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Electrical Contractor Business Plan
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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.">, opportunity.
The population in Richmond is growing. With more people come the need for more apartments and stores, in other words, new construction. New construction needs skilled electricians that can wire everything.
Premiere Electric is a new electrical contracting firm that Robin has started to serve the former Gardner and Miller customers, as well as expand her services to new customers in the tri-county area.
The market for commercial electrical contracting services is very fragmented and crowded. Among these, only a few are large firms with 20 or more electricians on staff. The remainder are small firms with less than three full-time electricians. Premiere Electric’s current niche is its strong relationship with former customers of Gardner and Miller, but this will not be sufficient for growth in a competitive market.
By focusing on data, communication and electrical installation and maintenance, Robin reduces her direct competitors to two large electrical firms that bid on the area’s largest projects. Though one day, Premiere Electric plans to be a force in the area’s largest projects, an opportunity exists now for new customers whose smaller projects are not being pursued aggressively by Robin’s competitors.
There are quite a few electric contractors in Richmond: Above Code Electric, Frazier Electrical, H.O. Feild Electric company, Prism Industries and Langhorne Electric to name a few.
All of them advertise many years experience, training and customers who trust them. Electrical contractors enter their customer’s home. They need to do excellent work as well as be able to be in someone’s house without danger of invading privacy.
Premiere Electric’s mission is to offer its customers the highest-quality electrical services. Robin focuses on personalized service by offering convenience and rapid service. Additionally, Premiere Electric has the technological expertise to install wireless voice and data systems, as well as intelligence systems in any size facility. Finally, Robin has strong vendor relationships with the most service conscious vendors who are capable of shipping major parts rapidly (on an overnight timeline in most cases) minimizing the system down time for Premiere Electric customers.
Currently, there is $100,000 worth of business with former Gardner and Miller customers. Robin believes she can capture a lion’s share of it and build from that base. She will start as the firm’s only employee but will hire additional electricians as her sales grow.
Financial Highlights by Year
We will be getting $62,000. Robin will invest $40,000 and we will get a $22,000 long term loan.
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Electrical Contractor Business Plan Template
Electrical contractor business plan.
You’ve come to the right place to create your Electrical Contractor business plan.
We have helped over 1,000 entrepreneurs and business owners create business plans and many have used them to start or grow their Electrical Contractor companies.
Below is a template to help you create each section of your Electrical Contractor business plan.
Oak City Electric, located in Raleigh, NC, is a newly established family owned and operated electrical contracting company. The company provides electrical contracting services to the local metropolitan area and its surrounding communities. With an emphasis on customer service and rapid response time, Oak City Electric is set to establish itself as one of Raleigh’s most trusted and reliable electrical contractors.
Oak City Electric was founded by Randy Wallace. Randy Wallace has been an electrician in the community for over 40 years. Although he has worked for several local competitors, Randy Wallace has always wanted to own and operate his own electrical contracting company. He finally saved up enough money and built up a large enough client base to make his dream come true. Randy’s education, experience, and skill set will quickly make Oak City Electric the #1 electrical contracting company in the area.
Oak City Electric will provide a variety of different electrical contractor services. These services include:
- Residential Electrical
- Commercial Electrical
- Industrial Electrical
- Safety Inspections
- Fixture, Smoke Detector, And Carbon Monoxide Detector Installation
- Smart Home Installation
- Security Systems
- Home Theater Installation
- Camera Systems
Pricing for all services will vary depending on the complexity and size of the project.
Oak City Electric will primarily serve the residents living within Raleigh, NC, and the surrounding areas. About 51% of the city owns their own homes and will likely need electrical work at some point. There are also thousands of businesses in the area and over 1 million square feet of industrial/warehouse space. Many of the city’s residents and businesses are underserved when it comes to electrical services, so our services will be in high demand.
Oak City Electric is led by Randy Wallace, a local electrician who has worked for the largest electrical contractor companies in Raleigh for over 40 years. Randy Wallace is fully licensed and bonded and has gained an impressive reputation as the most reliable and trustworthy electrician in the market. As a project manager that oversaw hundreds of projects, Randy has the proper knowledge and experience to own, manage, and operate his own electrical contracting company. He also has built a loyal client base, with many clients promising to use his services once the company is fully running.
Oak City Electric will be able to achieve success by offering the following competitive advantages:
- Technology: Oak City Electric will be able to provide the latest advancements in electrical contracting.
- Price: Oak City Electric is able to offer their services at the best and most competitive price.
- Community Relations: Oak City Electric will be a pillar in the community and be heavily involved in family-related activities in the area. It will sponsor events and provide free electrical services (for small jobs) to non-profit organizations and area schools.
- Highly Trained and Experienced Staff: Oak City Electric will be led by Randy Wallace who has decades of experience as an electrician and project manager.
Oak City Electric is seeking $400,000 in debt financing to launch. The funding will be dedicated to securing office space and build-out and purchasing the necessary equipment and tools. Funding will also be dedicated toward three months of overhead costs, including payroll, rent, and marketing costs. The breakout of the funding is below:
- Office space build-out: $100,000
- Equipment, tools, and supplies: $50,000
- Three months of overhead expenses (payroll, rent, utilities): $150,000
- Marketing costs: $50,000
- Working capital: $50,000
Who is oak city electric.
Randy Wallace has saved his wages for the necessary down payment to receive local bank financing. He has also located a prime spot for the lease of the company headquarters where the equipment and vehicles will be kept. Due to his experience and reputation in the electrical contractor industry, Randy has been able to receive written commitments from large development companies in Raleigh for them to be the preferred electrical subcontractor for their upcoming projects.
Oak City Electric’s History
Once his market analysis was complete, Randy began surveying the area for an available office space with plenty of surface parking to house the company’s large fleet of vans and trucks. Randy incorporated Oak City Electric as a Limited Liability Corporation in April 2023.
Once the lease is acquired for the space, light construction can begin to build out the company’s headquarters and small office.
Since incorporation, the Company has achieved the following milestones:
- Located an office space that would be ideal for the company
- Developed the company’s name, logo, and website
- Hired a general contractor for the build-out of the warehouse, small office, and parking area
- Determined equipment and necessary supplies
- Determined how many vehicles necessary for the fleet
- Began recruiting key employees
Oak City Electric’s Services
The electrical contractors industry has had healthy revenue growth over the last five years. This is mostly due to the increase in new construction activity and an uptick in renovations. Demand for nonresidential and residential construction projects is high, primarily due to low interest rates and access to credit. In addition to growing per capita disposable income and corporate profit, rising demand for construction projects requiring electrical work has boosted demand for industry services from corporations and individuals alike.
Over the next five years , industry revenue is expected to grow at a faster rate, largely as a result of pent-up demand. As the economy booms, the value of nonresidential construction and per capita disposable income are both anticipated to increase and contribute to industry revenue growth. In addition, the industry is projected to benefit from continued renovation and retrofitting activity, particularly green upgrades, such as energy-efficiency projects and smart home technologies. According to Arizton, these factors are expected to help boost the electrical contractor industry by a CAGR of 3.94% from now until 2028. Therefore, this is the perfect time to establish a new electric contracting company as there is a great demand for these services.
Demographic profile of target market.
Oak City Electric will serve the community residents of Raleigh, NC, and its surrounding areas.
The community of Raleigh has thousands of single family homes that will likely require electrical work. There are also a number of businesses and industrial parks that require regular lighting and other electrical services.
The demographics of the area in which we will operate are as follows:
The Company will primarily target the following three customer segments:
Direct and indirect competitors.
Oak City Electric will face competition from other companies with similar business profiles. A description of each competitor company is below.
Wallmore Electrical Contractors
Established in 1977, Wallmore is Raleigh’s largest and most requested electrical contractor. The company has grown itself to be the premier electrical contractor as it has completed dozens of projects over the years and has grown its workforce to over 100 employees and electricians.
The company was formed as a small family company and later acquired another electrical company in the area to allow itself to grow and add more services. They also have a very capable fleet of vans and trucks that are able to travel not just around the city, but across the state as well.
The company specializes in electrical lighting systems, such as LED retrofit, residential, commercial, industrial, and landscape lighting. They are also a preferred subcontractor to numerous large general contractors to complete their electrical projects for them. The projects range in size from residential developments to commercial remodeling and warehouse improvements.
We-Do-It-All Electrical & Mechanical Contractors
We-Do-It-All Electrical & Mechanical Contractors offers a complete electrical company to commercial industrial customers. The company offers a quick response to proposals and system installation services. Their team of well-trained and experienced electricians are capable of performing complicated projects with precision under tight time constraints.
The company has a lead industrial electrical contractor and commercial electrician that provides the design and implementation that is required for the project. He focuses on communicating with the client through the entire process; from initial planning and design to final implementation and testing. We-Do-It-All also places an emphasis on safety as they offer incentives for safe performance for all of their licensed electricians on staff.
