Mitch, thanks for the video. I tell the story of the mechanic that charged $100 to make a minor adjustment. The customer was upset with the price and the mechanic explained that the adjustment was only $1.00, but knowing what to adjust and how to adjust it was $99.00
Since UA-cam many customers think they can do this and we sell hundreds of capacitors to customers. We even test them if they bring them down. I sell that Capacitor for $55 out the door with no warranty or returns. I get dozens of jobs each year from customers that think they know what they are doing. Thanks for the comment.
Actually it's supposed to be $3,000 for a toilet seat, LOL. Anyhow the big difference, we have to pay a guy to come to your house, when was the last time you seen a doctor make a house call? Thanks for the comment.
99 % of my customers have a big smile on their face when i leave,the ac is working.but i never just change the capacitor,i do a complete check.i give them their moneys worth.
Yes, our techs are instructed to do the same. I also let the customer know that the run capacitor may not be the only problem and that we can't fully check the system till the capacitor is replaced. Thanks for the comment.
No offence but ive been in hvac and no theres zero reason to charge 300 for a cap and this is the reason i spent 800 on 2yrs of hvac training. Id rather do it myself than be robbed. More people need to become handy in life. I paid for college not for a job but for life and I've gotten back more money in savings than I would have made if I paid for a degree and got a job in it. I've even done mechanics school and electrical training as well as carpentry skills. If you have 2 hands and 8hrs of free time you shouldn't be paying people for overpriced services.
No offence taken. Like I said in an earlier reply to a comment. I built my own home back in 87 and did most of the work myself. During the prior 11 years I worked installing HVAC in literally thousands of new construction homes and the same for existing homes. During all that time I learned on the job how to frame, run electrical, sheetrock, plumbing, roofing and so on. I could have paid a contractor to build the house but saved thousands doing most of the work myself, drawing my own plans (4 years of architecture in High School) and acting as owner builder and hiring out what was cheaper for someone else to do and/or I didn't have the skill set. That being said, we charge what we have to to stay in business. It might look like we are making bank but as stated in the video our industry has the third highest failure rate and much of that is due not to the HVAC contractor not knowing how to service and install, but more from not charging enough to cover his costs, overhead and profit and just as important pay his employees a decent wage. Anyhow, thanks for the comment.
@@baileysair I think the real issue is inflated overhead that isn't within your control. Insurance, parts cost, etc all going up further than the consumers paycheck is and you and the rest of us small businesses suffer in the middle.
You hit the nail on the head, that is why small companies (less than 6 employees usually) can make more profit per employee than a medium or larger company because the owner is usually wearing all the hats and the overhead is usually very low. Economy of scale doesn't kick in for our business until the company gets over 50 people usually, then overhead will start to fall per employee.@@brad1367
First time I needed a cap replacement like this was when I discovered the AC wasn't working on a hot Saturday morning. Dude came out and fixed it within a few hours. Yeah it cost me $250 or something like that for a part I could buy much cheaper. If I knew that was the problem. If I knew which part to get. I know I'm not paying for just the part but for the service and expertise. Was well worth it to me to have my AC working again the next day. Money well spent as far as I'm concerned.
Thanks for the comment. Yes, it also could have something else going on and the tech can check the system after replacing the part. That is something your typical layman doesn't know how to do or has the correct tools. Again, thanks for the comment.
This breakdown assumes the call out was for a nonfunctional unit requiring capacitor repair. I had a guy out for another reason and he told me the capacitor was going bad and recommended replacing. $300 additional. I assumed it was an expensive part because it took him all of 5 minutes to replace and the total time out was an hour which I was already billed for. I later looked up the part price and got a new hvac guy.
@@baileysair yes, the tech also checked out and tested the rest of the system - pressures, AC outlet temperatures, etc - after he replaced the bad cap. I haven't a clue about that stuff.
@@ryancraig2795 The good techs will check everything, pressures, temperatures, they will tighten electrical connections, clean the condenser coil, take amp draws to see if any other problems persist, cycle the unit on and off via the thermostat. One of the other things that most people don't know is that the part comes with a warranty, if it fails usually within a year, most companies will replace if for free.
"You are not paying the man with the hammer to fix your boat; you are paying the man with a hammer that knows precisely where and how to tap to fix your boat." That's why fixing your 20-year-old appliance, car, house, toilet, or whatever costs what it does! I pass this type of info to my young son learning the HVACR trade. Thanks for sharing, Mitchell!
Nice video, Mitch just tell me where to sign for that tech wage, and I'm on it. 😂 good explanation 👏🏻. I had a customer who wanted the price and receipt for a control board that I picked up at the supply house in Modesto. He ended up having his daughter goggle the part number. He wasn't happy, so I had to explain to him about running a business. He understood after and apologized. But the time it took me to explain that. Yikes 😅
I did just that about a month ago. Gave a bid to a guy and a heck of a deal using some equipment we had in stock. When our guys got there he was upset because the coil and furnace were 17" wide and he had it in his brain it had to match the existing width equipment of 21". I said pass and told him to go ahead and get someone else.
You probably did that guy and the next people he interacts with a favor. Most people don't understand what it takes to maintain the service part of the business and I partially blame places that aren't clear about the actual cost of parts vs labor.
This breakdown assumes the call out was for a nonfunctional unit requiring capacitor repair. I had a guy out for another reason and he told me the capacitor was going bad and recommended replacing. $300 additional. I assumed it was an expensive part because it took him all of 5 minutes to replace and the total time out was an hour which I was already billed for. I later looked up the part price and got a new hvac guy.
He should have charged less if he is there for something else. The price in the video is for a standalone repair. In your case our techs are taught if there is more than one repair to take the most expensive repair and any others are halved as we are there taking care of more than one problem. Lets say he finds a bad condenser fan motor and our price is $580 to replace but he also finds a bad dual run capacitor that is priced at $300. It would then sell for $150 so the total repair would be $730 and not $880.
