Lessons From My First Year in HVAC

What was the biggest mistake I made in year one?

Underpricing was my biggest first-year mistake, and it nearly cost me the business. When I launched Frosty's HVAC in 2018, I was so focused on getting customers that I priced my services lower than everyone else. I thought low prices would win the market. Instead, I was working 12-hour days and barely covering my costs.

Here's the math I didn't do before setting my prices: I calculated what the repair cost in parts and added a markup. Sounds reasonable, right? But I forgot to account for insurance ($250+ per month), fuel (driving across Farmers Branch, Coppell, Irving, Flower Mound, Lewisville, Grapevine adds up fast), quarterly self-employment taxes, wear on my tools, warranty callbacks, and the hours I spent on the phone quoting jobs that never materialized.

By month four, I realized I was actually losing money on some jobs. A $150 service call sounds profitable until you factor in the $40 in gas, $30 in insurance cost allocated to that day, the parts markup that barely covers wholesale, and the two hours of drive time. I was essentially paying customers for the privilege of fixing their AC. It took me the entire first year to build pricing that actually sustained the business.

Why is saying yes to everything a trap?

Saying yes to every job is a survival instinct when you're new. The phone rings, you say yes. Someone calls from 45 minutes away, you say yes. A customer wants you to come out on Sunday at 7pm for a non-emergency, you say yes. You're terrified of turning away revenue because you don't know when the next call will come.

The problem is that not all jobs are created equal. That call from 45 minutes away means an hour and a half of driving for one service call. That Sunday evening non-emergency could have waited until Monday, but now you've lost your only evening with your family. When you say yes to everything, you have no time left for the high-value jobs that actually build your business.

I learned to set boundaries in year one. We serve 6 cities: Farmers Branch, Coppell, Irving, Flower Mound, Lewisville, Grapevine. If a call comes from outside that radius, I politely refer them to another contractor. Emergencies get priority. Non-emergencies get scheduled into the next available slot. Saying no to the wrong jobs gave me time to say yes to the right ones.

How bad was year-one cash flow really?

It was brutal. There's a truth about service businesses that nobody talks about: cash flow in year one is a rollercoaster with no seatbelt. In HVAC, your busiest months are June through September when temperatures in DFW push past 100 degrees. Your slowest months are the shoulder seasons — October, November, March, April — when the weather is mild and nobody's system is struggling.

I remember a two-week stretch in October 2018 where the phone didn't ring once. Not a single call. We had bills due, insurance premiums coming up, and zero revenue. Mariafernanda Jacobo and I sat at the kitchen table and looked at our bank account and had the hard conversation: do we keep going or do we fold?

We kept going. But that experience taught me something critical: you must save aggressively during the busy months to survive the slow ones. Now I set aside a percentage of every summer payment specifically for the winter fund. If you're starting a service business, have at least two to three months of operating expenses in reserve before you start. I didn't, and it almost ended us.

What was the best thing that happened in year one?

Our first five-star Google review changed everything. It was from a homeowner in Farmers Branchwhose AC had stopped cooling. Simple fix — a failed capacitor. I diagnosed it in 10 minutes, replaced it in 15, charged a fair price, and asked if they'd be willing to share their experience online.

That review went live and within a week, we got another call from someone who saw it. That customer also left a review. Then another. The flywheel started turning, and it's never stopped. Today we have 96 five-star Google reviews, and the vast majority of our new business comes from people reading those reviews.

The other best moment was our first repeat customer. Someone we'd serviced earlier in the year called back for a different issue and specifically asked for me. That meant we had done something right. They didn't just need HVAC service — they wanted Frosty's. That distinction is the difference between surviving and thriving.

What would I tell someone in their first year right now?

Track every dollar from day one. I mean every dollar — fuel receipts, part purchases, insurance payments, even the coffee you buy on the way to a job. I didn't track expenses properly in the first year, and when tax season came, I was scrambling through a shoebox of receipts trying to figure out what I'd spent. Get a bookkeeping app or hire someone. It's worth every penny.

Price for profit, not for volume. It's better to do fewer jobs at prices that actually sustain your business than to run yourself into the ground chasing volume. Your time has value. Your expertise has value. Your license (TACLA126718E) and your certifications (EPA 608 #2396328) represent years of investment. Price accordingly.

Build your online presence immediately. Google Business Profile, a basic website, social media — these are not optional. The customers who will sustain your business are searching online before they call anyone. If you don't show up, you don't exist.

And lean on your partner. I could not have survived year one without Mariafernanda Jacobo. She handled the books, the scheduling, the licensing renewals — all the operational work that would have drowned me if I'd tried to do it alone. I talk about that partnership in detail in my article on building a business with your spouse.