Why Most HVAC Owners Chase Revenue and Lose Profit: Chase Thomas on What Actually Builds a Sustainable Business

Chase Thomas built Honor Heating and Air in north Atlanta starting with nothing but a contractor’s license, a criminal record, and a faith that changed the direction of his life. He did not build a sustainable business by accident. In this episode of TradeOps Radio, he breaks down why most HVAC operators confuse top-line revenue with actual profitability, how offering options instead of opinions added 30 percent to his sales overnight, and why the business owner is almost always the first bottleneck worth fixing.

Most HVAC operators know their revenue. Few know their net profit. And that gap, between what the business brings in and what it actually keeps, is where most owners quietly lose the game without realizing it.

Chase Thomas knows both numbers. He is the founder of Honor Heating and Air, a residential and commercial HVAC company serving north metro Atlanta out of Gainesville, Georgia. He started developing a customer base in 2019 while working 60 hours a week for a large commercial company, finishing a cross-cultural business degree that took 11 years to complete, and raising four children, one of whom has severe autism. He went full-time in 2020 and has grown every year since.

His path into the trades was not conventional. He grew up with very little, lost his father to overdose, faced a life sentence in prison as a young man, and found faith in a way that he says changed everything about how he works, hires, and leads. Skills became the foundation he built on because skills, as he put it, are something nobody can take away regardless of what label they put on you.

This post covers what he shared on TradeOps Radio: the distinction between revenue and profit that most owners miss, the sales mistake that cost him a major account, and the leadership principle that will determine where your business is in ten years.

Revenue Is for Vanity. Profit Is for Sanity.

Most owners celebrate top-line growth. Thomas tracks the bottom line. The distinction is not semantic. It is the difference between a business that looks healthy and one that actually is.

The average HVAC company operates at a net profit margin of approximately 8 percent, according to industry benchmarks from Sera. Healthy operators target 15 to 25 percent. Most of the gap between those two numbers is not a marketing problem. It is a cost control, pricing, and financial literacy problem.

Thomas learned this the hard way through taxes. For the first two years of his business, he was running a charitable giving model that was costing him 30 percent more in taxes than it needed to. His CPA eventually corrected it. The problem was not the generosity. It was that the structure was not right. He was doing the right thing the wrong way, and the IRS does not grade on intent.

His most consistent tax advice is also his simplest: “Keep it simple. Don’t spend $100,000 to try to save from having to pay $20,000 in taxes.” The math on overspending to reduce a tax bill only works in one direction, and it is the wrong one. You spend $80,000 over the $20,000 you saved. Your bank account reflects a business that does not make money. And if you ever want to sell, no buyer is looking at a company with flat or negative net profit and writing you a serious check.

“Revenue is for vanity. Profit is for sanity,” Thomas said. It is a principle that every decision in the business should run through, from how you bid jobs to how you manage your relationship with your CPA.

The Gap Between Supply and Demand Is What You Are Actually Selling

Thomas has been to Thailand. He helped a friend get a mini split installed there, indoor unit, outdoor unit, line set, labor, all of it, for under $400. In the United States, that job costs a multiple of that.

The difference is not quality. It is basic economics. When demand is high and the supply of people who can do the work is low, that gap is valuable. The baby boomer generation of tradespeople is aging out. A cultural pivot toward four-year degrees over vocational training hollowed out the pipeline behind them. The result is that the U.S. faces approximately 40,100 HVAC job openings per year through 2034, with no clear sign that the supply side will close that deficit quickly.

That gap is where pricing power lives. But most operators do not fight for it at every stage. Thomas was direct about this: pricing is the first place most HVAC owners leak money without knowing it. Not from dishonesty, but from timidity. They assume their distributor pricing is fixed. They assume the market will not bear higher rates. They underestimate their own leverage.

“You’ve got to fight to get that right pricing in place,” he said, “because that’s directly connected to your profitability, which directly impacts my ability to be competitive within my market, which then also directly impacts my ability to have enough finances to pay the quality people to do the job and get it done properly.”

The chain runs from distributor pricing to labor quality to customer experience to growth. Every link matters, and pricing is the one most owners never challenge.

More Than Likely, the Business Owner Is the Problem

Thomas hit a wall around $1.2 million in revenue. He was the face of sales. He was also running operations. He was fielding calls, managing jobs, answering questions, solving problems. When he was physically in the field, the business moved. When he was not, it slowed.

He ran an autopsy on it until he found the diagnosis. The hub-and-spoke model, where everything routes through the owner, produces one predictable result: the owner burns out and the business stalls. The fix requires the owner to step back and give the people around them room to build the muscles the business needs.

“More than likely, if you’re the business owner, you’re the problem,” Thomas said.

The insight was not about failure. It was about recognizing a structural ceiling and choosing to raise it. He hired an operations manager to own efficiency, accountability, and the day-to-day systems that he did not want to be the bottleneck for. That hire let him focus on what he is actually built for: being the sales driver for the company.