Gamma Ray Electrical & Mechanical Contractors
Gamma Ray is an HVAC contractor that provides all electrical and mechanical services for any and all projects. The Gamma Ray electrical and mechanical team includes proficient electricians that are able to fix any electrical issue that can be found in the client’s living room, kitchen, or fuse box. The company’s electrical contractor services are open to both commercial and residential clients and can handle everything from troubleshooting to installing electrical systems for commercial buildings.
Gamma Ray’s complete list of electrical services include troubleshooting, infrared electrical testing, hookup and power supply, lighting and security lighting, wiring and connections, energy-use evaluation, 24-hour emergency services, preventive maintenance, electrical installation, diagnosis repair, updates and maintenance, equipment power supply, generator installation, electrical panel upgrades, and circuit installation.
Oak City Electric enjoys several advantages over its competitors. These advantages include:
Brand & value proposition.
Oak City Electric seeks to position itself as a respectable, upper-middle-market competitor in the electrical contracting market. Customers can expect high-quality electrical work and customer service.
The Oak City Electric brand will focus on the company’s unique value proposition:
- Complete list of electrical services
- Licensed with the latest technology
- Highly trained and capable staff of electricians
- Large fleet of vehicles that is ready to be dispatched at a moment’s notice 24/7
- Affordable pricing
The promotions strategy for Oak City Electric is as follows:
Oak City Electric will invest heavily in developing a professional website that displays all of the services the company will be able to provide. It will also invest heavily in SEO so that the brand’s website will appear at the top of search engine results.
Social Media Marketing
Social media is one of the most cost-effective and practical marketing methods for improving brand visibility. The company will use social media to develop engaging content, such as educational content about electrical work and about the services the Company offers.
Word of Mouth Marketing
Oak City Electric will encourage word-of-mouth marketing from loyal and satisfied clients. The company will use recommendations and word-of-mouth marketing to grow its customer base through the network of its existing customers. The company will incentivize its existing customer base to encourage friends to call Oak City Electric to help them with all their electrical needs.
Offers and incentives are an excellent approach to assisting businesses in replenishing the churn in their customer base that they lose each year. The company will introduce special offers to attract new consumers and encourage repeat purchases, which will be quite advantageous in the long run.
Oak City Electric’s pricing will be moderate so clients feel they receive great value when utilizing the company’s electrical contracting services.
The following will be the operations plan for Oak City Electric.
- Randy Wallace will be the Owner, President, and Manager of Oak City Electric. He will be in charge of the general operations of the company. He will also provide customer service and provide electrical work for his customers until he hires a large staff of electrical contractors.
- He is assisted by his long-time friend, Jack Taylor, who will be the Vice President of the company. He will assist with the marketing and administrative aspects of the business.
- Randy will also hire several electrical contractors to provide electrical services to his long list of clients.
Oak City Electric expects to achieve the following milestones in the following months:
- 7/202X Finalize lease agreement
- 8/202X Design and build out
- 9/202X Hire and train initial staff
- 10/202X Kickoff of promotional campaign
- 11/202X Launch Oak City Electric
- 12/202X Reach break-even
Key revenue & costs.
Oak City Electric’s revenues will come primarily from its electrical contracting services. The company will provide a range of electrical contracting services to the community and its surrounding areas. As the company’s revenues increase, it will look to gain a wider distribution area.
The warehouse lease, equipment, supplies, fleet of vehicles, and labor expenses will be the key cost drivers of Oak City Electric. Ongoing marketing expenditures are also notable cost drivers for Oak City Electric.
Funding Requirements and Use of Funds
Below are the key assumptions required in order to achieve the revenue and cost numbers in the financials and pay off the startup business loan.
- Monthly rent: $1,500
Income statement, balance sheet, cash flow statement, electrical contractor business plan faqs, what is an electrical contractor business plan.
An electrical contractor business plan is a plan to start and/or grow your electrical contractor business. Among other things, it outlines your business concept, identifies your target customers, presents your marketing plan and details your financial projections.
You can easily complete your Electrical Contractor business plan using our Electrical Contractor Business Plan Template here .
What are the Main Types of Electrical Contractor Businesses?
There are a number of different kinds of electrical contractor businesses , some examples include: Commercial Electrical Contractor, Residential Electrical Contractor, and Industrial Electrical Contractor.
How Do You Get Funding for Your Electrical Contractor Business Plan?
Electrical Contractor businesses are often funded through small business loans. Personal savings, credit card financing and angel investors are also popular forms of funding.
What are the Steps To Start an Electrical Contractor Business?
Starting an electrical contractor business can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.
1. Develop An Electrical Contractor Business Plan - The first step in starting a business is to create a detailed electrical contractor business plan that outlines all aspects of the venture. This should include potential market size and target customers, the services or products you will offer, pricing strategies and a detailed financial forecast.
2. Choose Your Legal Structure - It's important to select an appropriate legal entity for your electrical contractor business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your electrical contractor business is in compliance with local laws.
3. Register Your Electrical Contractor Business - Once you have chosen a legal structure, the next step is to register your electrical contractor business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws.
4. Identify Financing Options - It’s likely that you’ll need some capital to start your electrical contractor business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms.
5. Choose a Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations.
6. Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events.
7. Acquire Necessary Electrical Contractor Equipment & Supplies - In order to start your electrical contractor business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation.
8. Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your electrical contractor business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising.
Learn more about how to start a successful electrical contractor business:
- How to Start an Electrical Business
- Business plans
Electrical Contractor Business Plan
Used 4,920 times
This Electrical Contractor Business Plan template include information about the services you offer, who your target consumers are, why they should prefer you over your opponents and how much capital you require to get started.
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Electrical Contractor Business Plan Template
This business plan is for an electrical contracting company, [Contractor.Company] that will offer a range of services to residential, commercial, and industrial clients. [Contractor.Company] will be owned and operated by [Contractor.FirstName] [Contractor.LastName] , who has (insert number) years of experience in the electrical industry.
[Contractor.Company] will be located in [Contractor.City] , [Contractor.State] and will serve the surrounding area. The company will be registered as a (insert business structure, e.g., LLC, corporation, or partnership) and will have (insert number) employees at the start, including the owner. The company will offer services such as electrical installation, repair, and maintenance for residential, commercial, and industrial clients. The company will also provide energy efficiency consultations and solar panel installation.
The electrical contracting industry is expected to grow at a rate of (percentage) over the next five years. The demand for electrical services is driven by population growth, construction activity, and the need for energy efficiency improvements. [Contractor.Company] will target residential, commercial, and industrial clients in the [Contractor.City] area, focusing on high-quality service and customer satisfaction.
[Contractor.Company] will use a combination of traditional and digital marketing techniques to reach potential clients. This will include advertising in local newspapers and industry publications, as well as utilizing social media platforms and email marketing to promote services and specials. The company will also rely on word-of-mouth referrals from satisfied customers.
[Contractor. Company] will have a team of qualified electricians who will be responsible for completing projects in a timely and professional manner. The company will have a project manager who will oversee all projects and ensure that they are completed to the highest standards. The company will maintain a well-stocked warehouse with a variety of electrical supplies and equipment to ensure that projects can be completed efficiently.
[Contractor.Company] will generate revenue through the sale of electrical services to residential, commercial, and industrial clients. The company will also generate revenue through the sale of electrical supplies and equipment. The company will have operating expenses, including payroll, rent, utilities, and insurance. The company expects to generate (Amount) in revenue in the first year, with a projected growth rate of (Percentage) per year.
[Contractor.Company] is well-positioned to take advantage of the growing demand for electrical services in the [Contractor.City] area. With a team of experienced electricians, a focus on high-quality service, and a commitment to customer satisfaction, the company is confident that it will be successful in the competitive electrical contracting market.
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Electrical Contractor Business Plan Template
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. We will then go through an electrical contractor business plan template step-by-step so you can create your plan today.
Download our Ultimate Business Plan Template here >
What Is a Business Plan?
A business plan provides a snapshot of your electrical contractor business as it stands today, and lays out your growth plan for the next five years. It explains your business goals and your strategy for reaching them. It also includes market research to support your plans.
Why You Need a Business Plan
If you’re looking to start an electrical contractor business, or grow your existing electrical contractor business, you need a business plan. A business plan will help you raise funding, if needed, and plan out the growth of your electrical contractor business in order to improve your chances of success. Your electrical contracting business plan is a living document that should be updated annually as your company grows and changes.
Sources of Funding for Electrical Contractor Businesses
With regards to funding, the main sources of funding for an electrical contractor business are personal savings, credit cards, bank loans and angel investors. With regards to bank loans, banks will want to review your business plan and gain confidence that you will be able to repay your loan and interest. To acquire this confidence, the electrical contractor will not only want to confirm that your financials are reasonable, but they will also want to see a professional plan. Such a plan will give them the confidence that you can successfully and professionally operate a business. Personal savings and bank loans are the most common funding paths for electrical contractor businesses.
Finish Your Business Plan Today!
How to write a business plan for an electrical contracting business.
If you want to start an electrical contracting business or expand your current one, you need a business plan. Below are the details for each section of your electrical contractor business plan template:
Your executive summary provides an introduction to your business plan, but it is normally the last section you write because it provides a summary of each key section of your plan.
