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How to Write a Business Plan for a Electrical Contractor

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  • September 14, 2022
  • Small Businesses

business plan for electrical shop

Whether you’re looking to raise funding from private investors or to get a loan from a bank (like a SBA loan) for your electrical contractor company, you will need to prepare a solid business plan.

In this article we go through, step-by-step, all the different sections you need in the business plan of your electrical contractor business. Use this template to create a complete, clear and solid business plan that get you funded.

1. Electrical Business Executive Summary

The executive summary of a business plan gives a sneak peek of the information about your business plan to lenders and/or investors.

If the information you provide here is not concise, informative, and scannable, potential lenders and investors will lose interest.

Though the executive summary is the first and the most important section, it should normally be the last section you write because it will have the summary of different sections included in the entire plan.

Why do you need a business plan for an electrical business?

The purpose of a business plan is to secure funding through one of the following channels:

  • Obtain bank financing or secure a loan from other lenders (such as a SBA loan )
  • Obtain private investments from investment funds, angel investors, etc.
  • Obtain a public or a private grant

How to write an executive summary for an electrical business?

Provide a precise and high-level summary of every section that you have included in the business plan of your electrical business. The information and the data you include in this segment should grab the attention of potential investors and lenders immediately.

Also make sure that the executive summary doesn’t exceed 2 pages in total: it’s supposed to be a summary for investors and lenders who don’t have time to scroll through 40-50 pages, so keep it short and brief.

The executive summary usually consists of 5 major sub-sections:

  • Business overview : start by introducing your proposed electrical contracting firm, where it is located, the services you will offer, and the pricing strategy you want to implement. Mention what sets you apart from other businesses. For example, you may be a master electrician with a decade of experience in designing electrical systems.
  • Market analysis : summarise the market where you will operate and provide a brief about your target market, target audience, spending capability, etc. Also give certain data points about the electrical contractor business industry in the area where you want to operate (size and growth), as well as an overview of the main competitors, etc.
  • People : introduce your electrical business’ management and employee structure. Provide a brief (no more than a couple of sentences each) of the knowledge and experience of the team. Also, mention how the company will be structured (management roles and reporting lines)
  • Financial plan: how much profit and revenue do you expect in the next 5 years? When will you reach the break-even point and start making profits? You can include here a chart with your key financials (revenue, gross profit, net profit )
  • Funding ask : what loan/investment/grant are you seeking? How much do you need? How long will this last?

business plan for electrical shop

2. Electrical Business Overview

In this segment of the business plan, you will provide details about your proposed electrical contracting firm.

You must answer here some important questions that potential investors and lenders often ask about your business and operations. Here are some examples of questions you must answer:

  • What is the rationale behind your opening an electrical contractor business today?
  • In which location will you operate and why?
  • What type of services will you offer?
  • Are there specific types of services and/or industries that you specialize in?
  • What will be your pricing strategy and why?
  • What will be the legal structure of your company?

a) History of the Project

Any business overview must start with explaining the history of the project. There are 2 components here:

  • Passion & experience of the business owner
  • Rationale behind starting an electrical business today

Passion & experience

You must display your passion while at the same time, you must also showcase your experience. For instance, you may have 10 years of journeyman experience, or you may be a master electrician with the ability to design ground-breaking electrical systems.

Is there a certain problem (or perhaps, a set of problems) that your electrical contracting firm will try to solve when it comes into existence?

For example, there may be a steady increase in demand for commercial electrical contracting firms but there are only a few unorganized service providers incapable of efficiently handling commercial contracts.

The rationale behind your project must be backed up by a thorough analysis of the industry in the area where you plan to open your electrical contractor business. This is what we will cover under Market Overview further below.

business plan for electrical shop

b) Business Model

This section of the Business Overview should explain the model you want to adopt for your electrical contractor business. For example:

  • Which target audience segment you will focus on and why?
  • Is there enough demand for that segment in your focus area?
  • What type of services you will offer?

What are the different types of e lectrical contractor companies?

You may choose one of the following:

  • Residential Electrical Contractors: They usually collaborate with homeowners to design or install electrical systems
  • Commercial Electrical Contractors : They usually focus on commercial and outdoor spaces like malls, shops, college campuses, gardens, parks, etc.
  • Industrial Electrical Contractors : They usually focus on larger products like industrial manufacturing areas, warehouses, etc.

No matter what you select, you must ensure that there is enough demand for the type of electrical contracting firm you want to open and the range of services you will offer.

c) Services

The services you offer will depend on the type of customers you will serve and also on the skills you have. Provide a quick list of the major services that you will offer. Some services may include things like:

  • Exterior and interior lighting
  • Installation of safety systems & electronic appliances
  • Electrical wiring and transmission line installation
  • Repairs & upgrades, etc.

business plan for electrical shop

d) Pricing Strategy

This is where you will provide an overview of your pricing strategy. For instance, you may charge higher than your competitors because you may have a team of highly experienced electricians and also because you use high-quality wires and other materials than your competitors.

Similarly, you may decide to charge lower than your competitors because of the bulk purchase of products like wires, switches, etc., which allows you to bring down the cost of your services.

Whatever the case is, explain your pricing strategy and the logic behind it.

Pricing table

While it may not be possible to provide a proper pricing table for all services that you will offer, it is still a great idea to provide a table that gives an overview of your pricing structure.

Providing individual pricing for all services may not be possible, however, you may provide a range. For example:

  • Smart systems installation: $75 to $150 per hour (depending on the system and area)
  • Repair and upgrades: $80 to $120 per hour

However, don’t go into extreme details because potential investors are not interested in the nitty-gritty of your pricing. They just need the big picture to assess the profitability, because they will tie your pricing strategy with your financial projections later on.

business plan for electrical shop

e) Company Legal Structure

Finally, your business overview section should specify what type of business structure you want. Is this a corporation or a partnership (LLC)? Who are the investors? How much equity percentage do they own? Is there a Board of Directors? If so, whom? Do they have experience in the industry?

3. Electrical Business Market Overview

A complete understanding of the market where you want to operate is important for the success of your business. That’s also something you must showcase in your business plan.

For example, if there is a high demand for residential and commercial electrical contractors but you want to focus on industrial customers despite a very small market size, it may not be a great business decision.

Therefore, you must cover here 3 important areas:

  • Market size & growth : how big is the electrical contractor business industry in your area? What is its growth rate (or decline rate) and what are the factors contributing to its growth or decline?
  • Competition overview : how many competitors are there? What type of customers do they serve? What type of projects do they specialize in? How do they compare vs. your business? How can you differentiate yourself from them?
  • Customer analysis : who is your target audience? How frequently do they require electrical contractor services? What is their yearly spending on electrical contractor services?

a) Electrical Contractor Industry Size & Growth

How big is the electrical contractor industry in the us.

In 2021 there were over 70,000 electrical contracting firms in the US employing about 650,000 electrical workers.

As per the National Electrical Contractors Association (NECA) the industry is worth $202 billion: that’s an average annual turnover of $2,800,000 per company! 

Also, the vast majority of electrical contractors are small businesses: over 80% of all businesses had less than 10 employees.

business plan for electrical shop

How big is the electrical contractor industry in your area?

After getting a clear picture of the electrical contractor business industry in the US as a whole, narrow down to your location. It’s very likely that you won’t find the number anywhere (at least not for free).

In that case, you can use our guide to estimate the TAM, SAM, and SOM for your business. Here is an example of how to do it:

We already know that the average annual turnover for electrical contracting firms in the US is $2.8 million. Therefore, if the area where you will operate (a city for example) has a total of 30 electrical contractors, the electrical service industry in the area is worth approximately $84 million.

business plan for electrical shop

What’s the market growth of the electrical contractor industry in your area?

Next on our list is market growth: is the industry growing or declining in your area?

US market growth can be a great addition to your business plan, yet it doesn’t necessarily help to assess the industry in your area of service. For example, the industry might be growing in the US, but declining in your region for a number of reasons (for example, the large commercial market may be contracting because businesses are shutting down due to losses, resulting in the closure of electrical contractor businesses that focused on the commercial market).

As you likely won’t find this information online, you can instead rely on the number of electrical contractor businesses in the location to calculate the average growth rate of the industry in your area.

For example, if the region had only 27 electrical contractor businesses in 2019 and 30 in 2021, you can assume that the average annual growth rate of the electrical contractor businesses industry in the area is around 5-6%.

b) Competition Overview

Studying your competitors’ business models is vital. You need to understand what makes them successful or why they fail. A clear understanding of their business model, the products they sell, their marketing strategies, etc., will allow you to provide a better service.

If your competitors are offering nearly the same services, then what is their market share and how do they market their products & services to attract new customers?

It is always a good idea to do some research (if necessary, you may consider physically visiting your competitors without revealing your business intentions) and create a comparative table summarizing their service offerings, marketing strategies, target audience, etc.

Here is a sample table that you can use:

Electrical Business SWOT Analysis

SWOT stands for Strength, Weakness, Opportunities, and Threats. This analysis will help lenders and investors better understand how you compare vs. competitors as well as the overall risk and reward profile of your business.

Here is a sample that you can use as a reference:

  • Strengths : 12 years of experience as a master electrician in a popular electrical contractor company
  • Weaknesses : Startup cost, no initial brand reputation
  • Increased construction of residential apartments due to demand spike in rental housing and builders are looking for skilled electricians for wiring everything (backup with data for population and real estate boom)
  • Growth in retail stores and malls (because of population influx), which in turn has increased the demand for electricians for installation and maintenance (provide data)
  • Increased commercial warehouse construction because of increased regional distribution centers by e-commerce retailers that require electrical installations (provide data and explain why there is an increase in commercial warehouse construction – for example, increased demand and hence imports of cheaper products)
  • Threats : Big brands like Helix Electric, Bergelectric, & Cupertino Electric, Inc. are all eyeing the growing market

business plan for electrical shop

c) Customer Analysis

Finally, we need to look at your customers.

However, the first thing you must do is clearly define the target audience. For instance, you may serve individual households, commercial establishments, or even industrial establishments.

Some important points that you must include in your customer analysis include:

  • How much do your target customers spend on electrical services per year?
  • How frequently do they need electrical contractors?
  • What type of electrical services do they usually require (fresh installations, inspections, repairs, etc.)?
  • What type of electrical contractors do they usually hire (big brands, small contractors, individual electricians, etc.)?
  • What do they dislike about the existing electrical contractors in the area (for example, slow response time)?

business plan for electrical shop

4. Sales & Marketing Strategy

This is the section where you outline your customer acquisition strategy. Try to answer here the following questions:

What is your Unique Selling Proposition (USP)?

  • What are the different marketing strategies you will use?
  • How do you intend to track the success of your marketing strategy?
  • What is your CAC or customer acquisition cost?
  • What is your marketing budget?
  • What introductory promos and offers do you intend to provide for attracting new customers?
  • What marketing channels do electrical businesses use?

What marketing strategies do electrical contractors use?

A few marketing channels that electrical businesses typically use are:

  • Signages, vehicle branding
  • PPC ads (Google local services ads)
  • Social media platforms
  • Flyers & pamphlets
  • Word of mouth, recommendations

It is not necessary to use all channels. Instead, you can start by focusing on a few of them, and include other marketing strategies later.

business plan for electrical shop

In other words, how do you differentiate yourself vs. competitors? This is very important as you might need to win customers from competitors.

A few examples of USPs are:

  • Response Time : you may respond within 30 minutes (whatever you can commit to), which is faster than any competitor 
  • Emergencies : you may have years of experience dealing with electrical emergencies that can potentially cause immense damage to life and property
  • Free inspection : you may offer one free inspection of wiring and other installations once every quarter

Your USP will depend on your business model, competitor analysis, and target audience. Whatever your USP be, it should be clear and appealing to your target audience.

5. Management & People

You must address two things here:

  • The management team and their experience
  • The organization structure : different team members and who reports to whom?

Small businesses often fail because of managerial weaknesses. Thus, having a strong management team is vital. Highlight the experience and education of senior managers that you intend to hire to oversee your electrical business.

Describe their duties, responsibilities, and roles. Also, highlight their previous experience and explain how they succeeded in their previous roles.

It is also important that you explain how their experiences and qualifications help you in implementing the electrical business you are proposing. If they have specialized training and experience (master electrician or journeyman electrician for 8 years in a reputed electrical contractor firm), add that information.

Organization Structure

Even if you haven’t already hired electricians, trainees, managers, drivers, accountants, and other relevant staff members, you must provide a flowchart of the organizational structure defining hierarchy and reporting lines.

business plan for electrical shop

6. Financial Plan

The financial plan is perhaps, with the executive summary, the most important section of any business plan for an electrical contractor company.

Indeed, a solid financial plan tells lenders that your business is viable and can repay the loan you need from them. If you’re looking to raise equity from private investors, a solid financial plan will prove them your electrical contractor company is an attractive investment.

There should be 2 sections to your financial plan section:

  • The startup costs of your company
  • The 5-year financial projections

a) Startup Costs

Before we expand on 5-year financial projections in the following section, it’s always best practice to start with listing the startup costs of your project.

For an electrical contractor company, startup costs are all the expenses you incur before you start making sales. These expenses typically are limited especially for small businesses and include:

  • The lease deposit (if you rent an office and/or warehouse for your equipment)
  • Electrical equipment, tools, etc.
  • License & permits, business insurance, etc.

Of course, the startup costs depend on a number of factors, like the size of your business (employees), the services you plan to offer (which will dictate what equipment you may need), etc.

b) Financial Projections

In addition to startup costs, you will also need to build a solid 5-year financial model in the business plan of your electrical company.

Note that your financial projections should be built using a spreadsheet (e.g. Excel or Google Sheets) and presented in the form of tables and charts in your business plan.

As usual, keep it concise here and save details (for example detailed financial statements, financial metrics, key assumptions used for the projections) for the appendix instead.

Your financial projections should answer at least the following questions:

  • How much revenue do you expect to generate over the next 5 years?
  • When do you expect to break even?
  • How much cash will you burn until you get there?
  • What’s the impact of a change in pricing (say 10%) on your margins?
  • What is your average customer acquisition cost?

You should include here your 3 financial statements (income statement, balance sheet and cash flow statement). This means you must forecast:

  • The number of contracts (customers) over time ;
  • Your expected revenue ;
  • Operating costs to run the business ;
  • Capex (cost to buy the equipment and vehicles, etc.)

When projecting your financials, make sure to sensitize sales volume (customers), pricing as well as the expenses (inventory, salaries, etc.). Indeed, a small change in these assumptions may have a significant impact on your revenues, and most importantly, your profits.

business plan for electrical shop

7. Use of Funds

This is the last section of the business plan of your electrical contractor company. Now that we have explained what your business model is, what type of services you offer, how you get customers, etc., this section must now answer the following questions:

  • How much funding do you need?
  • What financial instrument(s) do you need: is this equity or debt, or even a free-money public grant?
  • How long will this funding last?
  • Where else does the money come from? If you apply for a SBA loan for example, where does the other part of the investment come from (your own capital, private investors?)

If you raise debt:

  • What percentage of the total funding the loan represents?
  • What is the corresponding Debt Service Coverage Ratio ?

If you raise equity

  • What percentage ownership are you selling as part of this funding round?
  • What is the corresponding valuation of your business?

Use of Funds

Any business plan for an electrical contractor company should include a clear use of funds section. This is where you explain how the money will be spent.

Will you spend most of the loan / investment in paying your employees’ salaries and the COGS (inventory)? Or will it cover mostly the cost for acquiring the equipment and machines?

For the use of funds, we also recommend using a pie chart like the one we have in our financial model template where we outline the main expenses categories as shown below.

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  • How To's & Quick Tips

How to Start an Electrical Business: A Guide for Prospective Entrepreneurs

Electricians with an entrepreneurial spark may want to consider starting an electrical company. they can be their own boss and also help train the next generation of electricians..

By Tom Scalisi | Published Jan 26, 2024 5:47 PM

We may earn revenue from the products available on this page and participate in affiliate programs.

A close up of a person using a multimeter.

Photo: istockphoto.com

Electricians are well-compensated tradespeople—the U.S. Bureau of Labor Statistics reports that the median annual pay for an electrician in 2022 (the most recent year for which data is available) was $60,240, and an electrician can make even more than that with the right experience and training. To really rake in the bucks, many skilled electricians opt to start their own electrical business rather than work under another electrician. Being their own boss allows them to set their electricity business rates, design their schedules, and generally make their own decisions as long as they meet certain requirements.

This guide is designed to help aspiring and current electricians who are considering starting their own electrical business. Electricians will learn more about how to start an electrical business so they can make a plan to reach their professional goals.

Before You Begin…

A close up of someone using a multimeter.

It’s important for aspiring entrepreneurs to recognize that they don’t necessarily need to start their own electrical business to have a lucrative and rewarding career in the electrical industry. Electrical technology is changing every day, and electricians who continue to grow their skill sets will be more in demand over time and can increase their earnings as their knowledge and experience increases.

Also, it’s important for electricians to understand that their daily work routine will likely change when they’re running an electrical business. Rather than wiring houses or replacing circuit boards, they may be hiring and training employees, holding meetings, and shopping for insurance plans. If those activities aren’t appealing, an electrician may be better suited to being an employee at another electrical business than owning their own business.

Tips for Starting an Electrical Business

  • Be patient. The process of becoming an electrician is long, and in some cases, it can take as many as 10 years before an electrician is in a place to start their own business.
  • Start small. Before jumping into owning a full-fledged electrical business, an electrician can get their license, register a business name, and carry insurance while they’re still working for someone else.
  • Understand local requirements. Each state’s rules are different. Electricians will want to make sure they understand all of the licensing and insurance requirements within their state.

STEP 1: Complete the training and work hours required to get your electrician license.

The first step for an individual to take when starting an electrical business is to get the required electrician license. In some states, a journeyman’s license is all an electrician needs to start their own business. In other states, a contractor may be required to have a master electrician’s license to legally start a business.

In either case, the path to both licenses starts with an apprenticeship. An apprenticeship is when a new electrician works under the supervision of a licensed electrician for several years, learning the trade from a professional.

“Most electrical apprenticeships have eligibility requirements including a high school diploma and proof of successfully completing algebra classes,” explains Stephan Cole, corporate field trainer with Rosendin , a nationwide electrical contractor with headquarters in San Jose, California. “There will be an interview process and the interviewers will ask you why you want to be an electrical worker and why you applied to this program; therefore, it would be wise to research the industry and the apprenticeship program that you are applying to, so you are ready and sure this is what you want to do.”

Each U.S. state has specific criteria that apprentices must meet before they can earn their next license (the journeyman license, in many cases). These requirements typically include a set number of work hours and/or a specific number of classroom hours (either in person or through one of the best online electrician schools ). Once an electrician has met these minimums, they can take their journeyman licensing exam.

If the state requires an electrician to hold a master electrician license to start a business, an electrician typically has two options:

  • Get more work experience. A journeyman electrician can opt to work for several years under an experienced master electrician until they’re eligible to take their master electrician license exam. The exact amount of work experience needed to qualify for a master electrician license varies from state to state.
  • Hire a master electrician. A journeyman electrician can hire a master electrician as an adviser and use their license to meet the state’s requirements for starting their business. Eventually, the business owner will be qualified to take their master electrician licensing exam, but they can operate legally under the master electrician’s license in the meantime.

STEP 2: Write a comprehensive business plan.

Once an electrician has the correct license and is ready to start their own business, they’ll need to write up an electrical business plan. This comprehensive document will include everything an entrepreneur needs to chart their course to success, and they’ll be able to refer back to it when they’re looking for investors, planning to scale, and making business decisions.

The following are some items an electrician business plan will need to include.

  • Executive summary. This describes the entrepreneur’s business plan in one page, including what sets them apart from the competition.
  • Business overview. This states the business name, important dates such as when the business was originally registered, and summarizes the business structure.
  • A list of services. This section will include the specific electrical services the business will offer to customers. It could be a basic list of residential services, or it could include specialized services the business owner offers, which they may have obtained specific training to perform.
  • Market analysis. This section will describe the business’s target customers and the competition in the area from other electrical businesses.
  • Financial plan. This will include the business’s pricing strategy and profitability forecast, including how much money is expected to come into and go out of the business within the first year.
  • Marketing strategy. This section describes how the business owner will market or advertise their business.

Electricians who aren’t sure how to write a business plan can enlist the help of a coworker or mentor, or even hire a professional business plan writer.

STEP 3: If necessary, secure financing to help fund your business start-up.

Starting an electrician business can be expensive. Some of the most common expenses an electrician will come across when starting a business include licensing fees, insurance premiums, tool and equipment purchases, and business vehicle purchases. The electrician may already have a vehicle or the basic tools needed to run an electrical business, but if they don’t, they’ll need to determine how to cover those start-up costs.

There are several options for an entrepreneur to secure money to start a new business, including the following.

