Heat-pump job maths for HVAC owners

The four numbers

Answer first: job value, gross margin, close rate and enquiry volume. Everything else is derived from them.

1. Average job value. The installed price of a typical heat-pump job, before any rebate. Use the median of your last 20 jobs if your work varies widely.
2. Gross margin. What's left after equipment, materials, labour and direct job costs, as a percentage.
3. Close rate. Installs divided by enquiries. Not quotes; enquiries, because marketing pays for the enquiry.
4. Enquiry volume. Heat-pump enquiries per month, from every channel.

Our illustrative contractor, used throughout:

Step 1: profit per install

Answer first: job value times gross margin gives the most you could ever spend to win an install and still break even.

$14,000 × 35% = $4,900 gross profit per install.

Spending $4,900 to win a $4,900 job is pointless, so decide what share you're willing to spend on acquisition. Many owners choose somewhere between a fifth and a third. At a quarter, your ceiling is about $1,225 per install.

That ceiling is the single most useful number in this guide. Any campaign that costs more than it per install is losing money, however many leads it reports.

Step 2: what an enquiry is worth

Answer first: the acquisition ceiling times your close rate gives the most you should pay per enquiry.

$1,225 × 25% = about $306 per enquiry.

If your paid campaigns produce heat-pump enquiries for $150 each, you have room to spend more. If they cost $400, you either need to spend less per enquiry or close more of them.

Notice the lever. If the close rate rises from 25% to 33%, the value of an enquiry rises to about $404. Nothing about the ads changed; the same spending became more profitable. That's why we often start with quote-to-install conversion before increasing ad budgets.

Step 3: what the plan has to produce

Answer first: divide the monthly marketing cost by the profit per install to see how many extra installs it must deliver.

Suppose you're on a plan at $4,498 per month and spend $3,000 per month on ads, so $7,498 in total before sales tax.

$7,498 ÷ $4,900 ≈ 1.5 extra installs a month to break even on gross profit.

At 40 enquiries and a 25% close rate, you're doing about 10 installs a month now. The question is whether the marketing can reasonably add two or more. If you're in a market with real competition and you're currently invisible for heat-pump searches, that's often realistic. If your crews are already fully booked, it isn't the right investment until capacity grows.

Step 4: account for the rebate surge

Answer first: rebate surges raise enquiry volume but usually lower the close rate, so recalculate before spending heavily.

When a program opens, enquiries spike. Many come from homeowners who aren't eligible, are early in research, or want to understand the program before committing. In our illustrative example, a surge month might look like this:

Installs rose, but each enquiry became worth less. If your cost per click jumps during the surge, as it often does when competitors all bid at once, your cost per enquiry can overtake its value. Two responses:

• Qualify harder. Better intake questions protect your technicians' time and keep the close rate up.
• Hold budget for after. The weeks after a surge, when competitors cut spending, are often cheaper per install. Our rebate campaigns are planned around this pattern.

Step 5: model the cash-flow lag

Answer first: when an incentive is paid to you rather than to the homeowner, part of your revenue arrives late.

Some programs pay installers directly. Newfoundland and Labrador's takeCHARGE Oil to Electric Incentive Program, for example, lists incentives of up to $22,000 paid to participating installers as of October 2026. That can make the sale easier, because the homeowner sees a smaller bill, but it means your revenue depends on the program's payment timeline.

A simple model: if a third of your heat-pump revenue in a busy month comes from incentives paid to you, and those payments take an average of eight weeks, then in a 13-install month at $14,000 each, about $60,000 of revenue lands two months later. Make sure your supplier terms and line of credit can carry it. Confirm actual payment timing with each program administrator.

Other programs, such as Efficiency Manitoba's air source heat pump rebate, set amounts by system type. As of October 2026, Manitoba paid more for a ducted cold-climate system ($2,000) than for a ductless one ($1,500). Who receives the payment and when depends on each program's rules, so check them before you build the model.

Step 6: compare channels on cost per install

Answer first: judge every channel by cost per install, not cost per lead.

A practical monthly table:

Fill in your last three months. Organic search often looks expensive in its first months and very cheap a year later, because the content keeps working. Paid channels look steady but stop the day you stop paying. A balanced heat-pump business usually wants both. Our heat-pump search and content service is the long-term side of that balance.

Common mistakes

1. Using revenue instead of margin. A $14,000 install is not $14,000 of room to spend.
2. Counting quotes instead of enquiries. Marketing pays for the enquiry; losses between enquiry and quote are part of the cost.
3. Ignoring capacity. Extra enquiries you can't install in a reasonable time cost you reputation as well as money.
4. Assuming the rebate is margin. Incentives reduce the homeowner's cost; they don't add to your gross profit.
5. Reacting to lead counts during a surge. Look at installs and cost per install, weekly.

Using these numbers with us

When you contact HeatPump.Agency, these four numbers are the first thing we ask for, and the contact page explains how to send them. They decide which service comes first, which plan fits, and what we'll measure. The pricing page has a short version of the same calculation for each plan.