The goal of your Executive Summary is to quickly engage the reader. Explain to them the type of electrical contractor business you are operating and its status. For example, are you a start-up, do you have an electrical contractor business that you would like to grow, or are you operating a chain of electrical contractor businesses?
Next, provide an overview of each of the subsequent sections of your plan. For example, give a brief overview of the electrical contractor industry. Discuss the type of electrical contractor business you are operating. Detail your direct competitors. Give an overview of your target market. Provide a snapshot of your marketing plan. Identify the key members of your team. And offer an overview of your financial plan.
In your company analysis, you will detail the type of electrical contractor business you are operating.
For example, you might operate one of the following types of electrical contractor businesses:
- Commercial Electrical Contractor : this type of electrical contractor business will focus on developing outdoor spaces such as college campuses, parks, gardens and more.
- Residential Electrical Contractor: this type of electrical contractor business collaborates with homeowners to design and/or install electrical and electronic systems.
- Industrial Electrical Contractor: this type of electrical contractor business works on large projects for manufacturers or warehouse facilities.
In addition to explaining the type of electrical contractor business you will operate, the Company Analysis section of your business plan needs to provide background on the business.
Include answers to question such as:
- When and why did you start the business?
- What milestones have you achieved to date? Milestones could include the number of customers served, number of positive reviews etc.
- Your legal structure. Are you incorporated as an S-Corp? An LLC? A sole proprietorship? Explain your legal structure here.
In your industry analysis, you need to provide an overview of the electrical contractor industry.
While this may seem unnecessary, it serves multiple purposes.
First, researching the electrical contractor industry educates you. It helps you understand the market in which you are operating.
Secondly, market research can improve your strategy, particularly if your research identifies market trends.
The third reason for market research is to prove to readers that you are an expert in your industry. By conducting the research and presenting it in your plan, you achieve just that.
The following questions should be answered in the industry analysis section of your electrical contractor business plan:
- How big is the electrical contractor industry (in dollars)?
- Is the market declining or increasing?
- Who are the key competitors in the market?
- Who are the key suppliers in the market?
- What trends are affecting the industry?
- What is the industry’s growth forecast over the next 5 – 10 years?
- What is the relevant market size? That is, how big is the potential market for your electrical contractor business? You can extrapolate such a figure by assessing the size of the market in the entire country and then applying that figure to your local population.
The customer analysis section of your electrical contractor business plan must detail the customers you serve and/or expect to serve.
The following are examples of customer segments: homeowners, businesses, general contractors, developers, etc.
As you can imagine, the customer segment(s) you choose will have a great impact on the type of electrical contractor business you operate. Clearly, a homeowner would respond to different marketing promotions than a local government, for example.
Try to break out your target customers in terms of their demographic and psychographic profiles. With regards to demographics, include a discussion of the ages, genders, locations and income levels of the customers you seek to serve. Because most electrical contractor businesses primarily serve customers living in their same city or town, such demographic information is easy to find on government websites.
Psychographic profiles explain the wants and needs of your target audience. The more you can understand and define these needs, the better you will do in attracting and retaining your customers.
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Your competitive analysis should identify the indirect and direct competitors your business faces and then focus on the latter.
Direct competitors are other electrical contractor businesses.
Indirect competitors are other options that customers have to purchase from that aren’t direct competitors. This includes in-house electricians and homeowners who do minor electrical work themselves. You need to mention such competition as well.
With regards to direct competition, you want to describe the other electrical contractor businesses with which you compete. Most likely, your direct competitors will be electrical contractors located very close to your location.
For each such competitor, provide an overview of their businesses and document their strengths and weaknesses. Unless you once worked at your competitors’ businesses, it will be impossible to know everything about them. But you should be able to find out key things about them such as:
- What types of customers do they serve?
- What types of projects do they specialize in?
- What is their pricing (premium, low, etc.)?
- What are they good at?
- What are their weaknesses?
With regards to the last two questions, think about your answers from the customers’ perspective. And don’t be afraid to ask your competitors’ customers what they like most and least about them.
The final part of your competitive analysis section is to document your areas of competitive advantage. For example:
- Will you provide a wider array of services?
- Will you provide special discounts or perks for returning customers?
- Will you provide better customer service?
- Will you offer better pricing?
Think about ways you will outperform your competition and document them in this section of your plan.
Traditionally, a marketing plan includes the four P’s: Product, Price, Place, and Promotion. For an electrical contractor business plan, your marketing plan should include the following:
Product : In the product section, you should reiterate the type of electrical contracting business that you documented in your Company Analysis. Then, detail the specific products you will be offering. For example, in addition to installing traditional electrical systems, will you also install smart home control systems or fire and security systems?
Price : Document the prices you will offer and how they compare to your competitors. Essentially in the product and price sub-sections of your marketing plan, you are presenting the services you offer and their prices.
Place : Place refers to the location of your electrical contractor company. Document your location and mention how the location will impact your success. For example, is your electrical contractor business located in a growing community with a booming construction sector, etc. Discuss how your location might be the ideal location for your customers.
Promotions : The final part of your electrical contractor marketing plan is the promotions section. Here you will document how you will drive customers to your location(s). The following are some promotional methods you might consider:
- Advertising in local papers and magazines
- Reaching out to local websites
- Social media marketing
- Local radio advertising
While the earlier sections of your business plan explained your goals, your operations plan describes how you will meet them. Your business operations plan should have two distinct sections as follows.
Everyday short-term processes include all of the tasks involved in running your electrical contractor business, including marketing your business, working on current projects, prepare for upcoming projects, and overseeing the entire project.
Long-term goals are the milestones you hope to achieve. These could include the dates when you expect to install your 500 th electrical system, or when you hope to reach $X in revenue. It could also be when you expect to expand your electrical contractor business to a new city.
To demonstrate your electrical contractor business’ ability to succeed, a strong management team is essential. Highlight your key players’ backgrounds, emphasizing those skills and experiences that prove their ability to grow a company.
Ideally you and/or your team members have direct experience in managing electrical contractor businesses. If so, highlight this experience and expertise. But also highlight any experience that you think will help your business succeed.
If your team is lacking, consider assembling an advisory board. An advisory board would include 2 to 8 individuals who would act like mentors to your business. They would help answer questions and provide strategic guidance. If needed, look for advisory board members with experience in overseeing construction projects or successfully running their own electrical contractor businesses.
Your financial plan should include your 5-year financial statement broken out both monthly or quarterly for the first year and then annually. Your financial statements include your income statement, balance sheet and cash flow statements.
Income Statement : an income statement is more commonly called a Profit and Loss statement or P&L. It shows your revenues and then subtracts your costs to show whether you turned a profit or not.
In developing your income statement, you need to devise assumptions. For example, will you work on 1 project at a time or will you oversee multiple projects at any given time? And will sales grow by 2% or 10% per year? As you can imagine, your choice of assumptions will greatly impact the financial forecasts for your business. As much as possible, conduct research to try to root your assumptions in reality.
Balance Sheets : Balance sheets show your assets and liabilities. While balance sheets can include much information, try to simplify them to the key items you need to know about. For instance, if you spend $50,000 on building out your electrical contractor business, this will not give you immediate profits. Rather it is an asset that will hopefully help you generate profits for years to come. Likewise, if a bank writes you a check for $50,000, you don’t need to pay it back immediately. Rather, that is a liability you will pay back over time.
Cash Flow Statement : Your cash flow statement will help determine how much money you need to start or grow your business, and make sure you never run out of money. What most entrepreneurs and business owners don’t realize is that you can turn a profit but run out of money and go bankrupt.
In developing your Income Statement and Balance Sheets be sure to include several of the key costs needed in starting or growing an electrical contractor business:
- Cost of equipment and supplies
- Payroll or salaries paid to staff
- Business insurance
- Taxes and permits
- Legal expenses
Attach your full financial projections in the appendix of your plan along with any supporting documents that make your plan more compelling. For example, you might include your office location lease or contracts for upcoming projects.
Putting together a business plan for your electrical contractor business is a worthwhile endeavor. If you follow the template above, by the time you are done, you will truly be an expert. You will really understand the electrical contractor industry, your competition, and your customers. You will have developed a marketing plan and will really understand what it takes to launch and grow a successful electrical contractor business.
Electrical Contracting Business Plan FAQs
What is the easiest way to complete my electrical contractor business plan.
Growthink's Ultimate Business Plan Template allows you to quickly and easily complete your Electrical Contractor Business Plan.
What is the Goal of a Business Plan's Executive Summary?
The goal of your Executive Summary is to quickly engage the reader. Explain to them the type of electrical contractor business you are operating and the status; for example, are you a startup, do you have an electrical contractor business that you would like to grow, or are you operating a chain of electrical contractor businesses?
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Electrical Contracting Business Plan
Soaring demands, high-profit margins, and a recurring revenue model make starting an electrical contracting business a lucrative and rewarding profession.