  • Taking out a small-business loan, either from a private lender or from the U.S. Small Business Administration .
  • Tapping into their home’s equity through one of the best home equity loans , such as one from U.S. Bank or Flagstar Bank .
  • Asking friends and family members to invest in their company or partner with them.
  • Working extra hours with an employer to save the required money.
  • Setting up a crowdfunding campaign to raise money.

Whatever decision an electrician makes, they’ll want to make sure they discuss it with a financial adviser to ensure they’re making the wisest choice possible for securing the financing they need.

Two men in yellow hards assess the electrical components of a machine.

STEP 4: Choose a business structure.

Once an electrician has a plan in place and the funding for their business, it’s time for them to choose a business structure. There are three main options an aspiring business owner can choose from.

  • Sole proprietorship: Sole proprietorships are great for one-person small businesses, and they’re easy to set up. However, they don’t offer protection for the owner’s personal assets, which could cause issues if a future client sues the electrician in the event of property damage or injury that occurs during the course of a job.
  • Limited liability company: An LLC is a common option for small electrical companies (even if they’re a one-person shop). This business structure includes more tax benefits for owners than a sole proprietorship and a layer of protection between personal assets and business assets.
  • S corporation: An S corporation (sometimes shortened to S corp) is a business structure that provides liability protection and increased tax benefits for an electrical contractor.

Contractors will want to consult with a tax adviser or attorney before determining which structure is best suited for their business. They may even want to enlist the help of one of the best LLC services , such as LegalZoom or Northwest Registered Agent , to help them register their business.

STEP 5: Get the appropriate business licenses required by your state or local government.

Next, a business owner will need to register their business name with the state and secure the appropriate types of business licenses needed for them to run their business legally. These licenses are different from an electrician’s license, which is a type of trade license. Trade licenses allow the holder to work in a specific trade, while a business license allows them to operate a business within the state or local municipality.

The process of getting a business license involves a business owner registering their name and filling out the appropriate paperwork. This can usually be done through their secretary of state’s office, but some states have their own business licensing agencies, so it’s important for an entrepreneur to research the rules in their location. Once this process is complete, the contractor will have the required license and tax identification numbers that allow them to operate legally within the jurisdiction.

STEP 6: Get the appropriate business insurance coverage.

Business insurance may seem like an afterthought, but it is a necessity for all types of businesses. According to InterCoast Colleges , business insurance can help protect an electrician’s business and their money should a client sue them. All electricians need some form of general liability insurance, which pays for property damages or injuries to clients that occur while the electrician is on the job (up to the policy limits). For example, a general liability policy will help pay for repairs to a client’s home if the electrician’s ladder slips and breaks a window, or if the client trips over an extension cord laid out by the electrician and sustains an injury.

In addition to general liability insurance, electrical contracting company owners might consider the following types of insurance coverage.

  • Inland marine insurance: This type of insurance covers an electrical business’s tools and equipment. If the covered items are damaged or stolen while being transported to or from a jobsite, inland marine insurance may help to repair or replace the covered items, less the deductible. Coverage may also apply when the tools and equipment are in storage or at a jobsite.
  • Commercial auto insurance: This type of insurance covers vehicles owned and operated by the business. It can cover the costs of vehicle repairs after a collision or other type of covered damage, medical bills for injuries resulting from an accident, and any legal fees in the event of a lawsuit.
  • Workers’ compensation insurance: This type of insurance covers medical costs and lost wages for employees who get hurt or become ill while on the job. It can also provide death benefits to dependents if an employee is killed while at work.

Many of the best small-business insurance companies , such as NEXT or Thimble , can bundle these policies into one for convenience and a discount as well.

STEP 7: Purchase the tools and equipment you need to get your business off the ground.

Practicing electricians likely have a basic set of the best electrician tools necessary to help them get started with their business. As they expand their offerings, however, they may need more expensive equipment, more powerful tools, special software for an electrical design business, and other business tools that help grow their company.

Business owners will want to ask themselves whether it’s best for them to buy a piece of equipment or to rent it. Alternatively, the owner can purchase the equipment and then rent it out for additional income. Since new business owners won’t want to spend money on unnecessary tools and equipment when they’re starting out, they’ll want to take their time when making major purchases, even if they need equipment to get their business off the ground.

STEP 8: Choose a business accounting software to help you track invoices and expenses.

There are certain aspects of being a business owner that can be streamlined or automated with the right software. Accounting software is a big help, as such programs can help the business owner produce and track invoices, balance accounts, track expenses, and even receive payments.

Choosing the best accounting software comes down to several factors. The software has to be within the business owner’s budget while also offering all the features they need to help their business run smoothly. As the business grows and its needs change, the owner can upgrade subscriptions or switch to more expensive, more comprehensive software down the road.

There are several options on the market, with Jobber being one of the biggest names in the space. New business owners will want to do their research by asking fellow electrical business owners which software they use and reading online reviews (such as Jobber reviews ) to see which option would best suit their needs.

A close up of a person in yellow work gloves using a tool to fix electrical wiring.

STEP 9: Determine which services your business will offer and set pricing.

Electrical business owners get to determine the types of electrician services they offer. For instance, they may choose to work solely in residential projects, commercial projects, or both. They can also provide industrial electrical installation company services or work primarily with generators, switchgear, and other equipment. Some may choose to work with audio and visual equipment or low-voltage technology. There are many career paths for an electrician, which makes this profession even more appealing to those looking to specialize.

Another benefit of being the boss is that the electrician can set their own pricing. They can choose to offer flat rates for certain projects or charge an hourly electrician cost . If their costs rise, they can transfer the increase to their customers by raising their hourly rate. By pricing their services fairly and competitively, they can ensure a steady electrician salary for themselves and their employees.

STEP 10: Create a marketing plan that includes a business website and a digital marketing strategy.

All electrical businesses need marketing plans to help build brand awareness and attract new clients, and this goes far beyond printing electrician business cards to hand out to potential customers.

A website is a necessity, in that it provides a place where prospective customers can learn more about the business and contact the owner. Business owners with web experience can create their own business website from scratch, or they can use a website creation tool. Alternatively, a business owner can hire a web developer to build and/or maintain their website.

It’s important for the person running the business website to have a baseline understanding of search engine optimization (SEO), which is a process that makes it more likely for a website to come up in a search results page for related keywords. For example, a well-optimized electrician website is more likely to show up on Google after a potential customer searches for “ hire an electrician near me ” than one that lacks basic SEO principles. Business owners who aren’t familiar with SEO will likely want to hire a third-party agency or freelancer to take care of this for them.

In addition to a well-optimized and user-friendly website, electrical-business owners will want to invest in digital marketing in the form of social media, video, and ads. Running an Instagram page that showcases previous projects, filming YouTube videos that explain processes and highlight projects, and paying for internet ads targeting potential customers are all critical to growing a successful business.

STEP 11: Hire electricians and grow your business.

Once the business has been established, the owner will need to start looking into how they can grow the business, which is often called “scaling.” Scaling requires employees, such as office staff, managers, and more electricians.

Electrical-business owners will want to interview and hire journeyman electricians who know what they’re doing, as well as give back to the electrical community by hiring apprentices who want to learn the trade. In some cases, the business owner might even supply them with trucks or vans to get them from the shop to the jobsite. Best practices include providing these employees competitive wages, health care and retirement benefits, and time off, which helps them feel appreciated and builds loyalty to the electrician company.

Once an aspiring entrepreneur understands how to start an electrical business, they can make a plan to take themselves from employee to employer and build their future. Being a business owner is much different than being an electrician working for an employer, but with the right mindset, work ethic, and plan, it’s a great way for an electrician to achieve the business and lifestyle of their dreams.

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How to Start a Profitable Electrical Business [11 Steps]

Nick

By Nick Cotter Updated Feb 02, 2024

electrical business image

Business Steps:

1. perform market analysis., 2. draft a electrical business plan., 3. develop a electrical brand., 4. formalize your business registration., 5. acquire necessary licenses and permits for electrical., 6. open a business bank account and secure funding as needed., 7. set pricing for electrical services., 8. acquire electrical equipment and supplies., 9. obtain business insurance for electrical, if required., 10. begin marketing your electrical services., 11. expand your electrical business..

Starting an electrical business requires a thorough understanding of the current market to identify opportunities and challenges. A comprehensive market analysis will guide your business strategy, helping you to make informed decisions and tailor your services to meet the needs of your target customers. Here are key steps to take when performing a market analysis:

  • Research the local demand for electrical services by assessing the number of residential and commercial properties in your target area.
  • Analyze your competitors by studying their services, pricing, and customer reviews to determine your competitive edge.
  • Examine industry trends, such as smart home technology and energy-efficient solutions, to identify growing markets and potential niches.
  • Understand regulatory requirements and standards in the electrical sector to ensure compliance and identify any barriers to entry.
  • Assess the availability of suppliers and workforce to ensure you can source materials and hire qualified electricians.
  • Conduct surveys or focus groups to gather feedback about potential customers' needs and preferences.

electrical business image

Are Electrical businesses profitable?

Yes, depending on the type of electrical business, they can be very profitable. Electrical businesses such as wiring and maintenance services, solar installation, or data wiring can be very profitable. Additionally, depending on the location, some businesses may have an advantage due to a higher demand for certain types of services.

Embarking on an electrical business venture requires a well-thought-out plan to navigate the complexities of the industry and set a course for success. A comprehensive business plan will serve as a roadmap for your operations, financial management, and growth strategies. Here's a guide to drafting your electrical business plan:

  • Begin by defining your business objectives, mission statement, and the services you'll offer.
  • Conduct a market analysis to understand your competition and identify your target customer base.
  • Outline your organizational structure, detailing the roles and responsibilities of your team members.
  • Develop a marketing strategy that highlights your unique selling points and how you'll attract clients.
  • Prepare a detailed financial plan including startup costs, pricing strategy, sales forecasts, and projected cash flow.
  • Consider the legal and regulatory requirements for your electrical business, including licenses, insurance, and safety standards.
  • Establish operational procedures for project management, customer service, and quality control to ensure efficiency and professionalism.
  • Set short-term and long-term goals with measurable milestones to track your progress and make adjustments as necessary.

How does a Electrical business make money?

An electrical business typically makes money by providing electrical services such as installation, repair, and maintenance of electrical systems, wiring, and equipment. The business may also earn revenue from the sale of electrical supplies and components.

Developing a brand is essential in creating an identity for your electrical business that resonates with your target audience. It's about crafting a memorable image and a promise of quality that customers will come to recognize and trust. Here are some key steps to guide you through the branding process:

  • Define Your Brand Values: Determine what your business stands for, including reliability, innovation, or sustainability. These values should resonate with your customers and be apparent in every aspect of your business.
  • Create a Unique Brand Name and Logo: Your brand name and logo are often the first things a customer will see. Make sure they are distinctive, professional, and reflective of the brand's personality and values.
  • Establish Brand Voice and Messaging: The way your business communicates should be consistent across all platforms, from your website to customer service. A clear and consistent brand voice helps build a strong connection with your audience.
  • Design a Visual Identity: Choose colors, fonts, and imagery that align with your brand and make it stand out. Consistent visual elements make your brand more recognizable and memorable.
  • Build an Online Presence: In today's digital age, having a professional website and active social media accounts are crucial for brand visibility and customer engagement.

How to come up with a name for your Electrical business?

Coming up with the perfect name for your electrical business can be a difficult task. Brainstorming words that relate to electricity and the services that you offer can be a great place to start. Consider using words from different languages, rhymes, or alliterations to make your name more memorable. Finally, be sure to check that the name isn’t already taken or too similar to another business in your area.

image of ZenBusiness logo

Starting an electrical business requires formalizing your business registration to ensure legal compliance and to protect your personal assets. This step is crucial as it establishes your business as a legitimate entity in the eyes of the law and allows you to operate officially. Below are the key points to consider when formalizing your business registration:

  • Choose a business structure that suits your needs, such as a sole proprietorship, partnership, limited liability company (LLC), or corporation. Each has its own legal and tax implications.
  • Register your business name with the appropriate state authority. If you're using a name other than your own, you may need to file a 'Doing Business As' (DBA) registration.
  • Obtain an Employer Identification Number (EIN) from the Internal Revenue Service (IRS) for tax purposes, especially if you plan to hire employees.
  • Apply for the necessary permits and licenses specific to electrical contracting in your state or locality, which may include a master electrician's license, electrical contractor license, and business license.
  • Consider purchasing insurance policies such as general liability insurance, workers' compensation, and professional liability insurance to protect your business from potential risks.
  • Comply with local zoning laws and building codes to ensure your business location is appropriate for an electrical services operation.
  • Register for state and local taxes as required to ensure you are set up to pay sales, payroll, and other business taxes.

Resources to help get you started:

Uncover vital resources perfect for electrical entrepreneurs aiming for insights on market trends, operational excellence, and strategic growth:

  • Electrical Trends Report: Annual insights into market trends and technology shifts in the electrical industry. No direct link available.
  • Electrical Contractor Magazine: Offers news, latest tech reviews, and business management tips. www.ecmag.com
  • IE3 Media: Provides a wealth of resources, from best practices to governmental policy impacts on the electrical trade. www.ie3media.com
  • Electric Smarts Network: A digital market network providing industry news, webinar trainings, and product information. www.electricsmarts.com
  • NECA (National Electrical Contractors Association): Offers resources for electrical contracting operational practices, business development, and education. www.necanet.org

Starting an electrical business requires careful attention to legal requirements. Licenses and permits are essential for operating legally and ensuring the safety of your services. Here is a quick guide to help you acquire the necessary documentation:

  • Check with your local city or county government office for specific electrical business licenses. Each locality may have different requirements.
  • Obtain an Electrical Contractor's License, which typically requires passing an exam that covers electrical codes, standards, and safety practices.
  • Make sure to have a General Business License, which allows you to operate a business in your city or county.
  • Apply for specialized permits for any specific services you offer, such as fire alarm or low voltage systems installation.
  • Consider professional liability insurance to protect your business against potential claims related to your electrical work.
  • Stay informed about renewals to ensure your licenses and permits remain valid and avoid any legal complications.

What licenses and permits are needed to run a electrical business?

Depending on the jurisdiction, a variety of licenses and permits may be required to operate an electrical business. These may include a professional license from a state licensing board; certification from the relevant authority for specific types of electrical work such as residential wiring, commercial wiring, or fire alarm systems; electrical permits from the local building department; and insurance coverage for liability.

Securing your financial foundation is a crucial step when starting an electrical business. A dedicated business bank account will help you manage your finances effectively, and securing the necessary funding will ensure you have the capital needed to cover startup costs and maintain operations. Follow these guidelines:

  • Choose the right bank: Research and compare different banks to find one that offers favorable terms for small businesses, such as low fees, easy access to funds, and good customer service.
  • Prepare the required documents: You will typically need your business registration details, EIN (Employer Identification Number), and personal identification to open a business bank account.
  • Understand your funding needs: Calculate the initial costs of starting your electrical business, including equipment, licensing, insurance, and working capital.
  • Explore funding options: Investigate various funding sources such as small business loans, lines of credit, grants, or investors. Consider the pros and cons of each to determine the best fit for your business.
  • Build a strong business plan: A detailed business plan is essential when seeking funding as it demonstrates to lenders or investors that you have a clear path to profitability.
  • Maintain good credit: Ensure that both your personal and business credit histories are in good standing to increase your chances of securing favorable loan terms.

Setting the right prices for your electrical services is crucial to ensuring the success of your business. It's important to find a balance that reflects the value of your work, covers your costs, and remains competitive in the marketplace. Here are some key points to consider when setting your pricing:

  • Costs: Calculate all your costs, including materials, labor, overhead, and any other expenses. Make sure your prices cover these costs and provide a reasonable profit margin.
  • Market rates: Research what other electricians in your area are charging for similar services. This will help you set competitive rates and understand what clients are willing to pay.
  • Value-based pricing: Consider the value you provide to your clients and set prices that reflect your expertise, certifications, and the complexity of the services offered.
  • Pricing models: Decide whether you will charge by the hour, by the project, or a combination of both. Fixed pricing for common services can simplify the decision-making process for potential clients.
  • Transparent pricing: Be upfront about your prices to build trust with clients. Consider providing detailed quotes and invoices that break down costs.

What does it cost to start a Electrical business?

Initiating a electrical business can involve substantial financial commitment, the scale of which is significantly influenced by factors such as geographical location, market dynamics, and operational expenses, among others. Nonetheless, our extensive research and hands-on experience have revealed an estimated starting cost of approximately $35500 for launching such an business. Please note, not all of these costs may be necessary to start up your electrical business.

Starting an electrical business requires careful selection of high-quality electrical equipment and supplies. This step is crucial as it ensures that your services meet industry standards and safety regulations. Here's how to go about acquiring the tools and materials needed for your electrical business:

  • Research and select reputable suppliers who offer quality products and warranties. Consider both local distributors and online vendors for competitive pricing.
  • Make a comprehensive list of essential tools, such as multimeters, wire strippers, pliers, and screwdrivers, as well as safety gear like insulated gloves and goggles.
  • Purchase inventory based on common electrical components such as wires, cables, connectors, switches, and circuit breakers, keeping in mind to stock various sizes and types.
  • Consider investing in advanced diagnostic tools and equipment if your budget allows, to provide specialized services.
  • Look for opportunities to buy in bulk to reduce costs, but ensure you have adequate storage space for your inventory.
  • Stay updated with new technologies and tools in the electrical industry to continuously improve your services and offerings.

List of Software, Tools and Supplies Needed to Start a Electrical Business:

  • Electrical tools, such as wire strippers, screwdrivers and power drills
  • Safety equipment, such as hard hats, safety glasses and work gloves
  • Electrical supplies, such as wire, conduit, circuit breakers and light fixtures
  • Electrical testing equipment, such as multimeters and voltage testers
  • Software, such as electrical CAD drawing programs and accounting software
  • Vehicles, such as trucks, vans or trailers
  • Marketing materials, such as business cards and brochures

Starting an electrical business involves managing risks that come with the trade. Obtaining the right business insurance not only protects your investment but also provides peace of mind for you and your customers. Here's what you need to consider:

  • General Liability Insurance: This is essential for any business, covering accidents or injuries to non-employees that occur as a result of your business activities.
  • Professional Liability Insurance: Also known as Errors and Omissions (E&O) insurance, it protects your business against claims of negligence or harm due to professional services provided.
  • Workers' Compensation Insurance: If you have employees, this insurance covers medical costs and lost wages for work-related injuries and illnesses.
  • Commercial Auto Insurance: If your business uses vehicles, this insurance covers damages from accidents or other vehicle-related incidents.
  • Tool and Equipment Insurance: This covers the repair or replacement of stolen, lost, or damaged tools and equipment.
  • Bonding: Surety bonds can be required to guarantee the completion of a job and the payment of suppliers and subcontractors.

Consult with an insurance agent specializing in business policies for the electrical industry to ensure you have adequate coverage for your specific needs.

Now that you've laid the groundwork for your electrical business, it's time to attract customers through strategic marketing. Here are some effective ways to promote your services and build a strong client base.

  • Develop an Online Presence: Create a professional website and maintain active social media profiles to showcase your work, share customer testimonials, and provide easy contact information.
  • Local SEO: Optimize your website for local search terms to ensure that potential customers in your area can find you easily when they need electrical services.
  • Networking: Join local business groups, attend trade shows, and partner with related businesses like home builders or real estate agents to gain referrals.
  • Advertising: Consider using Google Ads, social media advertising, and traditional methods such as flyers, local newspaper ads, or sponsoring community events.
  • Customer Reviews: Encourage satisfied clients to leave positive reviews on platforms like Google My Business and Yelp to build your reputation.
  • Offer Promotions: Provide introductory discounts or special offers to new customers to encourage them to choose your services over competitors.

Expanding your electrical business is a pivotal stage that requires strategic planning and careful execution. As you grow your operations, consider various avenues for development that align with your business goals and market demand. Here are some key steps to help you scale your electrical business effectively:

  • Diversify Services: Offer a wider range of services such as smart home automation, renewable energy solutions, or specialized commercial services to attract a broader client base.
  • Hire Skilled Technicians: As your workload increases, recruit qualified electricians to maintain high-quality service and customer satisfaction.
  • Invest in Marketing: Enhance your online presence with a professional website and engage in digital marketing to reach a larger audience.
  • Networking: Build relationships with contractors, suppliers, and other tradespeople to find new opportunities and partnerships.
  • Training and Development: Continuously train your staff on the latest technologies and safety protocols to stay competitive.
  • Expand Geographically: Consider opening new locations or offering services in neighboring areas to capture more market share.
  • Improve Operational Efficiency: Adopt new technologies and business management software to streamline operations and reduce costs.

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Electrical Contractor Business Plan [& Free Template]

Whether you’re a new electrical contractor launching your startup business or a veteran electrician looking to expand , define business goals, or obtain funding, you need a business plan. And if you created a business plan when you first started in the industry, but haven’t updated it since, it’s time for a revamp. 

Ready to write or improve your electrical business plan? Read on for information on what to include in an electrician business plan and a free electrical contractor business plan template to get started. 

