How to Start a Home Renovation Business in 8 Steps

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If you have decided to start a home renovation business, you are in to seize a great opportunity. So read on to find the steps you need to take to launch your business.

Launching a home renovation business (or any business whatsoever) is an uphill battle. However, at the top of this climb lies an opportunity as the remodeling industry size has swollen to over $110 billion in the US alone.

But, at this point, we understand that uncertainty may have set in, making you anxious about where to start and then what.

Such fears while starting a new business are normal. However, with a path laid out for you to follow, you will feel much more confident in taking the required steps. 

This is why we have come up with this step-by-step guide on how to start a home renovation business. So let’s start our journey.

Step 1: Research the Market and the Competition

Who are you up against? What circumstances will your new venture face? The answers to these questions are crucial to find before you start your own home renovation business. Why?

Because then you will be able to identify the cracks in the market as well as the services of your competitors. And it is via these cracks, you will make your place in the market.

To do market research well, understand that a market consists of three things:

  • Businesses
  • Potential customers
  • Marketplace

So let’s look at each of those.

1. Find your competitors

It is easy to find your competitors these days. Just search “home renovation businesses in [your region]” in any search engine.

Found them? Now make a list of all regional, national, and international players in the home remodeling market industry that you will be competing against.

Take each of them separately to know what all its home renovation services are and who its target audience is.

2. Understand the customer behavior

Not clearly understanding the target customers is one of the biggest mistakes any business makes. But thankfully, you are here and we won’t let you repeat those.

So, identify their needs. 

  • What do they want from a remodeling business like yours?
  • What is their average project size?
  • What is their motivation(s) to make a purchase?

Knowing the audience well demands you to go into a lot of depth. But an overview will do for now as you will get to know them better as you start running your new business.

3. Understand the marketplace

A marketplace is a medium that connects businesses to potential customers. For example, you can take a mall as a marketplace. Even Amazon is one of these.

The point of doing this is to know what are the ways your competitors use to reach their prospects. You can then pick a set of those pathways for your business to do the same.

This will give you a lot of insights that may later turn into advantages for your business to thrive.

Step 2: Develop a Business Plan

“What is a business plan?”, you may be wondering. Hubspot has explained it simply:

“A business plan is a documented strategy for a business that highlights its goals and its plans for achieving them.”

In other words, it is your guiding light that your company follows to get where you want it to be from where it is. A solid business plan for your home renovating business may include information about:

  • Company name and address
  • Company logo
  • Contact information
  • Goals
  • Market analysis
  • Team
  • Company’s services
  • Target market
  • Competition
  • Marketing and sales strategies (step 9)

You may have noticed that you have already completed a part of it with step 1. But you are now done with it yet. To help you with this, ask yourself these questions:

  • What are your business goals?
  • What need are you addressing?
  • What makes you different from your competitors?
  • Who is your target audience?
  • How is your business going to make money?
  • How will you promote your business?
  • What do you need to get started?

Pro tip: A good business plan will also help you attract funding from potential investors. Thus, it is really important to make it sound.

Step 3: Establish a Legal Structure

Defining the legal business structures is a must.

A legal business structure is a form that your business takes. It determines how your business is organized, managed, and taxed. A legal business entity can take any form such as:

  • Sole proprietorship
  • Partnership
  • Limited Liability Company (LLC)
  • Corporation

Each structure has its pros and cons. So only choose one after weighing both sides because it affects your liability, tax obligations, and management structure. Here is a guide to help you do that.

Pro tip: For better advice, consult with a legal or financial advisor before making a decision on which structure to choose.

Step 4: Obtain the Necessary Licenses and Permits

As a home improvement business, you are likely to do many things. Out of those, some require you to obtain a contractor’s license first. Here we have classified those, as per Investopedia:

License required License not required
Fences Painting or wallpapering
New windows Minor electrical repairs that don’t involve adding new or moving existing service
Plumbing and Electrical Installing hardwood floors or carpeting
Siding Installing new countertops
Water heater Replacing a faucet


    1. Some municipalities require you to get a contractor license for taking up any business project above the threshold value.
    2. The requirement for licenses either a business license or a contractor’s license usually varies by state. So contact your state’s licensing authority.

Step 5: Obtain Insurance

Running construction businesses is not everyone’s cup of tea. You will run into many problems now and then, especially if you are just starting.

Thus, getting your business insured will help you overcome many of these challenges, if you do face them, by protecting yourself and your assets from potential risks.

Usually, businesses in the home renovation industry pick insurance coverage with these insurances:

1. General liability insurance

It covers accidents and injuries that may occur on your business premises and any damage to property caused by your business operations anywhere.

2. Professional liability insurance

It is also known as errors and omissions insurance. Sometimes your mistake may result in financial damage to your clients. And this is what this insurance protects you from.

3. Workers’ compensation insurance

What if you fail to compensate your employees for their work? What if they suffer from any work-related injuries or illnesses? This is what this license is for.

4. Commercial property insurance

This insurance provides coverage for any damage to your business property. And this also includes your equipment, tools, and supplies.

5. Commercial auto insurance

Your home renovation will be using a commercial vehicle. Thus, this insurance protects it against any accidents and liabilities.

Step 6: Purchase the Necessary Equipment

With your business formally set up, you still have some necessary purchases to make so you can run it.