You know what, I AGREE. You might not expected that from me. This repair is very doable as a do it yourselfer. However, I have to remain steadfast in that it is dealing with high voltage which can kill or hurt you. Also, you could further damage the equipment if you mess up. Better to stay with a licensed and trained professional if you do not know what you are doing, plus they can check everything after it's installed to make sure that there is nothing wrong with the system. Your typical homeowner would not have the tools and or the expertise needed to diagnosis problems. I teach this trade for PG&E, Southern California Edison and National Comfort Institute, so I can't recommend that a lay person do it. In addition, I can't count on my fingers and toes how many times we get work from do it yourselfers. PS if you want to take my class online tomorrow night at PG&E which will be simulcast and live from the Stockton PG&E Energy Training Center at 6 pm, here is the link. Wednesday, September 13, 2023 6:00 PM-9:00 PM attendee.gotowebinar.com/register/7562457900197053269
You know, here in the not to distant future all fans and compressor will be inverter driven and not need capacitors. Dang there goes the money I needed to put the kids through college!
@@baileysair don't worry, anytime that variable speed motor or any circuit board develops even the slightest burp, you are looking at enough profit to send all your grandkids to Stanford!
You sure picked an easy job to talk about. I can barely work a volt meter but I've done this job twice on our system over the last decade. Feels good seeing that $300 price tag and knowing I only paid $20-30.
I agree, they are easy to replace. Heck I sell them out of our stock in the shop all the time. On a hot weekend we will get two or three people coming in and buying one off our shelves, we charge $55 for it with a no refund or return policy. If they bring in the old one we will even check it for them to make sure that is the problem. You might now ask why $55, that is easy, they don't want to wait for two or three days to get it mailed from online.
Absolutely right. This is why I learned everything about HVAC. Because these types of people are crooked! They will lie to you in minute if that makes you pull your wallet out. They are worse than used car dealers
@@kevinroberts781 Granted it doesn't make any sense to pay all the overhead when you are capable of solving your own problems but for those who cannot that overhead is still there whether they like it or not and whether they can afford it or not. Nice thing about making 6+ figures is you don't have to educate yourself on the workings of the things you use every day. I personally would rather know what's going on. In one case I had an intermittent problem with my HVAC but I knew how to recreate it although it could take several hours to get the system to that state. I was able to make sure it was right on that failure knee when the tech arrived and he was able to home right in on the problem. 6+ figures will not give you the ability to do that but it got my system up and running instead of an NTF call and still no AC. Knowledge is power at all income levels. Actual crooks are few and far between but incompetence and/or miscommunication are unfortunately more often than not the case.
True that. But before you judge. I have lived in the same house that I built with my own hands, not just owner builder but I was the framer, sheetrocker, electrician, plumber, roofer, painter etc.. the only thing I didn't do was the concrete. I built the house in 1987 and was the architect also drawn by hand, I credit that to 4 years of architecture in High School. I was 25 at the time. The wife and I saved for 5 years to purchase the lot and then went to the bank with the plans to borrow the money to build the house. The loan officer said they could let me borrow $65,000 to build it. She then asked, "How much will it cost to build the home", my reply, "I guess it's gonna be less than $65,000 then." We built it for $59,000 because of all my sweat equity. It took 8 months to build. The house still isn't paid off because we had to put money back into the business back in 2008 and borrow against the home because builder's stuck me for more than $160,000 and we chose to pay back all the supply houses ourselves instead of doing bankruptcy.
As someone that paid $500 to replace a $160 motor, that is what you pay to get it done right away. I could have ordered the motor and put it in myself, but finding it was bad on a Friday before a long weekend mean I wouldn't have got the replacement motor until Tuesday unless I paid $200+ for shipping it Saturday Delivery. That is another thing people forget. A/C companies stock a lot of parts so they can fix the A/C in hours when your house is 90 degrees and climbing. And those trucks, tools, fuels are not cheap, and the tech's don't work for free either.
@@baileysair They actually did in a way. The original capacitor was 60/5, but the new fan motor required a 7.5μF capacitor so the tech was supposed to replace it with a 60/7.5. He put in a 40/7.5 instead, by misreading the spec sheet on the system and killing the old and tired compressor in the process about a week later. So, the owner sold me an entire new A/C at a big discount to make up for the mistake. The A/C was already 17 to 18 years old, and wasn't worth fixing...
You have to allow the time it took the office to take the call and dispatch it, 5 minutes, another 10 minutes for the tech to drive to your home, another 10 minutes to greet you, tear into the unit and do his diagnosis, 15 minutes to install it, and another 15 minutes for the pressures to stabilize to make sure everything is working and there is nothing else wrong, and then give him 5 minutes to pack everything up and get on too his next job. I hope that you can see it is at a minimum, an hour for any service call, and not 15 minutes.
Sir, thank you for the video. It was very instructive and informative. I would like to point out that the reason why prices are so high is because the every day man has lost the willingness to try to understand a System and fix it himself. Yes, it is true that a technician has the years of experience and the back up of a more experienced coworker or boss that could guide him through to get the work done fast and safely and that is why people pay $300 for a capacitor replacement because it gets done the same day and you don’t have to move a muscle to accomplish it. You just pay for it all the words we are paying for being lazy but thank you for the video I enjoyed it.
And if someone takes the time to read this I would like to also point out and that replacement parts for HVAC systems are monopolize and or restricted to only HVAC contractors which I think is bullshit and the same goes to many Other replacement, parts and supplies that are exclusively sold to general contractors, etc.
I have to disagree with you slightly. First off, people should pick what they do best and stick to it. I can mow my lawn, but choose to have someone else do it because they are quicker and I would rather spend my time after hours and weekends doing either working, where I make more money, and or taking a much needed rest. Second, your average homeowner may be capable of changing a capacitor, but the hazards much outweigh the benefits for most people. Add in that we warrant the work and it's a win win.
