How To Start an Electrician Business




The electrician business is a good one to start if you have the time and capital. It can be quite profitable, as electricians are always in demand.

Also, we know every electrician has that moment in their lives when being their own boss is more attractive than working for others and now that you have completed your apprenticeship and gained a lot of experience, it’s not a bad time to start your own electrical business.

It can be difficult to navigate the path of entrepreneurship. But the rewards can be worth it as long as you take your time and don’t jump right away to this new journey.

Since we know how difficult it can be as well, we decided to pull this article together that will navigate you through the journey of starting your electrician business, and remember that although some steps will be skipped, it is based on some details and your own business plan.

This means you can add more, or maybe skip a few we will add as long as you find it a good alternative for your electrician business in specific.

Develop Your Electrical Business Plan

For entrepreneurs to succeed, a clear electrical contracting business plan is needed. Although many will want to skip this step, we highly recommend avoiding any unnecessary laziness since it isn’t quite welcome in this project.

A business plan will allow you to map out your business’s details and uncover some hidden opportunities you wouldn’t usually notice without it. Now, what should you include in this plan besides your business name?

  • What are the startup and ongoing costs?
  • Who are your target markets?
  • What can you charge customers for?
  • How will you name your company?

The idea is to add these questions (and many more) and answer them set by step to ensure you are able to come up with a clear map of what you will do in each part.

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To help you a bit, we decided to answer two primary questions:

  • Startup and ongoing costs for your business. 

If you think real estate and equipment for your business are everything you need to consider, you will have to think about it twice.

Startup and ongoing costs include licensing, business insurance that also includes general liability insurance and fees for union dues.

However, don’t worry since most startups spend less than $5.000 to get started, but these costs don’t include education or apprenticeship.

Apprenticeships can cost anywhere from $3.000 up to $20.000 depending on whether you attend a community college or technical school or if you get the opportunity to learn with a professional for a very affordable price.

Next, the ongoing expenses of running an electrician business are minimal but significant for some.

The cost of renewing a license can run from $200 to $300 per year, depending on where you live. Annual insurance premiums should cost between $1.500 and $2.000 based on your location, and rent costs can vary greatly.

  • Making your business more lucrative.

You can increase your efficiency by hiring electrician helpers as entry-level helpers to handle simpler jobs.

You might also consider adding ancillary services. To take on bigger jobs, you might partner with a plumber or a carpenter based on the services you will offer.

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Perform Target Market Research

We know the previous step and question we mentioned included your target market. However, this part is much more complicated than it seems. After all, you have to consider the type and number of people who will use your services to determine if there is enough demand in your local area for electrical contracting.

Your competitors and other electricians also matter in this analysis, and you need to focus on specific customers to determine, later on, the market you will target.

Which ones are these customers? We will go over them:

  • Domestic customers.

The number of homes in your locality will determine the demand for domestic work, while the type of housing will also influence it by determining the service industry and the options you will offer.

The more houses you live near, the domestic work is likely to be done.

Questions you have to answer during this process are: Are the houses small or large, new or old? Are they in good condition, or are they in disrepair? Are they occupied by the owner or rented out to others?

Older homes may need a complete rewire. If they are extended or remodeled, the older ones may not require any work for many years. Some types might require occasional installations of electric showers, kitchen extractor fans, or security lights.

We can continue going with this since outdoor spaces in residential properties also enter this category and the future services you can choose.

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  • Commercial customers.

An electrician is needed at least once in all types of establishments. Thus, you have a lot of research and market to do.

You should identify which businesses are more likely to need your services. A local shop might be more likely than a large supermarket to hire an electrician.

A complete electrical overhaul might be required for new businesses while existing ones could be targeted to install security lighting, CCTV systems, or door entry systems.

Just look at the most common locals based on your services as well, or define a new line of services you will offer following your research.

  • Sub-contract work.

Many construction firms subcontract work to electricians. To see if they are interested in your services, you could approach construction companies.

Smaller local builders and shopfitters can also be a source of work. All types of work, including shop renovations, loft conversions, and house extensions, will require wiring and fixtures.

Maintenance of electrical systems is required for schools, universities, hospitals, offices, and public facilities like libraries, sports centers, and libraries. You can contact them and your local authority to find out what services you offer.

  • When done with research, set the level of competition.

After you have considered your potential customers, it is time to assess the competition in your locality.