The market for electrical contractors is highly saturated. If you want to capitalize on the opportunity and make a profitable business venture out of it, you need a detailed business plan that can help raise the funds.
Need help writing a business plan for your electrical contracting business? You’re at the right place. Our electrical contracting business plan template will help you get started.
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- Fill in the blanks – Outline
- Financial Tables
How to Write An Electrical Contracting Business Plan?
Writing an electrical contracting 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 entire 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.
Products and services:.
Highlight the electrical contracting services you offer your clients. The USPs and differentiators you offer are always a plus.
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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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:
Describe your business in this section by providing all the basic information:
Describe what kind of electrical contracting company you run and the name of it. You may specialize in one of the following electrical contracting businesses:
- Residential contracting
- Commercial contracting
- Industrial contracting
- Specialty contracting
- Describe the legal structure of your electrical contracting company, whether it is a sole proprietorship, LLC, partnership, or others.
- Explain where your business is located and why you selected the place.
If you’re an established electrical contracting service provider, briefly describe your business history, like—when it was founded, how it evolved over time, etc.
This section should provide a thorough understanding of your business, its history, and its future 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.
Start this section by describing your target market. Define your ideal customer and explain what types of services they prefer. Creating a buyer persona will help you easily define your target market to your readers.
Market size and growth potential:
Describe your market size and growth potential and whether you will target a niche or a much broader market.
Analyze emerging trends in the industry, such as technology disruptions, changes in customer behavior or preferences, etc. Explain how your business will cope with all the trends.
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.
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:
Describe your services:
Mention the electrical contracting services your business will offer. This list may include services like,
- Electrical installations
- Electrical repairs
- Electrical design services
- Maintenance and upgrades
Describe your domain:
List down electrical systems for which you shall offer contracting services. This list may include,
- Electrical systems
- Fire alarm systems
- Security systems
- Data cabling – Telecommunication
- Home automation systems
: This section should explain how you maintain quality standards and consistently provide the highest quality service.
In short, this section of your electrical contracting 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):
Define your business’s USPs depending on the market you serve, the equipment you use, and the unique services you provide. Identifying USPs will help you plan your marketing strategies.
Marketing strategies:, sales strategies:, customer retention:.
Overall, this section of your electrical contractor 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 electrical contracting business, 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 & machinery:.
Include the list of equipment and machinery required for electrical contracting, such as testing and measuring tools, hand and power tools, heavy machinery, safety equipment, etc.
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 electrical contracting business’s management team. This section should provide a detailed description of each manager’s experience and qualifications, as well as their responsibilities and roles.
Introduce your management and key members of your team, and explain their roles and responsibilities.
Compensation plan:, advisors/consultants:.
Mentioning advisors or consultants in your business plans adds credibility to your business idea.
This section should describe the key personnel for your electrical contracting 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:.
Determine and mention your business’s break-even point—the point at which your business costs and revenue will be equal.
Be realistic with your financial projections, and make sure you offer relevant information and evidence to support your estimates.
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 electrical contracting 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 electrical contracting business plan should only include relevant and important information supporting your plan’s main content.
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This sample electrical contracting business plan will provide an idea for writing a successful electrical contracting 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 electrical contracting business plan pdf .
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Frequently asked questions, why do you need an electrical contracting business plan.
A business plan is an essential tool for anyone looking to start or run a successful electrical contracting business. 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 electrical contracting company.
How to get funding for your electrical contracting business?
There are several ways to get funding for your electrical contracting business, 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.
How do I write a good market analysis in an electrical contracting business plan?
Market analysis is one of the key components of your business plan that requires deep research and a thorough understanding of your industry. We can categorize the process of writing a good market analysis section into the following steps:
- Stating the objective of your market analysis—e.g., investor funding.
- Industry study—market size, growth potential, market trends, etc.
- Identifying target market—based on user behavior and demographics.
- Analyzing direct and indirect competitors.
- Calculating market share—understanding TAM, SAM, and SOM.
- Knowing regulations and restrictions
- Organizing data and writing the first draft.
Writing a marketing analysis section can be overwhelming, but using ChatGPT for market research can make things easier.
How detailed should the financial projections be in my electrical contracting business plan?
The level of detail of the financial projections of your electrical contracting business may vary considering various business aspects like direct and indirect competition, pricing, and operational efficiency. However, your financial projections must be comprehensive enough to demonstrate a comprehensive view of your financial performance.
Generally, the statements included in a business plan offer financial projections for at least the first three or five years of business operations.
Can a good electrical contracting business plan help me secure funding?
Indeed. A well-crafted electrical contracting business 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.
What's the importance of a marketing strategy in an electrical contracting business plan?
Marketing strategy is a key component of your electrical contracting business plan. Whether it is about achieving certain business goals or helping your investors understand your plan to maximize their return on investment—an impactful marketing strategy is the way to do it!
Here are a few pointers to help you understand the importance of having an impactful marketing strategy:
- It provides your business an edge over your competitors.
- It helps investors better understand your business and growth potential.
- It helps you develop products with the best profit potential.
- It helps you set accurate pricing for your products or services.
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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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Electrical Contractor Business Plan Template [Updated 2023]
I. Executive Summary
This Section's Contents
Services provided, customer focus, management team, success factors, financial highlights.
[Company Name], located in [insert location here], is a local newly established family owned and operated electrical contracting company. The company provides electrical contracting services to the local metropolitan area and its surrounding communities. With an emphasis on customer service and rapid response time, [Company Name] is set to establish itself as one of [Location]’s most trusted and reliable electrical contractors.
[Company name] was founded by [Founder’s Name]. [Founder] has been an electrician in the community for over 40 years. [Founder] has always wanted to own and operate his own electrical contracting company for many years now, but wanted to wait until his sons were old enough and attained their electrician’s license. He knew the company would be his legacy and offer his sons and their families a reliable and reputable career. Through his knowledge and ability to follow through to address each of his clients issues, [Founder] has gained an immense following and is the most requested electrical contractor in the greater [location] area.
[Company Name] will provide a variety of different electrical contractor services. The services include Smart Home installation, Security Systems, Home Theater Installation, Camera Systems, LED Lighting Retrofit, Residential Electrical, Commercial Electrical, Industrial Electrical, Audio Visual Solutions, Lighting Control, and Network Systems.
Pricing for all services will vary depending on the complexity and size of the project.
[Company Name] will primarily serve the residents within a 1 to 50-mile radius of our location. The demographics of these residents are as follows:
- 862,989 residents
- Average income of $36,000
- 59.3% married
- 41% in Mgt./Professional occupations
- Median age: 39 years
Of the above mentioned residents, there are about 76% of single family homes that will likely require electrical work. There are also over 1 million square feet of industrial and warehouse space and there is another 1 million in the planning stages of development for another industrial park to be built.
[Company Name] is led by [Founder’s Name], a local electrician who has worked for the largest electrical contractor company in [location] for over 40 years. [Founder] is fully licensed and bonded and has gained an impressive reputation as the most reliable and trustworthy electrician in the market. As a project manager that oversaw hundreds of projects, [Founder] has the proper knowledge and experience to own, manage, and operate his own electrical contracting company.
[Company Name] is uniquely qualified to succeed due to the following reasons:
- The company will be providing electrical contracting services to the local market that its competition does not yet provide.
- The company will have a full fleet of vans and trucks to be able to properly and professionally serve [location] and its surrounding communities.
- The owner has a positive reputation in the community and is widely requested for electrical projects of all sizes.
- The pricing model is competitive with other electrical contractor companies.
- [Company Name] is fully licensed, bonded, and insured.
[Company Name] is seeking a total funding of $625,000 of debt capital to open its electrical contracting company.
- Warehouse design/build-out: $100,000
- Equipment and fleet of vehicles: $300,000
- Initial inventory: $100,000
- Working capital: $125,000 to pay for marketing, salaries, and lease costs until [Company Name] reaches break-even
Top line projections over the next five years are as follows:
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Electrical Contractor Business Plan Home I. Executive Summary II. Company Overview III. Industry Analysis IV. Customer Analysis V. Competitive Analysis VI. Marketing Plan VII. Operations Plan VIII. Management Team IX. Financial Plan
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Electrical Contractor Business Plan Sample
Electrical Contractor business plan for starting your own business
So, you want to become an electrical contractor. Well, this is undoubtedly an exciting venture, but can end up causing huge legal troubles if you couldn’t manage it properly.
An electrical contractor can be a person or company that employs electricians to design, install, and maintain electrical systems. Due to the delicate nature of work, the company is required to comply with specific standards.
To succeed in this challenging yet profitable enterprise, you must write an effective business plan for electrical contractor as the first step. In your business plan, you must include details about how you will train the employees, reach your customers, and obtain your goals within the resource constraints.
If you don’t know how to write an effective business plan, you can take help from here. In this electrical contractors business plan pdf, we have provided all the details of an electrical contractor startup, E-Volts.
2.1 the business.
E-Volts will be a registered, licensed, certified, and insured electrical contractor company based in Detroit. The business will comprise of highly trained electricians and supervisors to ensure the highest-quality work delivery.