The phrase, jack of all trades master of none may sound like an insult for many people, but actually, I don’t look at it that way if somebody is versatile enough to have a minimal knowledge of many trades it’s more valuable than somebody that specializes only on one thing we live in the era of information, but people are too lazy to seek it HVAC Plumber, Carpentry electrician welder mechanic Electronics masonry all those are Trades and skills that are easily acquired. Just doing a little bit of research studying a little. Anyone can do it, but we are leaving on an era where people don’t make enough money, but even so they don’t value (the value of it) It’s easier to pay for something, even if it’s a steep price than to do it yourself but at the end of the day, you don’t learn anything or develop any new skills That is why a tire change costs $200 a capacitor costs 300 toilet replacement 700 an electrical breaker swap 450 and so on and so. Sorry for the butchery of this language and the grammatical massacre I just perform
@@eltren12 I didn't learn all these trades for money. I learned them because I always wanted to know how these worked. After awhile I realized people can't screw me over anymore. Simple because I can just do it myself.
$300 bucks?! People in vegas are charging $800 and above... With that said, I've worked on aircraft and equipment, with enough voltage and current, that would cook you from the inside; pneumatic and hydraulic pressures that would cut you in half; weights that would crush you like a bug. With that said, you you don't have the level of skill and understanding required, get a pro or you'll die.
I agree. However, we get tons of work from DIY people watching a video that try to fix it themselves. I mean I could mow my lawn, but I don't because I can spend my time doing something else that will make me more money so I can pay a guy to mow my lawn, plus I think he does a better job than I.
The Mrs. was most grateful 2 years ago when our AC died 9:30 PM Sat night and still 95 out. I had it up 15 minutes later because I thought ahead and had a spare on the shelf. Now I keep 2 and suggest everyone have a spare. $10 insurance policy...CHEAP!
I agree, this is a cheap part if you think ahead. Another reason besides not having the knowledge and/or even wanting to to the work is the convenience of getting it done that day and not having to wait for a part.
Unfortunately there are some unscrupulous companies out there. In our area there is a guy that charges over $500 for parts like this and even does it to little old ladies. The way it works with his techs is they have a set price to sell the part, like this run cap say $350 which they can never sell it for less. However, if the tech sells it for more than the $350 say he sells it for $450 then he and the tech split the $100. The problem with this type of behavior is that it paints everyone in the this business as being crooked and trying to take advantage of the customers. Thanks for the comment.
I have seen companies do it as cheap as $150 and as much as $500. The $150 is usually a one man company or someone working on the side or doing a business part time. The $500 one is usually giving a huge commission to the tech and, in my opinion overcharging. That is why I created the spreadsheet so it makes it easy to price stuff. Oh, by the way maintenance customers get a 15% discount so it only costs them about $50 less. I would venture that $250 is probably the average paid for a run cap in the country. Of course here in California things cost more. Thanks for the comment.
That 50% margin looks rich until one realises the taxes on that are near 50%. Also, trades rates have skyrocketed in the past 2 years, so it's not reasonable to assume one guy will ignore that trend.
@@baileysair And I will add that trades rates have been stuck in the sand for decades. This means inflation and retirement costs are killing tradesmen. So the recent bump up in rates compensates for some of the inflation but not all of it. Nobody is getting rich.
Padding the bill like the car dealers. The price for a service call, an hours labor on top of the that and add the capacitor at 100% profit, plus taxes.
We use margin and not mark up which is calculated differently. A few decades ago a friend of mine was a manager at an outdoor apparel store. A shirt they paid $1.10 for, sold for $40 when on sale, and $60 regular price. That is 36 times the cost of the shirt. But nobody batted an eye about that. My capacitor is $10 so its a bargain at only 30 times cost, plus I am going to your home and have to pay a guy that actually knows what he is doing.
We check prices of our competitors all the time and our pricing is actually a little less than the three major companies in the area that employ more than 50 people, while we are very close to many companies our size. Realize we are in California where gas is $5 a gallon. In addition, the spreadsheet takes into account when the part increases in price that we purchase it for and takes the margin down. Otherwise yes that would be an excessive charge for a $149 motor. This sliding margin keeps us competitive with our pricing for contractors in our area. A better way to think of it, is to think of it as a minimum charge. You also have to remember that this is flat rate not cost plus or by the hour. If you would like a copy of the spreadsheet send me an email, I gladly give this spread sheet and you can modify the margins to fit what you believe is fair. Thanks for the comment.
You are right Scott, my old Callahan Roach flat rate price book from 2005 shows it was $196. We used to pay $4,000 to $5,000 for those flat rate price book each year for our techs. Today we have our own based on my spreadsheet and we use Onsight catalog app to distribute it too all the techs. Callahan Roach was one of the better flat rate pricing. You gave them your labor rate and what you would like to make and they printed a book based on the numbers you gave them. Thanks for the defense and the comment. @@scott5654
You should have mentioned that your techs are also checking the system vitals and not just changing the run cap and calling it a day. Some people will see the value of the service, and some will not. No amount of logic or detailed explanation will change peoples' minds. You could offer a serve well below your cost of providing it and some people would still feel that they are being ripped off.
Thanks for your input. Yes they do more than swap out the capacitor. They will completely assess the equipment and make sure it is working. And yes, some people have no clue how business works, we need to make a profit to stay in business ad support our employees and customers. These are the same people that will overpay for a EV and not complain. But will complain how expensive a hamburger is now.
I still have to make a video on why caps fail. Caps from the 60's and before had a different dielectric oil and, I believe, used better quality materials and manufacturing standards. Today's capacitors fail all the time and directly blame the dielectric oil and how they are currently made with lower grade materials.
What nobody realizes is that to offer the 0% 48 or 60 month financing costs the consumer usually about 18 to 20 percent of the job. And that cost has to be added to the job. That's why I point people in California to Go Green financing, they have very reasonable rates, you can stretch the payment from 5 to 10 or 15 years keeping the payment low and they don't charge me any fees, so we give a same as cash discount.
