How to Start a Plumbing Business
Owning your own business can be liberating, especially when you’re providing a service that you’re passionate about.
Many plumbers start their careers by working as an apprentice or a contractor of another plumber. But as they grow in the trade and reach “expert status,” it is normal to want to branch off and start plumbing businesses of their own.
In this post, we’re going to cover everything you need to know about starting a plumbing business. We will discuss a few benefits of starting this kind of business and review a few directions plumbers can go in terms of specialization.
From there, we’ll provide a thorough rundown of how to start a plumbing business. You’ll walk away with 10 actionable steps for starting your own business.
Here’s What We’ll Cover:
Why Start a Plumbing Business?
At this point, there’s never been a higher demand for plumbers. There is a gold mine of opportunity for plumbers to create businesses of their own since there is more than enough work to go around.
Let’s review a few of the top benefits of starting a plumbing business.
Benefits of Starting a Plumbing Business
- Tradesmen shortage: There is a high demand for plumbing experts, but trades schools and family businesses that once kept up this supply are diminishing
- Many types of plumbing: There are so many types of plumbing, so you have a lot of variety in the direction you take your business
- Great pay: Plumbers make decent money right off the bat
- Flexibility in business structure: You could keep things simple as a freelance plumber, or you can build a more scalable business
Can I Start a Plumbing Business With No Experience?
Unless you are simply owning and operating your plumbing company and not rendering any services yourself, you will need experience.
Plumbing is a very specialized trade that requires quite a bit of training. A lot of plumbing has to be done to follow codes and regulations set forth by the city or state, so knowledge of these guidelines is a must.
In fact, you will need to be properly licensed as a plumber, but we will touch more on the specifics of this shortly.
Plumbing Business Specializations
Plumbers have a lot of different opportunities in terms of specializations and career paths. This means there are quite a few different types of plumbing businesses you could start.
Some popular types of plumbing businesses include:
- Plumbing technician: The kind of plumber that goes into homes and commercial buildings to evaluate the building’s plumbing issues
- Gas service: The specialists who deal with gas leaks and related issues
- Pipefitting: A plumber with special expertise in systems and pipe installation
- Steamfitting: Similar to pipefitting, but deals with pipe systems that handle high pressurized gas
- Pipelayers: Installs piping in trenches to connect to main water, gas and sewage tanks, typically on large scale projects
Do I Need to Choose a Specialization?
Yes, you do need to choose a specialization for your plumbing business.
Since the different paths you can take in the plumbing industry are so incredibly different, you’re wise to choose one to focus on.
With this approach, you will become very good at that one particular specialization. You’ll also only need to invest in very specific tools and materials for your plumbing company since you’re offering one service instead of a wide range of services.
Independent Contractor vs. Plumbing Company
Before you get started, you’re going to need to decide whether you want to start an independent contractor business or build a business with multiple plumbers working under you.
The freelance route is attractive to many because it gives you the flexibility to choose the jobs you want on a schedule that makes sense for you.
The biggest drawback of freelancing? There is room for growth but little room for scalability. This means that you can make more money by raising your rates, but you only have a finite number of hours in a day, so there will be a cap on how many people you can serve.
The route you want to take comes down to personal goals and preferences. You can definitely start as a freelancer to build credibility and a loyal clientele.
No matter which direction you take, you will need to be properly qualified to be a plumber if you are personally rendering plumbing services. To obtain your plumbing license, you’ll need to either study plumbing at a trade school or find an apprenticeship program. Trade school plumbing programs generally last about two years. Apprenticeships can last upwards of five years.
You should also choose a specialization before you start your business because that will likely entail working under an expert in that niche before you are equipped to operate on your own serving customers.
How to Start a Plumbing Business in 10 Steps
If you’ve worked as an apprentice under a skilled plumber, you’re likely somewhat familiar with how a plumbing business is operated. But do you know what it takes to get one up and running?
Let’s take a look at the general process that you’ll follow when starting your new plumbing business.
For the sake of this walkthrough, we’re going to assume that you already have the appropriate experience and licensing to work as a plumber.
1. Draw up a Business Plan
Every successful business starts with a plan. This plan could be some notes to outline your thoughts and ideas, or it could be a formal report on how you want to operate your business.
Unless you’re submitting your business plan to an organization or bank for funding, something informal will do the trick.
Write out everything you have in your head about starting your plumbing business, and see where you need to fill in the gaps.
Your business plan should detail what you have to offer, which customers you’re going to serve and how you’re going to make that happen. Take a look at what local competitors are doing, and figure out how you can do it better.
Decide on a specific area that you will serve. Determine how many miles you’re willing to travel and if you’d consider going beyond that mileage for a higher rate.
2. Create a Business Entity
Creating a legal business entity is very important. You should sort this out from the start so there are no crossed lines with your personal and professional accounts.
A limited liability company (LLC) should suffice for a plumbing company, but you also have the option of starting a corporation. Once you’ve established this entity, you’ll register for an employer identification number (EIN) on its behalf. This is a tax identification number that you’ll use for anything that has to do with finances.
We urge you to contact a local attorney or a local mentor in the plumbing industry for guidance so you can rest assured that everything is properly documented.
3. Identify Your Target Market
Even though you have established what sort of plumbing business you’re going to start, you’ll need to identify your target audience so that you know exactly who to market your services to.
