How to Start a Plumbing Business for Quick Success

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📝Key Takeaways:

  • From this blog, you will learn about the step-by-step guide to starting a plumbing business. These steps should be made by factoring in all your business expenses and profit margin.
  • You will also learn why to invest in social media marketing & paid advertisement and create a Google My Business account so that locals can reach you when they search for plumbing services in your area.

Working as a plumber is still one of the most respected professions in the world. The profession generally offers higher salaries, employee benefits, and financial security.

Today, the plumbing industry in the United States generates approximately $124 billion in revenue annually and employs over 500,000 people.

That’s quite a huge number. However, for many technicians, such as plumbers, becoming self-employed provides a means to end the everyday hustle.

By becoming a boss, these professionals will earn a higher income and gain more autonomy than working for a privately owned plumbing business company.

If you’re a licensed professional who wants to become a boss and learn how to start a plumbing business, you’re not alone. On the other hand, if you are entirely new in the industry, we’ve still got your back.

Read on to learn how to take off your own plumbing business with these easy steps!

How to Start a Plumbing Business in 8 Simple Steps

1.  Get your plumbing license

The first thing you should do before starting your own business is to obtain any necessary training or licensing to perform unsupervised plumbing jobs. Although many plumbers prefer to work under an apprenticeship to get their plumbing license, others prefer to attend a local trade school.

To work legally in many states, you must earn a plumbing license or master plumber certification after completing the training of a minimum of four years in an accredited journeyman program.

Because licensing requirements differ greatly from state to state, you should check with the relevant governmental agencies in your state before starting your new plumbing business. Other requirements might include a minimum bond amount in the event of a mishap and proof of liability insurance.

After you’ve completed all of the prerequisites, you’re prepared to register your plumbing business with the city government. Check your state’s business tax laws and consider establishing an LLC to safeguard your personal assets from financial debts and liability claims.

2. Create a detailed plumbing business plan

Creating a comprehensive business plan is imperative for your plumbing business strategy. It outlines the path to your success and reveals how factors like branding and working capital contribute to a consistent growth strategy as a whole.

A plumbing business plan can help you persuade business partners and financiers to back your venture. And your plumbing business structure should include the following sections:

  • Executive summary: Here, you discuss your plumbing company, its management team, and its customer base.
  • Company summary: In this section, you outline the goals of your plumbing company and the plumbing services you will offer to your clients.
  • Market Analysis: Here, you determine your niche and work on your unique offerings.
  • Strategy: In this part of your business plan, you figure out your sales strategy and set your business budget.
  • Personnel Plan: Here, you outline how to hire plumbing professionals and a management team.
  • Financial Plan: In this section, you outline your financial projections, including your cash flow and projected profit and loss. You also establish your fixed rates, overheads, and profit margins.Once you decide on the rates and margins, you then create the plumbing invoices accordingly.

Your aim should be to do some research on how much capital you really need to launch your plumbing business and expand it. Your research should also include working capital, marketing, and advertising costs, vehicle and equipment costs, and business expenditures.

If you intend to apply for small business loans to start up your plumbing business, you must include a financial plan section too in your business plan.

3. Include pricing and profit in your business plan

A business plan will highlight how much money you expect to make from your plumbing business. You can use the following prices in your business plan as industry benchmarks for typical residential customers:

  • Installing a bathtub: $2,750
  • Repairing a septic tank: $750 to $3,000
  • Replacing a faucet: $500
  • Installing toilet: $615
  • Unclogging a sink: $300
  • Unclogging a toilet: $350
  • Repairing a dishwasher: $450 or less
  • Installing main water line: $3,750
  • Installing garbage disposal: $325
  • Replacing a gas line: $1,450
  • Installing water system drainage: $3,300
  • Replacing a holding tank: $1,700
  • Installing a water heater: $1,000
  • Emergency after-hours surcharge: $85 per hour

In general, plumbing business owners earn more than $80,000 per year. A master plumber who earns $40 per hour and works 8 hours per day will earn $100,000 per year; however, the cost of basic resources and time spent managing the business will reduce this profit.

