Electrician Business Plans: The Design Essentials
Whether you're a residential or commercial electrician, a business plan will do more than prepare you for the challenges ahead. It will save you time and money, too.
Crafting the Plan
A glance at business plan templates online will show you that they can vary widely. But including these core elements will help yours work for you:
- An executive summary. This should highlight the strongest components of your plan.
- An overview of the electrician contracting industry in your area. Include research on your competitors and your client base.
- A description of the particular benefits your business can provide. These are things your competitors can't or don't offer.
- A plan for managing your business operations. How do they fit with your overall business goals?
- An outline of your marketing strategy. How will you promote your business and build a loyal customer base?
- A financial projection for 90 days, six months or a year. Cover current and ongoing costs. Also include projected revenues and financing arrangements you might make with your bank.
Putting these elements down on paper equips you to assess your strengths and weaknesses. And this helps you prepare for the nuts and bolts of running your own business.
Deciding What to ChargeEvery business owner faces this challenge. Weigh factors like your professional qualifications (including education or certification) and your experience. What are standard rates for your area? And what do your competitors charge? Do you charge by the hour or a flat rate for each job?
Charging by the hour is common among electricians. This means establishing an hourly base rate, then adding parts and labor onto that. Some electricians also adjust their rates based on the time of day. They may charge more for evening jobs, for example. Some charge more for weekend or holiday work, too.
An hourly rate policy has its shortcomings. If you finish a job sooner than expected, for instance, you'll make less than you planned. Customers may also balk at having to pay for expenses like transportation or picking up materials. They will likely compare your total charge, based on your hourly rate, with what they can get elsewhere.
Charging a flat rate for your work, on the other hand, offers some advantages. Your customers won't worry about a rising fee if the job runs long. And they're often more inclined to opt for additional work — upgrades, ongoing maintenance and so on — when they know the cost beforehand. In many cases, both you and your customers will be more comfortable knowing the overall price in advance.
Promoting Your BusinessYour business plan will help you decide the best way to spread the word about your business. Should you focus your marketing efforts on homeowners with plans to remodel? What about real estate developers? The markets you choose to serve will determine how you use direct mail or social media. It will also inform the design of your website.
Finally, think about what sets you apart from the competition. "Does your business have a particular specialization or cater to a niche market?" asks Entrepreneur. "Then definitely capitalize on what makes your business different from others in town."
Success always starts with a comprehensive business plan. Your skills and initiative will take it from there.