Find out where other electricians are located nearby. You can get an idea of the number of electricians in your area by looking through the relevant classes on online directories.

Local print directories are also electrician business options.

Determine Your Business Entity

New business owners face a major hurdle when deciding how to structure their company, and yes, you have to choose an option if you want to make your electrician business a reality.

Although there are more business entities available today, you can stick with the main ones to keep it simple:

  • Sole proprietor: It allows you to have complete control over your company. If your company defaults, the bank can seize your personal assets since there isn’t a separation between your finances and your business.
  • Limited liability company: This option was created to lower the risk of being a sole proprietor. Although an LLC allows you to separate your assets and your company’s finances, it can prove difficult to raise capital.
  • C corporation: This is the traditional corporate entity for most businesses. It works the same way as an LLC but protects business owners against personal risk and makes capital raising easier.
  • S corporation: This is the second most common option. However, S Corps can have no more than 100 shareholders, and all shareholders must reside in the United States. S Corps are also subject to pass-through taxes. This means that dividends are only subject to taxation for shareholders.

Depending on which entity you choose to register your company, there will be different steps. Licenses, certifications, and insurance may differ depending on the case as well.

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Be a Qualified Electrician

This is pretty obvious, but people won’t hire you if you are not a professional electrician, which is why your training will be necessary, and if you think about hiring any electrical contractors, the same applies.

But besides spending your time training, it is important to think about what qualifications you have now and the ones you may want to obtain in the future.

While the minimum requirements for starting an electrical business are important, it is worth learning more as you get established.

You may offer more services and make more money by gaining additional qualifications that include (maybe) installing solar panel systems, which are very popular, knowing how to set stations for charging electric vehicles and working with security and data systems.

If you think about something big in your niche, you should do your best to learn it if it is profitable as well.

Choose the Services You’ll Offer

Based on this, you will be able to determine how much money you need, have a better idea of the target market you should aim for, and know the jobs you take on.

If you need a recommendation, one option is to specialize in one type of work, such as shop refitting or with home systems or certain installations. You might also take on multiple jobs, depending on your experience, qualifications, and skills.

To give you an idea, these are the common types of work you can consider to define your services:

  • Domestic or residential electrical services and work.

Every small electrical company decides to take on it since it requires less time, they can take more contracts, and cover a wider market.

The services in this market involve installing wiring systems, new appliances, maintenance and testing of electrical appliances, wiring checks for landlords, installing water heaters, extractor fans, security lighting, and much more.

If you have the required skills and qualifications, you might be able to perform periodic inspection reports (PIRs) and electrical installation condition reports (EICRs) for customers who require them.

Your services could be used to sign off non-negligible electrical work for people who are unable to sign off under building regulations.

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  • Commercial services.

Commercial properties will often require the same work as domestic properties but with additional services like installing CCTV systems, burglar calamari, performing electrical systems, data and network cabling, low voltage systems, and more.

  • Industrial services.

Small electrical companies are less likely to do industrial work because they lack the necessary expertise and equipment. Still, you could offer control system installation, high capacity fiber-optic data cabling, and more complex projects if you can handle it.

  • Facility management.

Depending on your resources and workforce, you might offer facilities management services to local authorities, emergency service providers, and businesses with multiple locations.

This usually involves providing reactive maintenance services, which include troubleshooting and repairs. It can also involve testing or modification work as needed.

  • There are other types of work.

Many jobs will require you to do additional work, such as re-plastering, making goods, tiling, and plumbing. These tasks can be done by you, depending on your experience and skills, and yes, as an electrician.

Find Your Financing Option to Get Started

Next, you need to think seriously about resources and capital since we all know money is needed to start a business.

It can be expensive to start a business and almost always requires a large amount of capital.

In the case of this niche, your major expenses as an independent electrician will be your vehicle and equipment costs, and the prices can vary depending on the services you choose to offer and the options available.

Now, how can you finance your project? Well, you either finance it yourself or rely on a third party that can lend you the money.

You can get started if you have enough money. If not, you will need to contact your bank or another lender for a small business loan.

Most banks have options for other small business owners since they create divisions that offer various financial options, including more money using credit cars or SBA designed for the project you have in mind.

The options vary depending on the lender you choose as well.

For example, if you choose government loans, these options are created to support new businesses, but details about how much you can get to finance your business are unknown based on your location.

