Electricians are an essential part of modern life, helping keep the power on and keep us connected. There’s never a shortage of opportunities for sparkies to help people with their expertise and services, but starting an electrical business in Australia takes a lot of preparation too. Here’s our comprehensive guide on how to start an electrician business.
What do electricians do?
Electricians are responsible for managing electrical systems for homes, businesses and any other properties. They are also involved in planning how electrical systems will be deployed in properties and installing them to ensure connectivity and safe use. Because of how dangerous working with electricity can be, it’s illegal in Australia to do unlicensed electrical work. All electrical installation needs to be completed by a registered electrical contractor, meaning that there is always work available for electricians, and a good opportunity for people keen on starting an electrical business.
Electrician qualifications
To become a registered electrician, you need to have completed an apprenticeship with a licensed electrician as well as a Certificate III in Electrotechnology Electrician. The certificate includes important theoretical knowledge and practical training, and can be completed as part of your apprenticeship, typically taking 4 years. Once you’ve got these sorted, you need to apply for an electrician license from the regulatory authority in your state or territory. Different parts of Australia may have slightly different requirements.
Steps to starting an electrical business
Running your own business can be a daunting choice, but it’s also an exciting opportunity to take control of your daily work and organise your own schedule. Here’s how the best electrical businesses are started.
Build an electrical business plan
Every new business needs to come from a solid plan, outlining what you want to achieve and how you plan on getting there. A good electrician business plan should also include the type of business you are and how you plan on operating. The key information your plan should cover includes:
- Industry overview: Take a look at the overall electrical industry to understand the competition, preferences of customers, and current trends.
- Financial plan: Figure out how much money you’ll need to get your electrician business off the ground, and how much it will take to break even. Do you have the funds to support it or will you be searching for cash from a third party such as a bank, lender, or loan company? You’ll need to plan how much to charge. To do so, you can use accounting software to stay on top of your payments.
- Vision, mission, and goals: With your finances set, it’s time to write down your vision of where you want your electrical contracting company to go, your mission of what you want your company to accomplish, and any goals you want your company to achieve. This creates a great foundation to work off of.
- List out your products and services: Identify and document the services you plan to offer or the products you intend to sell. It can be done by:
- Listing every product or service you offer.
- Cross-checking your list with your inventory to catch any discrepancies.
- Assigning a price to each product or service.
- Organising your products and services into relevant categories.
- Reviewing your list for accuracy and making any necessary adjustments.
- Decide on your location: Consider where your company is going to operate. Will it be just in Victoria or interstate? Look at where there is a high demand for landscapers so you can put your business in the right place.
- Market analysis: Take note of the current market, including trends and emerging technologies. Identify your main competitors, their strengths and weaknesses, and the services they offer. See how you can offer something unique that other electricians aren’t already doing. By understanding the market landscape, you’ll be able to differentiate yourself and make an impact on consumers.
- Sales strategy: Setting a sales strategy will help you measure your success, and the goals are up to you. Set your ideal vision of success - is it reaching 100 clients? Selling your service to 8 new communities in 1 month? Knowing what you want to accomplish and how you are going to get there will help you figure out what steps to take.
Get insured and certified
Every new business needs to register for an Australian Business Number (ABN), which outlines your legal right to operate. You may need one or more business licenses depending on your location. Thankfully, the Australian Business Licence and Information Service (ABLIS) makes it easy to find exactly what you need. Just provide some information about your business and you’ll be pointed in the right direction.
It’s also important to get insurance for your equipment as well as general liability insurance to look after you and your staff in case anything happens while on a job. It can be helpful to look into personal accident and business interruption insurance so you’re always prepared against the worst scenarios.
Organise your tools and equipment
Part of being a reliable electrician is having all of the tools and materials required to do the job. In the early stages of starting a business, this is often the biggest cost, but it’s an essential one. You’ll need to look into tools like voltage indicators, wire cutters and strippers, battery drills and insulated screwdrivers, as well as materials like wire and electrical tape.
Additionally, having a reliable vehicle is huge for any new electrical business. Your jobs can take you all over, and having something to transport yourself and your tools in will make a huge difference.
Specialisation
While general electric work is always available, there are a variety of additional certificates you can consider investing in to boost your appeal against competitors. These could include specialisations in high voltage installations, solar power maintenance, smart home technology, and energy efficiency. Having specific certifications for these areas can give you a leg up against competitors and help you stand out in the market.
Set your pricing
One of the biggest factors that influences a customer’s purchasing decision is pricing. Set your prices too high and you’ll lose out to company’s with a sharper rate, but set them too low and you might be seen as inexperienced and unreliable. Consider what your direct competitors are charging, and whether you can offer a more competitive price, but don’t undervalue your time or your expertise either.
When planning your pricing, try and account for how much profit you need to sustain your business and help it grow. In general, a healthy profit margin for a trade or service business is around 15%. To get the perfect balance, check out our profit margin calculator, and read our advice on maximising your profit margins.
Find clients
With everything sorted, all you need are some clients and a complete business image for them to turn to. Make sure you have a name and logo sorted, and start promoting your business. This could be with simple marketing techniques like local advertising and social media, or more direct strategies if you can afford it. On top of these, don’t forget about the importance of word of mouth recommendations! Encourage any satisfied clients to leave a review and to recommend you to people they know.
Having a presence online will also make a huge difference. Ensure you set up a Google Business Profile so you can appear when people are searching for electricians, and build a website as soon as you can. Getting one built professionally is a serious investment, but you can also use page builders like Squarespace, Wix and WordPress in the early days.
Power on with dedicated software for electricians
Once you’ve kicked off, you’ll quickly come up against all the admin required to run a successful business. Thankfully, Mira makes managing admin tasks easy, helping you organise quotes, schedules, invoices and more.
All of these features are available in one easy-to-use app. Start a free trial of our job management software for electricians today, and supercharge your business for all the days to come.