Here are a few questions that will help you build this profile:
- Is your ideal client a business or a homeowner?
- Does your ideal client live in a specific neighborhood?
- What does your ideal client do for a living?
- What is their income?
- About how old is your ideal client?
- Will they need you during regular working hours or will they call on you for after-hours emergencies?
Identifying your target market and creating your ideal client profile from the start will give you direction in your business. It will help you better craft the service that you have to offer to best meet customers’ needs.
Having a clear picture of who you’re serving will help you reach those customers with no problem at all.
4. Establish a Solid Accounting System
Starting a plumbing business requires a bit of an investment. You’ll need to factor in costs for materials, equipment, liability insurance, business cards, transportation and a headquarters for storage and possibly an office. These costs will vary based on the type of plumbing business you’re starting.
When you’re getting started, you’re also going to need to consider your budget for branding. Right off the bat, you’ll have to invest in a logo and a website, which will likely be a couple of thousand dollars. You should also plan to set aside some money for marketing and advertising.
As you add up these figures, factor in what percent you’ll have to set aside for taxes. You’ll likely pay quarterly, but this will depend on the structure of your small business. Putting roughly 35% aside for taxes is generally the rule of thumb.
Also, as you make investments in your business, be sure to keep receipts for everything so that you can write it all off for tax breaks. Automated accounting software can help you keep your small business financials in check, send plumbing invoices and much more.
5. Price Your Services
Now that you have a good idea of how much it will cost to start and run your small business, it’s time to price your services.
Many business owners offer a flat rate for projects, and they generate this rate based on their desired hourly income. Make sure you factor in your operating costs when setting these rates.
In addition to your normal rates, you can have special rates for emergency calls, evenings and weekends. Charge more for work outside of your regular operating hours.
You should also have a call-out fee that clients pay simply to have you come out and evaluate the situation. This fee is typically between $50 and $100. We recommend checking what other business owners in your area are charging for a call-out fee to determine an appropriate rate.
Figure out additional travel fees for customers outside of the region that you typically cover.
6. Bring Your Brand to Life
A few steps back, you gave your plumbing business a name, and now it is time to bring that brand to life. Essentially, your brand will be your business persona.
Before you get started with the logo and visual aspects, identify your brand’s mission and core values. As a service-based business, values like honesty and integrity are a good place to start. Come up with three to five core values that will guide everything that you do.
From there, think of what sort of visuals represent your brand. A brand specialist and graphic designer can help you work this out, but it is a good idea to have a general direction before you start working with them.
Do you want your professionalism to be the focus of your brand? Maybe you’d like your brand to be more representative of hard work and strength.
All of these aspects will be tied together in your logo, which you’ll use on your website, your truck and any branded material.
No matter what look you go with, remember to keep your core values at the center of everything that you do in your small business.
7. Market Your Services
There are a few ways to market your services and reach your target audience.
As a service provider, trust is everything, so referral marketing is a great way to get started. This is essentially partnering with businesses that would share a clientele with you. Your partners could be plumbers with different specializations, or they could even be electricians, general contractors and the like.
Basically, you’ll give your partners a bonus every time they send you new customers. This could be a set fee per customer, or it could be a percentage of whatever you make on the job.
Local search engine optimization (SEO) and search engine marketing (SEM) are also wonderful marketing tactics for plumbers. Each of these approaches makes your business discoverable to your audience when they do a quick search of your services on a search engine like Google or Yelp.
The goal for both of these methods would be for your website and contact information to appear when people search terms like “plumber near me” or “plumber in [your location].” With SEO, your site pages are optimized for these specific keywords to appear organically, but with SEM, you pay for your posts to come up on top.
8. Hire Help If Necessary
How you hire for your plumbing business will vary depending on whether you’re freelancing or building a whole team of plumbers.
At the very least, it is a good idea to hire an assistant to take care of scheduling, billing and other administrative tasks.
If you do decide to build your team of plumbers, you’ll want to choose people who are licensed and highly skilled. You’ll want to check both personal and professional references to make sure that they’re reliable and trustworthy.
9. Deliver High-quality Work
As a service provider, your reputation depends on how you treat your customers and how well you deliver. This means that it is on you to deliver as promised every single time. If you’ve promised high-quality work, then you must show up and make it happen.
In the unavoidable event that something goes wrong, you need to be honest about it and make it right. We all make mistakes, but making a mistake on plumbing could cost your client a lot of money down the line.
Keep honesty and integrity at the forefront of your operation, and you should be good to go.
10. Collect Reviews and Testimonials
Part of building your business requires gaining trust in your community. Ask for reviews or testimonials upon the competition of a job.
Remember how we mentioned local SEO? If you set up a Google My Business page, your customers can leave their reviews there so that when people look for a well-rated plumber close by, you’ll pop up.
Additionally, having reviews on your website and social media page will help you come across as more legitimate, which will make your services easier to sell.
Launch Your Plumbing Business With Success
It is time to launch your plumbing business! You’ve likely spent the past few years fine-tuning your skills and mastering the trade, so stepping out on your own is the logical next step.
The 10 steps that we’ve outlined will serve as a trusty guide throughout this process, but don’t be afraid to tweak it where it makes for your business, services and target audience.