A general rule for HVAC working capital: maintain 2-3 months of operating expenses in accessible capital at all times. If your monthly fixed costs (payroll, truck payments, insurance, overhead) are $20,000, target a $40,000-$60,000 accessible working capital buffer. This covers a slow-season stretch without requiring emergency financing, which always costs more than planned financing.
Stop applying at the wrong time of year. Learn how the same HVAC company qualifies for $14K in March and $108K in August, and how to make the annual capital cycle work for you.
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T.A.G. Business Funding
500 FICO minimum. Bank declines OK. Revenue matters more than credit score. The funding provider sets the actual decision timeline after reviewing your file.
500 FICO minimum · $4K-$6K+/month revenue · Funding timing is set by the funding provider after review
How much working capital does an HVAC business need?
A general rule for HVAC working capital: maintain 2-3 months of operating expenses in accessible capital at all times. If your monthly fixed costs (payroll, truck payments, insurance, overhead) are $20,000, target a $40,000-$60,000 accessible working capital buffer. This covers a slow-season stretch without requiring emergency financing, which always costs more than planned financing.
What is the best working capital product for a growing HVAC company?
The best working capital product depends on the use and timeline. For short-term gaps (1-6 months): MCA or business line of credit. For equipment: equipment financing or lease. For long-term growth capital: SBA 7(a) loan or term loan if the business qualifies. Most HVAC companies in growth mode use multiple products simultaneously: MCA or line of credit for operating gaps, equipment financing for vans and tools, SBA for building purchases or major expansions.
Can an HVAC company use working capital to hire additional technicians?
Yes, payroll for new technicians is one of the most common HVAC working capital uses. The logic: a new technician costs $4,000-$6,000/month in compensation but can generate $15,000-$25,000/month in billable labor. The 3-6 month ramp-up period (when the tech is training and building their book) creates a cash flow gap that working capital bridges. Once the technician is productive, the revenue easily covers the financing cost.