@@MrRjnr No, in fact you apply for it online yourself and then you get your funding in place before you decide which contractor to use. Just be sure they are approved by Go Green. My daughter, also the office manager, likes both Coast and Matador. She says they are the easiest to deal with.
@donschulerer you are confusing mark up with margin 50% margin is 100% markup here is a link to a margin calculator play with it and plug in different margins. www.omnicalculator.com/finance/margin
I would say this how about all the complainers join hvac industry and try it for themselves. For some reason we have shortage of hvac techs and installers. See ya soon😂
You sir are a gentleman and a scholar. As I said in the first few minutes of the video, the 3rd business most likely to fail in the US is HVAC and Plumbing. Most techs see their boss charging $300 for a part that only costs a few dollars, while they are only paid a little more than a 10th of the charge and think their bosses are making bank. They then open their own business and use family and friends when starting, then as they run through those people they find work is actually hard to come by. They then see that they have to advertise and find that costs more money, and then they have to hire people and find that they are not just paying them a wage but they have to provide all the benefits and taxes that go along with employees. If they don't start charging appropriately they end up closing their door. Thanks for the comment.
I think your prices are ridiculous. I know a lot of techs that think they are worth this kind of pay but there's no way I'm going to get ripped like that. I'm an electrician and I would love to do some work for you and charge by your standards but I can't screw over my customers like that.
Owning a business is a balancing act, if we overcharge we lose customers, if we under charge we either have to short change the customer and/or pay ridiculously low wages or both, or worse go out of business. Staying in business means you need to pay your people, pay the rent, pay your insurance, pay the utilities, pay for advertising, pay for vehicles, pay for fuel, pay for vacations for your employees, pay for training your employees, pay for mill tax, pay state income tax, pay sales tax, pay for business licenses, pay for federal taxes, pay the office staff, pay the shop person, pay for permits.... the list goes on and on, and in the end you need to make a profit. Plus, you have to do this every day, every week, every month and every year to continue to operate. Simply put, I am not going to retire off a measly run capacitor that I sell you, in fact all HVAC companies out there couldn't stay open just doing repairs. They all need to sell equipment, the service department is just the means to an end, Having the opportunity to sell the customer a new system. Might I suggest that you open your own electrical company, get the required business and contractors licenses, the necessary bonds and insurance, buy a couple of trucks, hire a couple of people that want to get a decent wage, pay the payroll taxes, rent a building, advertise and then put a couple of years of business under your belt, then come and have a discussion with me after that. If you haven't changed your mind by then, well then you are doing something different than everyone else in this business. Good luck to you. Oh, and by the way, thanks for the comment.
As a homeowner that is UA-cam how to videos certified, I have a multimeter that has farad testing capability. I test the run capacitor each spring along with condenser coil water flush to be sure it is within operating spec range. I have access to one at my local Johnstone Supply if needed. The Titan Pro you have in your hand is China made crap. Yea it's cheaper, also with shorter life span, as is all the cheap commi made China crap capacitors. Titan HD is the one to pull off the shelf. USA made and longer life expectancy. At least provide a Mexico made Genteq capacitor. They better than the China commi crap. For $300 at my house, I'd probably expect to see a USA made Amrad capacitor. Trump 2024 !!!
If you would like a copy of my spreadsheet send me an email, I would be happy to send it too you so you could plug in the price of the more expensive US made AmRad. They do have a longer warrantly but cost me 41.52, and I would have to sell it for $612. The spreadsheet has a sliding margin based on the price of the part and goes to 25% margin at $41 and I make a whopping $135, about 3 times the part cost. Again, I am not going to retire on $135 and as someone else pointed out that is the Gross profit not the Net, I still have to pay income taxes to California and the Feds.
I'm aware of Amrad's pricing. You should at least provide your customers with a Titan HD USA made cap. California ? Newsome, Pelosi, Schiff. You certainly have my sympathy for that.
Scammers are in it for the money only, they do not care about the customer and or retaining them. We have been in business for over 47 years and I will continue, God willing, another 20 years. We didn't get here or stay in business by scamming customers. These are real costs needed to stay in business. Heck gas here in California is $6 a gallon and I have to pay for the truck, phones, rent, utilities, business licenses, taxes, wages, insurance, advertising, health care, sick pay, inventory, training, vacation days, software needed for bookkeeping, software for customer scheduling, computers, cell phones, and cell service, maintenance on vehicles, workers comp...the list goes on. You sir need an education on the actual costs to stay in business and make a profit, maybe you should takes some classes, then get back to me. Still thanks for the comment!
Mitch, thanks for the video. I tell the story of the mechanic that charged $100 to make a minor adjustment. The customer was upset with the price and the mechanic explained that the adjustment was only $1.00, but knowing what to adjust and how to adjust it was $99.00
Since UA-cam many customers think they can do this and we sell hundreds of capacitors to customers. We even test them if they bring them down. I sell that Capacitor for $55 out the door with no warranty or returns. I get dozens of jobs each year from customers that think they know what they are doing. Thanks for the comment.
Yeah, check out this video about what you are talking about. ua-cam.com/video/y-uK1c5Jyfs/v-deo.html
Now I understand how the government is charged $10.00 for a 10 cent washer. Pure genius.
Actually it's supposed to be $3,000 for a toilet seat, LOL. Anyhow the big difference, we have to pay a guy to come to your house, when was the last time you seen a doctor make a house call? Thanks for the comment.
99 % of my customers have a big smile on their face when i leave,the ac is working.but i never just change the capacitor,i do a complete check.i give them their moneys worth.
Yes, our techs are instructed to do the same. I also let the customer know that the run capacitor may not be the only problem and that we can't fully check the system till the capacitor is replaced. Thanks for the comment.
No offence but ive been in hvac and no theres zero reason to charge 300 for a cap and this is the reason i spent 800 on 2yrs of hvac training. Id rather do it myself than be robbed.