From installation of transmission and distribution lines to the provision of electricity to buildings, E-Volts will be there to shine and help.
2.2 Management of Electrical Contractor
Managing an electrical contractor business requires extensive pre-planning. In some cases, even a smaller mistake can lead to a disastrous situation. Therefore, you should be very careful about all the details.
E-Volts will lease a facility in Detroit to set up their office. Following that, a procurement and HR manager will be hired so that the company could find the best equipment and the best hands to handle the equipment.
To manage the tasks effectively, E-Volts will be creating a database so that employees’ activities and engagements could be recorded. And the availability of specified workers could be ensured for upcoming projects.
2.3 Customers of Electrical Contractor
Before exploring how to start an electrical contractors business, you should identify your customers. Knowing your client base will help you to develop a sales strategy that is best suited to target them. Besides, recognizing customers will also enable you to create a precise electrical contractor startup plan by defining pricing, and services, etc.
E-Volts will provide its services to individuals, businesses as well as local government. In this business plan electrical contractor, we will be discussing the ways E-Volts will adopt to target these customers.
2.4 Business Target
Our target is to become the most renowned electrical contractor business in our vicinity within a year of the launch. Moreover, we aim at generating a net profit margin of $10.5k per month by the end of the two years. Our 3 years’ profit forecast based on our gross profit margin, sales forecast and net profit is given here:
3.1 company owner.
E-Volts will be owned by Mark Koch. Mark is an electrical engineer who has also acquired a degree in MBA after his graduation in engineering. He has a strong grip on power and protection systems. He has also captured much experience in the field as he did electrical systems’ related jobs during the last two years.
3.2 Why the electrical contractor is being started
Marks always wanted to start his own business. As business offers flexibility and scalability, extensive profits and freedom to implement own ideas.
He opted for starting an electrical contractor business since there couldn’t be a better way to invest his interest and knowledge of electrical systems.
3.3 How the electrical contractor will be started
Step1: Creating A Business Plan
Before starting this business, you must create a detailed electrical contractor business plan template.
If you are new to creating a professional business plan, you can take help from this electrical contractor business plan example.
Step2: Acquiring Required Licenses & Permits
Step3: Leasing Property, Equipment & Hiring Managers
E-Volts will be started in a leased facility. After which the company will procure the equipment, machinery, furniture, and other items.
Step4: Establishing Company’s Database & Website
A software developer/ IT expert will be employed to create a management database and website for the company. The database will help the company in keeping a record of completed and pending activities. Moreover, the platform will also enable customers to book the services remotely and give their reviews and feedbacks.
Step5: Hiring & Training Staff
At the same time, the company will establish its workforce by hiring and training technicians and electricians. In this sample electrical contractors business plan we will provide the list of employees that will be hired by E-Volts along with their job responsibilities and estimated salaries.
Step6: Marketing & Advertisement
To reach its target community E-Volts will start advertising about its services and competitive aspects before a month of the launch. The detailed marketing and sales strategy plan of the company will be given in the upcoming sections.
Our startup expenses and available assets are summarized in the graph given here.
Deciding the services is the most important phase of a business. In this sample business plan for electrical contractor, you can look through the services provided by E-Volts. To have a greater idea of which services you can provide as an electrical contractor, you should read more electrical contractor business plan examples.
- Interior & Exterior Lighting: This will be our primary service. We will design and install lighting in homes, school buildings, plazas, restaurants, public spaces, and government buildings.
Areas Of Expertise:
- Home Décor Lighting
- Flush Mount and Semi-Flush Mount Ceiling Lighting
- Outdoor Landscape Lighting
- General Ambient Lighting
- Street Lighting
- Smart Lighting System
- Electronic Appliances Installation: Our workers specialize in installing air-conditioners, fans, electric chargers, motors, generators, transformers, solar panels, intercom, doorbells, circuit breakers, network wiring, and smart home wiring.
- House & Commercial Wiring Services: We will do wiring in homes and small buildings’ as well as in commercial properties.
- Installation of Underground/ Overhead Transmission Lines: Our workers are also skilled in the installation and removal of distribution & transmission lines whether they are overhead or underground.
- Repair and Upgradation: We have experts who can repair and upgrade electrical systems. You can have us at your doorstep whether you want just a fuse replacement or a complete electrical service upgrade. We also repair electronic appliances.
- Safety Systems: E-Volts specialize in protecting your power systems. We can tackle power surges. And we can also install safety systems in your homes like childproof electrical outlets, smoke detectors, and fire detectors, etc.
Marketing Analysis of Electrical Contractor
Marketing analysis is one of the most important parts of a business plan template electrical contractor. In this part, you have to identify who will be your customers so that you could meet their expectations and concerns within the available budget and resources.
The biggest problem new startups face is attracting potential customers. With a problem worth solving electrical contractor business plan you can understand your target customers’ psychology to determine their preferences and needs.
An effective electrical contractor business plan also includes a detailed analysis of market dynamics. By knowing the market ups and downs, and the strengths and weaknesses of your competitors, you can plan ways to outperform your competitors.
5.1 Market Trends
These days people are moving towards newer technologies. Some want to install a newer type of power outlet while some want to have a smart lighting system. Simply put, electricians are in demand like always. The only thing that can make you unsuccessful in this venture can be a really poor service delivery or extremely bad customer care.
According to IBIS World, nearly 205,048 electrical contractors are operating in the U.S. Their collective annual revenue sums up to $170bn as reported by First Research.
5.2 Marketing Segmentation
Marketing segmentation means dividing the population of your target customers into distinct groups. So that you can determine the dominant traits of each group of your buyers.
This activity can help you get an insight into how you should plan your services, pricing, and customer care.
In this blog on how to write a business plan for an electrical contractor, we have listed the marketing segmentation done by E-Volts.
The detailed marketing segmentation of the target audience of E-Volts is as follows:
5.2.1 Residents: Our first target group will be the locals living in Detroit. We expect them to avail of our lighting services as well as repair & upgradation services. The residents will also be needing us frequently for the installation or replacement of electronic appliances and safety systems.
5.2.2 Businesses: Our second target group comprises of small and large businesses. They will consume all of our services like electrical repairing, AC installation, commercial wiring, ceiling lighting, etc.
In this category, restaurants, shopping malls, and cinemas, etc. will require our landscaping lighting, interior & exterior lighting, and ambient lighting the most. To turn them into potential buyers, we will be offering them several discounts.
5.2.3 Local Government & Construction Companies: Our third target group will comprise municipalities and home builders. They are expected to avail of our electronic appliances installation services, lighting, repair & upgrade services, as well as commercial wiring services.
This category will also be acquiring our wiring services.
5.3 Business Target
Our business targets set to be met in a defined time are given below.
- To obtain an average rating of 4.65 by the end of the first year
- To balance startup expenses with earned profits by the end of the second year
- To achieve the net profit margin of $10.5k per month by the end of the second year
- To extend our work areas by the end of the first two years
5.4 Product Pricing
Our prices will almost be in the same range as that of our competitors. However, we will be charging a little more for the installation, removal, and repair of transmission and distribution lines.
In this electrical contractor business proposal, we are listing the ways adopted by E-Volts to reach their target customers. Moreover, we are also explaining the competitive advantages that E-Volts decided to come up with to go ahead of all competitors.
6.1 Competitive Analysis
- All of our professionals are skilled, licensed, and certified.
- We follow the National Electrical Code to ensure safe and secure working.
- We are offering an online booking facility so that our customers can call us to their location without visiting our office.
- In case of repairing services, our workers will reach the desired area in less than 45 minutes.
- Client satisfaction is our topmost priority. You can contact us anytime between 6 a.m. to 12 p.m. Moreover, you can tell us any problems you had with our workers through the feedback portal. You are also welcomed to give your valuable suggestions to improve our services.
6.2 Sales Strategy
The selling strategy of E-Volts as defined in its business plan electrical contractor is given here.
- We’ll create a great SEO optimized website for our business
- We’ll advertise our services through Google Local Services ads, local magazines, and newspapers
- We’ll ensure a strong presence on social media platforms
- We’ll offer a 50% discount on our lighting and repair services for the first month of the launch
6.3 Sales Monthly
6.4 Sales Yearly
6.5 Sales Forecast
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To ensure the smooth running of the business and efficient tackling of any disruptions or risks, you have to train your workers properly. E-Volts hired a business continuity coordinator to develop business continuity plan electrical contractor so that company can stay competitive.
The list of staff E-Volts will hire is given here in this business plan sample electrical contractor, along with their job responsibilities and average salaries.
7.1 Company Staff
Mark will supervise overall business operations himself, however, he will hire the following people.