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What Is a Business Plan for Electrical Contractors?

A business plan is a comprehensive document that outlines the company’s operations, goals, strategies, and financial projections. It serves as a roadmap for the business owner and potential stakeholders by detailing how the business will be structured, managed, and grown. 

A business plan is a fluid document that should be reviewed and refined annually to reflect goals that have been met or have changed. If an established business decides to move in a new direction, perhaps adding services or acquiring a smaller electrical outfit and expanding their service areas, they may create a new business plan.

Why Do Electrical Contractors Need a Business Plan?

In addition to serving as a roadmap for the company, electrical contractors need a business plan for the following reasons.

Reason #1: Raise Funding

New or expanding businesses often need to raise capital from lenders or investors. Before investing or providing a loan, lenders and investors want to see a detailed plan that demonstrates the company’s potential for success and how it intends to use the funds. Lenders want to know the company will be solvent enough to make regular debt payments.

The main sources of funding for an electrical business include personal funds, credit cards, bank loans, and investors. Personal savings and bank loans are the most common funding paths for electrical companies.

Reason #2: Define Business Goals and Reduce Risks

A business plan serves as your company’s blueprint. By setting up goals and ways to measure success, you’ll know if your business is on track. Your business plan should also outline risks, including competitors and market changes. By knowing business threats ahead of time, you can prepare plans for reducing or addressing them.

When it comes to measuring goals, a field management software with reporting capabilities provides the data electrical companies need to make informed business decisions. For example, ServiceTitan’s field reporting software offers a dynamic dashboard that allows business owners to customize the fields to display KPIs that matter most to them, including revenue, missed opportunities, and conversion rates.

The technician scorecard gives managers a report on overall technician performance, as well as the opportunity to drill down into metrics for each individual tech, including generated revenue, memberships sold, customer satisfaction, and billing efficiency. With this information in hand, managers can reward outstanding technician performance and find coaching opportunities.

Similarly, a CSR scorecard allows users to review incoming calls, conversions, and other CSR metrics as clients and potential customers call your business. The recorded calls can be used for CSR training or to re-engage with missed opportunities.  

How to Write an Electrical Contractor Business Plan [with Template]

An electrical contractor business plan should be tailored to the specific goals of your business and provide a realistic and achievable roadmap for its success. To help electricians know exactly what information to include in a business plan, ServiceTitan created an electrical company business plan template for you to download and fill in.

>> Download our free electrical business plan template. Save the PDF to your desktop as a new file. From there, you can customize it for your business.

Ready to get started? Include the following sections in your electrical business plan.

1. Industry Analysis

First, provide an overview of the electrical contracting industry. This market research should inform your business strategy. It also shows investors and lenders you did your due diligence. When preparing this section, consider:

Market strength

Market size

Competitors

Industry trends

2. Executive Summary

The executive summary is a condensed version of your full business plan where you include everything you would cover in a five-minute sales pitch about your business. Put simply, all the hard work and research you put into your business plan should inform the critical information you include in the executive summary. Even though this is in the front of the business plan, it’s best to complete this section last. 

Use the executive summary to concisely explain the fundamentals of the business. For example, what is your product or service? Who are your customers? Who are the business owners and financial investors? What are your goals and objectives?

If you’re applying for funding, make sure to specify the amount, how you plan to use it, and more importantly, how it will increase your profit margins. The executive summary needs to be professional, enthusiastic, and succinct. 

3. Business Overview

The company overview is where you start to dig into the details of your electrical contracting business. In short, it explains what your electrical business will do, and how you will achieve your objectives. The section often begins with a mission statement—typically 30 words or less—where you explain your company’s guiding principles and business philosophy.

Make sure to cover the following components in the business overview:

Goals and objectives : All successful businesses need to establish goals, objectives, and key performance indicators (KPIs). Make sure to elaborate on how you’ll set up your electrical shop for success .

Marketplace : Define your core customer base and explain how you’ll market your services, including the marketing channels you plan to use. Keep it brief. You’ll elaborate in the marketing plan section of your business plan.

Strengths and core competencies : Use this section to expand on the specific factors that will help your company succeed. Include what strengths set you apart from the competition and how you’ll prepare staff to succeed.

4. Services Analysis

Use this section to provide more detail about your specific products and electrical services. 

For example, (Electrical contractor name) offers residential and commercial electrical installation, service, and repair, including new installations, safety inspections, whole-home rewires, troubleshooting and servicing electrical issues, and more.  

Include any factors that give you a competitive advantage over other electrical contractors in your service area. For example, do your technicians possess advanced skills that enable them to work on high-tech electrical systems? Other examples of key service differentiators include:

Service guarantee 

Repair guarantee 

Replacement guarantee

Next, mention the pricing, fee, or leasing structures of your products or services. Will you price electrical jobs by the hour, or offer flat-rate pricing? You’ll want to examine the wage rate in your area to ensure you pay your employees a competitive salary. Also include the hourly rate, how you’ll account for drive time, and the billable amount for every job or service you offer.

5. Market Analysis

Include a market, or competitor, analysis. Identify and evaluate key competitors to define your company’s unique value proposition and capitalize on market opportunities. The analysis should include information on competitors’ strengths, weaknesses, market share, pricing strategies, and technological advancements.

Look for gaps in the market, whether there are services not being offered or service areas not being sufficiently served. These gaps create business opportunities . 

6. Customer Analysis

The customer analysis section of a business plan is where you focus on understanding your target customers. This includes describing your target market’s characteristics, needs, and behaviors to tailor your offerings effectively. Start by identifying your primary and secondary customer groups, considering factors like demographics (age, gender, location), psychographics (interests, values), and buying behaviors (how they make purchasing decisions). 

This analysis equips you to tailor your business strategies to meet customer demands effectively. By knowing your customers’ wants and pain points and leveraging customer experience software , you can create a strong foundation for building lasting customer relationships and achieving sustainable growth. 

ServiceTitan enables electrical contractors to provide their customers with a modern sales and service experience, which includes:

Scheduling options : Give leads the ability to schedule jobs whatever way works best for them, whether through web chats, texts, calls, or booking directly online. 

Detailed customer history : A robust CRM allows service techs to view complete customer information before arriving on the job site. Knowing the customer's name and job history helps techs and CSRs personalize the customer experience and provide better customer service.

Text messaging communication : Text appointment reminders and technician bios so customers know who and what to expect when your service truck arrives. Allow for two-way SMS communication, so customers can confirm appointments, reschedule appointments, or ask questions right from their phone. 

Live tracking : Allow customers to track your techs on a map, so they can better predict arrival times.

On-site estimates : Today’s customers don’t want to wait for estimates. With ServiceTitan Mobile , techs can build and display branded, digital estimates with good, better, and best options in just a few taps.  

Financing options: Working with your clients on payment options helps build loyal, repeat customers. With ServiceTitan customer financing, customers can apply for financing right from your tech’s phone or iPad, choose from different plans, and receive instant approval.

7. Marketing Plan

All businesses depend on marketing to promote their companies, generate new business, and grow repeat customers. If your electrical shop’s promotions or sales feel stagnant, it’s probably a good time to look at your marketing metrics and reevaluate your promotions and marketing channels. 

When it comes to marketing strategies , electricians typically utilize an omnichannel approach. If your target audience leans younger, you may want to invest heavily in digital marketing such as search engine optimization (SEO), Google ads, and social media marketing, while home mailers and direct mail may be more effective with older homeowners. Bottom line: You want to reach as many potential customers as possible, so don’t be afraid to try different marketing strategies.

Break down how you plan to spend marketing dollars by promotion channel, such as:

Direct mail (%)

Newspaper (%)

Television (%)

Search engine marketing (SEM) (%)

Social media marketing (%)

Your strategy should also include the average cost to acquire a new customer, and take into account other marketing drivers, such as club memberships and word-of-mouth referral programs.

Consider how your business will execute and track ROI of marketing strategies. For example, ServiceTitan offers data-driven marketing solutions to help you attract, convert, and retain customers, in addition to providing valuable insights into the performance of your campaigns.

8. Operations Plan

Expand on and explain the daily operation of your electrical contracting business, its location, equipment, people, processes, and surrounding environment.

Production : How and where are your products or services produced? Make sure to include production techniques and costs, quality control, customer service, inventory control, and product development.

Location : What requirements do you need in a physical location? Mention the amount of space, type of building, zoning, and utilities.

Legal : Include information related to licensing and bonding requirements, permits, environmental regulations, industry-specific regulations, zoning or building code requirements, liability insurance, and any trademarks, copyrights, or patents.

Personnel : List the number of employees, type of labor (skilled, unskilled, and professional), recruiting efforts, pay structure, training programs, and job descriptions.

Inventory and suppliers : Include the kind of inventory (raw materials, supplies, finished goods), the estimated value, and your top suppliers.

Credit policies : Will you sell your services on credit? If so, how will you approve customers or determine creditworthiness?

9. Management Summary

Mention the key roles that will manage the business on a day-to-day basis, including the general manager, operations manager, and other management team roles. What experience do they bring to the business? Do they hold special or distinctive competencies? Is there a plan for continuation of the business if leadership is lost or incapacitated?

If you employ more than 10 employees in your business structure, create an organizational chart showing the management hierarchy and who is responsible for key functions. Include descriptions for each position or employee.

You should also list professional and advisory support, including:

Board of directors

Management advisory board

Insurance agent

Consultant(s) 

Mentors and key advisors

10. Financial Plan

The financial plan typically includes a 12-month profit-and-loss projection, a cash-flow projection, a projected balance sheet, and a break-even calculation. Together, they present a reasonable estimate of your electrical contracting business's financial projections and business value . More importantly, the process of thinking through the financial plan will improve your insight into the inner financial workings of your company.

Include personal financial statements for each owner and major stockholder, showing assets and liabilities held outside the business and personal net worth. Owners will often have to draw on personal assets to finance the business, and these statements will show what is available. Bankers and investors usually want this information as well.

Over to You

ServiceTitan’s cloud-based, all-in-one electrical software gives business owners the technology they need to do the work efficiently, the data and reporting they need to do it smartly, and a wide array of resources to guide them as they grow toward achieving the goals outlined in their electrical contracting business plan.

>> Want to start your own electrical business or revitalize and grow an established business? Download this electrical business plan template to get started.

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Electrical Business Plan Template PDF

A successful electrical business is based on a solid business plan. To help you out, we've designed a business plan template PDF specifically for your electrical business.

Get your copy today!

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For help completing your electrical business plan, read our guide .

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How can an electrical business plan template help you?

  • A solid electrical business plan acts as your strategy guide for building a successful electrical business.
  • Whether you're an existing electrical business or just starting out, a business plan helps you get organised.
  • Use an electrical business plan to help secure funding for your business.

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Electrical Business

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How to Start an Electrical Business

Written by: Carolyn Young

Carolyn Young is a business writer who focuses on entrepreneurial concepts and the business formation. She has over 25 years of experience in business roles, and has authored several entrepreneurship textbooks.

Edited by: David Lepeska

David has been writing and learning about business, finance and globalization for a quarter-century, starting with a small New York consulting firm in the 1990s.

Published on January 6, 2022 Updated on February 14, 2024

How to Start an Electrical Business

Investment range

$3,250 - $23,100

Revenue potential

$130,000 - $1,000,000 p.a.

Time to build

1 – 3 months

Profit potential

$100,000 - $260,000 p.a.

Industry trend

​​Electricity is something that nearly everyone in the United States uses every day of their lives, one way or another. Electrical services are so important that the electrician industry is valued at over $200 billion. Electricians are highly skilled and are able to do work that is dangerous for the layperson to attempt, which is why they are in high demand. You can start an electrical business and tap into that demand and build a lucrative business.

Starting an electrical business will have challenges and require hard work and knowledge to be successful. This step-by-step guide has all the information and insight that you need to be on your way to start your entrepreneurial journey.

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Step 1: Decide if the Business Is Right for You

Pros and cons.

Starting an electrical business has pros and cons that you should consider before deciding if the business is right for you.

  • High Demand – Electrical services are in demand by consumers and businesses
  • Valuable Service – Provide essential services and safety to customers
  • Good Profit – Electricians command high rates
  • Education – You need to complete education to become licensed
  • Odd Hours – Customers may require emergency service at odd hours

Electrical industry trends

Rising new home construction has contributed to the growth of the US electrician industry. 

Industry size and growth

  • Industry size and past growth – Market analyst IBISWorld values the US electrician industry at nearly $205 billion in 2022. The industry has grown over 35% in the last decade.(( https://www.ibisworld.com/industry-statistics/market-size/electricians-united-states/ ))  
  • Growth forecast – Pent-up demand will contribute to robust growth over the five years to 2026, according to IBISWorld.(( https://www.ibisworld.com/united-states/market-research-reports/electricians-industry/ )) 
  • Number of businesses – There are nearly 225,000 electricians in the US.(( https://www.ibisworld.com/industry-statistics/number-of-businesses/electricians-united-states/ ))
  • Number of people employed – The industry employs over a million people.(( https://www.ibisworld.com/industry-statistics/employment/electricians-united-states/ )) 

electrical industry size and growth

Trends and challenges

Some trends in the industry include:

  • Demand for energy efficiency is rising, which is increasing the demand for electrical upgrades. New technologies, including energy storage technologies, are emerging to increase efficiency. Electricians will need to stay up to date on these technologies.
  • Sustainably made materials are also in demand, including recycled parts.

Some challenges also exist in the electrical industry which include:

  • There is a shortage of licensed electricians which will present a challenge for electrical companies looking to hire.
  • Liability issues exist if mistakes are made that jeopardize safety. Electricians must work with extreme caution. 

electrical industry Trends and Challenges

What kind of people work as electricians?

  • Gender – More than 95% of electricians are male and the rest are female.(( https://www.zippia.com/electrician-jobs/demographics/#gender-statistics ))
  • Average level of education – 32% of electricians finished high school while 30% hold an associate degree. It’s a good idea to earn professional certifications as electricians.(( https://www.zippia.com/electrician-jobs/education/ ))
  • Average age – Electricians are mostly under 45 years old.(( https://www.zippia.com/electrician-jobs/demographics/#age-statistics ))

electrical industry demographics

How much does it cost to start an electrical business?

Startup costs for an electrical business range from just over $3,000 to nearly $25,000. The low end assumes that you are already licensed and are going to run your business as a solopreneur from home. The high end includes the cost of training and setting up an office and shop. 

You’ll need a handful of items to successfully launch your electrical business. Here’s a list to get you started:

  • Screwdrivers and nut drivers
  • Wire strippers
  • Fishing tools
  • Measuring devices
  • Labeling machines
  • Power drills and drivers, hammer/drills

How much can you earn from an electrical business?

The average electrical contractor usually charges $75 to $100 per hour.  Working from home, your profit margin should be about 80%. In your first year or two, you could work from home 25 hours a week at $100 per hour, bringing in $130,000 in annual revenue. This would mean over $100,000 in profit, assuming that 80% margin. 

As your brand gains recognition, sales could climb to jobs that take 200 hours per week. At this stage, you would have a shop and office and staff, including other electricians, reducing your profit margin to around 25%. With expected annual revenue of over $1,000,000, you would make over a quarter-million dollars.

Electrical business earnings forecast

What barriers to entry are there?

There are a few barriers to entry for an electrical business. Your biggest challenges will be:

  • You need to be a licensed electrician or go through the process to become licensed
  • Finding other qualified electricians to work for you may be challenging

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Step 2: refining your business concept, in-depth market research:.

Comprehensive market research is foundational for any successful business. This includes analyzing local electrical services, understanding customer demands, and identifying gaps in the market. For example, is there a demand for eco-friendly electrical services or advanced home automation installations? Such insights can help you differentiate your business right from the start.

Service Portfolio Development:

Detail the range of services you plan to offer. Will your focus be on residential electrical issues, commercial electrical systems, or specialized services like smart home installations or renewable energy solutions? Clarify your expertise areas and consider offering unique services that are in demand but not widely available in your area.

Pricing and Profitability

Competitive pricing strategy:.

Set your service rates competitively, typically between $75 to $100 per hour. Factor in costs for parts, potential markups, and overhead charges. A solo operation should aim for a higher profit margin (around 80%), while a business with a team and office should adjust to a lower margin (around 25-30%). Regularly review and adjust your pricing to stay competitive and profitable.

Cost Management:

Use tools like our profit margin calculator to fine-tune your pricing strategy. Keep track of all expenses, including materials, labor, and overhead, to ensure your pricing covers costs and yields a healthy profit margin.

Identifying Your Target Market

Market segmentation:.

Your services should align with the needs of your target market. For residential services, focus on homeowners, offering maintenance, repairs, and upgrades. For commercial services, target businesses requiring installations, inspections, and energy-efficient solutions. Use platforms like Facebook, LinkedIn, and local community forums to connect with potential clients.

Setting Up Your Business Location

Starting small and scaling up:.

Initially, operating from home can significantly reduce overhead costs. As your business expands, look for commercial spaces that cater to your growing needs. Key factors for choosing a space include accessibility, adequate space and ventilation, natural lighting, and a flexible lease. Utilize online resources like Craigslist or Crexi to find suitable locations.

Infrastructure Needs:

Consider the necessary infrastructure for your business, such as storage for tools and materials, a workspace for small repairs, and an office area for administrative tasks. Ensure the space can be adapted as your business grows.

electrical business idea rating

Step 3: Brainstorm an Electrical Company Name

Your business name is your business identity, so choose one that encapsulates your objectives, services, and mission in just a few words. You probably want a name that’s short and easy to remember, since much of your business, and your initial business in particular, will come from word-of-mouth referrals.

Here are some ideas for brainstorming your business name:

  • Short, unique, and catchy names tend to stand out
  • Names that are easy to say and spell tend to do better 
  • Name should be relevant to your product or service offerings
  • Ask around — family, friends, colleagues, social media — for suggestions
  • Including keywords, such as “electric” or “electrical”, boosts SEO
  • Name should allow for expansion, for ex: “Jim’s Electric” over “Jim’s Wiring”
  • Avoid location-based names that might hinder future expansion
  • Use online tools like the Step by Step Business Name Generator . Just type in a few keywords and hit “generate” and you’ll have dozens of suggestions at your fingertips.

Once you’ve got a list of potential names, visit the website of the US Patent and Trademark Office to make sure they are available for registration and check the availability of related domain names using our Domain Name Search tool. Using “.com” or “.org” sharply increases credibility, so it’s best to focus on these. 

Find a Domain

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Finally, make your choice among the names that pass this screening and go ahead with domain registration and social media account creation. Your business name is one of the key differentiators that sets your business apart. Once you pick your company name, and start with the branding, it is hard to change the business name. Therefore, it’s important to carefully consider your choice before you start a business entity.

Step 4: Create an Electrical Contractor Business Plan

Every business needs a plan. This will function as a guidebook to take your startup through the launch process and maintain focus on your key goals. A business plan also enables potential partners and investors to better understand your company and its vision:

  • Executive Summary: Summarize your electrical contractor business’s mission to provide high-quality, reliable electrical installation and maintenance services for residential, commercial, and industrial clients.
  • Business Overview: Describe your business’s focus on offering electrical services, including wiring installations, repairs, inspections, and upgrades for a variety of projects.
  • Product and Services: Detail the range of electrical services offered, such as new construction wiring, electrical system upgrades, safety inspections, and emergency repair services.
  • Market Analysis: Evaluate the demand for electrical contracting services, considering factors like construction trends, local business growth, and home renovation activities.
  • Competitive Analysis: Compare your business to other local electrical contractors, focusing on your strengths like specialized skills, quick response times, or competitive pricing.
  • Sales and Marketing: Outline your strategy for attracting clients, using methods like local advertising, building partnerships with construction firms, or creating an online presence.
  • Management Team: Highlight the qualifications and experience of your team, particularly in electrical work, project management, and customer service.
  • Operations Plan: Describe the operational aspects, including project bidding, job scheduling, staff management, and compliance with safety standards.
  • Financial Plan: Provide an overview of financial aspects, covering startup costs, pricing strategy, and revenue projections.
  • Appendix: Include supplementary documents such as licenses, certifications, project portfolios, or detailed market research to support your business plan.

what to include in a business plan

If you’ve never created a business plan yourself before, it can be an intimidating task. Consider hiring an experienced business plan writer to create a professional business plan for you.

Step 5: Register Your Business

Registering your business is an absolutely crucial step — it’s the prerequisite to paying taxes, raising capital, opening a bank account, and other guideposts on the road to getting a business up and running.

Plus, registration is exciting because it makes the entire process official. Once it’s complete, you’ll have your own business! 

Choose where to register your company

Your business location is important because it can affect taxes, legal requirements, and revenue. Most people will register their business in the state where they live, but if you are planning to expand, you might consider looking elsewhere, as some states could offer real advantages when it comes to electrical businesses. 

If you’re willing to move, you could really maximize your business! Keep in mind, it’s relatively easy to transfer your business to another state. 