More people need to become handy in life. I paid for college not for a job but for life and I've gotten back more money in savings than I would have made if I paid for a degree and got a job in it. I've even done mechanics school and electrical training as well as carpentry skills. If you have 2 hands and 8hrs of free time you shouldn't be paying people for overpriced services.
No offence taken. Like I said in an earlier reply to a comment. I built my own home back in 87 and did most of the work myself. During the prior 11 years I worked installing HVAC in literally thousands of new construction homes and the same for existing homes. During all that time I learned on the job how to frame, run electrical, sheetrock, plumbing, roofing and so on. I could have paid a contractor to build the house but saved thousands doing most of the work myself, drawing my own plans (4 years of architecture in High School) and acting as owner builder and hiring out what was cheaper for someone else to do and/or I didn't have the skill set.
That being said, we charge what we have to to stay in business. It might look like we are making bank but as stated in the video our industry has the third highest failure rate and much of that is due not to the HVAC contractor not knowing how to service and install, but more from not charging enough to cover his costs, overhead and profit and just as important pay his employees a decent wage.
Anyhow, thanks for the comment.
@@baileysair I think the real issue is inflated overhead that isn't within your control. Insurance, parts cost, etc all going up further than the consumers paycheck is and you and the rest of us small businesses suffer in the middle.
You hit the nail on the head, that is why small companies (less than 6 employees usually) can make more profit per employee than a medium or larger company because the owner is usually wearing all the hats and the overhead is usually very low. Economy of scale doesn't kick in for our business until the company gets over 50 people usually, then overhead will start to fall per employee.@@brad1367
Why didnt you stay?
First time I needed a cap replacement like this was when I discovered the AC wasn't working on a hot Saturday morning. Dude came out and fixed it within a few hours. Yeah it cost me $250 or something like that for a part I could buy much cheaper. If I knew that was the problem. If I knew which part to get. I know I'm not paying for just the part but for the service and expertise. Was well worth it to me to have my AC working again the next day. Money well spent as far as I'm concerned.
Thanks for the comment. Yes, it also could have something else going on and the tech can check the system after replacing the part. That is something your typical layman doesn't know how to do or has the correct tools. Again, thanks for the comment.
This breakdown assumes the call out was for a nonfunctional unit requiring capacitor repair. I had a guy out for another reason and he told me the capacitor was going bad and recommended replacing. $300 additional. I assumed it was an expensive part because it took him all of 5 minutes to replace and the total time out was an hour which I was already billed for. I later looked up the part price and got a new hvac guy.
@@baileysair yes, the tech also checked out and tested the rest of the system - pressures, AC outlet temperatures, etc - after he replaced the bad cap. I haven't a clue about that stuff.
@@ryancraig2795 The good techs will check everything, pressures, temperatures, they will tighten electrical connections, clean the condenser coil, take amp draws to see if any other problems persist, cycle the unit on and off via the thermostat.
One of the other things that most people don't know is that the part comes with a warranty, if it fails usually within a year, most companies will replace if for free.
"You are not paying the man with the hammer to fix your boat; you are paying the man with a hammer that knows precisely where and how to tap to fix your boat." That's why fixing your 20-year-old appliance, car, house, toilet, or whatever costs what it does! I pass this type of info to my young son learning the HVACR trade. Thanks for sharing, Mitchell!
Nice video, Mitch just tell me where to sign for that tech wage, and I'm on it. 😂 good explanation 👏🏻. I had a customer who wanted the price and receipt for a control board that I picked up at the supply house in Modesto. He ended up having his daughter goggle the part number. He wasn't happy, so I had to explain to him about running a business. He understood after and apologized. But the time it took me to explain that. Yikes 😅
Ya I fire those customers 😂
The techs wages is only a fraction of that 78 dollar cost, the rule of thumb is to take what you are paying them and double it.
I did just that about a month ago. Gave a bid to a guy and a heck of a deal using some equipment we had in stock. When our guys got there he was upset because the coil and furnace were 17" wide and he had it in his brain it had to match the existing width equipment of 21". I said pass and told him to go ahead and get someone else.
@@baileysair agreed. Cut them off
You probably did that guy and the next people he interacts with a favor. Most people don't understand what it takes to maintain the service part of the business and I partially blame places that aren't clear about the actual cost of parts vs labor.
This breakdown assumes the call out was for a nonfunctional unit requiring capacitor repair. I had a guy out for another reason and he told me the capacitor was going bad and recommended replacing. $300 additional. I assumed it was an expensive part because it took him all of 5 minutes to replace and the total time out was an hour which I was already billed for. I later looked up the part price and got a new hvac guy.
He should have charged less if he is there for something else. The price in the video is for a standalone repair. In your case our techs are taught if there is more than one repair to take the most expensive repair and any others are halved as we are there taking care of more than one problem. Lets say he finds a bad condenser fan motor and our price is $580 to replace but he also finds a bad dual run capacitor that is priced at $300. It would then sell for $150 so the total repair would be $730 and not $880.
Folks, buy a spare capacitor for your ac. Amazon, 20 bucks... Learn how to replace it. It's not hard to do! I always keep two in my garage.
You know what, I AGREE. You might not expected that from me. This repair is very doable as a do it yourselfer. However, I have to remain steadfast in that it is dealing with high voltage which can kill or hurt you. Also, you could further damage the equipment if you mess up. Better to stay with a licensed and trained professional if you do not know what you are doing, plus they can check everything after it's installed to make sure that there is nothing wrong with the system. Your typical homeowner would not have the tools and or the expertise needed to diagnosis problems. I teach this trade for PG&E, Southern California Edison and National Comfort Institute, so I can't recommend that a lay person do it. In addition, I can't count on my fingers and toes how many times we get work from do it yourselfers. PS if you want to take my class online tomorrow night at PG&E which will be simulcast and live from the Stockton PG&E Energy Training Center at 6 pm, here is the link. Wednesday, September 13, 2023 6:00 PM-9:00 PM
attendee.gotowebinar.com/register/7562457900197053269
And don't forget to also get a spare capacitor for the air-handler blower fan.
