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?”
“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.