Choose your business structure

Business entities come in several varieties, each with its pros and cons. The legal structure you choose for your electrical business will shape your taxes, personal liability, and business registration requirements, so choose wisely. 

Here are the main options:

  • Sole Proprietorship – The most common structure for small businesses makes no legal distinction between company and owner. All income goes to the owner, who’s also liable for any debts, losses, or liabilities incurred by the business. The owner pays taxes on business income on his or her personal tax return.
  • Partnership – Similar to a sole proprietorship, but for two or more people. Again, owners keep the profits and are liable for losses. The partners pay taxes on their share of business income on their personal tax returns.
  • Limited Liability Company (LLC) – Combines the characteristics of corporations with those of sole proprietorships or partnerships. Again, the owners are not personally liable for debts.
  • C Corp – Under this structure, the business is a distinct legal entity and the owner or owners are not personally liable for its debts. Owners take profits through shareholder dividends, rather than directly. The corporation pays taxes, and owners pay taxes on their dividends, which is sometimes referred to as double taxation.
  • S Corp – An S-Corporation refers to the tax classification of the business but is not a business entity. An S-Corp can be either a corporation or an LLC , which just need to elect to be an S-Corp for tax status. In an S-Corp, income is passed through directly to shareholders, who pay taxes on their share of business income on their personal tax returns.

types of business structures

We recommend that new business owners choose LLC as it offers liability protection and pass-through taxation while being simpler to form than a corporation. You can form an LLC in as little as five minutes using an online LLC formation service. They will check that your business name is available before filing, submit your articles of organization , and answer any questions you might have. 

Form Your LLC

Choose Your State

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business plan for electrical shop

Step 6: Register for Taxes

The final step before you’re able to pay taxes is getting an Employer Identification Number , or EIN. You can file for your EIN online or by mail or fax: visit the IRS website to learn more. Keep in mind, if you’ve chosen to be a sole proprietorship you can simply use your social security number as your EIN. 

Once you have your EIN, you’ll need to choose your tax year. Financially speaking, your business will operate in a calendar year (January–December) or a fiscal year, a 12-month period that can start in any month. This will determine your tax cycle, while your business structure will determine which taxes you’ll pay.

business plan for electrical shop

The IRS website also offers a tax-payers checklist , and taxes can be filed online.

It is important to consult an accountant or other professional to help you with your taxes to ensure you are completing them correctly.

Step 7: Fund your Business

Securing financing is your next step and there are plenty of ways to raise capital:

  • Bank loans: This is the most common method but getting approved requires a rock-solid business plan and strong credit history.
  • SBA-guaranteed loans: The Small Business Administration can act as guarantor, helping gain that elusive bank approval via an SBA-guaranteed loan .
  • Government grants: A handful of financial assistance programs help fund entrepreneurs. Visit Grants.gov to learn which might work for you.
  • Friends and Family: Reach out to friends and family to provide a business loan or investment in your concept. It’s a good idea to have legal advice when doing so because SEC regulations apply.
  • Crowdfunding: Websites like Kickstarter and Indiegogo offer an increasingly popular low-risk option, in which donors fund your vision. Entrepreneurial crowdfunding sites like Fundable and WeFunder enable multiple investors to fund your business.
  • Personal: Self-fund your business via your savings or the sale of property or other assets.

Personal financing or friends and family financing may be your best bets, or you might be able to get a bank loan for your training.

types of business financing

Step 8: Apply for Electrical Contractor Licenses and Permits

Starting an electrical business requires obtaining a number of licenses and permits from local, state, and federal governments. You need to be a licensed electrician in your state. Check your state’s website for requirements. An electrician’s license is considered a specialty contractor’s license.

Federal regulations, licenses, and permits associated with starting your business include doing business as, health license and permit from the Occupational Safety and Health Administration ( OSHA ), trademarks, copyrights, patents, and other intellectual properties, as well as industry-specific licenses and permits. 

You may also need state-level licenses and local county or city-based licenses and permits. The license requirements and how to obtain them vary, so check the websites of your state, city, and county governments or contact the appropriate person to learn more. You could also check this SBA guide for your state’s requirements. 

This is not a step to be taken lightly, as failing to comply with legal requirements can result in hefty penalties.

If you feel overwhelmed by this step or don’t know how to begin, it might be a good idea to hire a professional to help you check all the legal boxes.

For peace of mind and to save time, we recommend using MyCorporation’s Business License Compliance Package . They will research the exact forms you need for your business and state, and provide them to you to make sure you’re fully compliant.

Step 9: Open a Business Bank Account

Before you start making money, you’ll need a place to keep it, and that requires opening a bank account . Keeping your business finances separate from your personal account makes it easy to file taxes and track your company’s income, so it’s worth doing even if you’re running your electrical business as a sole proprietorship. 

Opening a business bank account is quite simple, and similar to opening a personal one. Most major banks offer accounts tailored for businesses — just inquire at your preferred bank to learn about their rates and features.

Banks vary in terms of offerings, so it’s a good idea to examine your options and select the best plan for you. Once you choose your bank, bring in your EIN (or Social Security Number if you decide on a sole proprietorship), articles of incorporation, and other legal documents and open your new account. 

Step 10: Get Business Insurance

Business insurance is an area that often gets overlooked yet it can be vital to your success as an entrepreneur. Insurance protects you from unexpected events that can have a devastating impact on your business.

Here are some types of insurance to consider:

  • General liability: The most comprehensive type of insurance, acting as a catch-all for many business elements that require coverage. If you get just one kind of insurance, this is it. It even protects against bodily injury and property damage.
  • Business Property: Provides coverage for your equipment and supplies.
  • Equipment Breakdown Insurance: Covers the cost of replacing or repairing equipment that has broken due to mechanical issues.
  • Worker’s compensation: Provides compensation to employees injured on the job.
  • Property: Covers your physical space, whether it is a cart, storefront, or office.
  • Commercial auto: Protection for your company-owned vehicle.
  • Professional liability: Protects against claims from a client who says they suffered a loss due to an error or omission in your work.
  • Business owner’s policy (BOP): This is an insurance plan that acts as an all-in-one insurance policy, a combination of any of the above insurance types.

types of business insurance

Step 11: Prepare to Launch

As opening day nears, prepare for launch by reviewing and improving some key elements of your business. 

Essential software and tools

Being an entrepreneur often means wearing many hats, from marketing to sales to accounting, which can be overwhelming. Fortunately, many websites and digital tools are available to help simplify many business tasks.  

You can use industry-specific software, such as ServiceTrade , connecteam , or ServiceTitan , to manage your pricing, bids, scheduling, dispatching, and to monitor your key performance indicators (KPIs).

  • Popular web-based accounting programs for smaller businesses include Quickbooks , Freshbooks , and Xero . 
  • If you’re unfamiliar with basic accounting, you may want to hire a professional, especially as you begin. The consequences for filing incorrect tax documents can be harsh, so accuracy is crucial.

Develop your website

Website development is crucial because your site is your online presence and needs to convince prospective clients of your expertise and professionalism.

You can create your own website using services like WordPress, Wix, or Squarespace . This route is very affordable, but figuring out how to build a website can be time-consuming. If you lack tech-savvy, you can hire a web designer or developer to create a custom website for your business.

They are unlikely to find your website, however, unless you follow Search Engine Optimization ( SEO ) practices. These are steps that help pages rank higher in the results of top search engines like Google.

Here are some powerful marketing strategies for your future business:

  • Local Partnerships and Sponsorships: Forge partnerships with local businesses, contractors, or community events. Sponsoring local events or sports teams can increase brand awareness and position your electrical business as an integral part of the community.
  • Targeted Social Media Advertising: Leverage social media platforms like Facebook and Instagram to run targeted advertising campaigns. Focus on specific demographics and geographic areas to reach potential customers who are more likely to need electrical services.
  • Customer Referral Programs: Encourage your satisfied customers to refer your services to others by implementing a referral program. Offer discounts or incentives for each successful referral, turning your happy clients into brand ambassadors.
  • Seasonal Promotions: Introduce seasonal promotions or discounts during peak times when homeowners are likely to undertake electrical projects, such as the spring and fall. This can create a sense of urgency and attract more business during high-demand periods.
  • Educational Workshops: Host workshops or webinars in your local community to educate homeowners on electrical safety, energy efficiency, or DIY tips. Position yourself as an expert, and participants are more likely to turn to your business for their electrical needs.
  • Vehicle Branding: Ensure your service vehicles are branded with your logo, contact information, and a brief service offering. These moving advertisements not only enhance your professional image but also serve as mobile billboards, promoting your business wherever you go.
  • Online Reviews and Testimonials: Actively encourage satisfied customers to leave positive reviews on popular review sites like Google, Yelp, or industry-specific platforms. Positive reviews build trust and credibility, influencing potential clients to choose your services.
  • 24/7 Emergency Service Promotion: Highlight your ability to provide 24/7 emergency electrical services. Create targeted marketing materials that emphasize your quick response times during urgent situations, positioning your business as a reliable and responsive service provider.
  • Loyalty Programs: Implement a loyalty program for repeat customers. Offer discounts or special perks for clients who consistently choose your services, fostering long-term relationships and customer loyalty.
  • Branded Merchandise Giveaways: Distribute branded merchandise such as pens, notepads, or even small electrical tools at local events or as part of a promotion. This creates brand visibility and serves as a constant reminder of your services.

Focus on USPs

Unique selling propositions, or USPs, are the characteristics of a product or service that sets it apart from the competition. Customers today are inundated with buying options, so you’ll have a real advantage if they are able to quickly grasp how your electrical business meets their needs or wishes. It’s wise to do all you can to ensure your USPs stand out on your website and in your marketing and promotional materials, stimulating buyer desire. 

Global pizza chain Domino’s is renowned for its USP: “Hot pizza in 30 minutes or less, guaranteed.” Signature USPs for your electrical business could be: 

  • Eco-friendly electrical services to increase your energy efficiency
  • 24/7 on-call electrical services
  • Reliable electrical services for small businesses

unique selling proposition

You may not like to network or use personal connections for business gain. But your personal and professional networks likely offer considerable untapped business potential. Maybe that Facebook friend you met in college is now running an electrical business, or a LinkedIn contact of yours is connected to dozens of potential clients. Maybe your cousin or neighbor has been working in electric for years and can offer invaluable insight and industry connections. 

The possibilities are endless, so it’s a good idea to review your personal and professional networks and reach out to those with possible links to or interest in electrical businesses. You’ll probably generate new customers or find companies with which you could establish a partnership. 

Step 12: Build Your Team

If you’re starting out small from a home office, you may not need any employees. But as your business grows, you will likely need workers to fill various roles. Potential positions for an electrical business would include:

  • Electricians – provide electrical services
  • Dispatcher – take calls and dispatch electricians
  • General Manager – staff management, supply ordering, accounting

At some point, you may need to hire all of these positions or simply a few, depending on the size and needs of your business. You might also hire multiple workers for a single role or a single worker for multiple roles, again depending on need. 

Free-of-charge methods to recruit employees include posting ads on popular platforms such as LinkedIn, Facebook, or Jobs.com. You might also consider a premium recruitment option, such as advertising on Indeed , Glassdoor , or ZipRecruiter . Further, if you have the resources, you could consider hiring a recruitment agency to help you find talent. 

Step 13: Run an Electrical Business – Start Making Money!

Electricians are in high demand. The industry is worth over a shocking $200 billion in the United States alone!  You can start your own electrical business and get just a few watts of that market to make a healthy profit. Even working by yourself from your home, you’ll be doing well since you can charge $100 per hour or even more. 

Your skills are valuable, and you’ll be performing an essential service as well. Now that you’ve added more knowledge to your toolbelt, you’re ready to start wiring up a successful electrical business!

  • Electrical Business FAQs

Electricians generally charge between $75 to $100 per hour plus parts. Some also charge a markup on parts and an extra charge to cover the company overhead.

Every state has its own requirements to become licensed. Some require a certain number of hours or years working with a licensed electrician, and some require more formal training. You also may have to pass an exam.

To get customers for your electrical business, you can focus on developing a strong online presence through social media, search engine optimization, and online advertising. You can also network with other professionals in the industry, such as contractors and real estate agents, to generate referrals and build relationships with potential clients. 

Generally, electrical businesses that focus on providing high-quality services, building strong customer relationships, and staying up-to-date with the latest industry trends and technologies are more likely to be profitable over the long term.

As an electrical business, you can offer a wide range of services to clients, including installation, repair, and maintenance of electrical systems in residential, commercial, and industrial settings. Specific services may include wiring and rewiring, lighting installation, electrical panel upgrades, generator installation, and energy efficiency upgrades.

You can emphasize your commitment to safety, reliability, and sustainability, and showcase your qualifications and certifications to demonstrate your expertise and credibility in the industry. 

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  • Decide if the Business Is Right for You
  • Refining Your Business Concept
  • Brainstorm an Electrical Company Name
  • Create an Electrical Contractor Business Plan
  • Register Your Business
  • Register for Taxes
  • Fund your Business
  • Apply for Electrical Contractor Licenses and Permits
  • Open a Business Bank Account
  • Get Business Insurance
  • Prepare to Launch
  • Build Your Team
  • Run an Electrical Business - Start Making Money!

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How to write a business plan for an electrical appliances store?

electrical appliances store business plan

Putting together a business plan for an electrical appliances store can be daunting - especially if you're creating a business for the first time - but with this comprehensive guide, you'll have the necessary tools to do it confidently.

We will explore why writing one is so important in both starting up and growing an existing electrical appliances store, as well as what should go into making an effective plan - from its structure to content - and what tools can be used to streamline the process and avoid errors.

Without further ado, let us begin!

In this guide:

Why write a business plan for an electrical appliances store?

What information is needed to create a business plan for an electrical appliances store.

  • How do I build a financial forecast for an electrical appliances store?

The written part of an electrical appliances store business plan

  • What tool should I use to write my electrical appliances store business plan?

Having a clear understanding of why you want to write a business plan for your electrical appliances store will make it simpler for you to grasp the rationale behind its structure and content. So before delving into the plan's actual details, let's take a moment to remind ourselves of the primary reasons why you'd want to create an electrical appliances store business plan.

To have a clear roadmap to grow the business

Small businesses rarely experience a constant and predictable environment. Economic cycles go up and down, while the business landscape is mutating constantly with new regulations, technologies, competitors, and consumer behaviours emerging when we least expect it.

In this dynamic context, it's essential to have a clear roadmap for your electrical appliances store. Otherwise, you are navigating in the dark which is dangerous given that - as a business owner - your capital is at risk.

That's why crafting a well-thought-out business plan is crucial to ensure the long-term success and sustainability of your venture.

To create an effective business plan, you'll need to take a step-by-step approach. First, you'll have to assess your current position (if you're already in business), and then identify where you'd like your electrical appliances store to be in the next three to five years.

Once you have a clear destination for your electrical appliances store, you'll focus on three key areas:

  • Resources: you'll determine the human, equipment, and capital resources needed to reach your goals successfully.
  • Speed: you'll establish the optimal pace at which your business needs to grow if it is to meet its objectives within the desired timeframe.
  • Risks: you'll identify and address potential risks you might encounter along the way.

By going through this process regularly, you'll be able to make informed decisions about resource allocation, paving the way for the long-term success of your business.

To anticipate future cash flows

Regularly comparing your actual financial performance to the projections in the financial forecast of your electrical appliances store's business plan gives you the ability to monitor your business's financial health and make necessary adjustments as needed.

This practice allows you to detect potential financial issues, such as unexpected cash shortfalls before they escalate into major problems. Giving you time to find additional financing or put in place corrective measures.

Additionally, it helps you identify growth opportunities, like excess cash flow that could be allocated to launch new products and services or expand into new markets.

Staying on track with these regular comparisons enables you to make well-informed decisions about the amount of financing your business might require, or the excess cash flow you can expect to generate from your main business activities.

To secure financing

Whether you are a startup or an existing business, writing a detailed electrical appliances store business plan is essential when seeking financing from banks or investors.

This makes sense given what we've just seen: financiers want to ensure you have a clear roadmap and visibility on your future cash flows.

Banks will use the information included in the plan to assess your borrowing capacity (how much debt your business can support) and your ability to repay the loan before deciding whether they will extend credit to your business and on what terms.

Similarly, investors will review your plan carefully to assess if their investment can generate an attractive return on investment.

To do so, they will be looking for evidence that your electrical appliances store has the potential for healthy growth, profitability, and cash flow generation over time.

Now that you understand why it is important to create a business plan for an electrical appliances store, let's take a look at what information is needed to create one.

Need a convincing business plan?

The Business Plan Shop makes it easy to create a financial forecast to assess the potential profitability of your projects, and write a business plan that’ll wow investors.

The Business Plan Shop's Business Plan Software

Writing an electrical appliances store business plan requires research so that you can project sales, investments and cost accurately in your financial forecast.

In this section, we cover three key pieces of information you should gather before drafting your business plan!

Carrying out market research for an electrical appliances store

As you consider writing your business plan for an electrical appliances store, conducting market research becomes a vital step to ensure accurate and realistic financial projections.

Market research provides valuable insights into your target customer base, competitors, pricing strategies, and other key factors that can significantly impact the commercial success of your business.

Through this research, you may uncover trends that could influence your electrical appliances store.

You could find that customers may be more interested in purchasing energy efficient appliances as environmental concerns become more prevalent. Additionally, customers might be more likely to purchase items online as technology advances and online shopping becomes more popular.

Such market trends play a significant role in forecasting revenue, as they offer valuable data about potential customers' spending habits and preferences.

By incorporating these findings into your financial projections, you can present investors with more accurate information, helping them make informed decisions about investing in your electrical appliances store.

Developing the marketing plan for an electrical appliances store

Before delving into your electrical appliances store business plan, it's imperative to budget for sales and marketing expenses.

To achieve this, a comprehensive sales and marketing plan is essential. This plan should provide an accurate projection of the necessary actions to acquire and retain customers.

Additionally, it will outline the required workforce to carry out these initiatives and the corresponding budget for promotions, advertising, and other marketing endeavours.

By budgeting accordingly, you can ensure that the right resources are allocated to these vital activities, aligning them with the sales and growth objectives outlined in your business plan.

The staffing and equipment needs of an electrical appliances store

Whether you are at the beginning stages of your electrical appliances store or expanding its horizons, having a clear plan for recruitment and capital expenditures (investment in equipment and real estate) is vital to ensure your business's success.

To achieve this, both the recruitment and investment plans must align coherently with the projected timing and level of growth in your forecast. It is essential to secure appropriate funding for these plans.

Staffing costs for an electrical appliances store might include salaries for employees, benefits, and payroll taxes. Equipment costs might include the purchase of computers and other technology, shelves and fixtures to display merchandise, and inventory management systems.

To create a financial forecast that accurately represents your business's outlook, remember to factor in other day-to-day operating expenses.

Now that you have all the necessary information, it's time to dive in and start creating your business plan and developing the financial forecast for your electrical appliances store.

What goes into your electrical appliances store's financial forecast?

The financial forecast of your electrical appliances store's business plan will enable you to assess the growth, profitability, funding requirements, and cash generation potential of your business in the coming years.

The four key outputs of a financial forecast for a electrical appliances store are:

  • The profit and loss (P&L) statement ,
  • The projected balance sheet ,
  • The cash flow forecast ,
  • And the sources and uses table .

Let's look at each of these in a bit more detail.

The projected P&L statement

The projected P&L statement for an electrical appliances store shows how much revenue and profits your business is expected to generate in the future.

projected profit and loss statement example in a electrical appliances store business plan

Ideally, your electrical appliances store's P&L statement should show:

  • Healthy growth - above inflation level
  • Improving or stable profit margins
  • Positive net profit

Expectations will vary based on the stage of your business. A startup will be expected to grow faster than an established electrical appliances store. And similarly, an established company should showcase a higher level of profitability than a new venture.

The projected balance sheet of your electrical appliances store

Your electrical appliances store's forecasted balance sheet enables the reader of your plan to assess your financial structure, working capital, and investment policy.

It is composed of three types of elements: assets, liabilities and equity:

  • Assets: represent what the business owns and uses to produce cash flows. It includes resources such as cash, equipment, and accounts receivable (money owed by clients).
  • Liabilities: represent funds advanced to the business by lenders and other creditors. It includes items such as accounts payable (money owed to suppliers), taxes due and loans.
  • Equity: is the combination of what has been invested by the business owners and the cumulative profits and losses generated by the business to date (which are called retained earnings). Equity is a proxy for the value of the owner's stake in the business.

example of forecasted balance sheet in a electrical appliances store business plan

Your electrical appliances store's balance sheet will usually be analyzed in conjunction with the other financial statements included in your forecast.

Two key points of focus will be:

  • Your electrical appliances store's liquidity: does your business have sufficient cash and short-term assets to pay what it owes over the next 12 months?
  • And its solvency: does your business have the capacity to repay its debt over the medium-term?

