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Starting a Home Based Handyman Business - step 1

The First 5 Steps to Starting a Home Based Handyman Business

Are you thinking about starting a home based handyman business and want to know the best way to get started?  

You’re definitely not alone.  On almost a daily basis I get e-mails from my readers with questions like:

“I want to start  a handyman business, what’s the first thing I should do?”

or

“I’m thinking of going the handyman business route, but I’m not sure if I can make enough money.”

Regardless of your questions about getting started or your experience, starting a handyman business the smart way should always consist of the same steps.

In this article, I’m going to walk you through the first 5 steps to starting a successful handyman business. By completing these first steps, you will create a clear business plan that is sure to bring you profit, freedom, and satisfaction.

Step #1:  Skills

The very first step you should take is to evaluate your current skills and decide on the services you are going to provide.

You may be thinking, “Don’t I need to be able to do everything?”  The short answer is no, you don’t.  In fact, you can be very profitable offering a limited range of services.

For example, I am unable to do any plumbing, electrical, or HVAC work without a license.  This limits my services significantly and I still have more business than I need.

Additionally, think about all of the other handyman-like service businesses out there such as garage door repair, lawn care, locksmith, home security installers, masons, and many more. These businesses all focus on a specific service and are still highly profitable.

As a handyman, you are typically going to have a much broader range of services that will span several trades, but you can certainly get started by offering what you know how to do and grow from there.  That’s how I started my handyman business and I’m still learning new skills everyday.

So the first thing you need do is make a list of all of the possible services you can offer right now.

Step #2:  Laws

One of the best ways to ruin your day is to start a business as a handyman only to later realize you need a contractor’s license.  Hopefully, you don’t find this out the hard way and I reach you in time.

Before you get too excited about the services list that you just made, it’s time to do some reading on the contracting laws in your state (every state is different).  You need to figure out which services you can and can’t offer without a license.  Or, you need to figure out what license you need in order to provide the service you want to provide.

For example in my state, I can’t do any electrical, plumbing, or HVAC without a license in those specific trades.  Also, I can’t do jobs over $1,000 without a contractor’s license.  So, basically I can do anything under a $1,000 that isn’t plumbing, electrical, or HVAC.  That’s ok though, because there is plenty of work that fits perfectly into this little niche.

Despite the fact that I could do bigger jobs and potentially make more money with a license, not having a license actually works better for my business model.

You can get a pretty good idea of the laws in your state by going to your state’s contractor’s board website and reading there.  Typically they will have a FAQ section for handymen which will outline laws related to small repairs and maintenance type work.

Step #3:  Customers

One thing that I talk about a lot is customer selection and targeting the right customers for your business.  I really can’t stress this enough because it will make or break any home service business.

As a handyman, plumber, electrician, contractor, or any service provider for that matter, targeting the right customers can and will have a dramatic effect on your profitability and enjoyment with your business.

If you are targeting customers you enjoy working for and who are a good match for you service, you’ll be happier, they’ll be happier, you’ll get more referrals and repeat business, and your life will be that much better.  If you get this wrong, you’re going to struggle either finiancially or emotinoally with your business.

Trust me on this one.  When I first started, I didn’t really understand this concept and ended up working for a lot of people that just weren’t a good fit for me.  I’d try to make my service fit what the customer was looking for instead of what I really had to offer.  This led to dropping my prices, doing lower quality work than I was comfortable with, and a lot of frustration.

By spending some time figuring out who would benefit most from your service and who you actually want to work for, you can avoid this frustration and your success will be accelerated dramatically.

So once you have decided on the services you can or want to offer and know the laws, take some time and really evaluate who your ideal client is so you can focus on attracting those customers.

Step #4:  Your Rates

It’s time to figure out how much to charge.

As with any type of business, having a good grasp on the financial side of the handyman business is essential – especially when it comes to setting your handyman rates.

This is one of the most difficult parts of starting a handyman business because there are so many variables you need to consider.  It’s also the place where I see the most mistakes. Your experience level, efficiency of work, ability to sell, reputation, and professionalism all need to be taken into account.

But, I have good news!  Instead of just picking a number out of the air for your billable hourly rate based on what your friends or family thinks, you can base it on cost.  (Nothing against your friends and family, but they probably aren’t your ideal customers so their opinions don’t matter!)

That’s right, cost-based pricing is a great way to get a foundation for your prices.  Cost based pricing is exactly what is sounds like, pricing based on costs or expenses.

By simply adding up all of your expenses (both personal and business related) and plugging that information into this simple equation, out pops your hourly rate.  Boom!

Whether you are charging by the hour or by the job, you must understand the expenses associated with operating a handyman business as well as how much you need to make to cover those and make a solid profit.

Pricing is complicated, that’s why I spent a year interviewing the most profitable handymen, researching psychology, and developing a framework for setting your pricing.  I compiled what I learned into a step by step guide for pricing your service for maximum profit and customer satisfaction.  It’s called “The $100K Handyman” and you can find it right here.

Step #5:  Marketing Plan

At this point, you should have a good idea of the services you are going to offer, who is going to buy them, and how much you are going to charge.

The next step is to figure out how you are going to reach your ideal clients and then convince them to buy from you.  That’s right, it’s time to form a marketing plan.