A plumbing company can ultimately make an extra $25,000 to $50,000 per year for each hired plumber. The more your plumbing company expands and hires new plumbing professionals and trucks, the more money you can expect to make.

The amount you expect to earn will also be determined by the prices you can charge for plumbing services in your area. For small plumbing work, the typical contractor’s prices range from $150 to $350 using a flat-rate pricing model, where your plumbing business will estimate the required work and give the client a final quote.

4. Purchasing the essential plumbing equipment

You can avoid constantly having to run to the hardware store by equipping your service van with a few basic plumbing tools.  However, don’t spend all of your money on expensive new equipment.

Start with the essentials. If possible, consider purchasing used tools and equipment, and only rent or buy equipment for specialized plumbing jobs if you have the permit and abilities and the job is in high demand.

The following are some plumbing tools, supplies, inventory, and safety gear you must always keep handy:

4.1. Plumbing tools and equipment:

  • Hacksaws
  • Set of cordless battery tools such as drills, screwdriver, saw grinder, impact driver
  • Set of hand tools, including pliers and a set of adjustable wrenches
  • Pipe cutters
  • Grips

4.2. Supplies and inventory:

  • bathroom and toilet fittings
  • Elements
  • Thermostats
  • Plastic and copper pipes
  • Inlet valves

4.3. Safety gear:

  • Safety goggles
  • Heat shields
  • Knee pads
  • Plumbing gloves

5. Discover your target audience

Spend some time analyzing market conditions and plumbing industry trends before deciding where to set up your plumbing business. Identify your competitors and the most in-demand plumbing specialties by speaking with other plumbers and electricians in the region.

You should also consider which potential clients you intend to be your primary revenue source. Take into account their requirements, issues, and established relationships with other plumbing businesses or contractors.

Assess whether the majority of your potential customers are homeowners with short-term plumbing projects or construction companies with more stable contracts and schedules.

Knowing your target market thoroughly before launching your plumbing business will make it considerably easier to create a presence in the industry.

6. Plan your financial budget

Plumbing companies can make generous profit margins, but with poor financial management, they can quickly fail. So how much money should you invest in your business to get started? The answer to this question can vary greatly.

Some aspiring small business owners trade in their own vehicles for a van and have managed to gather a collection of necessary tools over time. They began with free promotion and registration costs of less than $1,000. You should prepare to invest $10,000 to $60,000 or more if you don’t have any existing tools or vehicles.

The following expenses may be incurred when starting a plumbing business:

6.1. Insurance, registration, and licensing

You can register an S-corp or LLC in your state for $400 to $1,200, earn a plumber’s license and a business license, and manage your first installments for liability and employees’ compensation insurance.

6.2. Business setup

Business expenses vary significantly based on what resources you already have on hand and can work without while your company is still starting out.

Be prepared to pay for business cards, ads in the local paper, and an engaging business website. You must also invest in a computer, accounting software, invoicing software, Google’s pay-per-click system, and a CRM system. All of these investments would cost you around $2,000 and $4,000.

6.3. Van

Many plumbers prefer to buy a low-cost used van starting at around $3,000 since outfitting a service van can be done gradually. You could also deposit a down payment for the service van to get started for less money. Also, take into account the price of vehicle insurance, maintenance, and gas.

6.4. Tools

A complete set of basic tools can cost up to $5,000. Therefore, find out what tools you already have. Determine whether you require power tools, cameras, or only hand tools.

Consider renting some tools only if they are truly necessary and can be budgeted for in your financial plan since it will save you money in the short run but will cost you more in the long run.

Paying for everything can feel like a huge financial drain. However, there are several methods for funding your new plumbing company. A new plumbing business can be funded using a variety of methods, such as

  • Receiving grants
  • Getting investors on boards
  • Applying for business loans from banks
  • Receiving a small business loan from a friend or family
  • Self-funding through savings

7. Spread the word about your Plumbing business

Reaching out to new customers is the first step toward building a consistent client base. However, there are five inexpensive areas that many plumbing businesses neglect:

  • 7.1. Asking for referrals and reviews

  • Develop a strategy for asking for reviews and referrals from new customers.