Others like angel investors could be a better option since they include your family or close friends. Some entrepreneurs might be interested in your business and open to fiance it for you.

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To make it simple, angel investors are capital providers for startups and new businesses.

In return for their capital, angel investors often receive convertible debt or a share of the ownership. They are more likely to lend money than traditional lenders.

More options like private lenders, regular banks, and similar organizations can be considered.

Start Considering Your Work Rate

Assuming you will have a steady workstream, the amount of money you can make depends on how many days you work and how much you work.

You might decide to keep your normal business hours from 8:30 AM to 17:00 from Monday through Friday, while Saturday mornings are usually included with some business owners.

You may also decide to work longer hours, perhaps working extra hours when you are in high demand or taking time off for quieter times.

Many electricians offer an emergency call-out service that is available 24 hours a day, and this can be a good option if you notice a demand for the services during hours that aren’t regular. Still, you should ensure that you have the ability to provide coverage at all times if you plan to offer this service.

You should be able to estimate the time it will take to complete certain jobs as an electrician in order to quote for a job.

If it takes you five days to complete the job, it is no good giving a quote for three days, for example. Thus, you need to have a good idea of the real-time.

Your own abilities and experience, as well as the quality and standard of your work, will determine the speed at which you work. All of these factors should be reflected in your charges and rates.

Also, if you are open to someone’s business advice, you must remember your non-productive time that should be covered for those in which you are actually making money.

Besides, not all working days will be spent making money even if you are working.

On the other hand, you may find your business busier depending on what type of work you do, so you can set rates based on the months that are likely to be the busiest for you to either attract even more clients or earn an extra.

Just make sure you are estimating everything properly. Amount of hours you will invest, your effort and work, and all other factors.

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How to Move onto Pricing

After considerations, how will you actually price your services?

Regardless of your regular research and what you get out of it, you will notice there are several ways to price them.

For example, you could charge an hourly or daily rate for your electrician services, but you could also charge per project and the job you are performing.

Some electricians just set a rate for their workforce but also add the price of materials used during the service.

Sometimes, you might have to charge a standard fee for wiring up a loft light and switch, installing sockets, or providing an electrician’s report to a home buyer.

Depending on the job and the customer, you may choose to cost different jobs using different pricing methods instead of having a standard and unique one.

When deciding what to charge, it is important to ensure that you have enough work to cover your operating costs and your drawings while considering the previous factors mentioned: Your qualifications and skills when setting your charges.

If you ask us, it is better to start with an hourly rate, but only if your competitors in the area are working with it as well, and depending on the service, you will deliver.

You can change it to a daily rate or per service for short projects or very long ones.

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Need some help with this? When setting your charges, consider the following:

  • What do your competitors charge for similar work?
  • Do you want to be able to compete with your competitors by offering attractive pricing?
  • You can vary the rate depending on the complexity and type of work involved.
  • Will you make a profit or pass on the cost of any goods and materials you sell?
  • Will you charge a call-out fee for certain types of jobs?
  • Will you charge extra for emergency work outside of normal hours?

Let’s Talk About Marketing

It is important to consider how your potential customers will view your business and how you will communicate your key messages to them.

And yes, this is when we start talking about marketing and all the process you will go through to promote your business.

Unlike other people and writers, we don’t want to come up with a bunch of strategies (though we will add some) but rather help you focus on the important aspects.

  • Creating the right image for your business. 

People must have a good first impression of your company. While many electricians work at home, some have their own workshop or storage space, but what does this have to do with the right image? That your physical store or place will be accessible for the public, which influences the market’s opinion about you.

Thus, you should ensure that your reception area is tidy and clean.

Also, remember that your vehicle will be a prominent advertisement for your company. You don’t have to get a new vehicle, but you should make sure it looks smart and well-maintained and maybe have it professionally signed if you own a van.

Finally, remember to be polite, friendly and answer the phone promptly or any other channel your leads and clients use to contact you.

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  • Work on your online presence. 

A website is a great way to advertise your business and reach a wider audience, and if you ask us, it is a must for ANY business right now to have a place to which you will attract your potential clients.

Next, consider getting your business listed in online directories, such as the ‘contact an expert directory’ run by trade associations.

Social media is also a great way to market your business, keep in touch with customers, and have a way to keep them informed about your services and rates.

