The Ultimate How-To Guide for Starting Your Electrician Business

You have big dreams of running your own successful electrical services company. You have a vision, and you're ready to bring it to life.

The first step is learning exactly how to start an electrician business. What's involved in the process? How long will it take? And how much will it cost?

We put together this guide to help you get answers to these questions.

To start, we'll touch on key industry trends. Then, we'll outline the step-by-step process of planning and launching a business.

To tie it all together, we'll share some quick and easy preliminary steps you can take today.

Whether you're serious about starting an electrician business or just curious about the process, this is what you need to know.

Understanding the Electrical Industry

Before delving into how to start an electrician business, it's a good idea to learn a bit more about the state of the industry.

The rise of 5G technology: 5G technology is expanding across the US. Upgrading to 5G requires more electrical infrastructure. This could be an opportunity worth capitalizing on.
Growth in renovation activities: More people are renovating their homes instead of moving. This creates a higher demand for residential electrical work.
Lack of craft-skilled labor: There simply aren't enough skilled electrical workers to keep up with demand. This trend impacts productivity and pushes back project timelines. Companies of all sizes are looking for ways to attract and train new electricians. It is also a double-edged sword. On the one hand, there will likely be a lot of work for your new business. On the other, you might struggle to find the employees you need.

What these Trends mean for You

Looking at the state of the industry, one thing is clear: now is a great time to learn how to start an electrician business.

The demand for electrical work is high. What's more, the job outlook for electricians from 2022 to 2032 is expected to grow by 6%, which is faster than average.

How to Start an Electrician Business

With a glimpse into industry trends and growth potential, you may be more convinced than ever that an electrician business is the right direction. Here's a step-by-step guide to help you start an electrician business.

Step 1: Pursue the Right Training and get Qualified

Already a qualified electrician? You might be able to skip this step. Just make sure you have the license needed to start your own business—this varies from state to state.

If you're not a qualified electrician yet, here are some of the steps you might need to follow:

Attend trade school. This is not always essential, but trade school is a great way to get hands-on experience.
Take part in an apprenticeship program. An apprenticeship program is another way to get on-the-job training. You get paid for your work while developing your skills.
Get licensed. Electrical professionals must be licensed to work legally. Requirements vary by state. But you usually need to pass a written examination.
Gain job experience. This helps you develop your skills and increases your chances of success.
Consider a journeyman license. A journeyman license is an important step in your career. It shows that you have mastered the knowledge and skills to work independently.
Become a master electrician. A master electrician license represents the highest level of expertise in the field. You can work on any electrical system and supervise other electricians.

Take action: Rules are different depending on where you live. Check the licensing requirements in your state.

Step 2: Set Goals for Your Business

To succeed, you need goals to keep you focused and motivated.

What do you want to achieve? Where do you see yourself in 5- or 10- years' time?

This is also a good opportunity to get some clarity on the type of business you'd like to start. Will it serve residential or commercial clients? What values will it uphold?

Take action: Write down your goals. Review them every month and track your progress.

Step 3: Write an Electrical Business Plan

A business plan is your map to success. It details your business strategy, financial projections, and marketing approach.

A plan helps you stay organized and on track. It can also help you secure funding.

Here's what your business plan should include:

Executive summary: Provide a brief overview of your business.
Business description: Explain the services you will offer.
Market analysis: Assess your local market and competitors and define your ideal client.
Organization and management: Detail your business's structure.
Marketing plan: Outline how you will attract and retain customers.
Financial plan: Cover your budget, funding, and financial projections.

Take action: You don't have to start your plan from scratch. Try using a business plan template instead. Make sure your plan is detailed and realistic.

Step 4: Organize the Financial Side of Your Electrical Business

Finances are make or break for any business—particularly new ones. You need to know how much money you need to start and run your business.

Consider the following:

Start-up costs: List all initial expenses. Think about tools, vehicles, and training. You'll also need to register your business. Do you have enough money to cover these investments? Will you need to pursue funding?
Ongoing costs: Write down ongoing expenses like fuel, staff wages, website costs like hosting, and marketing costs. Don't forget about insurance.

With these costs in mind, determine how much you'll have to charge for your services to make a profit. Aim for a profit margin between 10 and 20%.

Step 5: Register Your Business

Registering your business can help secure personal liability protection, legal advantages, and tax benefits.

Where you live and the structure of your business will impact how you'll need to register it. Figure these factors out, and the process becomes straightforward.

Most small businesses will just need to register their name with state and local governments.

Step 6: Start Marketing Your Electrical Business

Every business needs customers. Marketing is a sure-fire way to attract them.

Here are some impactful strategies to try:

Digital marketing: Build a professional, search-engine-optimized (SEO) website. Use social media to promote your services and engage your audience. Claim your Google Business Profile.
Traditional local advertising: Run ads in the newspaper. Put up flyers around your neighborhood. Do a letterbox drop to let locals know about your services. You could even offer a limited-time offer to celebrate your launch.
Word of mouth: Ask satisfied customers to refer you to others. Encourage them to leave reviews online.

Take action: Create a marketing plan that includes both organic and paid tactics. Set a budget and track your results.

How You can Start Your Electrician Business Right Now

We’ve outlined the process for getting your electrician business off the ground. While there are a few steps to complete and critical aspects to determine, there are some things you can do right now to get yourself pointed in the right direction.

Here are some actionable tips to help you get started immediately:

Brainstorm business names. Choose a name that is unique and reflects your services. Make sure it is easy to remember and spell.
Calculate start-up costs. List all expenses you will need to start your business. This includes tools, licenses, insurance, and marketing.
Set realistic goals. Define clear short-term and long-term goals for your business.
Come up with a timeline. Create a timeline for launching your business. Set deadlines for each step.