1. Purchase your hardware

To keep your cost to the minimum, start with the essentials such as a computer and printer. This will help you manage your business and connect with your clients.

2. Invest in quality tools and equipment

Now it’s time to purchase your weapons with which you will serve your clients. So we suggest you invest in high-quality tools that are durable and reliable.

As a home renovation business, you will need specialized tools and equipment such as:

Required tools Examples
Power tools Cordless drill, jigsaw, saw, angle grinder, and air compressor
Hand tools Hammer, screwdrivers, utility knife, chisels, and hand saws
Safety gear Hard hats, safety glasses, ear protection, dust masks, gloves, and work boots
Painting supplies Paint brushes, rollers, trays, and paint sprayers
Electrical tools Wire cutters, wire strippers, wire crimpers, electrical tape, and voltage tester
Plumbing tools Pipe cutters, pipe wrenches, pliers, basin wrenches, and pipe threaders
HVAC tools HVAC gauges, refrigerant recovery machine, duct tape, and HVAC wrench
Drywall tools Drywall saw, drywall mud pan, joint knives, sanding tools, and drywall screws

3. Get the required software

In addition to hardware, you will also need to install software to help you run your business efficiently. This includes:


Choose the Best Invoicing Software For Your Business

InvoiceOwl is your complete invoicing solution which lets you create, send, and manage invoices easily.

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Step 7: Open a Business Bank Account

Instead, will your business account do? Not if you are concerned about protecting your assets.

When you use a single bank account for all your purposes, you run the risk of getting it all wiped out if your business is sued. However, if you have a separate business account, only this will be jeopardized in such cases.

You can also look to issue a business credit card as well as it will finance you in the name of your business, instead of your name.

So contact any trusted bank in your region and apply for both.

Step 8: Develop a Marketing Strategy

If you did the first 2 steps mentioned here correctly, then developing a marketing strategy will be much easier. A marketing strategy is a plan to help you promote and brand your business to your target audience. Here is how you do it:

1. Define your unique selling proposition (USP)

As suggested earlier, have you found any cracks in the market and the services of your competitors? This will help you take advantage of this gap to make your business stand out in the home improvement industry.

So ask yourself, “What makes your home renovation business unique?” This could be the quickness or quality of your services, your exceptional customer service, etc.

2. Establish your brand

How your target audience perceives your business is what your brand is. To START establishing your brand, reflect your USP on all your business properties such as:

  • Business name
  • Logo
  • Website
  • Social media profiles
  • (And most importantly) Your services

3. Build Your online presence

This is probably the most rewarding thing you do for the marketing of your business. In today’s digital age, having a strong online presence is a must if you are looking to make it big. For this, there are at least 2 things you have to do:

  1. Build a website that showcases your work, services, and contact information.

  2. Create social media profiles on platforms to connect with your audience by posting on them regularly.

4. Utilize SEO with content

SEO (Search Engine Optimization)  is how your website comes higher on search engines for relevant search queries. 

For example, if someone is searching for, let’s say, “best home renovation business”, is your website coming up for it?

This is a very vast subject, But you can start by placing keywords at right place such as:

  • Meta title and description
  • Content

You can also showcase your expertise by consistently posting your website blog. This will help you with SEO as well as branding your business as an authority.

5. Optimize for local SEO

This will help the prospects in your region find you easily. And it is very easy to set up as well. Just get yourself registered for free on:

The better you set up your profile, the better are your chances to be placed higher than your competitors.


Market Your Home Renovation Business as a Professional

InvoiceOwl not just makes invoicing easier for you. It also brands your business as an authority.

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Avoid These Mistakes as a Home Remodeling Business Owner

Given that you are starting a new venture, as a home renovation business owner you are bound to make some mistakes no matter how much you try to perfect your overall business model. To save you from that, let’s identify them: 

  • Underestimating project costs and failing to plan properly
  • Ignoring the importance of communication
  • Not aligning with the client expectations
  • Not obtaining the necessary business permits
  • Poor time management
  • Failing to prioritize safety
  • Overcommitting to home renovation projects
  • Neglecting marketing
  • Ignoring the honest customer reviews
  • Failing to track expenses and revenue
Frequently Asked Questions
  1. Why is a marketing strategy important for a home renovation business?

    Any business, including those that specialize in home renovation, needs a marketing plan. It helps in building your brand, identifying and pursuing your ideal clients, and generating more leads and sales.

  2. How do I identify my target audience?

    Consider demographics like age, gender, income, and location to accurately identify your target audience. For you to create a marketing message that appeals to them, you should also take into account their needs and preferences.

  3. What is a unique selling proposition (USP)?

    What distinguishes your company from its competitors is your USP. It can be anything such as a guarantee of quality work, exceptional customer service, etc.


So these were the 8 steps you needed to take to launch your own home renovation company. Following them, you are all set for a great start to your venture. 

It may look daunting at first, but the key is to take one step at a time while avoiding the common but costly mistakes we just shared. All the best.

Author Bio
Jeel Patel
Jeel Patel

Jeel Patel is the founder of InvoiceOwl, a top-rated estimating and invoicing software that simplifies the invoicing and estimating processes for contractor businesses. Jeel holds a degree in Business Administration and Management from the University of Toronto, which has provided him with a strong foundation in business principles and practices. With understanding of the challenges faced by contractors, he conducted extensive research and developed a tool to streamline the invoicing and estimating processes for contractors. Read More

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