- 1 Co-Manager & HR Manager to help manage the business
- 3 Supervisors to monitor different projects
- 1 Business Continuity Coordinator to manage threats and risks
- 2 Electrical Engineers to design electrical systems
- 6 Electricians to work for the company
- 1 Accountant to maintain financial records
- 1 Sales Executive to carry out the company’s sales strategy plan
- 2 Drivers to provide transport
- 1 IT Expert to manage company’s sites and database
- 1 Customer Care Representative
7.2 Average Salary of Employees
The last step before initiating a business is creating a financial plan. A profit and loss business plan electrical contractor template analyze your investment group business plan , payrolls, taxes, and other expenses to draft a way of earning profits. In this electrical contractor business plan pdf we are providing detailed brake-even analysis, profit and loss projections, business balance sheet, and business ratios of E-Volts.
8.1 Important Assumptions
8.2 brake-even analysis.
8.3 Projected Profit and Loss
8.3.1 profit monthly.
8.3.2 Profit Yearly
8.3.3 Gross Margin Monthly
8.3.4 Gross Margin Yearly
8.4 Projected Cash Flow
8.5 Projected Balance Sheet
8.6 business ratios.
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Electrical Contractor Business Plan [Sample Template]
By: Author Tony Martins Ajaero
Home » Business Plans » Construction & Engineering
Are you about starting an electrical contractor business? If YES, here’s a complete sample electrical contracting business plan template & feasibility report you can use for FREE to raise money .
If you have studied an electrical related business, or you have the passion for electrical stuff, then you may want to be an electrical contractor. One of the things that you have to however have at the back of your mind is the fact that you will need to arm yourself with the right information that will be able to operate of a very skilled level.
A Sample General Electrical Contractor Business Plan Template
1. industry overview.
Electric contractors are an integral part of not just the construction cum real estate industry, but plays very important roles in ensuring that households, offices and public facility enjoys electric power supply and electric appliances are repaired when they become faulty.
Basically, players in this industry executes electrical work at a sites such as installing wiring, services electrical equipment and sells and installs electrical equipment et al. So also, some of the electrical work they performed include new work, additions, alterations, and maintenance and repairs et al.
No doubt, the electrical contractor services industry is indeed one of the largest subcontracting industries in the united states of America going by the revenue generated in the industry. A close watch on the industry activities shows that the revenue increase is due to acceleration in downstream construction markets in the United States.
As a result of the steady increase of demand from downstream construction markets, activities in this industry, registered businesses and of course contracts / job numbers have been on a steady rise. Going forward, the construction industry and real estate industry are expected to continue thriving hence increase in the demand for the services of electrical contractors.
So also, the industry is also expected to benefit from the increase in renovation and retrofitting activities, principally for green upgrades, such as energy-efficiency projects et al.
The Electrical Contractor Services industry is indeed a thriving and profitable industry in the United States, Canada, Japan, Germany, united kingdom, and France and in almost all the countries of the world. Statistics has it that the Electrical Contractor Services industry in the United States of America, is worth over $135 billion, with an estimated growth rate of 1.9 percent.
There are about 202,274 registered and licensed electrical contractor services businesses in the United States and they are responsible for employing about 909,862 people. It is important to state that there is no company with a dominant market share of the available market in this industry.
According to research carried out by IBISWORLD, it shows that, the small-scale and localized nature of operations in the Electrical Contractor Services industry results in a geographically dispersed structure that corresponds to the distribution of population and of course economic activity throughout the United States of America.
So also, most small-scale electrical contractors target a narrow, regional market, while larger-scale electrical contractors often undertake maintenance and construction contracts throughout several states. It was also indicated in the report that the Southeast region of the United States accounts for an estimated 23.7 percent of the industry establishment, which is roughly in line with the region’s share of the national population (25.6%).
The electrical contractor services industry will keep on thriving in the coming decade especially if an entrepreneur in this line of business is committed to providing reliable and quality work for customers in the services they render. The market is highly unsaturated and there is room for growth as the industry is expanding and maturing.
The good news for would be entrepreneurs in this line of business is that there is an estimate of continued annual growth for the electrical contractor services industry for as high as 20 percent.
Over and above, the electrical contractor services industry is very open to any aspiring entrepreneur who has acquired the required trainings, skills and perhaps professional certifications to start his or her own business and of course make good money from the industry.
2. Executive Summary
James Guttmann & Sons Electrical Services, Inc. is a licensed and standard American electrical contractor services company. We have been able to secure a standard and well – positioned office facility in a central business district in Little Rock – Arkansas.
We are an electrical contractor services company that is set to compete in the highly competitive electrical contractor services industry not only in Little Rock – Arkansas, but also throughout the United States market. James Guttmann & Sons Electrical Services, Inc. is set to executes electrical work at a sites such as installing wiring, services electrical equipment and sells and installs electrical equipment et al.
Basically, we will provide services such as electric power and systems installation and servicing, telecommunications installation and servicing, fire and security system installation and servicing, electronic control system installation and servicing et al.
Our business goal is to become one of the leading electrical contractor service companies in the United States and we will make sure that we do all we can to compete favorably with leaders in the industry.
Our workers are going to be selected from a pool of certified and highly experienced electrical technicians and tradesmen (electricians) with different area of expertise as it relates to our service offerings in and around Little Rock – Arkansas and also from any part of the United States of America as the business grows.
We will make sure that we take all the members of our workforce through the required trainings that will position them to meet the expectation of the company and to compete with leading electrical contractor services companies in the United States and throughout the globe.
At James Guttmann & Sons Electrical Services, Inc., our client’s best interest will always come first, and everything we do will be guided by our values and professional ethics. We will ensure that we hold ourselves accountable to the highest standards by meeting our client’s needs precisely and completely.
We will cultivate a working environment that provides a human, sustainable approach to earning a living, and living in our world, for all our partners, employees and for our clients. James Guttmann & Sons Electrical Services, Inc. is a family business that is founded by Engr. James Guttmann a graduated from Illinois Institute of Technology B.Engr. in electrical and electronics engineering.
He will run the business alongside his son Ken Guttmann who has a B.Sc. in Business Administration. They have a combine experience that can help them build James Guttmann & Sons Electrical Services, Inc. to favorably compete with other leading electrical contractor services businesses in the United States of America.
3. Our Products and Services
James Guttmann & Sons Electrical Services, Inc. is established with the aim of maximizing profits in the electrical contractor services industry.
We want to compete favorably with the leading electrical contractor service companies and also installation, maintenance and repair companies in the United States- which is why we have put in place a competent quality assurance team that will ensure that every electrical repairs, installations and services carried out or related services rendered meet and even surpass our customers’ expectations.
We will work hard to ensure that James Guttmann & Sons Electrical Services, Inc. is not just accepted in Little Rock – Arkansas but also in other cities in the United States of America. Our service offerings are listed below;
- Electric light or power installation
- Electric wiring installation on construction projects
- Repair or maintenance of electrical wiring (except of electricity transmission or distribution lines)
- Domestic exhaust fans installation
- Closed-circuit video surveillance systems installation
- Communication wiring and cabling installation
- Electric power and systems installation and servicing
- Telecommunications installation and servicing
- Fire and security system installation and servicing
- Electronic control system installation and servicing
- Repairs and maintenance of communication and electrical equipment
- Other related electrical installation, maintenance and repair services
4. Our Mission and Vision Statement
- Our vision is to establish a standard and all – round electrical contractor services company whose services and brand will not only be accepted in Little Rock – Arkansas but also in other cities in the United States of America.
- Our mission is to provide professional electrical installation, maintenance and repair services and other related services that will assist businesses, individuals, households and non-profit organizations in ensuring that their facility and electrical equipment are always in good shape.
- We want to build an electrical contractor service company that can favorably compete with other leading brands in the electrical contractor services cum installation, maintenance and repair services industry.
Our Business Structure
James Guttmann & Sons Electrical Services, Inc. is a business that intend starting small in Little Rock – Arkansas, but hope to grow big in order to compete favorably with leading electrical contractor Services Company and installation, maintenance and repair companies in the industry both in the United States and on a global stage.
We are aware of the importance of building a solid business structure that can support the picture of the kind of world class business we want to own. This is why we are committed to only hire the best hands within our area of operations.
At James Guttmann & Sons Electrical Services, Inc. we will ensure that we hire people that are qualified, hardworking, creative, customer centric and are ready to work to help us build a prosperous business that will benefit all the stakeholders (the owners, workforce, and customers).
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 five years or more as agreed by the board of trustees of the company. In view of the above, we have decided to hire qualified and competent hands to occupy the following positions;
- Chief Executive Officer
- Head, Technical Services (Senior Electrical Engineer)
- Human Resources and Admin Manager
- Sales and Marketing Executive
Electrical Engineers and Electricians
Client Service Executive
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; developing incentives; developing a climate for offering information and opinions; providing educational opportunities.
- Responsible for providing direction for the business
- 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 signing checks and documents on behalf of the company
- Evaluates the success of the organization
Head, Technical Services (Senior Electrical Engineer):
- Serves as project manager of the organization; works directly with employees
- Develops strategic plan by studying technological and financial opportunities; presenting assumptions; recommending objectives.
- Accomplishes subsidiary objectives by establishing plans, budgets, and results measurements; allocating resources; reviewing progress; making mid-course corrections.
- Coordinates efforts by establishing procurement, production, marketing, field, and technical services policies and practices; coordinating actions with corporate staff.
