How to start an electrical contracting business

September 24, 2018 4:10 pm Published by

Starting an electrical contracting business from the ground up takes bravery, passion, money and a message you want to deliver. No matter what industry it is, you’re probably branching out on your own because you see a need for something and you feel you have the answer clients are seeking.

Whatever that need is, it’s probably also got a lot to do with being your own boss. Creating your own business is going to take a lot of focus and whether or not you fail will depend on your business ethics.

Starting an electrical business requires a license and training, learning about permits, insurance, tools of the trade and a business plan.

Obtaining a Electrician’s License

If you’re thinking about starting an electrical business, odds are you already have a license and the years of experience and apprenticeship required. If not, then now is the time to start working toward your license. Licensed electricians are required to know how to read blueprints, install electrical wiring and fixtures, using specialized equipment, and knowing building codes and the proper safety protocol.

While training differs depending on your location, the process for obtaining an electrician license typically includes:

    • Apprenticeships: Electricians must receive up to four years of on the job training. In addition to apprenticing, they must complete courses on electrical science and theory.
    • Journeyman License: Once the apprenticeship is completed, the electrician will be expected to pass an Electrical Journeyman exam to obtain their Journeyman license.
    • Master Electrician License: This licensed is achievable after working for two years under a Journeyman License and passing the Master Electrician Exam.
  • Electrical Contractor License: This is often optional depending on your state or city requirements. Licensed contractors are either Master Electricians or employ one and hold the contract and liability insurance.

For more information on what is required in your state, please check out these two sources:

No matter what state you are in, you must have a license to operate your own electrical business. You will not be able to pull job permits without a license.

Learn about Business Permits.

Electrical business permits requirements really depend on the state or city you live in. Before starting your business, you should check with your state to see what kind of jobs they require permits for. Some states will require buildings plans to be submitted for any new buildings and repairs to buildings over a certain square foot.

How do you get an electrical business permit? Permits are issued by either your local building department or Building Codes Division field offices. You will need a license as well as tax clearance and certificate of insurance in order to pull a business permit.

Research Tax and Insurance Requirements

Some states will require you to obtain a tax clearance from the state’s Revenue Department as well as prove you have valid insurance that describes your vocation.

Insurance is like a safety net. Even experienced technicians with years of field experience can have a mishap while on the job. You should look into getting insurance for your vehicle and tools as well as insurance for yourself and any employees you may hire. When starting your own business, you should look into general liability, worker’s compensation and income protection policies.

Acquire Electrical Equipment, Tools & Vehicles

Do you have enough equity to purchase the equipment, tools and vehicles you will need to begin working? If not, look into financing options that way you won’t have to fork over all of your cash all at once. Having a back up plan is always your best plan.

Electricians typically carry their tools and equipment in a van or oversized truck. When you’re looking to purchase your vehicle, pay extra attention to your cargo space. You will need to be able to transport tall ladders and other bulky tools of the trade.

Equipment costs can pile up quickly and while you want to be smart about your spending do not be cheap. Cheap equipment and tools will cost you more in the long run and could create more problems that solve. Cheap tools break and time is money.

Create Invoices & Work Orders

Owning your own business comes with the added perk of keeping track of finances. If you’re a numbers person this might end up being how you unwind after a long day or it could be your worse nightmare. But it doesn’t have to end in tears!

Test out as many invoicing programs as you can before purchasing. This way you will find one that is easy for you to use and fits your business plan.

Creating the perfect electrical invoice form will also reduce your headache and reduce financial loss. Many business owners do not put much thought into their invoices and thus end up hurting their business rather than helping it. Take time to think about what you need and how your business flows. Set up your work order in a way that makes sense for you and any other electricians you may have working for you.

Remember, invoice programs and forms should help you not hinder you. At we strive to help you create the perfect carbonless forms for your business. Don’t settle for an invoice that only halfway meets what you need. Try one of our electrical contractor form templates and customize it to the way you need it.

Make a Business Plan & Marketing Strategy

A polished business plan will give your new business structure and the proper strategy to get it off the ground. It is a time consuming step but every successful business owner has had one. Just being able to put into words why you’ve chosen this venture will keep your purpose in perspective. Also, it’s good to plan and understand what your long term goals will be and what your future holds. Make plans for any and every situation. It’s best to be over prepared so that if tragedy strikes you know what to do.

Another part of business planning is coming up with a marketing strategy. You need to start marketing right away. If you open your doors without announcing yourself, there won’t be any clients there to walk through.

You will need to build a website and set up social media accounts. After that, determine who your target audience is. You will either need to start email campaigns, stick up flyers, hang up door hangers or mail postcards. can help you with all of your printing needs. We have ready-to-print marketing templates that will make this step a little less stressful!

At some point you will also need an electrical company business card. Business cards are still very much relevant in todays digital world. People are able to scan them into their phones and some people still keep them on file for emergencies. It’s also a great way to introduce yourself when meeting a client for the first time. Do not skip the business cards! They will be your lifeline to return customers.

Find a Mentor

Remember you are not alone in your journey. Many others have traveled this road. Get their advice and weigh your options. For more information and to connect with a community of electricians, visit these sites:

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