Want to know the secret to growing your HVAC business sustainably? It’s not just about fixing more systems or booking more installs. The real money comes from HVAC service agreement programs—your built-in source of recurring revenue, customer loyalty and business stability.
Think of them as subscriptions for heating and cooling: consistent income, stronger relationships and smoother scheduling all year long.
In this guide, you’ll learn:
- Why HVAC service agreement programs matter for your bottom line
- How much recurring revenue to expect
- The different types of plans to offer
- Tips for selling more agreements
- How to keep customers happy (and renewing)
Why HVAC Service Agreement Programs Are a Game Changer
Recurring revenue isn’t just a bonus—it’s the foundation of a stable HVAC business.
Here’s something that will make you think: in 2024, recurring service agreements captured 55% of industry revenue, and that segment is expected to grow at an 8.3% yearly rate. That means more than half of all HVAC service money comes from ongoing agreements, not one-time jobs.
Why is this so important? Because getting new customers costs a lot of money. Customer retention costs 5 to 7 times less than customer acquisition, with the average cost to acquire new HVAC customers ranging between $250 and $350. When you keep customers coming back with HVAC service agreement programs, you save a ton of money on marketing.
Plus, there’s this amazing fact: increasing customer retention rates by just 5% can increase profits by 25% to 95%. That’s huge! A small improvement in keeping customers can almost double your profits.
Fun Fact: About 11% of customers leave every year, and 7% do so simply because they don’t feel appreciated. HVAC service agreement programs help you stay connected with customers so they never feel forgotten.
How Much Money Can You Make?
Let’s talk numbers. How much should you aim for when building your HVAC service agreement programs?
For a healthy HVAC business, you should target:
- 250 service agreements per $1 million in service revenue (or per billable tech)
- 1,000-1,500 agreements per $1 million for best-in-class companies with dedicated maintenance teams
Here’s a helpful table showing what customers typically pay:
| Customer Type | Basic Plan (Yearly) | Comprehensive Plan (Yearly) |
| Residential | $120 – $500 | $500 – $1,500 |
| Small Commercial | $500 – $1,000 | $1,000 – $2,000 |
| Large Commercial | $2,000+ | $5,000+ |
Unlike emergency calls that happen randomly, HVAC maintenance agreements deliver predictable revenue and make your company more attractive to future buyers. Businesses with recurring revenue consistently command higher valuations (10 times EBITDA or more).
Did you know? Service agreements dramatically increase the value of your business, as sophisticated buyers want recurring revenue, which is what service agreements offer. If you ever want to sell your company, having strong HVAC service agreement programs makes it worth a lot more money.
How to Build Your HVAC Service Agreement Programs
Now let’s turn to actually creating HVAC service agreement programs that work. You can’t just offer one basic plan and hope everyone signs up. Different customers have different needs.
1. Create Different Levels
Think of it like buying a car. Some people want the basic model. Others want all the fancy features. Your HVAC service agreement programs should work the same way.
Basic Level: Include two tune-ups per year (one before summer, one before winter), priority scheduling and a small discount on repairs. Keep it simple and affordable.
Middle Level: Add more perks like bigger repair discounts (maybe 15-20% off), free filter changes and no overtime charges for emergencies.
Premium Level: Go all out! Include everything from the other levels, plus free repairs up to a certain dollar amount, same-day emergency service and annual safety inspections.
When you offer choices in your HVAC service agreement programs, more people find something that fits their budget and needs.
2. Make It Easy to Sign Up
The easier you make it to join your HVAC service agreement programs, the more people will say yes. Here’s how:
- Let customers sign up online or by phone
- Offer monthly payment options instead of one big yearly bill
- Give a discount if they sign up right after you finish a service call
- Make the contract simple to read without confusing legal words
Technicians should be able to convert 25%-50% of their demand service calls into a service agreement sale. That means every time your techs go out on a job, they have a chance to sign someone up. Train them to explain the benefits in a way that makes sense.
Fun Fact: About 30% of customers already use preventative maintenance plans, which means you have 70%+ or possibly more of your customer base to work with. There’s a huge opportunity waiting!
Keeping Customers Happy (and Renewing)
Getting people to sign up for your HVAC service agreement programs is only half the battle. You also need to keep them happy so they don’t cancel. Here’s the truth: 73% of customers stay loyal to brands because of friendly customer service.