The projected cash flow statement

A cash flow forecast for an electrical appliances store shows how much cash the business is projected to generate or consume.

example of cash flow forecast in a electrical appliances store business plan

The cash flow statement is divided into 3 main areas:

  • The operating cash flow shows how much cash is generated or consumed by the operations (running the business)
  • The investing cash flow shows how much cash is being invested in capital expenditure (equipment, real estate, etc.)
  • The financing cash flow shows how much cash is raised or distributed to investors and lenders

Looking at the cash flow forecast helps you to ensure that your business has enough cash to keep running, and can help you anticipate potential cash shortfalls.

It is also a best practice to include a monthly cash flow statement in the appendices of your electrical appliances store business plan so that the readers can view the impact of seasonality on your business cash position and generation.

The initial financing plan

The initial financing plan, also known as a sources and uses table, is a valuable resource to have in your business plan when starting your electrical appliances store as it reveals the origins of the money needed to establish the business (sources) and how it will be allocated (uses).

electrical appliances store business plan: sources & uses example

Having this table helps show what costs are involved in setting up your electrical appliances store, how risks are shared between founders, investors and lenders, and what the starting cash position will be. This cash position needs to be sufficient to sustain operations until the business reaches a break-even point.

Now that you have a clear understanding of what goes into the financial forecast of your electrical appliances store business plan, let's shift our focus to the written part of the plan.

Need inspiration for your business plan?

The Business Plan Shop has dozens of business plan templates that you can use to get a clear idea of what a complete business plan looks like.

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The written part of an electrical appliances store business plan plays a key role: it lays out the plan of action you intend to execute to seize the commercial opportunity you've identified on the market and provides the context needed for the reader to decide if they believe your plan to be achievable and your financial forecast to be realistic.

The written part of an electrical appliances store business plan is composed of 7 main sections:

  • The executive summary
  • The presentation of the company
  • The products and services
  • The market analysis
  • The strategy
  • The operations
  • The financial plan

Let's go through the content of each section in more detail!

1. The executive summary

In your electrical appliances store's business plan, the first section is the executive summary — a captivating overview of your plan that aims to pique the reader's interest and leave them eager to learn more about your business.

When crafting the executive summary, start with an introduction to your business, including its name, concept, location, how long it has been running, and what sets it apart. Briefly mention the products and services you plan to offer and your target customer profile.

Following that, provide an overview of the addressable market for your electrical appliances store, current trends, and potential growth opportunities.

Next, include a summary of key financial figures like projected revenues, profits, and cash flows.

Finally, in the "ask" section, detail any funding requirements you may have.

2. The presentation of the company

As you build your electrical appliances store business plan, the second section deserves attention as it delves into the structure and ownership, location, and management team of your company.

In the structure and ownership part, you'll provide valuable insights into the legal structure of the business, the identities of the owners, and their respective investments and ownership stakes. This level of transparency is vital, particularly if you're seeking financing, as it clarifies which legal entity will receive the funds and who holds the reins of the business.

Moving to the location part, you'll offer a comprehensive view of the company's premises and articulate why this specific location is strategic for the business, emphasizing factors like catchment area, accessibility, and nearby amenities.

When describing the location of your electrical appliances store, you could focus on the potential for customer traffic. It could be situated in a community with high levels of consumer activity, such as a shopping mall or a popular neighborhood restaurant district. You could also emphasize the potential for growth in the area, as the population of the surrounding area may be increasing rapidly. In addition, you could point out any unique features or amenities that might draw customers to the store, such as a nearby park or a major highway that passes by. Finally, you could highlight any partnerships that you could leverage to bring more customers to the store, such as deals with local businesses or organizations.

Lastly, you should introduce your esteemed management team. Provide a thorough explanation of each member's role, background, and extensive experience.

It's equally important to highlight any past successes the management team has achieved and underscore the duration they've been working together. This information will instil trust in potential lenders or investors, showcasing the strength and expertise of your leadership team and their ability to deliver the business plan.

3. The products and services section

The products and services section of your business plan should include a detailed description of what your company offers, who are the target customers, and what distribution channels are part of your go-to-market. 

For example, your electrical appliances store might offer a range of products such as refrigerators, dishwashers, washing machines, air conditioners, and vacuum cleaners. Your store might also offer services such as installation, maintenance, and repair services. This will enable customers to purchase suitable appliances for their needs, and to ensure that they are installed and maintained properly. This can improve the customers' convenience and satisfaction, and help to build trust in the store.

4. The market analysis

When outlining your market analysis in the electrical appliances store business plan, it's essential to include comprehensive details about customers' demographics and segmentation, target market, competition, barriers to entry, and relevant regulations.

The primary aim of this section is to give the reader an understanding of the market size and appeal while demonstrating your expertise in the industry.

To begin, delve into the demographics and segmentation subsection, providing an overview of the addressable market for your electrical appliances store, key marketplace trends, and introducing various customer segments and their preferences in terms of purchasing habits and budgets.

Next, shift your focus to the target market subsection, where you can zoom in on the specific customer segments your electrical appliances store targets. Explain how your products and services are tailored to meet the unique needs of these customers.

For example, your target market might include young professionals. These customers are likely to be between the ages of 25 and 35, and have an above average disposable income. They are likely to be tech-savvy and interested in the latest gadgets and appliances.

In the competition subsection, introduce your main competitors and explain what sets your electrical appliances store apart from them.

Finally, round off your market analysis by providing an overview of the main regulations that apply to your electrical appliances store.

5. The strategy section

When writing the strategy section of a business plan for your electrical appliances store, it is essential to include information about your competitive edge, pricing strategy, sales & marketing plan, milestones, and risks and mitigants.

The competitive edge subsection should explain what sets your company apart from its competitors. This part is especially key if you are writing the business plan of a startup, as you have to make a name for yourself in the marketplace against established players.

The pricing strategy subsection should demonstrate how you intend to remain profitable while still offering competitive prices to your customers.

The sales & marketing plan should outline how you intend to reach out and acquire new customers, as well as retain existing ones with loyalty programs or special offers. 

The milestones subsection should outline what your company has achieved to date, and its main objectives for the years to come - along with dates so that everyone involved has clear expectations of when progress can be expected.

The risks and mitigants subsection should list the main risks that jeopardize the execution of your plan and explain what measures you have taken to minimize these. This is essential in order for investors or lenders to feel secure in investing in your venture.

Your electrical appliances store could face the risk of a natural disaster such as a flood or a fire damaging the store and its contents. This could result in significant financial losses due to the destruction of inventory and equipment. Your store might also face the risk of theft. Thieves could target your store for expensive items such as televisions, computers, or sound systems. This could lead to a loss of profits as well as a decrease in customer confidence in the store.

6. The operations section

The operations of your electrical appliances store must be presented in detail in your business plan.

The first thing you should cover in this section is your staffing team, the main roles, and the overall recruitment plan to support the growth expected in your business plan. You should also outline the qualifications and experience necessary to fulfil each role, and how you intend to recruit (using job boards, referrals, or headhunters).

You should then state the operating hours of your electrical appliances store - so that the reader can check the adequacy of your staffing levels - and any plans for varying opening times during peak season. Additionally, the plan should include details on how you will handle customer queries outside of normal operating hours.

The next part of this section should focus on the key assets and IP required to operate your business. If you depend on any licenses or trademarks, physical structures (equipment or property) or lease agreements, these should all go in there.

You may have valuable physical assets such as inventory, equipment, or building space. You could also have intellectual property such as trademarks, trade secrets, or copyrighted materials. These could be associated with the store's name, logo, or other intellectual creations.

Finally, you should include a list of suppliers that you plan to work with and a breakdown of their services and main commercial terms (price, payment terms, contract duration, etc.). Investors are always keen to know if there is a particular reason why you have chosen to work with a specific supplier (higher-quality products or past relationships for example).

7. The presentation of the financial plan

The financial plan section is where we will present the financial forecast we talked about earlier in this guide.

Now that you have a clear idea of what goes in your electrical appliances store business plan, let's look at the solutions you can use to draft yours.

What tool should I use to write my electrical appliances store's business plan?

There are two main ways of creating your electrical appliances store business plan:

  • Using specialized business planning software,
  • Hiring a business plan writer.

Using an online business plan software for your electrical appliances store's business plan

Using online business planning software is the most efficient and modern way to write an electrical appliances store business plan.

There are several advantages to using specialized software:

  • You can easily create your financial forecast by letting the software take care of the financial calculations for you without errors
  • You are guided through the writing process by detailed instructions and examples for each part of the plan
  • You can access a library of dozens of complete business plan samples and templates for inspiration
  • You get a professional business plan, formatted and ready to be sent to your bank or investors
  • You can easily track your actual financial performance against your financial forecast
  • You can create scenarios to stress test your forecast's main assumptions
  • You can easily update your forecast as time goes by to maintain visibility on future cash flows
  • You have a friendly support team on standby to assist you when you are stuck

If you're interested in using this type of solution, you can try The Business Plan Shop for free by signing up here .

Need a solid financial forecast?

The Business Plan Shop does the maths for you. Simply enter your revenues, costs and investments. Click save and our online tool builds a three-way forecast for you instantly.

Screenshot from The Business Plan Shop's Financial Forecasting Software

Hiring a business plan writer to write your electrical appliances store's business plan

Outsourcing your electrical appliances store business plan to a business plan writer can also be a viable option.

Business plan writers are skilled in creating error-free business plans and accurate financial forecasts. Moreover, hiring a consultant can save you valuable time, allowing you to focus on day-to-day business operations.

However, it's essential to be aware that hiring business plan writers will be expensive, as you're not only paying for their time but also the software they use and their profit margin.

Based on experience, you should budget at least £1.5k ($2.0k) excluding tax for a comprehensive business plan, and more if you require changes after initial discussions with lenders or investors.

Also, exercise caution when seeking investment. Investors prefer their funds to be directed towards business growth rather than spent on consulting fees. Therefore, the amount you spend on business plan writing services and other consulting services should be insignificant compared to the amount raised.

Keep in mind that one drawback is that you usually don't own the business plan itself; you only receive the output, while the actual document is saved in the consultant's business planning software. This can make it challenging to update the document without retaining the consultant's services.

For these reasons, carefully consider outsourcing your electrical appliances store business plan to a business plan writer, weighing the advantages and disadvantages of seeking outside assistance.

Why not create your electrical appliances store's business plan using Word or Excel?

I must advise against using Microsoft Excel and Word (or their Google, Apple, or open-source equivalents) to write your electrical appliances store business plan. Let me explain why.

Firstly, creating an accurate and error-free financial forecast on Excel (or any spreadsheet) is highly technical and requires a strong grasp of accounting principles and financial modelling skills. It is, therefore, unlikely that anyone will fully trust your numbers unless you have both a degree in finance and accounting and significant financial modelling experience, like us at The Business Plan Shop.

Secondly, relying on spreadsheets is inefficient. While it may have been the only option in the past, technology has advanced significantly, and software can now perform these tasks much faster and with greater accuracy. With the rise of AI, software can even help us detect mistakes in forecasts and analyze the numbers for better decision-making.

And with the rise of AI, software is also becoming smarter at helping us detect mistakes in our forecasts and helping us analyse the numbers to make better decisions.

Moreover, software makes it easier to compare actuals versus forecasts and maintain up-to-date forecasts to keep visibility on future cash flows, as we discussed earlier in this guide. This task is cumbersome when using spreadsheets.

Now, let's talk about the written part of your electrical appliances store business plan. While it may be less error-prone, using software can bring tremendous gains in productivity. Word processors, for example, lack instructions and examples for each part of your business plan. They also won't automatically update your numbers when changes occur in your forecast, and they don't handle formatting for you.

Overall, while Word or Excel may seem viable for some entrepreneurs to create a business plan, it's by far becoming an antiquated way of doing things.

  • Using business plan software is a modern and cost-effective way of writing and maintaining business plans.
  • A business plan is not a one-shot exercise as maintaining it current is the only way to keep visibility on your future cash flows.
  • A business plan has 2 main parts: a financial forecast outlining the funding requirements of your electrical appliances store and the expected growth, profits and cash flows for the next 3 to 5 years; and a written part which gives the reader the information needed to decide if they believe the forecast is achievable.

We hope that this in-depth guide met your expectations and that you now have a clear understanding of how to write your electrical appliances store business plan. Do not hesitate to contact our friendly team if you have questions additional questions we haven't addressed here.

Also on The Business Plan Shop

  • How to write a business plan to secure a bank loan?
  • Key steps to write a business plan?
  • Top mistakes to avoid in your business plan

Do you know entrepreneurs interested in starting or growing an electrical appliances store? Share this article with them!

Guillaume Le Brouster

Founder & CEO at The Business Plan Shop Ltd

Guillaume Le Brouster is a seasoned entrepreneur and financier.

Guillaume has been an entrepreneur for more than a decade and has first-hand experience of starting, running, and growing a successful business.

Prior to being a business owner, Guillaume worked in investment banking and private equity, where he spent most of his time creating complex financial forecasts, writing business plans, and analysing financial statements to make financing and investment decisions.

Guillaume holds a Master's Degree in Finance from ESCP Business School and a Bachelor of Science in Business & Management from Paris Dauphine University.

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Free Electrical Business Plan PDF Download | Electrical Shop Business Plan

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How to Start an Electrical Business - Free Electrical Business Plan PDF Download

Are you considering starting an electrical business and are in need of an electrical business plan? if yes, you'll find this free book to be extremely helpful.

This is a practical guide that will walk you step by step through all the essentials of starting your business. The book is packed with guides, worksheets and checklists. These strategies are absolutely crucial to your business' success yet are simple and easy to apply.

Don’t Start a New Electrical Business Unless You Watch This Video First!

Checklist for Starting a Business: Essential Ingredients for Success

If you are thinking about going into business, it is imperative that you watch this video first! it will take you by the hand and walk you through each and every phase of starting a business. It features all the essential aspects you must consider BEFORE you start a business. This will allow you to predict problems before they happen and keep you from losing your shirt on dog business ideas. Ignore it at your own peril!

Here’s a Valuable Free Gift for You This is a high quality, full blown business plan template complete with detailed instructions and all related spreadsheets. You can download it to your PC and easily prepare a professional business plan for your business. Click Here! To get your free business plan template

The Single Most Important Ingredient for Business Success

The first and most important thing you need to acquire in order to succeed in a small business is... knowledge.

Sounds exaggerated? Listen to this...

According to research conducted by Dun & Bradstreet, 90% of all small business failures can be traced to poor management resulting from lack of knowledge.

This is backed up by my own personal observations. In my 31 years as a business coach and consultant to small businesses, I've seen practically dozens of small business owners go under and lose their businesses -- not because they weren't talented or smart enough -- but because they were trying to re-invent the wheel rather than rely on proven, tested methods that work.

Conclusion: if you are really serious about succeeding in a business... If you want to avoid the common traps and mistakes... it is absolutely imperative that you acquire the right knowledge.

"Why Invent Mediocrity, When You Can Copy Genius?"

That's an excellent quote I picked up from a fellow business owner a few years back. What this means is that you should see what is working and try to duplicate it. Why go through all the trouble of inventing something new, that you don't even know will ever work, when you can easily learn from and duplicate something that has been a proven success?

[ Note: One of the BIGGEST mistakes almost all new businesses make is that they WASTE tons of valuable time, energy and money on trying to create something "new", that has never been tested or proven... only to find out later that it was a total loss. Don't make the same mistake! ]

Hi! My name is Meir. I'm the founder and president of BizMove.com, a successful Internet based information business. I'm also the author of numerous books, mostly in the area of small business management.

I've been involved in small business for the past 31 years of my life, as a business coach, manager of a Electrical firm, a seminar leader and as the owner of five successful businesses.

During my career as a business coach and consultant I've helped dozens of business owners start their businesses, market, expand, get out of troubles, sell their businesses and do practically every other small business activity you can think of. You see, I have been there .... done it ... and bought the Small Business t-shirt! -- This free book contains techniques and strategies I've learned during my 31 year small business career.

Here's what you'll discover in the 'How to Start a Electrical Business' book:

Success Tip: Setting Goals

Good management is the key to success and good management starts with setting goals. Set goals for yourself for the accomplishment of the many tasks necessary in starting and managing your business successfully. Be specific. Write down the goals in measurable terms of performance. Break major goals down into sub-goals, showing what you expect to achieve in the next two to three months, the next six months, the next year, and the next five years. Beside each goal and sub-goal place a specific date showing when it is to be achieved.

Plan the action you must take to attain the goals. While the effort required to reach each sub-goal should be great enough to challenge you, it should not be so great or unreasonable as to discourage you. Do not plan to reach too many goals all at one time.

Establish priorities. Plan in advance how to measure results so you can know exactly how well you are doing. This is what is meant by "measurable" goals. If you can’t keep score as you go along you are likely to lose motivation. Re-work your plan of action to allow for obstacles which may stand in your way. Try to foresee obstacles and plan ways to avert or minimize them.

Click here! to download your Electrical Business Plan book for free (PDF version)

Management Skills Video: How to Become a Great Manager and Leader

Learn how to improve your leadership skills and become a better manager and leader. Here's how to be the boss people want to give 200 percent for. In the following video you'll discover 120 powerful tips and strategies to motivate and inspire your people to bring out the best in them.

For more insightful videos visit our Small Business and Management Skills YouTube Chanel .

Here're other free books in the "how to start a business" series that may interest you:

Here's a Sample 'Executive Summary' for a Electrical Business plan :

COMPANY NAME ADDRESS CITY, STATE, ZIP CODE Tel.  Fax: Email:

COMPANY NAME is an Electrical Sub-Contractor, primarily doing commercial, industrial, medical and residential. COMPANY NAME offers value engineering for energy evaluation & efficiency. The purpose of the company's plan is to grow in the fields mentioned above as well as branch out into Nevada, Arizona & New Mexico. COMPANY NAME also wants to further the company's market share in the solar/energy and the service industry.

1.1 Objectives

1. To fund growth of existing business & increase market share of our service business 2. Expand into the field of energy/solar 3. With additional capital the ability to bid larger projects.

1.2 Mission

COMPANY NAME 's sole purpose is to establish a profitable and well managed company while at the same time designing to please the local residents with excellent service in California.  COMPANY NAME’s near future plans are to grow the company's electrical contracting business in California and other states such as Nevada, Arizona and New Mexico.  The company will seek to provide these services in the timeliest manner and with an ongoing comprehensive quality control program to provide 100% customer satisfaction.

1.3 Keys to Success

1.  Servicing and maintaining our existing client base 2.  Having employees that understand and implement our high standards 3.  Reliability and communication with clients from beginning of each job to end.

COMPANY NAME is in the city of Orange and has been in the county of Orange since 1994, servicing Los Angeles, Riverside, San Bernardino and San Diego counties. We provide electrical contracting services to a wide range of clients, including owners and general contractors, mainly in the medical field. COMPANY NAME's current corporate office is at [INSERT ADDRESS].   The company's corporate office is a 4,650 sq ft concrete tilt up building. This corporate office houses all administrative operations, with warehouse space used for inventory and service vehicles. All of the work is done at many off-site locations.

2.1 Company Ownership

COMPANY NAME is a privately held C Corporation where OWNER’S NAME is president & secretary and CO-OWNER’S NAME is Vice President.

2.2 Company History

In 2006 and 2007 COMPANY NAME experienced a decrease in sales due to California budget cuts for the company's voice and data division that had provided services to Employment Development Departments.   The decrease in sales was also due to existing clients who were very slow in paying for services rendered.  COMPANY NAME had also made the decision to focus more on the medical field and their primary client base. The company had cut ties with three general contractors and proceeded to establish new contacts within the medical field. The year of 2008 was a great year and COMPANY NAME was on track to double sales; however the economy was starting to slow. 2009 was a respectable year, however, again, due to the economy COMPANY NAME re-evaluated again to expand into solar/energy industry.

Table: Past Performance

3.0 Services

COMPANY NAME 's products are: 1) Design build which is based on a per square foot price. 2) Contract work which is specific to a certain set of blueprints/drawings. 3) Service work that is based on an hourly rate.

COMPANY NAME will focus on four main markets within the industry such as: MEDICAL This field is a viable source of business now and due to ever changing technology a great source of future business that will sustain us long term. SERVICE There will always be a need for service and this is an area that we have never taped into and believe there is great potential. COMMERCIAL/INDUSTRIAL This has been the company's main focus; COMPANY NAME has built great long term relationships with building owners who now look for our guidance in directing their energy improvements. SOLAR/ENERGY We feel we always need to look at new trends and stay ahead of change in our approach to long term sustainability.

How to Organize Paperwork for Business

We must all be efficient and productive in today's business world. Being organized helps you handle tasks quickly so that you have more time and space to do what you truly want to do.

1. One-time mail system.

Have an In Box on your desk for new mail/information. Look at your mail once a day. Review each piece of mail once to decide whether to do it, delegate it or dump it. If it adds value to your business or is required for doing business, do it or delegate it. If not, then dump it. If you keep it, then categorize it using the A, B, C system. Use your time wisely.