You know, here in the not to distant future all fans and compressor will be inverter driven and not need capacitors. Dang there goes the money I needed to put the kids through college!
90% of people in America have more money than common sense. Just look at our current administration
@@baileysair don't worry, anytime that variable speed motor or any circuit board develops even the slightest burp, you are looking at enough profit to send all your grandkids to Stanford!
You sure picked an easy job to talk about. I can barely work a volt meter but I've done this job twice on our system over the last decade. Feels good seeing that $300 price tag and knowing I only paid $20-30.
I agree, they are easy to replace. Heck I sell them out of our stock in the shop all the time. On a hot weekend we will get two or three people coming in and buying one off our shelves, we charge $55 for it with a no refund or return policy. If they bring in the old one we will even check it for them to make sure that is the problem. You might now ask why $55, that is easy, they don't want to wait for two or three days to get it mailed from online.
Absolutely right. This is why I learned everything about HVAC. Because these types of people are crooked! They will lie to you in minute if that makes you pull your wallet out. They are worse than used car dealers
@@kevinroberts781 Granted it doesn't make any sense to pay all the overhead when you are capable of solving your own problems but for those who cannot that overhead is still there whether they like it or not and whether they can afford it or not. Nice thing about making 6+ figures is you don't have to educate yourself on the workings of the things you use every day.
I personally would rather know what's going on. In one case I had an intermittent problem with my HVAC but I knew how to recreate it although it could take several hours to get the system to that state. I was able to make sure it was right on that failure knee when the tech arrived and he was able to home right in on the problem. 6+ figures will not give you the ability to do that but it got my system up and running instead of an NTF call and still no AC. Knowledge is power at all income levels. Actual crooks are few and far between but incompetence and/or miscommunication are unfortunately more often than not the case.
You may not get getting rich off one replaced capacitor. But you aren't living in a double wide on a rented lot.
True that. But before you judge. I have lived in the same house that I built with my own hands, not just owner builder but I was the framer, sheetrocker, electrician, plumber, roofer, painter etc.. the only thing I didn't do was the concrete. I built the house in 1987 and was the architect also drawn by hand, I credit that to 4 years of architecture in High School. I was 25 at the time. The wife and I saved for 5 years to purchase the lot and then went to the bank with the plans to borrow the money to build the house. The loan officer said they could let me borrow $65,000 to build it. She then asked, "How much will it cost to build the home", my reply, "I guess it's gonna be less than $65,000 then." We built it for $59,000 because of all my sweat equity. It took 8 months to build. The house still isn't paid off because we had to put money back into the business back in 2008 and borrow against the home because builder's stuck me for more than $160,000 and we chose to pay back all the supply houses ourselves instead of doing bankruptcy.
As someone that paid $500 to replace a $160 motor, that is what you pay to get it done right away. I could have ordered the motor and put it in myself, but finding it was bad on a Friday before a long weekend mean I wouldn't have got the replacement motor until Tuesday unless I paid $200+ for shipping it Saturday Delivery.
That is another thing people forget. A/C companies stock a lot of parts so they can fix the A/C in hours when your house is 90 degrees and climbing.
And those trucks, tools, fuels are not cheap, and the tech's don't work for free either.
Thanks for the comment. Plus most companies will give you a warranty if it fails before a year.
@@baileysair They actually did in a way.
The original capacitor was 60/5, but the new fan motor required a 7.5μF capacitor so the tech was supposed to replace it with a 60/7.5.
He put in a 40/7.5 instead, by misreading the spec sheet on the system and killing the old and tired compressor in the process about a week later.
So, the owner sold me an entire new A/C at a big discount to make up for the mistake.
The A/C was already 17 to 18 years old, and wasn't worth fixing...
$300 is silly it takes 15 minutes to install!
You have to allow the time it took the office to take the call and dispatch it, 5 minutes, another 10 minutes for the tech to drive to your home, another 10 minutes to greet you, tear into the unit and do his diagnosis, 15 minutes to install it, and another 15 minutes for the pressures to stabilize to make sure everything is working and there is nothing else wrong, and then give him 5 minutes to pack everything up and get on too his next job. I hope that you can see it is at a minimum, an hour for any service call, and not 15 minutes.
Sir, thank you for the video. It was very instructive and informative. I would like to point out that the reason why prices are so high is because the every day man has lost the willingness to try to understand a System and fix it himself. Yes, it is true that a technician has the years of experience and the back up of a more experienced coworker or boss that could guide him through to get the work done fast and safely and that is why people pay $300 for a capacitor replacement because it gets done the same day and you don’t have to move a muscle to accomplish it. You just pay for it all the words we are paying for being lazy but thank you for the video I enjoyed it.
And if someone takes the time to read this I would like to also point out and that replacement parts for HVAC systems are monopolize and or restricted to only HVAC contractors which I think is bullshit and the same goes to many Other replacement, parts and supplies that are exclusively sold to general contractors, etc.
I have to disagree with you slightly. First off, people should pick what they do best and stick to it. I can mow my lawn, but choose to have someone else do it because they are quicker and I would rather spend my time after hours and weekends doing either working, where I make more money, and or taking a much needed rest. Second, your average homeowner may be capable of changing a capacitor, but the hazards much outweigh the benefits for most people. Add in that we warrant the work and it's a win win.
It takes a few hours of learning to repair any HVAC system. You can argue with me about that but you just basically said what I just said.