- Builds company image by collaborating with customers, government, community organizations, and employees; enforcing ethical business practices.
- Maintains quality service by establishing and enforcing organization standards.
- Maintains professional and technical knowledge by attending educational workshops; reviewing professional publications; establishing personal networks; benchmarking state-of-the-art practices; participating in professional societies.
- Makes certain that the technical department perform efficiently, coordinate employee efforts, and facilitate communications between management and handymen
- Ensures that the organization work in line with international best practices.
Admin and HR Manager
- Responsible for overseeing the smooth running of HR and administrative tasks for the organization
- Designs job descriptions with KPI to drive performance management for clients
- Regularly holds meetings with key stakeholders to review the effectiveness of HR Policies, Procedures and Processes
- 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 staff induction for new team members
- Responsible for training, evaluation and assessment of employees
- Responsible for arranging travel, meetings and appointments
- Updates job knowledge by participating in educational opportunities; reading professional publications; maintaining personal networks; participating in professional organizations.
- Oversees the smooth running of the daily office activities.
Sales and Marketing Manager
- 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
- Identifies development opportunities; follows up on development leads and contacts; participates in the structuring and financing of projects; assures the completion of development projects.
- Writes winning proposal documents, negotiate fees and rates in line with organizations’ policy
- Responsible for handling business research, market surveys and feasibility studies for clients
- Responsible for supervising implementation, advocate for the customer’s needs, and communicate with clients
- Develops, executes and evaluates new plans for expanding increase sales
- Creates new markets cum businesses for the organization
- Empowers and motivates the sales team to meet and surpass agreed targets
Accountant / Cashier:
- Responsible for preparing financial reports, budgets, and financial statements for the organization
- Provides managements with financial analyses, development budgets, and accounting reports; analyzes financial feasibility for the most complex proposed projects; conducts market research to forecast trends and business conditions.
- Responsible for financial forecasting and risks analysis.
- Performs cash management, general ledger accounting, and financial reporting for one or more properties.
- Responsible for developing and managing financial systems and policies
- Responsible for administering payrolls
- Ensures compliance with taxation legislation
- Handles all financial transactions for James Guttmann & Sons Electrical Services, Inc.
- Serves as internal auditor for James Guttmann & Sons Electrical Services, Inc.
- Responsible for carrying out electric light or power installation
- Responsible for carrying out electrical wiring installation on construction projects
- Handles repair or maintenance of electrical wiring (except of electricity transmission or distribution lines)
- Responsible for carrying out domestic exhaust fans installation
- Handles closed-circuit video surveillance systems installation
- Handles communication wiring and cabling installation
- Handles electric power and systems installation and servicing
- Responsible for telecommunications installation and servicing
- Handles fire and security system installation and servicing
- Responsible for electronic control system installation and servicing
- Handles general repairs and maintenance of communication and electrical equipment
- Handles other related electrical installation, maintenance and repair services as instructed by the Head, Technical Services.
- Welcomes clients and potential clients by greeting them in person or on the telephone; answering or directing inquiries.
- 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 clients on the phone, uses every opportunity to build client’s interest in the company’s products and services
- Manages administrative duties assigned by the creative director 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 clients when they make enquiries
6. SWOT Analysis
James Guttmann & Sons Electrical Services, Inc. engaged the services of a core professional in the area of business consulting and structuring to assist our organization in building a well – structured electrical contractor services company that can favorably compete in the highly competitive electrical contractor services cum electrical installation, maintenance and repair service industry in the United States and the world at large.
Part of what the team of business consultant did was to work with the management of our organization in conducting a comprehensive SWOT analysis for James Guttmann & Sons Electrical Services, Inc. Here is a summary from the result of the SWOT analysis that was conducted on behalf of James Guttmann & Sons Electrical Services, Inc.;
Our core strength lies in the power of our team; our workforce. We have a team of certified and highly trained and experience electrical engineers and electricians / technicians et al, a team with excellent qualifications and experience in various niche areas in the electrical contractor services cum installation, maintenance and repair service industry.
Aside from the synergy that exists in our carefully selected workforce, our services will be guided by best practices in the industry.
As a new electrical contractor services company in Little Rock – Arkansas, it might take some time for our organization to break into the market and gain acceptance especially from top profile clients (construction companies) in the already saturated and highly competitive electrical contractor services and installation, maintenance and repair services industry; that is perhaps our major weakness.
Another weakness is that we may not have the required cash to pump into promoting our business the way we would want to.
No doubt, the opportunities in the electrical contractor services and installation, maintenance and repair services industry is massive considering the number massive activities going on in the construction cum real estate industry and also the numbers of households and corporate organizations who are would always need one or more electrical appliances or wiring to fix in their facilities.
As an electrical contractor services company, we are ready to take advantage of any opportunity that is available in the industry.
Just like any other business, one of the major threats that we are likely going to face is economic downturn. It is a fact that economic downturn affects purchasing / spending power.
Another threat that may likely confront us is the arrival of a new electrical contractor services business or even installation, maintenance and repair company in same location where our target market exist and who may want to adopt same Business model like us.
7. MARKET ANALYSIS
- Market Trends
No doubt, the electrical contractors industry is indeed one of the largest subcontracting industries in the United States of America going by the revenue generated in the industry. A close watch on the industry activities shows that the revenue increase is due to acceleration in downstream construction markets in the United States.
As a result of the steady increase of demand from downstream construction markets, activities in this industry, registered businesses and of course contracts / job numbers have been trending upward. Going forward, the construction industry and real estate industry are expected to continue thriving hence increase in the demand for the services of electrical contractors.
So also, the industry is also expected to benefit from the increase in renovation and retrofitting activities, principally for green upgrades, such as energy-efficiency projects et al. On the average, starting and running an electrical contractor services business can be cost effective.
This is especially so when you have highly trained, well qualified and experienced staff as members of your team. With the quality of work carried out by them for your customers, you will be able to retain your customers and the good work your company does will be well spread by word of mouth as customers will tend to recommend your services to their families and friends once you are able to do a good job in their homes and on their properties.
A company’s ability in providing its customers with quality service at affordable prices will also be a factor that will count in the industry. This way the company will be able to retain existing clients and get more business from new customers. The competition in the electrical contractor industry shows that there is a viable market for the services of electricians.
As long as you are prepared to run a high quality business, you will have your own share of the market as some electricians business that exist take their customers for granted and offer them mediocre services. This gives you room as a new entrant into the business to come in and dominate if you are prepared to give quality service to your client.
8. Our Target Market
Before starting our electrical contractor services company in Little Rock – Arkansas, we conducted a market survey and feasibility studies and we are certain that there is a wide range of both corporate and individual clients who would need the services of electricians on a regular basis.
In view of that, we have created strategies that will enable us reach out to various corporate organizations and households who we know can’t afford to do without our services. Below is a list of the people and organizations that we have specifically market our services to;
- Construction and Real Estate Companies
- Banks, Insurance Companies and other related Financial Institutions
- Blue Chips Companies
- Corporate Organizations
- Real Estate Owners, Developers, and Contractors
- The Government (Public works department)
- Schools (High Schools, Colleges and Universities)
- Sport Facilities
- Religious Organizations
- Individuals and households
Our Competitive Advantage
Surviving in the business world as an electrical contractor services business or installation, maintenance and repair company requires more than, your expertise, knowing how to deliver standard electrical installations, repairs and maintenance jobs but also how to network with key people that matters; decision makers that can decide who will get an electrical installation, repair and maintenance contract.
There are favorable conditions for growth in the electrical contractor services industry and as a result of this, survival in the industry will require that you build on existing knowledge of the services you offer to your customers and broaden your skill base in order to be able to compete favorably.
More electrical contractor services companies are coming up and they are using the services of existing franchise in the business to boost their competitive edge and exposure in the industry.
We are quite aware that to be highly competitive in the electrical contractor services industry means that you are not only expected to be able to deliver consistent and highly reliable electrical installation, repair and maintenance jobs, but you must be able to meet set targets. No one would want to continue to hire your services if don’t always meet up with the target date of completion of projects.
Our competitive advantage lies in the power of our team; our workforce. We have a team of certified and highly trained and experience electrical engineers and electricians / technicians et al, a team with excellent qualifications and experience in various niche areas in the electrical contractor services cum installation, maintenance and repair service industry.
Lastly, all our employees will be well taken care of, and their welfare package will be amongst the best within our category (startups electrical contractor services cum installation, maintenance and repair businesses in the United States) in the industry.
It will enable them to be more than willing to build the business with us and help deliver our set goals and achieve all our business aims and objectives.
9. SALES AND MARKETING STRATEGY
- Sources of Income
James Guttmann & Sons Electrical Services, Inc. is established with the aim of maximizing profits in the electrical contractor services industry and we are going to go all the way to ensure that we do all it takes to meet and surpass the expectations of all our clients. James Guttmann & Sons Electrical Services, Inc. will generate income by offering the following services;
10. Sales Forecast
One thing is certain, there would always be construction and real estate companies, corporate organization, government agencies, households and individual who would need the services of electrical contractor services cum installations, maintenance and repair companies.