You might also consider using blogs and relevant forums. However, be aware that not all forum websites allow advertising to be posted on their site.

Relying on traditional advertising can be good, considering that you will work for local clients who can find you in newspapers or other directories.

Be original and cover all the channels you can think about.

Just make sure you are following the results of each method to determine which ones are worth your money the most and in which you should invest more time as well.

The Local Lead Generation Process for Your Electrician Business

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All right! So, everything is about building properties and generating leads. But how does the process actually take place? Are there other steps I need to know?

The steps I mention below are what students from our local lead generation program follow to generate leads for businesses like yourself. So I’ll help you see what we do. And how if you join our program, you can simply generate leads for your own business (unless you want to start a side hustle and build a laptop lifestyle business).

Essentially, our lead generation can be divided into four steps:

The first is prospecting. You need to take the time to do market research on a niche (industry) and determine how many phone-driven businesses are there.

Keep in mind that this is local research as you need to know how many companies need leads. For example, you may search for “plumbing services Youngstown OH.”

You will find dozens or even hundreds of businesses trying to get themselves in front of the customers by ranking on Map Listings, organic results, and even Ad.

The second step, building. When you find a niche (plumbing, tree services, a software company, real estate…), you will need to start building your digital properties. You don’t need to be an expert in HTML or coding. It can be easy with the right tools.

The third step is now taking time to rank your lead gen website. With the site done, you need to work on SEO strategies and start dominating those Google search results. If you’re new to SEO, it stands for Search Engine Optimization.

To keep it simple, it consists of the entire process of growing a company’s visibility on search engines like Google and generating organic traffic. And remember this, local lead generation is part of the strategies.

Moving on to step four, once you rank the site, you will start getting your ROI and profits. You only need to rent it out to a local business interested in the leads the site generates. You can offer a couple of free leads to their move on with the actual pay per lead.

To review steps 1-4 above, I described it to a normal student who is building a lead gen business to help local service providers generate more calls. But replace the student with you as the business owner. And replace sending the leads to a business to simply siphoning the leads to your personal business.

By the way, fun fact, about 20% of our students in our local lead gen program are actually business owners who went through the program. And they use the skillsets we teach to generate leads for their own business.

An Example of Lead Generation: Home Advisor

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You must be thinking, “if lead generation sounds so good so far, how come I haven’t seen any company?” That’s the thing; there are many out there. You just don’t know they are dedicated to it.

HomeAdvisor is one of the best examples you can find on the Internet as it is a top lead generation company that has spent millions building its brand but also earned even more zeros for this same reason.

They started small as everyone else but invested in building their brand awareness to make people who are looking for home services go to their website and find what they need. They are over 75% of people’s first choice when they need those services.

If you don’t get HomeAdvisor that much or need a refresh, users need to submit their information to request a service and get a professional or expert who can provide it.

HomeAdvisor’s job is to share your information, which makes you a lead, with local companies so they can contact you and offer the service you’re requesting. For sharing this lead information, HomeAdvisor gets paid by the companies. This happens for every single lead they send to multiple businesses.

Business owners who don’t have marketing skills or don’t even know how to have any online presence will always rely on those pages to list their services.  They will save time and effort, but companies like HomeAdvisor can make them spend lots of money as leads aren’t exclusive (one lead is sent to multiple companies after all).

Using Facebook Ads aka Paid Ad Platforms: Do They Generate Leads?

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They DO generate leads. If not, no one would use them.

However, you need to remember two facts:

  1. Paid ads or platforms can be expensive.
  2. They don’t generate “natural” leads.

Whenever someone sees or clicks in one of those ads, over 80% of them did it by accident or are trying to close/report it.

Why? Because they aren’t looking for those services. At least not at the moment.

What those ads do instead is interrupt their time on the platforms. Users aren’t there to find companies or businesses unless they are searching for a specific company’s user, and for that, there’s a search bar. This is why it is hard to convert them to actual customers who will show interest in the companies’ services. Also, you’re limited by a budget.

When using lead generation, everything is organic. You aren’t forcing others to pay attention to your business but rather being there when they need you. This is why Google’s organic traffic will always beat paid ads, and the reason companies continue investing in it, which is a lot cheaper as well.

What Is Local SEO?

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Don’t worry… I didn’t get it at first either. Following the short explanation, local SEO focuses on scaling businesses’ visibility on search engines. However, this is only for those who serve their communities face-to-face.