2. Categories for performing your work.

Set up desk trays labeled A, B, and C. Items in category A must be handled today. Category B items must be handled this week. Category C items are generally filing that must be kept because they have some value, such as invoices, tax returns, and statements.

3. Prioritize your work within categories A and B.

Sort the categories into 1, 2, and 3. A1 must be done NOW, it is "hot" or "urgent." A2 can be done this AM. A3 can be done by the end of the day. B1 is done on Monday. B2 done by Wednesday. B3 done by the end of the week. Make the decision once, then do the work.

Set a day and time each week for filing. Don't let it stack up. Give yourself space to work.

5. Purge your files on a regular schedule.

For example, purge files every six months. Send these documents to storage. This gives you more space to work.

6. Storing records.

Store documents in boxes. Mark the contents of each box. For instance, clients A-F2013. Mark the destruction date on the box, D = June 02. Base your destruction date on the legal requirements for your industry.

7. Toss out stored documents on a regular schedule.

For example, two times per year, visit the storage area and remove boxes that are beyond the destruction date. Depending on your industry, they may need to be shredded rather than put in the trash.

8. Color code your records.

For example, clients with first names beginning with A-F are in Orange folders; G-K Yellow; L-P Blue; Q-Z Green. This will save you time when you are searching for a file. You can also apply this to AP, AR, Payroll, and Taxes. This can also be done by year. For example, 2012 AP is blue; 2013 AP is purple.

9. Hot files.

Put a red cover on files that you consider "hot." These could be urgent projects, legally or financially sensitive, or important VIP clients. Keep these visually at your fingertips.

10. Use out guides.

If you work with other people and share files, create a check-out system so that files are not lost. Put the file name, taken-by name, and date on a card and place it in an out guide box. When you can't find what you want, check the box to see if your co-worker is using the file. Be sure to remove the card from the box when you return the file.

Copyright © by Bizmove Free Business Guides. All rights reserved.

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How to Run a Successful Electrical Business

  • by Richard F. Stolz Richard F. Stolz is a ... more
  • April 11, 2019
  • 5  Minute Read
  • Home > Blog > Financial Health > How to Run a Successful Electrical Business

business plan for electrical shop

Many electricians decide to go into business for themselves. After all, they’ve mastered the trade, created relationships with loyal customers, and developed a good sense of the rules and regulations. However, knowing how to run a successful electrical business requires a different skill set than that of a first-rate electrician.

You likely spent the first few years in business learning the finer details of running an electrical company. Here’s a chance to check in on your progress as a business owner, and spot opportunities for improvement and growth. Just as you need to stay current in your technical skills to maintain your license, keeping your business successful requires a periodic assessment and tune-up.

1. Benchmark Your Performance

If your company is growing and profitable, it may be tempting to continue with business as usual. But are you as profitable as you could be? Perhaps your competitors have a formula for how to run a successful electrical business that’s more potent than yours.

Business benchmarking is sort of like a voltage drop test. You’re comparing your numbers to those of your peers. CliftonLarsonAllen provided three years of benchmark data for electrical and mechanical contractors. For example, it took contractors an average of 69.6 days to convert their receivables into cash. How long is it taking your business? Check out data relevant to your business to make sure you’re keeping pace.

2. Keep Your Business Plan Current

If you don’t have a business plan, it might be time to create one. Running an electrical business successfully involves having a plan in place for how you’ll reach your goals.

If you’ve created a business plan in the past, also keep in mind that it can “expire” quickly. That’s because circumstances change. Maybe it’s something good, like a new residential community is about to be built nearby. Or maybe it’s something bad, like a new electrical contractor opened up in your town and hired away some of your best people.

Whatever the circumstances, it’s important to keep a current plan. A common way to begin is with a “SWOT” analysis. SWOT stands for strengths, weaknesses, opportunities and threats. Once you identify them, you can create or update your business plan.

3. Stay Tuned In to Your Customers’ Needs

Getting customers can be a challenge, so it’s vital to keep them. When possible, check in to see how things have worked out since your last job. Perhaps your customer remodeled a bathroom and your role was to install several new fixtures and GFCI receptacles. Maybe adding new fixtures to another bathroom would spruce it up without a complete remodeling job, a small project you could propose. Maybe you’d want to bring a new NFPA 70 standard to the attention of a customer you haven’t seen for a while.

Also, as innovative electrical system products come to market, like surge protectors with energy-saving features, your customers might appreciate an occasional product update. It may also keep your name top of mind the next time they need an electrician.

Business owner maintains safety while fixing fuse box, part of how to run a successful electrical business

4. Keep Your Technology Up to Date

Almost daily, new small business technology hits the market that enhances personal safety and business productivity. You don’t need to buy new technology for its own sake, but to help you grow and maximize your profitability. Whether it’s software for customer relationship management, bookkeeping, making financial projections, tracking time, managing work orders, or job bidding, it’s all out there and getting better all the time. Technology’s long-term benefits can make it a worthwhile investment.

5. Maintain Sufficient Working Capital

Running short on cash can be costly in more ways than one — when it forces you to maintain a balance on a credit card account, lose out on discounts from suppliers, or prevents you from purchasing productivity-enhancing technology. Leveraging working capital loans and other forms of small business financing are key to running a successful electrical business. They can tide you over during a dry cash flow spell.

6. Evaluate Your Bidding Track Record

There are two aspects to bidding a job successfully when running an electrical business: getting a healthy share of the available work and charging the right price. If your bids aren’t competitive, you won’t get much business. If they’re too competitive, you could lose money. Take a fresh look at how you’re pricing jobs, and how you’re deciding which projects to bid on (and be prepared to say no to new business ). Make sure you’ve accounted for all the costs you need to cover, including overhead, with some money left over for a fair profit.

Also, consider your success ratio. If you’re consistently losing out to a competitor, try to determine the reason. And remember, cost isn’t the only variable, though it’s typically the most important. Are you getting your bids in promptly? Are they detailed, professional and clearly presented? Where applicable, can you provide customers with more than one option when bidding?

7. Optimize the Size of Your Business

Knowing how to run a successful electrical business includes knowing how big, or small, your business should be. The “Goldilocks principle” applies here — not too hot, not too cold … not too big, not too small. Too small is when you’re so busy doing administrative tasks that you don’t have enough time to do the work that’s the focus of your business. Too large can mean having greater capacity — and larger associated expenses — than the available work. It’s essential to find the right balance.

8. Maintain Your High Safety Standards

The risk of personal injury inherent in running an electrical business is one of the reasons you can command a good price for your work. But easing up on safety precautions, for whatever reason, is not only bad for business, but could mean the end of your business. Make sure you have proper safety training programs in place, as well as a workers’ compensation policy.

9. Think About Your Talent Pipeline

If key people in your business are closing in on retirement, or might just decide to move on to another opportunity, don’t be left in the lurch. It’s not always easy to find skilled younger workers moving into this field, but don’t let the challenge deter you. Consider partnering with a local community college to offer internships or apprenticeships, to keep new talent flowing into your business.

10. Ask for Referrals

No list of tips on how to run a successful electrical business is complete without a reminder to ask your customers to refer their friends to you. Sometimes it just doesn’t occur to them to do so. But if they’re happy with your work, and if you help them remember you by staying in touch, they’ll become your best — and least expensive — marketing tool.

Of course, progress is hard to come by without time, effort and determination on your part. Sometimes, it will also cost money. As you prep for growing your electrical business, you may want to research how to get a small business loan to front some of these expenses without tying up your cash flow. Whether you’re ready to tackle each of these pieces of advice in one go, or you need to start small, it’s important to carve out time to consider your business practices and plan for future growth.

If you own an electrical business, you can consider electrical and plumbing business loan options with National Funding.

Tags: Bad Credit , Business Growth , Construction , Managing your Cash Flow , Marketing for Small Business , Small Business Loans , Working Capital

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Electrical Supply Business Plan [Sample Template]

By: Author Tony Martins Ajaero

Home » Business Plans » Construction & Engineering

Are you about starting an electrical supply business? If YES, here is a complete sample electrical supply business plan template & feasibility report you can use for FREE .

Okay, so we have considered  all the requirements for starting an electrical supply business. We also took it further by analyzing and drafting a sample electrical supply business marketing plan template backed up by actionable guerrilla marketing ideas for electrical supply businesses. So let’s proceed to the business planning section.

As an aspiring entrepreneur who wants to delve into a business with huge returns on investment, one of your options is to venture into the construction industry. There are several money-spinning business opportunities in the construction industry and one of them is to start an electrical supply business.

Just like other investment vehicles, there are potential down sides that you need to look out for if you want to be successful in this business. One of the major risks in electrical supply is a sudden downturn in the economy.

Part of what you need to do to make headway in this line of business is to ensure that your store is properly positioned and you a have good business relationship with construction contractors, constructions companies and key players in the real estate industry.

If you are truly convinced that starting an electrical supply business is the right business for you, then you need to write your own business plan . The essence of writing a business plan before starting any business is for you to have a roadmap of how you want to setup, manage and expand your business.

Below is a sample electrical supply business plan template that will help you successfully write yours with little or no stress.

A Sample Electrical Supply Business Plan Template

1. industry overview.

Electrical supply business is part of the Electrical Equipment Wholesaling industry and this industry consists of businesses that are into the sale and supply of wiring, lighting fixtures and light bulbs, relay and industrial controls, switchgear and switchboard apparatus, motors and generators, power and distribution transformers and other electrical equipment.

On the average, an electrical supply company distributes electrical construction materials, such as wiring supplies, electrical light fixtures, light bulbs, security systems, electrical power equipment, switchboards, circuit breakers and fuses to construction companies. Hence, demand from building, developing and general contracting largely determines industry revenue growth.

In addition, demand for many of the industry’s products depends on industrial production and electrical power consumption. As manufacturing activity in the economy increases, they purchase industry goods to both outfit their factories and to act as intermediary components.

If you are a closer watcher of the Electrical Equipment Wholesaling industry, you will agree that over the past five years, the Electrical Equipment Wholesaling industry has struggled to rebuild itself, even as the overall economy strengthens.

Industry goods are purchased by professional contractors and consumers engage in remodeling and construction projects.

Rising consumer confidence and household income have helped ignite remodeling activity forestalled during the recession, providing additional demand for electrical equipment used in home improvement projects. Even so, rising competition from large home improvement stores has stifled revenue growth for electrical supply stores.

The Electrical Equipment Wholesaling industry is indeed a large industry and pretty much active in most countries of the world. Statistics has it that in the united states of America alone, there are about 17,709 registered and licensed electrical supply stores scattered all across the United States responsible for employing about 226,258 people and the industry rakes in a whopping sum of $179 billion annually.

The industry is projected to grow at 2.2 percent annual growth within 2013 and 2018. It is important to state that The Electrical Equipment Wholesaling industry has no companies with major market shares.

A recent report published by IBISWORLD shows that over the past five years, the Electrical Equipment Wholesaling industry has grown by 2.2 percent to reach revenue of $179bn in 2018. In the same timeframe, the number of businesses has grown by 0.7 percent and the number of employees has grown by 3.6 percent.

The Electrical Equipment Wholesaling industry is highly regulated in the United States of America and anyone who aspires to start an electrical supply business must apply and obtain a license before they can legally operate in the industry.

No doubt, the Electrical Equipment Wholesaling industry is a profitable industry and it is open for any aspiring entrepreneur to come in and establish his or her business.

2. Executive Summary

Mac Bruce™ Electrical Supply Store, Inc. is a registered electrical equipment supply store business that will be located in one of the busiest streets in Albuquerque – New Mexico. We have been able to lease a facility that is big enough (a 5 thousand square foot facility) to fit into the kind of standard electrical equipment supply store that we intend launching and the facility is located in the heart of the city.

Mac Bruce™ Electrical Supply Store, Inc. will supply electrical construction materials such as wiring supplies, electrical light fixtures, light bulbs, security systems, electrical power equipment, switchboards, circuit breakers and fuses et al to construction companies.

We are aware that there are several electrical equipment supply outlets all around New Mexico, which is why we spent time and resources to conduct a thorough feasibility studies and market survey so as to be well positioned to favorably compete in the industry. We have an online service option for our customers, and our outlet has various payment options.

Mac Bruce™ Electrical Supply Store, Inc. will ensure that all our customers are given first class treatment whenever they visit our electrical equipment store. We have a CRM software that will enable us manage a one on one relationship with our customers no matter how large they grow to. We will ensure that we get our customers involved in the selection of brands that will be on our store.

Mac Bruce™ Electrical Supply Store, Inc. will at all times demonstrate her commitment to sustainability, both individually and as a business, by actively participating in our communities and integrating sustainable business practices wherever possible.

We will ensure that we hold ourselves accountable to the highest standards by meeting our customers’ needs precisely and completely whenever they patronize our products.

Mac Bruce™ Electrical Supply Store, Inc. is owned by Mac Bruce and his immediate family members. Mac Bruce has a B.Sc. in Business Administration, with over 10 years’ experience in the electrical equipment wholesaling industry, working for some of the leading brands in the United States.

Although the business is launching out with just one outlet in Albuquerque – New Mexico, but there is a plan to open other outlets all around major cities in the United States of America.

3. Our Products and Services

Mac Bruce™ Electrical Supply Store, Inc. is in the electrical equipment wholesaling industry to service a wide range of clients and of course to make profits, which is why we will ensure we go all the way to make available a wide range of electrical equipment from top manufacturing brands in the United States.

Our product offerings are listed below;

  • Lighting fixtures and light bulbs
  • Relay and industrial controls
  • Switchgear and switchboard apparatus
  • Motors and generators
  • Power and distribution transformers
  • Other electrical equipment.

4. Our Mission and Vision Statement

  • Our vision is to become the leading brand in the electrical equipment wholesaling industry in New Mexico and to establish a one stop electrical equipment supply store in Albuquerque.
  • Our mission is to establish a world – class electrical equipment supply store that will make available a wide range of electrical equipment from top manufacturing brands at affordable prices in Albuquerque – New Mexico.

Our Business Structure

Mac Bruce™ Electrical Supply Store, Inc. is looking towards building a standard business that can be listed among the top – flight electrical supply stores in Albuquerque – New Mexico. For that singular reason, we will make sure that we establish the business on a solid business structure.

We will ensure that we hire people that are qualified, honest, customer centric and are ready to work to help us build a prosperous business that will benefit all the stakeholders. As a matter of fact, profit-sharing arrangement will be made available to all our senior management staff and it will be based on their performance for a period of ten years or more.

In view of that, we have decided to hire qualified and competent hands to occupy the following positions;

  • Chief Executive Officer (Owner)
  • Store Manager
  • Human Resources and Amin Manager

Merchandize Manager

Sales and Marketing Manager

  • Accountants / Cashiers
  • Customer Services Executive

Truck and Van Drivers

5. Job Roles and Responsibilities

Chief Executive Officer – CEO:

  • Increases management’s effectiveness by recruiting, selecting, orienting, training, coaching, counseling, and disciplining managers; communicating values, strategies, and objectives; assigning accountabilities; planning, monitoring, and appraising job results
  • Creates, communicates, and implements the organization’s vision, mission, and overall direction – i.e. leading the development and implementation of the overall organization’s strategy.
  • Responsible for fixing prices and signing business deals
  • Responsible for providing direction for the business
  • Responsible for signing checks and documents on behalf of the company
  • Evaluates the success of the organization
  • Reports to the board

Admin and HR Manager

  • Maintains office supplies by checking stocks; placing and expediting orders; evaluating new products.
  • Ensures operation of equipment by completing preventive maintenance requirements; calling for repairs.
  • Defines job positions for recruitment and managing interviewing process
  • Carries out induction for new team members
  • Responsible for training, evaluation and assessment of employees
  • Responsible for arranging travel, meetings and appointments
  • Oversees the smooth running of the daily office activities.

Store Manager:

  • Responsible for managing the daily activities in the store / warehouse
  • Ensures that proper records of electrical equipment are kept and warehouse does not run out of products
  • Ensures that the store facility is in tip top shape and goods are properly arranged and easy to locate
  • Controls electrical equipment distribution and supply inventory
  • Supervises the workforce in the electrical equipment sales floor.
  • Manages vendor relations, market visits, and the ongoing education and development of the organizations’ buying teams
  • Helps to ensure consistent quality of electrical equipment are purchased and retailed/supplied in good price that will ensure we make good profit
  • Responsible for the purchase of electrical equipment for the organizations
  • Responsible for planning sales, monitoring inventory, selecting the merchandise, and writing and pricing orders to vendors
  • Manages external research and coordinate all the internal sources of information to retain the organizations’ best customers and attract new ones
  • Models demographic information and analyze the volumes of transactional data generated by customer purchases
  • Identifies, prioritizes, and reaches out to new partners, and business opportunities et al
  • Identifies development opportunities; follows up on development leads and contacts
  • Responsible for supervising implementation, advocate for the customer’s needs, and communicate with clients
  • Documents all customer contact and information
  • Represents the company in strategic meetings
  • Helps to increase sales and growth for the company

Accountant/Cashier:

  • Responsible for preparing financial reports, budgets, and financial statements for the organization
  • Provides managements with financial analyses, development budgets, and accounting reports
  • Responsible for financial forecasting and risks analysis.
  • Performs cash management, general ledger accounting, and financial reporting
  • Responsible for developing and managing financial systems and policies
  • Responsible for administering payrolls
  • Ensures compliance with taxation legislation
  • Handles all financial transactions for the organization
  • Serves as internal auditor for the organization
  • Assists in loading and unloading goods/electrical equipment
  • Maintains a logbook of their driving activities to ensure compliance with federal regulations governing the rest and work periods for operators.
  • Keeps a record of vehicle inspections and make sure the truck is equipped with safety equipment, such as hazardous material placards.
  • Assists the transport and logistics manager in planning their route according to a pick – up and delivery schedule.
  • Inspects vehicles for mechanical items and safety issues and perform preventative maintenance
  • Complies with truck driving rules and regulations (size, weight, route designations, parking, break periods etc.) as well as with company policies and procedures
  • Collects and verifies delivery instructions
  • Reports defects, accidents or violations

Client Service Executive

  • Ensures that all contacts with clients (e-mail, walk-In center, SMS or phone) provides the client with a personalized customer service experience of the highest level
  • Through interaction with customers on the phone, uses every opportunity to build client’s interest in the company’s products and services
  • Manages administrative duties assigned by the human resources and admin manager in an effective and timely manner
  • Consistently stays abreast of any new information on the organizations’ products, promotional campaigns etc. to ensure accurate and helpful information is supplied to customers when they make enquiries

6. SWOT Analysis

Any profitable business is bound to be competitive and as a new business, you must be ready to compete in the industry and competing in the industry means that you must follow due process in establishing a business. We are quite aware that there are several electrical equipment supply stores all over Albuquerque and even in the same location where we intend locating ours, which is why we are following the due process of establishing a business.

We know that if a proper SWOT analysis is conducted for our business, we will be able to position our business to maximize our strength, leverage on the opportunities that will be available to us, mitigate our risks and be equipped to confront our threats.

Mac Bruce™ Electrical Supply Store, Inc. employed the services of an expert HR and Business Analyst with bias in supply chain business to help us conduct a thorough SWOT analysis and to help us create a Business model that will help us achieve our business goals and objectives.

This is the summary of the SWOT analysis that was conducted for Mac Bruce™ Electrical Supply Store, Inc.;

Our business is located in a city with heavy construction and real estate activities and also, we can boast of having good business relationship with top manufacturers in the electrical equipment manufacturing industry.

A major weakness that may count against us is the fact that we don’t have our own electrical equipment production plant, we are a new electrical equipment supply outlet and we don’t have the financial capacity to compete with multi – billion dollars electrical equipment supply stores when it comes to supplying at rock bottom prices.

  • Opportunities:

The fact that we are going to be operating our electrical equipment supply store in one of the busiest construction locations in Albuquerque – New Mexico provides us with unlimited opportunities to sell our electrical equipment to a large number of construction contractors.

We have been able to conduct thorough feasibility studies and market survey and we know what our potential clients will be looking for when they order electrical equipment from us; we are well positioned to take on the opportunities that will come our way.

A major threat that we are going to face as an electrical supply business operating in the United States of America is uncertainty in government policies as it relates to price control and influx of electrical equipment manufactured outside the United States of America.

When the prices charged by manufacturers to wholesalers’ declines, wholesalers typically have to reduce their selling prices to retailers. This results in subdued revenue growth for wholesalers, even if demand expands.

7. MARKET ANALYSIS

  • Market Trends

If you are conversant with the electrical equipment supply Industry, you will quite agree that the changes in disposable income, consumer sentiment, ever changing trends and of course the rates of homeownership are major growth drivers for this industry.

No doubt, a massive rise in consumer confidence has also contributed in helping the industry experience remarkable growth, but uneven performance in these drivers has led to slightly constrained revenue growth.

