. Nobody is hired to do industrial service without some real experience. My experience residentially was limited to service calls on equipment owned by managers of the companies we serviced (for free at that, and our management didn't even take that all that seriously) I do know that union licensed industrial refrigeration service mechanics once finished their apprenticeships are paid $75/hour with great benefit and retirement packages. Add that to the cost of a truck, office costs (including the office staff with sales, billing and management positions their wages and benefit packages since they don't generate any money) liability insurance and other overhead and I can see $300-400+ hour easy to reach. I doubt any home owner would pay me to come and service their equipment. They want the low price and the low end techs are what are available and $17-25 won't attract any good techs. Around here (Toronto) $25/hour barely affords a one bedroom apartment. I wouldn't work for that 30 years ago. Working with sensitive food process equipment with high pressure large btu steam generators and low temp chillers (fast cook and instant freeze), computer rooms, and hospital air systems you have to have techs who are well trained, well experienced and care about what their doing. There's too much at stake. One computer room I serviced was 15,000sqft. It had two independent back up power systems, each piece of cooling equipment had a backup unit. If the room went down the company would be losing in excess of $100k an hour. Going down could be caused by a multitude of things, I was certain it wouldn't be my fault. Pearson Airport has a food service company, Cara Foods, that has several 25 million btu steam generators to cook the food going on the airplanes. The danger is real, you need good techs who take this seriously.
If there are residential companies getting away with charging $1000/hr it seems (again) to me that it's not the business' fault but the customers fault. As far as getting line items on invoices, I'll only have to guess that most resi customers wouldn't know what anything is anyway so why go into such detail? The company I worked for did have each part listed and the labor described as it was required for the customers insurance purposes.
I know you think the whole HVAC trade is a farce, and I won't change your mind, but there are techs who do know what their doing and should get paid accordingly.
American Locomotive
Well-known member
Stop bringing other trades into this - they have their own issues too (that many complain about on here, including those who work for shops in the trade) - but are not ultimately not relevant to this.
Once again, many HVAC companies bill effective labor rates in the multi-hundreds of dollars per man hour. Defenders of the trade constantly talk about "experience" and "overhead". But that's all nonsense when more of than not you get some young kid with little experience, who knows little more than "gas-n-go", and he's getting paid $18/hr. When you question the "overhead", they never can provide receipts explaining just how much their "overhead" costs them per job.
danski0224
Well-known member
That's because, outside of a trade union, the pay for trade work *****.
danski0224
Well-known member
dcg9381
Well-known member
Because the basic consumer knows nothing of what needs to be done or what it costs. These are "loss leaders". The rest of us that know what's going on can clean our own coils and change our own filters. It's an "intro" to your home to sell you something else.
You and I know that. But $50 probably seems like a reasonable amount drive from A to B for many people.
Agree.
From what I was reading with the recent UAW negotiations, the "old pay" and the "new pay" are radically different for doing the same job.
The deal with trade work - if you can do it "on the side" there's some money to be made. But the real money to be made is making it all the way up the trade latter and having not-so-licensed people do it under your license. That's where the money is. Takes years to get there.
danski0224
Well-known member
And no one in any trade in the residential market will comply, either.
I have heard of this practice only in some commercial work. I do know that one of the clients of my employer asks for a detailed bid that includes everything. But, everyone has to comply.
danski0224
Well-known member
So, an Owner, charging hundreds of dollars per hour?
Paying your employees as little as possible? Demanding as much as possible?
Then there's the a-holes here and elsewhere saying that's too much?
Just making sure that I understand.
danski0224
Well-known member
While the UAW may be "blue collar", it isn't what most would consider a "trade".
danski0224
Well-known member
dcg9381
Well-known member
It's about margin yes as a business owner. You've got overhead, insurance, you're fronting the money, potentially paying any number of fees related to having employees.
Most trades bids that I know about are "by job". The only hourly billing I see is automotive and we all know that's not about time actually spent (unless you have an independent that actually does it that way).
It's the white collar jobs that I see where you're margined per hour by a factor of 3-5x over what the employee gets paid. Then again, you're probably paying that employee to sit if there is no work. I've paid $10k for less than 12 hours of time, no materials, just expertise.
Again, margin business. There is risk in paying employees "as little" as possible. IE, they learn skills and will go somewhere else. Then you start over with noob employees and that has risk.