    Additionally, incentive programs that provide services or discounts in exchange for referrals can persuade current clients to endorse your company.

  • 7.2. Creating a membership plan

  • Enrolling clients in a membership plan is more than just a sales tactic. It allows companies to check in, take care of minor issues, conduct annual inspections that meet the needs of customers and develop better relationships.

  • 7.3. Making follow-up calls and emails

  • Following up with customers via emails or phone calls allows plumbing businesses to ensure that their customers’ issues are resolved during their downtimes, potentially generating new revenue in the future.

    It enables plumbing companies to offer a discount while also building a good reputation.

  • 7.4. Networking groups

  • Join a networking group to help spread the word and find community partners. This can be accomplished by participating in relevant forums, LinkedIn, and Facebook groups and communities.

  • 7.5. Collaborations with local contractors

    As local professionals, plumbers can find new leads by strengthening their ties to the local tradespeople. Try approaching builders, landscapers, and electricians for subcontracting and referral work.

8. Create your online presence

Ignoring to build your online presence and focusing on your local visibility can lead to stunted growth of your plumbing services business. Consider the following ideas to be recognized in your region and get more positive leads:

  • 8.1. Business Website

  • Having a competent business website can make you appear as competent as other leading companies. If you implement search engine optimization (SEO) on your website, it can help prospective customers in your region discover you.

    Using keywords and implementing SEO will ensure that search engines such as Google and Bing recognize your company and raise your ranking on their pages.

  • 8.2. Google My Business

  • Because most potential customers use the internet to search for new businesses in their area, it’s critical to set up a Google Business Profile as early as possible.

    People can go directly to your website from your Google Business Profile page for more information about your plumbing business and the services you offer. Customers will eventually begin to leave ratings and reviews on your Google Business Profile about their experiences.

  • 8.3. Paid advertising

  • Many plumbing companies use PPC (pay-per-click) advertising on Angie’s List, Google, or Facebook to generate leads.

    Although search engine advertising can be effective, experts advise keeping lead costs below your profit margin for a typical plumbing job. To determine your ideal numbers, keep track of how many jobs your business closes.

  • 8.4. Social media marketing

    You might also want to use social media marketing to attract new clients to your business.

    Social media accounts such as LinkedIn, Twitter, YouTube, Instagram, and Facebook receive millions of visitors every day who are actively searching for new businesses such as yours.

As you begin to build an online community, your plumbing business will gradually grow and thrive, leading to more clients and increased profitability.

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Frequently Asked Questions
  1. How much money do professional plumbers make?

    Plumbers make an average of $29.37 USD per hour, or $61,100 per year, according to Annual salaries range from $33,460 ($16.09 per hour) to $98,990 ($47.59 per hour).

  2. When should companies hire more plumbers?

    There’s no fixed answer to when you should hire more plumbers.  However, there could be various signals that your company is expanding faster than you can keep up with and that you need more professionals on your team.

    Here are a few indicators:

    • You are unable to keep up with quotes and are declining work.
    • You have a backlog of paperwork, financial accounting, and accounts receivable.
    • You’re expanding your service offerings and require a plumber with specialized skills.
    • You need a vacation badly because you’re exhausted, overburdened, and stressed out.
    • Your plumbing services are in such high demand that a second plumber (or more plumber) is required.

Leverage the Capabilities of InvoiceOwl!

We hope this blog gives you a good perspective on how to start a plumbing business effectively and win more clients.

But you must remember that if you don’t get paid faster, your company won’t scale as fast as you thought!

To solve this challenge, we introduce you to InvoiceOwl, a plumbing estimate and invoicing software. It is estimating and invoicing software that allows you to create error-free estimates and invoices with complete automation.

InvoiceOwl allows you to generate invoices from any location at any time and send them to your clients via email. You can even track these invoices if you want to get paid faster.

However, InvoiceOwl’s capabilities go far beyond just creating invoices. It also allows you to create estimates and purchase orders too efficiently.

So, what are you waiting for?

Sign up for our FREE trial period today to learn about all of the benefits we have to offer for streamlining your business operations.

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