The harder lesson was learning to let people make mistakes. Thomas described a scenario where a technician was learning to braze between a unit and a wall and burned up a service valve. The job extended by four hours. Hundreds of dollars were lost. He framed it the way it should be framed: that was an investment in that technician’s education. If you micromanage every decision and solve every problem yourself, you take that learning opportunity away. The technician never develops, and the owner never gets free.

“I didn’t give them the space to learn that job,” Thomas said. “And sometimes that means it’s going to cost you.”

Hire for Character. Teach Everything Else.

Thomas hired a technician with 25 years of experience and fired him within five days.

The reason was not skill. The reason was character. In less than a week, it was clear this person was not going to be a culture fit. Thomas moved fast because he has seen what it costs not to.

“The quality of their character is what we hire people on,” he said. “I can teach them anything else. I can help them find the answer to anything. But I can’t make you be a good person. I can’t make you care genuinely about people.”

This is not sentiment. It is operational math. One person with the wrong character in a small team contaminates the rest of the culture faster than any system can compensate for. A technician who does not genuinely care about the homeowner will cut corners when no one is watching, because in a crawl space or an attic, no one is watching.

Thomas uses a baseball analogy that lands well for this. The best batters in the game hit one out of three. They miss two out of every three attempts. That does not mean they stop stepping up to the plate. It means they accept that bad hiring decisions are part of the process, recognize them fast, and correct them faster. The costly mistake is not the wrong hire. It is keeping the wrong hire too long because you are uncomfortable with the conversation.

He also does not hire friends or family. One clear boundary, stated plainly.

Stop Selling Through Your Own Lens

Chase Thomas lost a major account to aroma therapy in a duct system.

He had a multi-million dollar client with multiple HVAC systems across a large home. The client wanted variable speed technology. Thomas, who had built his technical worldview around keeping things simple and easy to service, pushed back. He told the client he did not want the variable speed. He told the client the aroma therapy attachment was a bad idea. He was applying his own lens, as a technician, to a customer who saw things completely differently.

The client went and found someone who would give him what he wanted.

When Thomas asked for feedback, the response was clear: the client had felt unheard. He wanted options and got opinions instead.

“What we’re doing to people when we don’t give them all the options,” Thomas said, describing the moment like a waitress who does not mention the ribeye because she assumed you would not want it. You only find out it was on the menu when you see it come out to the table next to you.

His correction was to implement a good-better-best pricing structure for every job. The result was a 30 percent increase in sales, not from new marketing or a new service area, but from letting the customer choose. Contractors using tiered pricing models report 15 to 25 percent higher average job values compared to single-option approaches. Thomas found this to be true before he had the research to confirm it.

Needs-based selling is not about closing harder. It is about listening well enough to present the right set of options and then getting out of the way. The homeowner already knows what they want. The technician’s job is to make sure every option available is on the table. The business owner’s job is to build the sales and lead systems that support that consistently.

The Correction Culture You Build Today Sets Your Ceiling for Year Ten

Thomas shared a principle he applies to how mistakes are handled on his team: correct in private, praise in public.

The reasoning runs deeper than etiquette. If a technician is afraid to admit when something went wrong, they will hide it. You will find out eventually, but you will find out after the customer has been affected, after the problem has compounded, and after you have lost the chance to fix it cheaply. The culture around correction determines whether your people tell you the truth or manage you.

“If it’s not a safe place for them to screw up,” Thomas said, “they’re going to lie to you. They’re going to act like it didn’t happen, and you’re going to find out. You’re going to pay for it one way or another.”

Creating psychological safety around mistakes is not the same as tolerating poor performance. Thomas holds his people accountable. The difference is in tone and framing. A mistake is a learning event. It gets addressed directly, privately, and specifically. What it is not is a reason for a public dressing-down that shuts the person down the next time they need to tell you something went sideways.

He also connects efficiency to incentive transparently. When a job runs over into a second day because of poor time management, he shows his technicians exactly what that costs: lost productivity, potentially lost bonuses, a constraint on what the business can offer them. He does not rule by iron fist. He gives them the real numbers and lets the numbers make the argument.

“When they see it hits their pocket, it’s different,” he said.

Culture in year one predicts culture in year ten. It will compound in whichever direction you set it.

Three Things to Take From This Conversation

Know your net profit, not just your revenue. The average HVAC company operates at an 8 percent net margin. If your tax strategy is designed to show zero profit, you are not saving money. You are destroying the valuation of the business you have spent years building. Run every decision through the bottom line, not the top line.

Give your customer the ribeye. Build a good-better-best structure for every job and present all three options. Removing your personal lens from the sale is one of the fastest levers available. Thomas added 30 percent to his sales by doing one thing: giving people the options he had previously withheld because he assumed they would not want them.

Create a safe space for mistakes and a clear consequence for avoidable ones. Technicians who are afraid of correction will hide problems. Teams that can talk openly about what went wrong learn faster and lose less. Set the correction culture now. It will set the ceiling for everything else.

Watch the full episode on TradeOps Radio. If you want to talk through what it would take to build the systems and visibility your operation needs to grow, book a free strategy call with the TradeOps team.