HVAC Service Markup Calculator

An HVAC service markup calculator is a tool used by HVAC businesses to determine the sale price they should charge customers for their services. The goal for HVAC business owners is to make sure that all their expenses are covered while still bringing in a profit.

A markup is an amount added to the cost price of goods or services that results in the final sale price. Markups help businesses not only cover their overhead expenses but also make profit.

The right markup rate for your business can vary depending on your expenses, competition, and profit needs. A good rule of thumb for a baseline markup is adding 20% to 50% to the original cost.

Profit margin is a ratio of profit to revenue, while markup is the ratio of profit to cost. The profit margin allows you to compare your profit to the sale price, not the purchase price.

There’s two use case for our calculator:

Case 1 – To add the markup percentage to the service cost, in order to calculate the service price.

Case 2 – To find the markup percentage by providing the service cost and expected service price.

The calculator uses the following formulas in order to give you the results:-

Case 1 – “Add Markup”

First you need to input the Service Cost and the Desired Markup Percentage.

Markup Value = (Service Cost) * (Desired Markup Percentage/100)

Service Price = Markup Value + Service Cost

Case 2 – “Find Markup”

First you need to input the Service Cost and the Expected Service Price.

Markup Value = Expected Service Price – Service Cost

Markup Percentage = (Markup Value/Total Service Cost) * 100

Example:

Case 1 – “Add Markup”

Service Cost = $10,000

Desired Markup Percentage = 10%

Markup Value = $10,000 * (10/100) = $1,000

Service Price = $1,000 + $10,000 = $11,000

Case 2 – “Find Markup”

Service Cost = $10,000

Expected Service Price = $14,000

Markup Value = $14,000 – $10,000 = $4,000

Markup Percentage = ($4,000/$10,000) * 100 = 40%