What does this mean?

Experts and professionals like painters, plumbers, and dentists (but not only them) offer their services to their local customers. Why? Because they can’t deliver them unless they are located in the same area of their customers.

To make sure those businesses get more leads, you need to rank them locally by claiming the business listing on Google to place them on Map Listings. Local SEO also involves online reviews, citation management, and how you manage your entire online presence in the local area.

If you are going to bet on lead gen, you need to adapt yourself to today’s world: The Internet.

Keep in mind that although traditional channels and methods like billboards, warm calls, and pamphlets still work, they aren’t part of your tools. Whenever someone needs a service, they go to Google and search for it.

“Dentist in Miami” or “plumbing services in Orlando,” etc. And you can keep coming up with services or professionals people need and look for. Thus, you need to make sure you’re using Google to get the companies in front of their clients.

Users will always click on the first search results (those near the top), and many of them will be either Ad links (people paid to place their websites there), Map Listing, and then you get websites. Almost all of them are your goal and where you should always aim to place yourself.

Can My Electrician Business Utilize a Local Lead Generation Strategy?

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If you want customers, you better know you need it. Following the previous explanation, lead gen is all about placing businesses in front of their customers, choosing them over their competitors.

Put it simply – it’s all about closing deals and having clients for those companies to make money. The main difference with the usual methods companies use for this is how lead generation approaches different channels to get them in the right place of the market to get customers.

Those channels are all focused on the Internet as most people are searching for products but also services across the net. The issue is that the Internet is way too broad, and businesses don’t know how to place themselves. They usually try, but they get one common result: losing money and time.

How Powerful Are Organic Electrician Leads from Google?

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For companies looking for customers, it’s everything. For you? Pretty much the same. When you build a business with digital properties, you get to make thousands of dollars a month.

This isn’t a “get started today and get rich tomorrow” thing, but it is HIGHLY scalable, and ROI + positive results are guaranteed. Learning a fairly decent and very needed set of skills to create your digital properties and start ranking them on Google is required.

I have invested in several online businesses over the years, and if there’s something uncertain, whether you will get your ROI or not, even more than the actual profit.

However, this business moved my earnings from five figures a year to a month in ONLY passive income while sitting comfortably at home.

On my laptop. Anywhere. Anytime.

You can look at one of the first sites I built back in 2016, and it continues making me over $1.000+ every month. The best part is that I don’t need to touch it or the rest I’ve built over the years, just like this digital property.

What Makes Lead Generation SO Alluring?

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Here it goes: you can work from home.

The main issue with regular business opportunities is how much you need to invest in staff, equipment, or rent to have a place to sell your products or offer your services.

We all know the hassles of traditional businesses that involve regular expenses, which are extremely high.  Can you afford it? I don’t think so, and even if you can, is it worth it? Now, it isn’t only about the money. You also need to put in a lot of work, and it isn’t only during the first couple of months or years. Usually, it is as long as you continue running it.

You can save yourself those headaches and bone-breaking tasks and expenses with lead gen since it is more about generating leads with digital channels—mainly websites.

Websites can be VERY cheap to build, and with many tools online, you get to do it in a couple of hours instead of days. Any virtual or digital business is scalable and won’t need constant maintenance.

So, let’s summarize this:

  • You save money in regular expenses with traditional and most online businesses as what you need is yourself and digital properties (websites).
  • You can bet on passive income.
  •  There’s no need to hire more people to get started.
  • You can generate leads in multiple industries, which allows you to work on any niche you want.

How Can I Get Started in the Local Lead Generation Program?

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Anyone can start and learn. That’s the beauty of this business model. I knew nothing about SEO, Map Listing, and everything I’ve mentioned so far. It is all about learning the skills, gaining experience, and deciding to take the step.

Remember that this business model will never get old as business owners are always looking for leads. They need to do business and scale their companies. Why not do the same while helping others and still making money?

You can start with this local lead generation course highly recommended for anyone wanting to grow in the business. It is a close training that will take you through each step and make sure you are able to get your ROI, profits and take control of your life.

You will be added to an incredible lead generation family ready to help you 24/7 when asking questions on the group. Anyone is welcome who’s willing to put in the work. Click here to watch the lead gen webinar.

Learn more about local lead generation below.

Take a sneak peek into our proven strategies to build a passive income by building a local lead generation business from your laptop...