So also, the rising demand for both building renovations, as a result of increasing disposable income and consumer sentiment, will result in revenue growth, but profit margins will stagnate as electrical equipment supply stores keep prices low to attract more sales amid growing competition.

A close watch on industry activities reveals that the retail market was hit hard by the recent economic downturn. The construction of new homes is a primary market for industry products, so as housing starts, increase demand tends to follow.

Moreover, as home builders have increased their use of electronics, demand for complementary electrical equipment has risen. In 2018, housing is expected to increase, presenting a potential opportunity for the industry. As part of marketing strategies, electrical equipment supply stores partner with key players in the construction and real estate industry. They are in the best position to offer you electrical equipment supply contract.

8. Our Target Market

We have positioned our electrical equipment supply store to service the construction industry in Albuquerque – New Mexico. We have conducted our market research and feasibility studies and we have ideas of what our target market would be expecting from us.

We are in business to supply a wide range of electrical equipment to the following;

  • Construction Companies
  • Construction Contractors
  • Home Remodeling Companies
  • Small Electrical equipment Retail Stores

Our competitive advantage

A close study of the industry reveals that the market has become much more intensely competitive over the last decade. As a matter of fact, you have to be highly creative, customer centric and proactive if you must survive in this industry. We are aware of the stiff competition and we are prepared to compete favorably with other leading electrical equipment supply stores.

Our electrical equipment supply store is located in a corner piece property in the largest electrical equipment market in Albuquerque – New Mexico. We have enough parking space that can accommodate over 10 cars/trucks per time.

One thing is certain, we will ensure that we have a wide range of electrical equipment available in our store at all times. It will be difficult for customers to visit our store and not see the type of electrical equipment that they are looking for.

One of our business goals is to make Mac Bruce™ Electrical Supply Store, Inc. a one stop electrical equipment shop for customers. Our excellent customer service culture, online store, various payment options and highly secured facility will serve as a competitive advantage for us.

Lastly, our employees will be well taken care of, and their welfare package will be among the best within our category in the industry meaning that they will be more than willing to build the business with us and help deliver our set goals and achieve all our aims and objectives. We will also give good working conditions and commissions to freelance sales agents that we will recruit from time to time.

9. SALES AND MARKETING STRATEGY

  • Sources of Income

We are in the electrical equipment wholesaling industry to maximize profits and we are going to go all the way out to ensure that we achieve or business goals and objectives. Mac Bruce™ Electrical Supply Store, Inc. will generate income by;

10. Sales Forecast

One thing is certain when it comes to electrical equipment supply stores, if your store is stocked with various types of electrical equipment and centrally positioned, you will always attract customers cum sales and that will sure translate to increase in revenue generation for the business.

We are well positioned to take on the available market in Albuquerque – New Mexico and we are quite optimistic that we will meet our set target of generating enough income/profits from the first six months of operation and grow the business and our clientele base.

We have been able to examine the electrical equipment wholesaling industry, we have analyzed our chances in the industry and we have been able to come up with the following sales forecast.

Below is the sales projection for Mac Bruce™ Electrical Supply Store, Inc., it is based on the location of our business and other factors as it relates to electrical equipment supply stores startups in the United States;

  • First Fiscal Year: $450,000
  • Second Fiscal Year: $950,000
  • Third Fiscal Year: $1. 9 million

N.B : This projection was done based on what is obtainable in the industry and with the assumption that there won’t be any major economic meltdown and there won’t be any major competitor retailing same electrical equipment and customer care services as we do within same location. Please note that the above projection might be lower and at the same time it might be higher.

  • Marketing Strategy and Sales Strategy

Before choosing a location for Mac Bruce™ Electrical Supply Store, Inc., we conducted a thorough market survey and feasibility studies in order for us to be able to penetrate the available market and become the preferred choice for key players in the construction and real estate industry.

We have detailed information and data that we were able to utilize to structure our business to attract the number of customers we want to attract per time.

We hired experts who have good understanding of the electrical equipment supply industry to help us develop marketing strategies that will help us achieve our business goal of winning a larger percentage of the available market in Albuquerque – New Mexico.

In summary, Mac Bruce™ Electrical Supply Store, Inc. will adopt the following sales and marketing approach to win customers over;

  • Introduce our electrical equipment supply store by sending introductory letters alongside our brochure to construction companies, construction contractors, home remodeling companies and other key stake holders in Albuquerque – New Mexico
  • Ensure that we have a wide range of electrical equipment from different manufacturing brand at all times.
  • Make use of attractive hand bills to create awareness and also to give direction to our electrical equipment supply store
  • Position our signage/flexi banners at strategic places around Albuquerque – New Mexico
  • Position our greeters to welcome and direct potential customers
  • Create a loyalty plan that will enable us reward our regular customers
  • List our business and products on yellow pages ads (local directories)
  • Leverage on the internet to promote our business
  • Engage in direct marketing and sales
  • Encourage the use of Word of mouth marketing (referrals)

11. Publicity and Advertising Strategy

Despite the fact that our electrical equipment supply store is well located, we will still go ahead to intensify publicity for the business. We are going to explore all available means to promote our electrical equipment supply store.

Mac Bruce™ Electrical Supply Store, Inc. has a long – term plan of opening outlets in various locations all around New Mexico and key cities in the United States which is why we will deliberately build our brand to be accepted in Albuquerque before venturing out.

Here are the platforms we intend leveraging on to promote and advertise Mac Bruce™ Electrical Supply Store, Inc.;

  • Place adverts on community – based newspapers, radio and TV stations
  • Encourage the use of word of mouth publicity from our loyal customers
  • Leverage on the internet and social media platforms and other platforms to promote our business.
  • Ensure that our we position our banners and billboards in strategic positions all around Albuquerque – New Mexico
  • Distribute our fliers and handbills in target areas in and around our neighborhood
  • Advertise our electrical equipment supply store business in our official website and employ strategies that will help us pull traffic to the site
  • Brand all our official cars and trucks and ensure that all our staff members wear our branded shirt or cap at regular intervals.

12. Our Pricing Strategy

Aside from quality, pricing is one of the key factors that gives leverage to electrical equipment supply stores, it is normal for consumers to go to places where they can get electrical equipment at cheaper price which is why big players in the industry will attract loads of clients.

We know we don’t have the capacity to compete with multi – million – dollar electrical equipment stores but we will ensure that the prices and quality of all the electrical equipment that are available in our store are competitive with what is obtainable amongst electrical equipment supply stores within our level.

  • Payment Options

The payment policy adopted by Mac Bruce™ Electrical Supply Store, Inc. is all inclusive because we are quite aware that different customers prefer different payment options as it suits them but at the same time, we will ensure that we abide by the financial rules and regulation of the United States of America.

Here are the payment options that Mac Bruce™ Electrical Supply Store, Inc. will make available to her clients;

  • Payment via bank transfer
  • Payment with cash
  • Payment via credit cards
  • Payment via online bank transfer
  • Payment via check
  • Payment via mobile money transfer
  • Payment via bank draft

In view of the above, we have chosen banking platforms that will enable our client make payment for supply of our electrical equipment without any stress on their part. Our bank account numbers will be made available on our website and promotional materials to clients who may want to deposit cash or make online transfer for products purchased.

13. Startup Expenditure (Budget)

From our market survey and feasibility studies, we have been able to come up with a detailed budget on achieving our aim of establishing a standard and one stop electrical equipment supply business in Albuquerque – New Mexico and here are the key areas where we will spend our startup capital;

  • The total fee for registering the Business in Albuquerque – New Mexico – $750.
  • Legal expenses for obtaining licenses and permits as well as the accounting services (software, P.O.S machines and other software) – $3,300.
  • Marketing promotion expenses for the grand opening of Mac Bruce™ Electrical Supply Store, Inc. in the amount of $3,500 and as well as flyer printing (2,000 flyers at $0.04 per copy) for the total amount of $3,580.
  • The cost for hiring Business Consultant – $2,500.
  • Insurance (general liability, workers’ compensation and property casualty) coverage at a total premium – $2,400.
  • The cost for payment of rent for 12 months at $1.76 per square feet in the total amount of $65,600.
  • The cost for shop / warehouse remodeling (construction of racks and shelves) – $20,000.
  • Other start-up expenses including stationery ($500) and phone and utility deposits ($2,500).
  • Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $60,000
  • The cost for start-up inventory (stocking with a wide range of electrical construction materials, such as wiring supplies, electrical light fixtures, light bulbs, security systems, electrical power equipment, switchboards, circuit breakers and fuses) – $250,000
  • The cost for counter area equipment – $9,500
  • The cost for store equipment (cash register, security, ventilation, signage) – $13,750
  • The cost of purchase and installation of CCTVs – $10,000
  • The cost for the purchase of office furniture and gadgets (Computers, Printers, Telephone, TVs, Sound System, tables and chairs et al) – $4,000.
  • The cost of launching a Website – $600
  • Miscellaneous – $10,000

We would need an estimate of $750,000 to successfully set up our electrical equipment supply store in Albuquerque – New Mexico.

Generating Funds/Startup Capital for Mac Bruce™ Electrical Supply Company, Inc.

Mac Bruce™ Electrical Supply Company, Inc. is a private business that is solely owned and financed by Mac Bruce and his immediate family members. He has decided to restrict the sourcing of the startup capital to 3 major sources.

  • Generate part of the startup capital from personal savings
  • Source for soft loans from family members and friends
  • Apply for loan from the bank

N.B: We have been able to generate about $250,000 (Personal savings $200,000 and soft loan from family members $50,000) and we are at the final stages of obtaining a loan facility of $500,000 from our bank. All the papers and documents have been signed and submitted, the loan has been approved and any moment from now our account will be credited with the amount.

14. Sustainability and Expansion Strategy

The future of a business lies in the number of loyal customers that they have, the capacity and competence of their employees, their investment strategy and the business structure. If all of these factors are missing from a business, then it won’t be too long before the business closes shop.

One of our major goals of starting Mac Bruce™ Electrical Supply Company, Inc. is to build a business that will survive off its own cash flow without injecting finance from external sources once the business is officially running. We know that one of the ways of gaining approval and winning customers over is to retail our wide range of quality electrical equipment a little bit cheaper than what is obtainable in the market and we are well prepared to survive on lower profit margin for a while.

Mac Bruce™ Electrical Supply Company, Inc. will make sure that the right foundation, structures and processes are put in place to ensure that our staff welfare are well taken of. Our company’s corporate culture is designed to drive our business to greater heights and training and retraining of our workforce is at the top burner.

As a matter of fact, profit-sharing arrangement will be made available to all our management staff and it will be based on their performance for a period of six years or more. We know that if that is put in place, we will be able to successfully hire and retain the best hands we can get in the industry; they will be more committed to help us build the business of our dreams.

Check List/Milestone

  • Business Name Availability Check : Completed
  • Business Registration: Completed
  • Opening of Corporate Bank Accounts: Completed
  • Securing Point of Sales (POS) Machines: Completed
  • Opening Mobile Money Accounts: Completed
  • Opening Online Payment Platforms: Completed
  • Application and Obtaining Tax Payer’s ID: In Progress
  • Application for business license and permit: Completed
  • Purchase of Insurance for the Business: Completed
  • Leasing of facility and remodeling the shop: In Progress
  • Conducting Feasibility Studies: Completed
  • Generating capital from family members: Completed
  • Applications for Loan from the bank: In Progress
  • Writing of Business Plan: Completed
  • Drafting of Employee’s Handbook: Completed
  • Drafting of Contract Documents and other relevant Legal Documents: In Progress
  • Design of The Company’s Logo: Completed
  • Printing of Promotional Materials: In Progress
  • Recruitment of employees: In Progress
  • Purchase of the needed furniture, racks, shelves, computers, electronic appliances, office appliances and CCTV: In progress
  • Purchase of initial supply of electrical construction materials: In Progress
  • Creating Official Website for the Company: In Progress
  • Creating Awareness for the business both online and around the community: In Progress
  • Health and Safety and Fire Safety Arrangement (License): Secured
  • Compilation of our list of products that will be available in our store: Completed
  • Establishing business relationship with vendors – manufacturers of electrical equipment and construction contractors: In Progress

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Electronics Shop Business Plan

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The advancement in technology is wild, and so is the upgradation of electronic appliances. Therefore, starting an electronics shop is a profitable venture.

Anyone can start a new business, but you need a detailed business plan when it comes to raising funding, applying for loans, and scaling it like a pro!

Need help writing a business plan for your electronics shop? You’re at the right place. Our electronics shop business plan template will help you get started.

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  • Fill in the blanks – Outline
  • Financial Tables

How to Write An Electronics Shop Business Plan?

Writing an electronics shop business plan is a crucial step toward the success of your business. Here are the key steps to consider when writing a business plan:

1. Executive Summary

An executive summary is the first section planned to offer an overview of the entire business plan. However, it is written after the whole business plan is ready and summarizes each section of your plan.

Here are a few key components to include in your executive summary:

Introduce your Business:

Start your executive summary by briefly introducing your business to your readers.

Market Opportunity:

Product offering:.

  • For instance, you may include televisions, audio speaker sets, laptops, tablets, mobile phones, etc as some of your products.

Marketing & Sales Strategies:

Financial highlights:, call to action:.

Ensure your executive summary is clear, concise, easy to understand, and jargon-free.

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business plan for electrical shop

2. Business Overview

The business overview section of your business plan offers detailed information about your company. The details you add will depend on how important they are to your business. Yet, business name, location, business history, and future goals are some of the foundational elements you must consider adding to this section:

Business Description:

Describe your business in this section by providing all the basic information:

Describe what kind of electronics shop you run and the name of it. You may specialize in one of the following electronics shop businesses:

  • Retail electronics store
  • Online electronics store
  • Specialized electronics store
  • Wholesale electronics supplier
  • Electronic repair shop
  • Describe the legal structure of your electronics shop, whether it is a sole proprietorship, LLC, partnership, or others.
  • Explain where your business is located and why you selected the place.

Mission Statement:

Business history:.

  • Additionally, If you have received any awards or recognition for excellent work, describe them.

Future Goals

This section should provide a thorough understanding of your business, its history, and its plans. Keep this section engaging, precise, and to the point.

3. Market Analysis

The market analysis section of your business plan should offer a thorough understanding of the industry with the target market, competitors, and growth opportunities. You should include the following components in this section.

Target market:

  • For instance, general consumers, tech enthusiasts, small business owners, or gamers would be an ideal target audience for a commercial electronics shop.

Market size and growth potential:

  • For instance, the electronics shop industry was $159.6 billion in 2022, so it is crucial to define the segment of your target market and its growth potential.

Competitive Analysis:

Market trends:.

  • For instance, smart home devices have a booming market; explain how you plan on dealing with this potential growth opportunity.

Regulatory Environment:

Here are a few tips for writing the market analysis section of your electronic store business plan:

  • Conduct market research, industry reports, and surveys to gather data.
  • Provide specific and detailed information whenever possible.
  • Illustrate your points with charts and graphs.
  • Write your business plan keeping your target audience in mind.

4. Products And Services

The product and services section should describe the specific services and products that will be offered to customers. To write this section should include the following:

Electronics shop’s products:

Mention the electronics shop products your business will offer. This list may include,

  • Smartphones
  • Audio speakers
  • Televisions
  • Smart home devices
  • All other electrical appliances & accessories

Quality measures:

  • This may include product authenticity & legitimacy, product inspection & testing, product warranty & guarantee, etc.

Additional Services

In short, this section of your electronics shop plan must be informative, precise, and client-focused. By providing a clear and compelling description of your offerings, you can help potential investors and readers understand the value of your business.

5. Sales And Marketing Strategies

Writing the sales and marketing strategies section means a list of strategies you will use to attract and retain your clients. Here are some key elements to include in your sales & marketing plan:

Unique Selling Proposition (USP):

  • For example, expert staff & technical support, a wide product range, or competitive pricing could be some of the great USPs for a professional electronics shop.

Pricing Strategy:

Marketing strategies:, sales strategies:, customer retention:.

Overall, this section of your electronics shop business plan should focus on customer acquisition and retention.

Have a specific, realistic, and data-driven approach while planning sales and marketing strategies for your electronics shop, and be prepared to adapt or make strategic changes in your strategies based on feedback and results.

6. Operations Plan

The operations plan section of your business plan should outline the processes and procedures involved in your business operations, such as staffing requirements and operational processes. Here are a few components to add to your operations plan:

Staffing & Training:

Operational process:, equipment & software:.

  • Explain how these technologies help you maintain quality standards and improve the efficiency of your business operations.

Adding these components to your operations plan will help you lay out your business operations, which will eventually help you manage your business effectively.

7. Management Team

The management team section provides an overview of your electronics shop’s management team. This section should provide a detailed description of each manager’s experience and qualifications, as well as their responsibilities and roles.

Founders/CEO:

Key managers:.

  • It should include, senior management, and other department managers (e.g. operations manager, technical service manager.) involved in the electronics shop business operations, including their education, professional background, and any relevant experience in the industry.

Organizational structure:

Compensation plan:, advisors/consultants:.

  • So, if you have any advisors or consultants, include them with their names and brief information consisting of roles and years of experience.

This section should describe the key personnel for your electronics shop services, highlighting how you have the perfect team to succeed.

8. Financial Plan

Your financial plan section should provide a summary of your business’s financial projections for the first few years. Here are some key elements to include in your financial plan:

Profit & loss statement:

Cash flow statement:, balance sheet:, break-even point:.

  • This exercise will help you understand how much revenue you need to generate to sustain or be profitable.

Financing Needs:

Be realistic with your financial projections, and make sure you offer relevant information and evidence to support your estimates.

9. Appendix

The appendix section of your plan should include any additional information supporting your business plan’s main content, such as market research, legal documentation, financial statements, and other relevant information.

  • Add a table of contents for the appendix section to help readers easily find specific information or sections.
  • In addition to your financial statements, provide additional financial documents like tax returns, a list of assets within the business, credit history, and more. These statements must be the latest and offer financial projections for at least the first three or five years of business operations.
  • Provide data derived from market research, including stats about the industry, user demographics, and industry trends.
  • Include any legal documents such as permits, licenses, and contracts.
  • Include any additional documentation related to your business plan, such as product brochures, marketing materials, operational procedures, etc.

Use clear headings and labels for each section of the appendix so that readers can easily find the necessary information.

Remember, the appendix section of your electronics shop business plan should only include relevant and important information supporting your plan’s main content.

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This sample electronics shop business plan will provide an idea for writing a successful electronics shop plan, including all the essential components of your business.

After this, if you still need clarification about writing an investment-ready business plan to impress your audience, download our electronics shop business plan pdf .

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Frequently asked questions, why do you need a food distribution business plan.

A business plan is an essential tool for anyone looking to start or run a successful electronics shop. It helps to get clarity in your business, secures funding, and identifies potential challenges while starting and growing your business.

Overall, a well-written plan can help you make informed decisions, which can contribute to the long-term success of your electronics shop.

How to get funding for your electronics shop?

There are several ways to get funding for your electronics shop, but self-funding is one of the most efficient and speedy funding options. Other options for funding are:

  • Bank loan – You may apply for a loan in government or private banks.
  • Small Business Administration (SBA) loan – SBA loans and schemes are available at affordable interest rates, so check the eligibility criteria before applying for it.
  • Crowdfunding – The process of supporting a project or business by getting a lot of people to invest in your business, usually online.
  • Angel investors – Getting funds from angel investors is one of the most sought startup options.

Apart from all these options, there are small business grants available, check for the same in your location and you can apply for it.

Where to find business plan writers for your electronics shop?

There are many business plan writers available, but no one knows your business and ideas better than you, so we recommend you write your electronics shop business plan and outline your vision as you have in your mind.

What is the easiest way to write your electronics shop business plan?

A lot of research is necessary for writing a business plan, but you can write your plan most efficiently with the help of any electronics shop business plan example and edit it as per your need. You can also quickly finish your plan in just a few hours or less with the help of our business plan software .

Can a good electronics shop business plan help me secure funding?

Indeed. A well-crafted electronics shop business plan will help your investors better understand your business domain, market trends, strategies, business financials, and growth potential—helping them make better financial decisions.

So, if you have a profitable and investable business, a comprehensive business plan can certainly help you secure your business funding.

About the Author

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Upmetrics Team

Upmetrics is the #1 business planning software that helps entrepreneurs and business owners create investment-ready business plans using AI. We regularly share business planning insights on our blog. Check out the Upmetrics blog for such interesting reads. Read more

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Electronics Retailer Business Plan

Start your own electronics retailer business plan

Safe Current

Executive summary executive summary is a brief introduction to your business plan. it describes your business, the problem that it solves, your target market, and financial highlights.">.

Safe Current is small business unit of The Cleveland Illuminating Company (TCIC), and electric utility. Safe Current was formed and will be lead by Brian Henderson.

Safe Current has identified three key factors that will be instrumental to its sustainability:

  • Ensure 100% customer satisfaction: Repeat customers and customer referrals are valuable.
  • Design and sell meaningful and valuable power protection products.
  • Design and implement strict financial controls. This is very important because although Safe Current is a small business unit of TCIC, they must be a stand alone entity financially and and yet they have financial and accounting responsibilities to the shareholders of TCIC.