The good news for you is that people are actively searching for your services every single day of the year and sometimes is just a matter of putting your message in front of them.  The bad news is that there are a lot of other handymen out there with the same thing in mind.

Don’t worry, there’s more good news. Most handymen are terrible marketers and by putting a little extra effort in your marketing you can make a killing.  The fact that you are reading this blog puts you way ahead of the pack.

Your goal in this step is to figure out which marketing methods are going to be most effective and have the highest ROI (return on investment).

So sit down, study your ideal clients behaviors, desires, and frustrations so you can come up with the best methods for promoting your handyman business and gaining those customers. For me, I’ve had the most success by advertising my business online and building a great website.

Once you have taken these 5 steps, you will have a solid understanding of how to attack this business in a way that will be most profitable and enjoyable for you.

P.S. Ready to experience the freedom and fulfillment of your own business? Good news! I’ve created a complete step-by-step guide to help you build a profitable handyman business from scratch. Check it out right here.
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  • Diederik April 20, 2014

    Hello Dan,

    just wanted to say your blog is the first good info I found on starting up a Handyman business. I finally have an idea now of what to focus on and how to proceed and will be reading your blog a lot more this week.

    cheers Diederik

    • Dan Perry April 21, 2014

      Thanks Diederik!

      Glad you have found it useful. I definitely agree that the majority of books out there leave out a lot of critical info. Good luck with your business.

      Dan

  • matthew cooper July 17, 2015

    Dan, hi my name is Matthew Cooper and im in the beginning stages of starting a handyman business in nc. i am an industrial mechanic and am able to do just about anything . ive done electrical, plumbing, hvac, mechanical, and everything inbetween with my work over the last 16 years. can you give me an idea of how to figure out what area would best be suited to what ive done my whole adult life. i know enough about everything to do one of two things and that is fix it or destroy it!! lol. where would my skills be more usefull because i love everything i work on as long as im using my hands. i really enjoyed your tips and post here and would love to know your thoughts since you have been doing this for a while. thanks

    matt cooper

    • Dan Perry July 17, 2015

      Hi Matt,

      If you specialize in a field that requires a specific license (usually plumbing, electrical, or HVAC in most states) then you can make more money. However, that requires getting a license and in many states that process can take a few years.

      If you want to get started now, I would read up on the laws in your state and see what you are actually allowed to do. That’s a great place to limit your options.

      If you like variety, you may consider just being a general repair handyman.

      Hope that helps,

      Dan

  • AK September 4, 2015

    Dan, i have been reading your blog but my question to you is. I am in Virginia. Is it better to license as a cotractor and do any kind of contractual work or better to be licensed as a handyman. I am an IT person but can do many other things and i was looking into licensing as a Contractor with a Class A and taking all the trainings. What do you think.

    • Dan Perry September 6, 2015

      If you want to do bigger jobs then I would get a contractors license. If you just want to do quick, get in and get out kind of jobs, then I’d recommend the handyman route. I’m not sure what licenses are required in Virginia so I can’t say whether or not you should actually get a license though.

  • Dave October 28, 2015

    Hi Dan,
    I used your audio-book over the past few days and had a similar business years ago, and your advice is great! – I would have saved so much time and money then if I had this resource.. it is exacltly as you say – charged to little did too much and paid the price..
    I am now in Australia, and have been stuck at a desk for 7 years, doing something different, and tired of it now – i live in a costal city that is growing quickly, has heaps of fli-in-fly-out workers residing here(so dad is off on site 28 days out of 37), and thinking of getting started with a handyman business next year.

    My question to you – I have electrical qualifications for Australia, but require an additional Electrical Contractors licence to do electrical domestic work, which will take me 15 days full time or 15 weeks part time study, and costs $2000..Is it worth getting this licence before I start my handyman business, and will I recover this cost, as I don’t want to become another “Electrical contractor” , but I want to provide handyman services..
    Any ideas on how I can promote my handyman business as a handyman offering electrical services, not and electrical contractor offering handyman services??

    Thanks,
    Dave

    • Dan Perry November 7, 2015

      Dave,

      I can’t tell you whether or not it’s worth it to get your license before you start. I think that depends on how soon you want to start your business.

      As far as promoting yourself as a handyman who does electrical services, that is no problem. Electrical services would just be one of your featured services that you’d mention among the other services you offered. So, depending on which marketing method you are using to promote your business, you would simply call yourself a handyman and mention the services you specialize in.

  • Julius DUDLEY January 22, 2016

    Yeah I am look to star my Owen handyman service to the state of California

  • george lennon February 2, 2016

    could you recommend a company that would take care of all the necessary paper work for starting a handyman business in the state of florida

    • Dan Perry February 3, 2016

      Have you looked into Legalzoom.com? They can help you with this.

      However, just know that any of these services will likely come at a premium.

  • Paul Clancy February 16, 2016

    Thank you for your help

  • John sallese March 3, 2016

    I’ve been running handyman service for years but I was asked to do roofs before I cut mostly trees but most are big paint jobs and remodel I’m fixing to work with a realist ate company doing there work so I need a contractors license and a handyman license both correct

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