ECN Forum Forums General Topics of the Trade Business Related Discussion assigning license to another company

active,

again, it seems to me that the only reason Nov is considering any kind of relationship with the HVAC contractor is because he doesn't want to build a company from scratch.

by forming a new company as a partnership, the HVAC contractor could provide the financing, insurance, truck, etc. Nov would provide the knowledge and the license.

And yeah, he would have to give a % to his new "partner", but it 90% of the work is done for the HVAC contractor, it would be like working for the HVAC contractor as an employee, but with more say in how things are done. If it doesn't work out, dissolve the company and proceed with your exit stratagy.

my main issue, I have never met an HVAC contractor who wants to take in someone who isn't family in a situation like this because he wants to pay the guy more money. (i know, a bad run on sentence)

the HVAC contractor wants to save money. A partnership does that, but it gives Nov a leg up in starting an EC company. The initial financing could/would be by the HVAC contractor. The partnership lasts for 3 yrs, np. Nov now has an existing business that he could buy out or just roll over.

working for the HVAC contractor and lending him the license is a recipe for disaster. Nov would have no control over the situation and the HVAC will always be looking for another license that will work for less. A partnership gives Nov a say in what goes on and he can't just be fired and sent packing.

I happen to completely disagree with your numbers though. especially if this is residential. the HVAC contractor wants the license to do service upgrades and hookups. And unlike electricians, HVAC and plumbers actually charge enough to make a profit.

Most HVAC companies around here will do a 200A upgrade for around $3k. However, they sell it based on putting the cost in with the cost for a new system. Then they finance the whole deal for the customer. Customer only pays $200/month.

But don't forget, as part of the setup, the HVAC contractor provides the financing needed. Thats what he brings to the table.

If Nov plays his cards right, he could feasibly build a nice business on the HVAC contractors back before it falls apart.