Products Safe Current will offer two main products, surge arrestors and surge protectors. These products are made by a contract manufacturer and sold under the Safe Current brand name:

  • Surge Arrestors : This is a piece of equipment that is mounted on the outside of a house or business near the meter that offers protection from external electrical surges.
  • Surge Protectors : This is a piece of equipment that protects individual or groups of appliances against internal electrical spikes. All of Safe Currents protectors are of industrial grade.

Management Brian has an MBA from Case Western Reserve University and has experience working for the large telecom ATT as an assistant project manager, and Allegheny Power working in the value added services department. Safe Current has been forecasted to achieve impressive sales for years two and three, with correspondingly respectable net profit.

Sbp, electronics retailer business plan, executive summary chart image

1.1 Objectives

  • To develop a profitable product for TCIC that is unregulated from the core power generation business services.
  • To become profitable within one year.
  • To use this business as a successful model for future ventures.

1.2 Mission

To develop a family of surge protectors and arrestors for consumers that offer safety and value. Safe Current will leverage the strength of The Cleveland Illuminating Company to help build brand recognition. All customer’s expectations will be exceeded with their innovative, useful products and complete customer satisfaction is guaranteed.

1.3 Keys to Success

  • Offer every customer 100% satisfaction.
  • Design and sell meaningful, valuable, power protection products.
  • Design and employ strict financial controls.

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Company summary company overview ) is an overview of the most important points about your company—your history, management team, location, mission statement and legal structure.">.

Safe Current is an unregulated subsidiary of The Cleveland Illuminating Company that sells direct to businesses and consumers. It will be operated as a stand alone business leveraging the existing resources and goodwill of TCIC.

Safe Current will be located on site at TCIC, using an office within the complex and also sharing TCIC’s computer network connection and phone connections. Safe Current will operate their own customer service call department. Safe Current will use TCIC’s existing call center for sales calls and TCIC’s existing billing system as well as their order fulfillment and shipping departments. Safe Current will pay a flat rate (10%) for these services.

The Cleveland Illuminating Company has chosen to create Safe Current as a means of increasing the rate of return to shareholders outside the government regulated rates available to electric utilities.

2.1 Company Ownership

Safe Current is a wholly owned subsidiary of TCIC.

2.2 Start-up Summary

Safe Current will leverage the existing resources of TCIC and pay a set overhead fee for the resources used. Equipment that will be needed as follows:

  • Five computer stations, one laser printer; Microsoft Office, Access, and proprietary software used by TCIC; network connection to TCIC.
  • Five office furniture setups.
  • A five extension phone system.

Sbp, electronics retailer business plan, company summary chart image

Market Analysis Summary how to do a market analysis for your business plan.">

Safe Current has identified three distinct market segments that they will target. The first segment is family home owners, typically with children, and the second is single home owners.

These two segments have been chosen because families with children typically have a large number of electronic devices and the upper income single home owners often adopt technology using lots of gadgets in their home.

The third segment is commercial businesses that have equipment they want protected. Competition is very limited for surge arrestors as they require electric utility installation. There is some competition with the surge protectors, however the competitive products are of a consumer level of quality and protection, different from Safe Current’s products which offer industrial levels of protection.

3.1 Market Segmentation

Safe Current has segmented the market into three distinct groups.

Family home owners This segment generally has electronic equipment and lives in middle- to high-end homes.

  • 69% have at least one child.
  • The median household income is $77,000.
  • Eat out 2.3 times a week.
  • 58% of the families have two incomes.
  • 63% have cable TV.
  • 49% have a broadband Internet connection.

Single home owners This segment is a single person who owns their own home. They are generally professionals who often use a lot of electronic technology.

  • Ages 25-40.
  • 71% are professionals.
  • The median household income is $62,000.
  • Eat out 2.7 times a week.
  • 72% have cable TV.
  • 71% have a broadband Internet connection.

Commercial sales This segment is small to mid-size businesses that have expensive electronic equipment that they need protected. Commercial sales are not industry specific. All businesses, regardless of type, have pieces of equipment that can be protected.

Sbp, electronics retailer business plan, market analysis summary chart image

3.2 Target Market Segment Strategy

Safe Current is targeting these groups since all tend to have many pieces of electronic equipment all of which are vulnerable to power surges.

While most home owners insurance offers some level of compensation for damage, deductibles are typically high enough that most people do not make claims. Both segments are already customers and aware of TCIC’s reputation for safety, reliability and operational excellence, making it easy to solicit their business.

3.3 Industry Analysis

Safe Current operates selling two similar service devices, surge arrestors and surge protectors. While these products are similar, they have serve different purposes.

The surge arrestors are a product that can only be offered by a utility so it is typically only sold and installed as a package by the utility.

The surge protectors operate within the more general consumer product segment as evidenced by the fact that surge protectors can be found by a wide range of retailers such as hardware stores, do-it-yourself type stores, and computer and electronic retailers.

It should be noted that Safe Current’s parent company, The Cleveland Illuminating Company is an electric utility and is therefore operating within a regulated industry. Current regulation by the public utility commission (PUC) dictates that the rate of return is capped at 10.5% for utility activities.

Safe Current however provides a product that operates within the unregulated area of the utility and therefore does not have rate of return caps. This is quite advantageous to Safe Current because it allows them to leverage the assets of the utility without being held to the same restrictions as the rest of the utility.

3.3.1 Competition and Buying Patterns

Surge arrestors Safe Current does not face any real competition for the arrestors due to the installation requirement of the electric utility.

While there are four current vendors that sell the actual arrestor equipment, it is far more expensive to buy the equipment and then pay the utility for installation than buying the package (product and installation) directly from the utility.

Surge protectors Safe Current faces general competition from several sources. This is qualified as general competition since the products typically sold (90% of the time) are of consumer quality versus the industrial quality that Safe Current offers.

Due to TCIC’s direct contacts with electrical component manufacturers and their sheer buying scale/power, Safe Current is able to offer high-quality industrial grade products for prices that are similar to the consumer units. Competitors in this segment include:

  • Hardware stores
  • Mass merchants
  • Do-it-yourself stores
  • Computer retailers
  • Electronic retailers

3.4 Products

Safe Current will offer a family of surge arrestors and surge protectors for consumers. A surge protector protects appliances plugged into it against spikes in voltage.

A surge arrestor or “whole house surge protector” protects all circuits of a house from a surge in current emanating from outside the building. These products will protect consumers and their sensitive electric and electronic appliances from power surges or transient voltage.

A power surge is an increase in voltage significantly above the designated level of flow of electricity. If a surge or spike is high enough it will inflict serious damage, just like applying to much water pressure through a hose. Too much will case the hose to burst. The same thing happens when there is too much electrical pressure through a wire, the wire “bursts.”

Surge protectors work by diverting the extra electricity into the outlet’s grounding wire. A surge arrestor offers the same protection, however, the protection occurs before the current comes into the home. There are several sources of surges.

The most familiar source is lightning. When lightning strikes near a power line, the electrical energy creates a boost of electrical pressure. A surge arrestor is the best form of protection against lightning as a lightning surge will overpower most surge protectors.

A more common source is the operation of high power electrical devices such as refrigerators and air conditioning units. These appliances cause spikes when their compressors or motors are turned on and off, creating sudden, brief demands for power and upsetting the flow of the electrical voltage.

These types of surges can be protected only by surge protectors because the spike occurs within the home and not from the electrical grid.

The last main source of surges come from the utility company’s equipment. The complex system of equipment that brings electrical power from the grid into the home may have points of failure that can cause uneven power transmissions.

A combination of a surge arrestor and surge protectors on major or expensive electric/electronic components can significantly decrease the possibility of surge/spike damage.

Safe Current will offer two main products, surge arrestors and surge protectors. These products are made by a contract manufacturer and sold under the Safe Current brand name:

Safe Current has chosen to outsource production because 1) it has numerous relationships with contract manufacturers that can make the products for far less than they can, 2) production would create significant capital costs which are truly unnecessary. The beauty of this business model is the usage of contract manufacturers and the leveraging of TCIC resources.

Strategy and Implementation Summary

Safe Current has developed a targeted strategy that allows them to leverage their competitive edge and quickly gain market penetration. Safe Current’s competitive edge is its ability to use The Cleveland Illuminating Company’s utility status for the sale of house surge arrestors and protectors.

The marketing strategy will concentrate on the ability to offer supreme, inexpensive protection for an entire family’s stable of electric and electronic appliances. This campaign will be communicated through various methods and will focus on the product offerings coming from the safe, established TCIC, an icon of Cleveland for over 50 years. Please review the following sections for a more detailed analysis.

4.1 Competitive Edge

Safe Current’s competitive edge is their ability to leverage the huge advantage of being aligned with The Cleveland Illuminating Company, an electric utility serving the Cleveland market for over 50 years. TCIC has spent a long time developing brand equity and Safe Current will be able to tap into this equity immediately.

Safe Current will also be able to use TCIC’s extensive vendor connections and buying power. The last component of their competitive edge is Safe Current’s exclusive ability to install house arrestors. This last edge is a sustainable edge since no other company will ever be able to make arrestor installations, a function of the regulated power industry.

4.2 Marketing Strategy

Safe Current’s marketing strategy will seek to communicate the idea that the products that they offer are in effect cheap insurance against large electric and electronic appliance damage or losses.

By proactively purchasing Safe Current’s products, customers are able to protect against loss and damage of all of their expensive appliances. While many homeowners probably have some sort of insurance, deductibles are often prohibitively high, making a claim for damage to one or a couple appliances not worth the money. Safe Current will use several forms of communication for this marketing campaign:

  • Inserts in Bills : Colorful inserts will be added into the bills of TCIC customers. Currently, the customers are receiving a monthly bill from TCIC and inserts are an inexpensive, yet powerful way of reaching the customers.
  • Website : Safe Current will have a website which will be comprehensive in describing the different product offerings as well as allowing the customer to order directly from the site.
  • Direct Mail : Another advantage of the relationship Safe Current has with TCIC is the ability to use their customer database. This allows Safe Current to generate a targeted list of customers that they can send product information to.

4.3 Sales Strategy

Safe Current’s sales campaign will emphasize the fact that Safe Current is a subsidiary of TCIC. This will be effective because TCIC is a well known, stable electric utility known for its safe and reliable operation.

This idea is evidenced by the fact that almost every time that a consumer reaches for a light switch the light goes on. Sure there are interruptions, often weather related, that interrupt the electrical service, but those interruptions are reconnected quite fast.

The utility is stable and safe and is always working to serve the customer. These electricity related products will clearly leverage the brand equity developed by TCIC over the last five decades.

4.3.1 Sales Forecast

The sales forecast has been developed as a forecast and tracking tool to provide the company with realistic sales goals as well as a way to verify progress. The forecast has been developed as a conservative estimate, not an aggressive sales promise.

By adopting a conservative forecast, Safe Current increases the likelihood of reaching sustainable sales growth. The following table and charts provide more detailed information about the sales cycle, both from a temporal viewpoint and a product perspective.

Sbp, electronics retailer business plan, strategy and implementation summary chart image

4.4 Milestones

Safe Current has identified several quantifiable, reachable milestones that will serve as goals that the entire organization will work toward in order to make Safe Current a sustainable business.

The following table details the specific milestones as well provides a temporal timetable for expected completion dates. Following the table is a chart for a graphical representation of the information.

Sbp, electronics retailer business plan, strategy and implementation summary chart image

Web Plan Summary

Safe Current’s website will be used as both a marketing and sales tool. It will take on marketing responsibilities as one of the communication methods used to raise awareness regarding Safe Current’s product families. Extensive product information will be included on the site in an easy to use format.

The site will also be used as a sales tool, allowing customers to purchase the products as well as set up installation appointments for the surge arrestors. Allowing the website to offer sales support will provide consumers with a convenient way to purchase the products as well as provide Safe Current with a low-cost sales program that does not require a live sales support agent. The site will periodically be updated to encourage customers to make repeat visits.

5.1 Website Marketing Strategy

Safe Current will market their website in two primary ways:

  • Search engine submission : As search engines become more and more powerful, a large number of Internet users use them to find relevant information on the Internet. Safe Current will submit their site to many popular engines ensuring that their site comes up high on the list of hits.
  • URL reference in all printer material : The Web address, www.safecurrent.com, will be printed on all material that Safe Current uses encouraging consumers to check out the site.

5.2 Development Requirements

The website will be developed by TCIC’s internal Web development team for the price of $5,000.

Management Summary management summary will include information about who's on your team and why they're the right people for the job, as well as your future hiring plans.">

Brian Henderson received a Bachelors of Science in business and marketing from the University of Pittsburgh and an MBA from Case Western Reserve University. Upon graduation from the MBA program, Brian went to work for ATT for three years. At ATT Brian was an assistant project manager, selling telephone accessories using direct marketing techniques. After his ATT experience, Brian worked for Allegheny Power, a Pennsylvania-based electric utility. At Allegheny Power Brian was again an assistant project manager in charge of selling commercial businesses value added services. Brian spent three years at Allegheny before joining The Cleveland Illuminating Company as a Project Manager.

6.1 Personnel Plan

As a side business unit of TCIC, Safe Current will have only a few employees. Billing, sales, and order fulfillment will be accomplished using TCIC’s existing organization, paying a 10% fee for these services. The employees/positions that Safe Current will use include:

  • Project Manager : Brian will take on a wide range of functions including business development, product procurement, management, and sales.
  • Customer Service Agents (4): These positions will assist customers calling about Safe Current’s products. Additionally, at times the employees may help Brian with other activities.

Financial Plan investor-ready personnel plan .">

The following sections outline important financial information.

7.1 Important Assumptions

The following table details important financial assumptions.

7.2 Break-even Analysis

The Break-even Analysis indicates what will be needed in monthly revenue to reach the break even point.

Sbp, electronics retailer business plan, financial plan chart image

7.3 Projected Cash Flow

The following chart and table displays projected cash flow.

Sbp, electronics retailer business plan, financial plan chart image

7.4 Projected Profit and Loss

The following table presents projected profit and loss.

Sbp, electronics retailer business plan, financial plan chart image

7.5 Business Ratios

The following business ratios detail both ratios specific to Safe Current as well as ratios specific to the general industry. Variances in Safe Current’s ratios relative to the industry’s can be explained by the fact that Safe Current is able to leverage the valuable assets of TCIC, an electric utility, to achieve above market margins. As a small business unit of an electrical utility it is normal for business ratios to be different from the competition.

7.6 Projected Balance Sheet

The following table details the projected balance sheet.

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COMMENTS

  1. Electrical Shop Business Plan [Sample Template]

    Below is a sample electrical shop business plan template that can help you to successfully write your own with little or no difficulty. A Sample Electrical Shop Business Plan Template 1. Industry Overview

  2. How to Write a Business Plan for a Electrical Contractor

    1. Electrical Business Executive Summary The executive summary of a business plan gives a sneak peek of the information about your business plan to lenders and/or investors. If the information you provide here is not concise, informative, and scannable, potential lenders and investors will lose interest.

  3. How to Start an Electrical Business: A Guide for Prospective Entrepreneurs

    STEP 10: Create a marketing plan that includes a business website and a digital marketing strategy. All electrical businesses need marketing plans to help build brand awareness and attract new ...

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    Why write a business plan for an electrical company? What information is needed to create a business plan for an electrical company? How do I build a financial forecast for an electrical company? The written part of an electrical company business plan What tool should I use to write my electrical company business plan?

  5. Electrical Contractor Business Plan Template [Updated 2024]

    Written by Dave Lavinsky Electrical Contractor Business Plan Over the past 20+ years, we have helped over 1,000 entrepreneurs and business owners create business plans to start and grow their electrical contracting businesses. On this page, we will first give you some background information with regards to the importance of business planning.

  6. How to Start a Profitable Electrical Business [11 Steps]

    1. Perform market analysis. 2. Draft a electrical business plan. 3. Develop a electrical brand. 4. Formalize your business registration. 5. Acquire necessary licenses and permits for electrical. 6. Open a business bank account and secure funding as needed. 7. Set pricing for electrical services. 8. Acquire electrical equipment and supplies. 9.

  7. How to Start an Electrical Business

    2. An electrical business plan. Your electrical business won't get off the ground without a business plan. Yes, it takes a little time, but it's time well spent. That's because a comprehensive plan gives your new business structure, purpose and a clear-cut strategy. Read our guide to writing a proper business plan.

  8. Electrician Business Plan Template, Example, and Software

    Simply export the electrician business plan template to Ms Word (.docx) format Executive summary: the executive summary gives the reader a clear and concise overview of your business idea Company: this section lays out the structure of your business, including its location, management team and legal form

  9. Electrical Contractor Business Plan [& Free Template]

    Include the following sections in your electrical business plan. 1. Industry Analysis. First, provide an overview of the electrical contracting industry. This market research should inform your business strategy. It also shows investors and lenders you did your due diligence. When preparing this section, consider:

  10. Electrical Business Plan Template

    A solid electrical business plan acts as your strategy guide for building a successful electrical business. Whether you're an existing electrical business or just starting out, a business plan helps you get organised. Use an electrical business plan to help secure funding for your business. First name

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    Startup costs for an electrical business range from just over $3,000 to nearly $25,000. The low end assumes that you are already licensed and are going to run your business as a solopreneur from home. The high end includes the cost of training and setting up an office and shop.

  12. How to write a business plan for an electrical appliances store?

    First, you'll have to assess your current position (if you're already in business), and then identify where you'd like your electrical appliances store to be in the next three to five years. you'll determine the human, equipment, and capital resources needed to reach your goals successfully.

  13. Free Electrical Contractor Business Plan Template + Example

    1 million businesses. Download a free electrical contractor business plan template with SBA-approved format. Includes pre-filled examples and step-by-step guides for a successful start.

  14. Free Electrical Business Plan PDF Download

    Are you considering starting an electrical business and are in need of an electrical business plan? if yes, you'll find this free book to be extremely helpful. This is a practical guide that will walk you step by step through all the essentials of starting your business. The book is packed with guides, worksheets and checklists.

  15. How to Run a Successful Electrical Business

    2. Keep Your Business Plan Current. If you don't have a business plan, it might be time to create one. Running an electrical business successfully involves having a plan in place for how you'll reach your goals. If you've created a business plan in the past, also keep in mind that it can "expire" quickly.

  16. Electrical Contracting Business Plan [Free Template

    Here are a few tips for writing the market analysis section of your electrical contracting business plan: Conduct market research, industry reports, and surveys to gather data. Provide specific and detailed information whenever possible. Illustrate your points with charts and graphs. Write your business plan keeping your target audience in mind.

  17. Electrical Shop Business Plan [Sample Template for 2022]

    1. Industry Product. Electrical store business is part of the Electrical Equipment Wholesaling industry and this industry consist of businesses that are into the sold and supply of wiring, lighting fixtures and light bulbs, communicate and industrial controls, switchgear and switchboard apparatus, motors and generators, current plus distribution transformers press other electrical equipment.

  18. Electrical Supply Business Plan [Sample Template]

    Electrical supply business is part of the Electrical Equipment Wholesaling industry and this industry consists of businesses that are into the sale and supply of wiring, lighting fixtures and light bulbs, relay and industrial controls, switchgear and switchboard apparatus, motors and generators, power and distribution transformers and other elec...

  19. Business plan electrical shopdocx

    the proposed business that is VAPSHI ELECTRICAL ENTERPRISE will be dealing specifically with the sale of electrical materials, tools and equipments and also will be offering different services like repair of electrical equipment, tools or gadgets, winding of motors etc. 1 BUSINESS NAME VAPSHI ELECTRICAL ENTERPRISE is the preferable name for the ...

  20. Electronics Repair Shop Business Plan Example

    1.1 Objectives. Tucson Electronics (TE) is a growth-oriented business. Its ten year goal is to become a regional leader in TV/VCR/home stereo repair, with shops in the Tucson and Phoenix area. With this in mind, the objectives over the next three years for Tucson Electronics are the following: Achieve steady growth in sales revenues by year ...

  21. Electronics Shop Business Plan [Free Template

    Here are the key steps to consider when writing a business plan: 1. Executive Summary. An executive summary is the first section planned to offer an overview of the entire business plan. However, it is written after the whole business plan is ready and summarizes each section of your plan. Here are a few key components to include in your ...

  22. Electronics Retailer Business Plan Example

    1.1 Objectives To develop a profitable product for TCIC that is unregulated from the core power generation business services. To become profitable within one year. To use this business as a successful model for future ventures. 1.2 Mission To develop a family of surge protectors and arrestors for consumers that offer safety and value.

  23. Business Plan Electrical Shop

    Business Plan Electrical Shop | PDF | Pricing | Retail business-plan-electrical-shop.docx - Free download as Word Doc (.doc / .docx), PDF File (.pdf), Text File (.txt) or read online for free.