The phrase, jack of all trades master of none may sound like an insult for many people, but actually, I don’t look at it that way if somebody is versatile enough to have a minimal knowledge of many trades it’s more valuable than somebody that specializes only on one thing we live in the era of information, but people are too lazy to seek it HVAC Plumber, Carpentry electrician welder mechanic Electronics masonry all those are Trades and skills that are easily acquired. Just doing a little bit of research studying a little. Anyone can do it, but we are leaving on an era where people don’t make enough money, but even so they don’t value (the value of it) It’s easier to pay for something, even if it’s a steep price than to do it yourself but at the end of the day, you don’t learn anything or develop any new skills That is why a tire change costs $200 a capacitor costs 300 toilet replacement 700 an electrical breaker swap 450 and so on and so.
Sorry for the butchery of this language and the grammatical massacre I just perform
@@eltren12 I didn't learn all these trades for money. I learned them because I always wanted to know how these worked. After awhile I realized people can't screw me over anymore. Simple because I can just do it myself.
$300 bucks?! People in vegas are charging $800 and above... With that said, I've worked on aircraft and equipment, with enough voltage and current, that would cook you from the inside; pneumatic and hydraulic pressures that would cut you in half; weights that would crush you like a bug. With that said, you you don't have the level of skill and understanding required, get a pro or you'll die.
I agree. However, we get tons of work from DIY people watching a video that try to fix it themselves. I mean I could mow my lawn, but I don't because I can spend my time doing something else that will make me more money so I can pay a guy to mow my lawn, plus I think he does a better job than I.
The Mrs. was most grateful 2 years ago when our AC died 9:30 PM Sat night and still 95 out. I had it up 15 minutes later because I thought ahead and had a spare on the shelf. Now I keep 2 and suggest everyone have a spare. $10 insurance policy...CHEAP!
I agree, this is a cheap part if you think ahead. Another reason besides not having the knowledge and/or even wanting to to the work is the convenience of getting it done that day and not having to wait for a part.
Great video Mitch, thanks!
You can charge whatever your customers will pay.
He in NC I heard some people being charge $650
Unfortunately there are some unscrupulous companies out there. In our area there is a guy that charges over $500 for parts like this and even does it to little old ladies. The way it works with his techs is they have a set price to sell the part, like this run cap say $350 which they can never sell it for less. However, if the tech sells it for more than the $350 say he sells it for $450 then he and the tech split the $100. The problem with this type of behavior is that it paints everyone in the this business as being crooked and trying to take advantage of the customers. Thanks for the comment.
I'm sure in NYC $650 is normal since an apartment rents for $3,000. NC is not that expensive.
Your right again, regionally a customer in NYC would definitely pay more than someone in Arkansas. @@scott5654
That's what my ex just paid in the Dallas area
I have seen companies do it as cheap as $150 and as much as $500. The $150 is usually a one man company or someone working on the side or doing a business part time. The $500 one is usually giving a huge commission to the tech and, in my opinion overcharging. That is why I created the spreadsheet so it makes it easy to price stuff. Oh, by the way maintenance customers get a 15% discount so it only costs them about $50 less. I would venture that $250 is probably the average paid for a run cap in the country. Of course here in California things cost more. Thanks for the comment.
That 50% margin looks rich until one realises the taxes on that are near 50%. Also, trades rates have skyrocketed in the past 2 years, so it's not reasonable to assume one guy will ignore that trend.
Oh by the way, that was Gross margin, and I really mean Gross as you stated we still have to pay taxes. Loved the comment.
@@baileysair And I will add that trades rates have been stuck in the sand for decades. This means inflation and retirement costs are killing tradesmen. So the recent bump up in rates compensates for some of the inflation but not all of it. Nobody is getting rich.
Padding the bill like the car dealers. The price for a service call, an hours labor on top of the that and add the capacitor at 100% profit, plus taxes.
We use margin and not mark up which is calculated differently. A few decades ago a friend of mine was a manager at an outdoor apparel store. A shirt they paid $1.10 for, sold for $40 when on sale, and $60 regular price. That is 36 times the cost of the shirt. But nobody batted an eye about that. My capacitor is $10 so its a bargain at only 30 times cost, plus I am going to your home and have to pay a guy that actually knows what he is doing.
I think your margin at 50% is too high for a business that has a very significant amount of competition
We check prices of our competitors all the time and our pricing is actually a little less than the three major companies in the area that employ more than 50 people, while we are very close to many companies our size. Realize we are in California where gas is $5 a gallon. In addition, the spreadsheet takes into account when the part increases in price that we purchase it for and takes the margin down. Otherwise yes that would be an excessive charge for a $149 motor. This sliding margin keeps us competitive with our pricing for contractors in our area. A better way to think of it, is to think of it as a minimum charge. You also have to remember that this is flat rate not cost plus or by the hour. If you would like a copy of the spreadsheet send me an email, I gladly give this spread sheet and you can modify the margins to fit what you believe is fair. Thanks for the comment.
You're wrong. We started charging a flat rate in 2005 and this job would cost the customer $200 in 2005.
You are right Scott, my old Callahan Roach flat rate price book from 2005 shows it was $196. We used to pay $4,000 to $5,000 for those flat rate price book each year for our techs. Today we have our own based on my spreadsheet and we use Onsight catalog app to distribute it too all the techs. Callahan Roach was one of the better flat rate pricing. You gave them your labor rate and what you would like to make and they printed a book based on the numbers you gave them. Thanks for the defense and the comment. @@scott5654
@@baileysair How do know your competition pricing? Do you call them pretending to be a customer?
They don't look on amazon
On Amazon they average about $15
You should have mentioned that your techs are also checking the system vitals and not just changing the run cap and calling it a day. Some people will see the value of the service, and some will not. No amount of logic or detailed explanation will change peoples' minds. You could offer a serve well below your cost of providing it and some people would still feel that they are being ripped off.
Thanks for your input. Yes they do more than swap out the capacitor. They will completely assess the equipment and make sure it is working. And yes, some people have no clue how business works, we need to make a profit to stay in business ad support our employees and customers. These are the same people that will overpay for a EV and not complain. But will complain how expensive a hamburger is now.
