Starting a plumbing business can be a lucrative venture. In fact, the industry generates over $4 trillion globally, with North America accounting for 47.9% of global smart bathroom revenue (ca. $124.2 billion), according to WebFX.

According to the same source, a plumbing business' profit typically accounts for ca. 35% of its sales. The average U.S. plumber earned $59,880 annually in 2021, while 53% of these people have a high school diploma. 84% of them are employed in the private sector.

These stats should illustrate how lucrative a plumbing business can be when done right. We'll hereby go through the steps of “doing things right.”

Drafting a Plumbing Business Plan

Every successful venture starts with a good business plan, and plumbing isn't an exception. A well-structured business plan can help plumbers start their business from scratch and deal with all kinds of circumstances (which are many and regular).

  • Listed below you'll find key elements to include in the business plan, as follows:
  • Executive summary (features a business overview)
  • Business description (features details, such as specific plumbing services, the target market, and legal structure)
  • Market research (trends, market demand, and competitors' strengths and weaknesses)
  • Marketing and sales strategy
  • Operations and management (details day-to-day operations)
  • Financial projections (costs, revenue forecasts, and profit and loss assessments)
  • Funding requirements (e.g., funds for equipment purchase, hiring staff, and advertising)
  • SWOT analysis
  • Milestones and timeline
  • Appendices (any supporting documents)

A business plan is not set in stone. It should be adaptable as to include any changes called for as the plumbing business grows. In other words, business plans need to be updated to reflect progress and any change in circumstances.

E.g., if you're wondering what to charge for plumbing work, you should dive into competitor analysis on a regular basis. Plumbing businesses aren't static and costs change all the time.

Essential Equipment and Supplies

Investing in high-quality tools (e.g., pipe wrenches, pipe cutters, soldering equipment, plumbing snakes, etc.) is essential for any successful plumbing business. In addition, you should make sure that the inventory includes a wide range of plumbing materials (e.g., pipes, fittings, fixtures, etc.).

Finally, there's safety equipment to consider, which at the very least should include gloves and safety goggles. For best results, complement the basics with hard hats and steel-toed boots.

Expensive equipment that may come in handy includes pipe inspection cameras, trenchless repair equipment, work vehicles equipped with tool storages, and plumbing software.

Navigating Licensing and Regulations

The plumbing industry needs to adhere to quite a lot of regulations and licenses, so research is critical in this regard. Typically, plumbing businesses need to adhere to a set of plumbing codes, safety standards, and environmental regulations.

We'll help you get started by listing the essentials, which include:

  • Plumbing license for the target jurisdiction
  • Business license
  • Contractor's license (where applicable)
  • Insurance, specifically General Liability Insurance and Worker's Compensation Insurance
  • Permits for plumbing projects
  • Local zoning regulations
  • EPA Lead Certification (for homes built before 1978)
  • Occupational Safety and Health Administration (OSHA) compliance
  • Tax Identification Number (TIN)
  • Choose a legal structure for your plumbing business (sole proprietorship, limited liability company (LLC), partnership, or corporation)
  • Compliance with local building codes
  • Environmental regulations
  • Business Insurance

Staying updated on changes in plumbing regulations, licensing requirements, and industry standards is essential, so keep an eye on the developments.

Marketing Your Plumbing Business for Success

With the world going virtual, even local plumbing businesses need to increase their online presence. This portends investments in marketing and building brand awareness.

To increase your brand's online presence, you'll need to hire professionals to create a professional and user-friendly website showcasing your services, testimonials, expertise, and contact information. SEO is typically a better option than paid ads, meaning that a long-term strategy is called for.

As for building brand awareness, social media exposure, content- and email marketing, and online directory listing are critical.

Additional proven techniques include vehicle branding and community involvement, which take time and money, so plan accordingly.

Managing Finances for Long-Term Prosperity

Lastly, to ensure your plumbing business will stay successful in the long run, it's critical to manage finances skillfully.

Key aspects of financial management for plumbing businesses include budgeting, cash flow management, keeping financial records, tax planning, debt management, monitoring profit margins, maintaining an emergency fund, planning for retirement, financial forecasting (long-term and scenario analysis), and seeking professional advice.

As you can see, there's a lot to keep in mind when starting a plumbing business, so it's recommended to start small and take your time expanding the business.

Hiring new workers may not be necessary in the beginning, if you're planning to start locally, but do consider this option for the long run. Overall, planning and revising are the core of any successful plumbing business, so don't shy away from professional advice when starting out.