1. Stay in Touch
Don’t disappear after someone signs up for your HVAC service agreement programs. Send them reminders when it’s time for their tune-up. Wish them happy holidays. Share helpful tips about saving energy or what to do if their system makes a weird noise.
According to the Better Business Bureau, a healthy mix should be six to eight relationship-building touches showing care for their wellbeing to every one soliciting for action. That means for every time you try to sell them something, you should reach out 6-8 times just to help or say hello.
2. Show Up on Time
This seems simple, but it matters so much. When you promise to be somewhere at 2:00 PM, be there at 2:00 PM. More than 50% of customers will switch to a competitor after just one negative service encounter. One bad experience can end a relationship.
3. Ask for Feedback
After every service visit, ask customers how you did. Were your techs friendly? Did they fix the problem? Is there anything you could do better? When customers see you care about their opinion, they trust you more. Plus, you learn how to improve your HVAC service agreement programs.
Fun Fact: 82% of satisfied customers will likely refer friends to your business, and customers referred by other customers have a 37% higher customer retention rate. Happy customers bring you more happy customers!
Why Your Business Needs HVAC Service Agreements
If you’re serious about growing your HVAC business, you can’t ignore HVAC service agreement programs. They solve so many problems at once:
Steady Income: Instead of worrying about slow months, you have money coming in all year. Winter is slow for AC repair? No problem—you have maintenance appointments scheduled from your service agreements.
Better Planning: When you know how much money is coming in, you can hire the right number of people and buy equipment without stressing about cash flow.
Loyal Customers: People in your HVAC service agreement programs stick around. They call you first when something breaks because they already have a relationship with your company.
Higher Business Value: If you want to sell your company someday, investors prefer high-revenue visibility, high-margin businesses with a large service component, with transaction multiples remaining robust (above 10 times EBITDA). HVAC service agreement programs make your business much more valuable.
Investors, buyers, and top HVAC companies all favor service models with high-margin recurring revenue and strong retention systems—and HVAC service agreements deliver both.
Making It All Work
Starting HVAC service agreement programs doesn’t have to be complicated. Begin small if you need to.
1. Pilot the Program
Pick your best, most loyal customers and invite them to be the first members of your program. Get their feedback and improve based on what they tell you.
2. Use Technology to Simplify Management
HVAC software like FieldEdge automates scheduling, invoicing and renewals—so nothing falls through the cracks.
3. Train Your Team
From dispatch to techs, everyone should understand your program and know how to explain the benefits clearly.
Did You Know? Preventive maintenance contracts captured 39% of total HVAC revenue in 2024, showing just how important these programs are to the industry. The companies with organized, software-driven service agreement programs are leading the pack.
Book a FREE demo of FieldEdge today to experience how the best service software will BOOST your business growth!
HVAC Service Agreements: A Must for Boosting Your Business
HVAC service agreement programs aren’t just optional anymore—they’re essential for modern HVAC businesses. They create the steady, predictable income you need to scale. They help you keep customers instead of always hunting for new ones. And they make your business worth more money.
The market is growing. Companies that build strong HVAC service agreement programs now will be the winners in the years ahead.
Don’t wait for the slow season to wish you had more steady work. Start building your HVAC service agreement programs today. Your future self (and your bank account) will thank you.
Here’s a few things to remember going forward:
- Recurring revenue is king: Service agreements provide steady, predictable income that’s easier and cheaper to maintain than constantly finding new customers
- The numbers are impressive: Just a 5% increase in customer retention can boost profits by 25-95%
- Start with realistic goals: Aim for 250 service agreements per million dollars in service sales, then scale up to 1,000-1,500 as you grow
- Offer choices: Create basic, middle, and premium tiers so every customer finds something that fits their needs and budget
- Keep customers happy: Focus on friendly service, showing up on time, and staying in touch regularly—not just when you want to sell something
Remember, building successful HVAC service agreement programs takes time, but the payoff is worth it. Start today, stay consistent, and watch your business grow stronger every month.
Book a FREE demo of FieldEdge today to see how leading HVAC companies automate their service agreement programs, reduce admin time and grow year-round revenue.
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