Can the cap be wrapped with aluminum heat sink to extend its life?
I still have to make a video on why caps fail. Caps from the 60's and before had a different dielectric oil and, I believe, used better quality materials and manufacturing standards. Today's capacitors fail all the time and directly blame the dielectric oil and how they are currently made with lower grade materials.
HVAC companies that offer financing will advise that you need a whole new system for only $500 a month...........................for 4 years.
What nobody realizes is that to offer the 0% 48 or 60 month financing costs the consumer usually about 18 to 20 percent of the job. And that cost has to be added to the job. That's why I point people in California to Go Green financing, they have very reasonable rates, you can stretch the payment from 5 to 10 or 15 years keeping the payment low and they don't charge me any fees, so we give a same as cash discount.
@@baileysair do I need an HVAC replacement contract in place to initiate GoGreen financing?
@@MrRjnr No, in fact you apply for it online yourself and then you get your funding in place before you decide which contractor to use. Just be sure they are approved by Go Green. My daughter, also the office manager, likes both Coast and Matador. She says they are the easiest to deal with.
Hi Mitchell what are your views on vrv mutisplit systems ?
Multisplits are fine especially when combined with ducted airhandlers for zoning.
@donschulerer you are confusing mark up with margin 50% margin is 100% markup here is a link to a margin calculator play with it and plug in different margins. www.omnicalculator.com/finance/margin
What a loot !!
There be gold in them there hills!
I would say this how about all the complainers join hvac industry and try it for themselves. For some reason we have shortage of hvac techs and installers. See ya soon😂
You sir are a gentleman and a scholar. As I said in the first few minutes of the video, the 3rd business most likely to fail in the US is HVAC and Plumbing. Most techs see their boss charging $300 for a part that only costs a few dollars, while they are only paid a little more than a 10th of the charge and think their bosses are making bank. They then open their own business and use family and friends when starting, then as they run through those people they find work is actually hard to come by. They then see that they have to advertise and find that costs more money, and then they have to hire people and find that they are not just paying them a wage but they have to provide all the benefits and taxes that go along with employees. If they don't start charging appropriately they end up closing their door. Thanks for the comment.
You can't change $300. If you want to stay in business you can't change $300. That's laughable.
I think your prices are ridiculous. I know a lot of techs that think they are worth this kind of pay but there's no way I'm going to get ripped like that. I'm an electrician and I would love to do some work for you and charge by your standards but I can't screw over my customers like that.
Owning a business is a balancing act, if we overcharge we lose customers, if we under charge we either have to short change the customer and/or pay ridiculously low wages or both, or worse go out of business.
Staying in business means you need to pay your people, pay the rent, pay your insurance, pay the utilities, pay for advertising, pay for vehicles, pay for fuel, pay for vacations for your employees, pay for training your employees, pay for mill tax, pay state income tax, pay sales tax, pay for business licenses, pay for federal taxes, pay the office staff, pay the shop person, pay for permits.... the list goes on and on, and in the end you need to make a profit. Plus, you have to do this every day, every week, every month and every year to continue to operate.
Simply put, I am not going to retire off a measly run capacitor that I sell you, in fact all HVAC companies out there couldn't stay open just doing repairs. They all need to sell equipment, the service department is just the means to an end, Having the opportunity to sell the customer a new system.
Might I suggest that you open your own electrical company, get the required business and contractors licenses, the necessary bonds and insurance, buy a couple of trucks, hire a couple of people that want to get a decent wage, pay the payroll taxes, rent a building, advertise and then put a couple of years of business under your belt, then come and have a discussion with me after that. If you haven't changed your mind by then, well then you are doing something different than everyone else in this business. Good luck to you.
Oh, and by the way, thanks for the comment.
As a homeowner that is UA-cam how to videos certified, I have a multimeter that has farad testing capability. I test the run capacitor each spring along with condenser coil water flush to be sure it is within operating spec range. I have access to one at my local Johnstone Supply if needed. The Titan Pro you have in your hand is China made crap. Yea it's cheaper, also with shorter life span, as is all the cheap commi made China crap capacitors. Titan HD is the one to pull off the shelf. USA made and longer life expectancy. At least provide a Mexico made Genteq capacitor. They better than the China commi crap. For $300 at my house, I'd probably expect to see a USA made Amrad capacitor. Trump 2024 !!!
If you would like a copy of my spreadsheet send me an email, I would be happy to send it too you so you could plug in the price of the more expensive US made AmRad. They do have a longer warrantly but cost me 41.52, and I would have to sell it for $612. The spreadsheet has a sliding margin based on the price of the part and goes to 25% margin at $41 and I make a whopping $135, about 3 times the part cost. Again, I am not going to retire on $135 and as someone else pointed out that is the Gross profit not the Net, I still have to pay income taxes to California and the Feds.
I'm aware of Amrad's pricing. You should at least provide your customers with a Titan HD USA made cap. California ? Newsome, Pelosi, Schiff. You certainly have my sympathy for that.
@grey
I'm sorry.
Some of the caps we do provide are Titan Pro made in USA, unfortunately California is the bluest of the blue. @@greyholcombjr.9623
In other words, a scam. Nicely put in an excel, but a scam.
Scammers are in it for the money only, they do not care about the customer and or retaining them. We have been in business for over 47 years and I will continue, God willing, another 20 years. We didn't get here or stay in business by scamming customers. These are real costs needed to stay in business. Heck gas here in California is $6 a gallon and I have to pay for the truck, phones, rent, utilities, business licenses, taxes, wages, insurance, advertising, health care, sick pay, inventory, training, vacation days, software needed for bookkeeping, software for customer scheduling, computers, cell phones, and cell service, maintenance on vehicles, workers comp...the list goes on. You sir need an education on the actual costs to stay in business and make a profit, maybe you should takes some classes, then get back to me. Still thanks for the comment!
Oh watch this video and learn ua-cam.com/video/y-uK1c5Jyfs/v-deo.html