How to Set Up an Electrical Business

Setting up an electrical business requires more than proficiency in dealing with electrical equipment. You’ll need to get your licenses, register your business, hire employees, market your business, and plan for the future. If you don’t strategize and develop your business goals ahead of time, you can find yourself losing money later on. This handy guide on how to set up an electrical business will tell you everything you need to do to stay ahead of your competition and build a successful electrical business.

How to Set Up an Electrical Business

Being an electrician is a specialized trade. To work as a professional electrician, you’ll need to be certified from a trade school, or pass out from an apprenticeship program. Without the proper certification, you may not be allowed to practice as an electrician, much less run an electrical business. That’s why electricians are in high demand.

If you’ve already secured your trade certification and can work as an electrician, then you’ve already completed the first step towards setting up your electrical business. Here’s what you do next.

License and Regulations

You’ll need a business license to start an electrical business. There may also be other licenses involved in your state or geographical area. To make sure that you’re complying with local governmental regulations, you’ll need to speak to your local authorities. They’ll help you ensure that you have all the licenses and permits you need to start setting up your electrical business.

Once you have your permits, you can register your business with your state. Before you register, you’ll need to choose the structure of your new business. There are various different kinds of structures, such as LLCs and corporations. These have different public liability requirements, tax and compliance requirements, and more. Choosing the right business structure for your electrical business is essential, as this’ll be the foundation of your business.

While you’re registering your business, you’ll also be required to provide a name for your business. Selecting a name that has an available domain name for a website is crucial. You can easily find out whether your chosen domain name is available or not using free software available online.

Geographical Area and Target Audience

As an electrical business, you’ll be restricted to the area you can travel to. Since most of your equipment will travel with you in your work van, choosing a geographical area with a lot of potential clients is good for your business.

Up-and-coming business or industrial hubs, residential areas or places from where you can access other parts of your city are good for your office space. You can also get in touch with local real estate agents to find out whether they have any jobs or referrals available for you. Often, a real estate agent will need to ensure that the electrical wiring of a home is up to par before they can have an open house.

Your office space doesn’t have to be large, but you should be able to accommodate all your equipment, as well as a workbench. Your office space should also either have a parking lot where you can park your work van, or be near to a place where you can legally park your van. Remember that your work van will be hosting a lot of electrical equipment, so you may need to consult with the local authorities to find the ideal parking spot for your van.

Equipment and Employees

As a new business owner, there’s an initial investment that you’ll have to make. This investment is towards getting quality equipment, a reliable work van, as well as employees.

You may not have the time to handle all aspects of running an electrical business by yourself, so having a trustworthy team is essential. Hire apprentices who can take care of smaller electrical work while you handle all major repairs. An accountant will also be necessary, especially as you need to maintain a regular record of your cash flow for tax purposes.

Business Plan and Funding

Having a business plan can be a major asset for your electrical business. It contains various essential information about your electrical business, such as your business goals, services offered, financial projections, milestones, and more.

It’s also a necessary document if you want to get a business loan. Investors and lenders often ask to see your business plan before they’ll discuss lending money to your business.

A good business plan also helps you understand your personal motivations for setting up an electrical business, what you hope to achieve from it, your growth opportunities, as well as competitive analysis.

Website, SEO, and Marketing

After you’ve set up your electrical business, you’ll need to start securing clients. For electrical businesses, there are a few avenues through which you will find your clients:

Your website

Social media platforms, with Facebook being a top way prospective client, look for local electrical businesses


That’s why you’ll need to set up a website that’s search engine optimized. SEO helps your website to feature higher on Google’s search engine ranking results. This brings more traffic to your website every time someone in your geographical area searches on Google for an electrical business.

Social media platforms like Facebook are also used by clients to find electrical businesses. Having an active social media account where you regularly post quality content related to your business can help you boost sales.

Creating a marketing plan and investing in securing clients can also help you find more prospective clients. You can also directly approach commercial properties and real estate agents to ask about work.

Rates and Services

Before you start work as the owner of your own electrical business, you’ll need to know your rates and the services you offer. Many electrical businesses choose to focus on a niche, with the aim to become an authority within that niche and obtain clients specific to their specialization.

You can, for example, choose to only work with certain kinds of electrical equipment over others. To figure out the right rates for your services, do a market analysis to see what rates your competition is offering. Don’t price your services too low or your clients may become wary. At the same time, don’t price your services too high or you won’t find many clients. An average of what your competition is offering, where you keep the costs of running your business in mind will be ideal.

There are other areas you need to think about when it comes to building an electrical business as well. Insurance for electricians is an area you can consider as well. If you have employees, you may also need to get workers’ compensation insurance. Other kinds of insurance, like public liability insurance, can protect your electrical business in case you face legal issues from a client or a third party.

These essential tips will help you set the foundations of your electrical business in a way where you can expect sustained long-term growth and expansion.


  1. Staff, ‘How to Start an Electrical Business – What You Must Know’, viewed December 21st 2020,
  2. Staff, ‘How to Start an Electrician Business’, viewed December 21st 2020,
  3. Tradify Team, Updated February 14th 2020, ‘How to Start an Electrical Business – An Electrician’s Guide’, viewed December 21st 2020,

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