These are businesses, so if new AC is $25k and that's what the market will pay, what business owner is going to drop that rate?
Too much for the consumer or business owner? I see both sides of it.
American Locomotive
Well-known member
It is the same problem, but you're not trying to have a productive conversation about it. You just keep using "what about-isms" to try and deflect.
I'm not asking for a company to explain their overhead costs to every customer.
I'm asking for a company to justify and explain their overhead, in an average-cost-per-job way in this conversation right now. A business owner could easily and quickly squash "whining" about HVAC prices in this this forum permanently, forever, if they just posted some numbers. When someone whines about the costs in the future, we could simply refer them back to this thread. But not a single HVAC contractor here has been able to do so, and then they always start chirping back about the "whiners". Either justify your costs, or stay quiet when someone complains about the costs. It's like your wife nagging you to help around the house, and when you ask what needs to be done, she says "I'm not telling you".
Maybe, but when you pay engineering consulting fees, it's often 1) Done hourly (for consulting work), and 2) You have direct or indirect access to a whole team of engineers and a myriad of other support staff to work, vet, approve and certify your project.
On the other hand, I call "Bubba's HVAC" to come look at my condensing unit. They send Jimbo with 8 teeth (and 3 are in his pocket) who's getting paid $21.30/hr to come look at the unit. He changes a capacitor, he's in-and-out in 25 minutes, and then I get a bill for $600. That's the reality of modern HVAC work.
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People keeping harping on about "how much the market will bare" to justify price gouging. HVAC is not an "optional" thing. You NEED your heating system to work in the winter. People many areas of the country, especially the elderly, NEED their air conditioning to work in the summer. The "market will bare" incredible costs to replace or service these units, because their only other option is literally dying.
danski0224
Well-known member
So, we are pretty much on the same page.
danski0224
Well-known member
And I have posted why that would never do any good.
It would still be too much for someone. And there's too many details that make a difference.
Maybe I need to peruse the other forums and look for these bid breakdowns, and see if they eased the natives.
The big mistake is calling Bubba's HVAC with his 3 or 4 teeth to come and take care of you. It might take some time to find a company that wants to service your equipment rather than just replacing it. Maybe call a reputable industrial business and explain your problem with Bubba and that you need your stuff repaired properly. You probably will pay just as much, if not more, but your problem will be repaired. There is no solution to the resi overcharging problem until people stop paying for it.
Another thought, If I sold something regardless of what I paid for it and someone bought it, happily paying the price, does it matter what the numbers are? A good deal is when both sides are happy.
Another thought, If I sold something regardless of what I paid for it and someone bought it, happily paying the price, does it matter what the numbers are? A good deal is when both sides are happy.
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danski0224
Well-known member
Until the complainers start posting pictures and a scope of work, along with the price, I'm not sure that there is overcharging.
Ok, a $600.00 capacitor? Yeah, likely out of line. But, then it quickly devolves into someone listing a $10 part and no travel and diagnosis. It would be fairly easy to justify $250, based on travel time and retail labor rates. But, some here would think that $24 is overcharging.
Jim greengo
Well-known member
I'm tired of paying Dr prices for my pacemakers.
Is there an on line supplier where can by my own?
Same goes for lawyers/legal advice,any ideas? Hahaha
Is there an on line supplier where can by my own?
Same goes for lawyers/legal advice,any ideas? Hahaha
Jim greengo
Well-known member
There's plenty of slick talking estimators out there who have all their teeth and drive fancy trucks who will stick it to ya.
Don't let how a person dresses or what they drive fool ya .
I'll take a guy with actual skills,that knows how to use them in a 20 year old van any day,over a flashy truck .
There could be the odd individual overcharge, like any industry or service. If it really was common place gouging or overcharging, you'd hear much more about it. Not just the same jealous whining here. If the customer was happy to have their cooling operating again for $600 who am I to complain for them when their happy?
Jim greengo
Well-known member
Most business owners never reach the multi millionaire stage in the trades. Hahaha
danski0224
Well-known member
Some do. I'm working for one. Specialized work, though.
Jim greengo
Well-known member
Do people ever stop to think of how those parts end up on a service truck?
Somebody spent time going to get those parts,that costs money.
so if the part costs me $15.00 at the supply house I've still got an hr of my time in it already ,so that's let's a $100 for me.
So now that's a $115.00 part.