We are well positioned to take on the available market in the electrical contractor services industry and we are quite optimistic that we will meet our set target of generating enough income / profits from the first six month of operations and grow our company to enviable heights.
We have been able to critically examine the electrical contractor services cum installation, maintenance and repair market and we have analyzed our chances in the industry and we have been able to come up with the following sales forecast.
The sales projection is based on information gathered on the field and some assumptions that are peculiar to similar startups in Little Rock – Arkansas. Below is the sales projection for James Guttmann & Sons Electrical Services, Inc., it is based on the location of our business and of course the wide range of our services and target market;
- First Fiscal Year-: $ 250,000
- Second Fiscal Year-: $550,000
- Third Fiscal Year-: $1 million
N.B : This projection is 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 offering same electrical installation, maintenance and repair 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
We are mindful of the fact that there is stiffer competition in the electrical contractor services industry; hence we have been able to hire some of the best marketing experts to handle our sales and marketing.
Our sales and marketing team will be recruited based on their vast experience in the electrical contractor services cum installation, maintenance and repair services industry and they will be trained on a regular basis so as to be well equipped to meet their targets and the overall business goal of James Guttmann & Sons Electrical Services, Inc.
Our corporate goal is to grow James Guttmann & Sons Electrical Services, Inc. to become one of the top 10 electrical contractor services brands in the United States of America- which is why we have mapped out strategy that will help us take advantage of the available market and grow to become a major force to reckon with not only in Little Rock – Arkansas but also in other cities in the United States of America.
James Guttmann & Sons Electrical Services, Inc. is set to make use of the following marketing and sales strategies to attract clients;
- Introduce our business by sending introductory letters alongside our brochure to individuals, households, construction and real estate companies, corporate organizations, religious organizations and key stake holders.
- Promptness in bidding for electrical installations, repair, and maintenance contract from construction companies, real estate companies, the government and other cooperate organizations
- Advertise our business in relevant business magazines, newspapers, TV stations, and radio station.
- List our business on yellow pages ads (local directories)
- Attend relevant international and local expos, seminars, and business fairs et al
- Create different packages for different category of clients in order to work with their budgets and still deliver excellent services
- Leverage on the internet to promote our business
- Engage direct marketing approach
- Encourage word of mouth marketing from loyal and satisfied clients
11. Publicity and Advertising Strategy
We have been able to work with our brand and publicity consultants to help us map out publicity and advertising strategies that will help us walk our way into the heart of our target market.
We are set to become the number one choice for both corporate clients and households in the whole of Little Rock – Arkansas and beyond which is why we have made provisions for effective publicity and advertisement of our electrical contractor services company.
Below are the platforms we intend to leverage on to promote and advertise James Guttmann & Sons Electrical Services, Inc.;
- Place adverts on both print (newspapers and magazines) and electronic media platforms
- Sponsor relevant community based events / programs
- Leverage on the internet and social media platforms like; Instagram, Facebook , twitter, YouTube, Google + et al to promote our services
- Install our Bill Boards on strategic locations all around Little Rock – Arkansas
- Engage in road show from time to time in targeted neighborhoods
- Distribute our fliers and handbills in target areas
- Contact corporate organizations and households by calling them up and informing them of James Guttmann & Sons Electrical Services, Inc. and the services we offer
- List our company in local directories / yellow pages
- Advertise our company in our official website and employ strategies that will help us pull traffic to the site.
Ensure that all our staff members wear our branded shirts and all our vehicles are well branded with our company logo et al.
12. Our Pricing Strategy
At James Guttmann & Sons Electrical Services, Inc. we will keep the prices of our services below the average market rate for all of our customers, by keeping our overhead low and by collecting payment in advance from construction and real estate companies and other corporate organizations who would hire our services.
In addition, we will also offer special discounted rates to all our customers at regular intervals. We are aware that there are some one – off jobs or government contracts which are always lucrative, we will ensure that we abide by the pricing model that is expected from contractors or organizations that bid for such contracts.
- Payment Options
At James Guttmann & Sons Electrical Services, Inc. our payment policy will be all inclusive because we are quite aware that different people prefer different payment options as it suits them. Here are the payment options that we will make available to our clients;
- Payment by via bank transfer
- Payment via online bank transfer
- Payment via check
- Payment via bank draft
- Payment via mobile money
- Payment with cash
In view of the above, we have chosen banking platforms that will help us achieve our plans with little or no itches. Our bank account numbers will be made available on our website and promotional materials to clients who may want to deposit cash.
13. Startup Expenditure (Budget)
In setting up any business, the amount or cost will depend on the approach and scale you want to undertake. If you intend to go big by renting a place, then you would need a good amount of capital as you would need to ensure that your employees are well taken care of, and that your facility is conducive enough for workers to be creative and productive.
This means that the start-up can either be low or high depending on your goals, vision and aspirations for your business. The tools and equipment that will be used are nearly the same cost everywhere, and any difference in prices would be minimal and can be overlooked.
As for the detailed cost analysis for starting a standard electrical contractor services company; it might differ in other countries due to the value of their money. However, this is what it would cost us to set James Guttmann & Sons Electrical Services, Inc. in the United of America;
- Business incorporating fees in the United States of America will cost – $750.
- The budget for Liability insurance, permits and license will cost – $3,500
- Acquiring an office space that will accommodate the number of employees for at least 6 months (Re – Construction of the facility inclusive) will cost – $100,000.
- The amount required to purchase the needed tool box and repair equipment – $20,000
- Equipping the office (computers, printers, projectors, markers, servers / internet facility, furniture, telephones, filing cabinets, and electronics) will cost – $10,000
- Amount required to purchase the needed software applications to run our business – $3,500
- Launching an official Website will cost – $500
- Amount need to pay bills and staff members for at least 2 to 3 months – $70,000
- Additional Expenditure such as Business cards, Signage, Adverts and Promotions will cost – $1,000
Going by the report from the market research and feasibility studies conducted, we will need about two hundred and fifty thousand ( 250,000 ) U.S. dollars to successfully set – up a medium scale but standard electrical contractor services company in the United States of America.
Generating Funding / Startup Capital for James Guttmann & Sons Electrical Services, Inc.
James Guttmann & Sons Electrical Services, Inc. is a family business that will be owned and managed by Engr. James Guttmann and his immediate family members. They are the sole financial of the business which is why they decided to restrict the sourcing of the start – up capital for the business to just three major sources.
These are the areas we intend generating our start – up capital;
- Generate part of the start – up capital from personal savings and sale of his stocks
- Generate part of the start – up capital from friends and other extended family members
- Generate a larger chunk of the startup capital from the bank (loan facility).
N.B: We have been able to generate about $100,000 (Personal savings $70,000 and soft loan from family members $30,000) and we are at the final stages of obtaining a loan facility of $150,000 from our bank. All the papers and document has been duly signed and submitted, the loan has been approved and any moment from now our account will be credited.
14. Sustainability and Expansion Strategy
The future of a business lies in the numbers of loyal customers that they have the capacity and competence of the employees, their investment strategy and the business structure. If all of these factors are missing from a business (company), then it won’t be too long before the business close shop.
One of our major goals of starting James Guttmann & Sons Electrical Services, Inc. is to build a business that will survive off its own cash flow without the need for 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 offer our electrical installation, maintenance and repair services 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.
James Guttmann & Sons Electrical Services, 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 three 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 Incorporation: Completed
- Opening of Corporate Bank Accounts various banks in the United States: Completed
- Opening Online Payment Platforms: Completed
- Application and Obtaining Tax Payer’s ID: In Progress
- Securing a standard office facility, renovation and equipping of the facility inclusive: Completed
- Application for business license and permit: Completed
- Purchase of All form of Insurance for the Business: Completed
- Conducting Feasibility Studies: Completed
- Generating part of the start – up capital from the founders: Completed
- Writing of Business Plan: Completed
- Drafting of Employee’s Handbook: Completed
- Drafting of Contract Documents: In Progress
- Design of Logo for the business: Completed
- Purchase of repair and installation tools and equipment: Completed
- Graphic Designs and Printing of Packaging Marketing / Promotional Materials: Completed
- Recruitment of employees: In Progress
- Purchase of the Needed furniture, office equipment, software applications, electronic appliances and facility facelift: In progress
- Creating Official Website for the business: In Progress
- Creating Awareness for the business: In Progress
- Health and Safety and Fire Safety Arrangement: In Progress
- Establishing business relationship with vendors and key players in the construction and real estate industries: In Progress
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A handy electrical contractor business plan template to help you launch your company
Creating a business plan is an impactful milestone when launching any new business. If you’re looking to become an electrical contractor or offer electrical services as part of your own business, this handy guide will take you through the process of writing an electrical contractor business plan.
What are the benefits of writing a business plan?
All small businesses need a business plan. Business plans guide small business owners through the research and market analysis process. The document helps entrepreneurs figure out their:
- Pricing strategy
- Target market
- Marketing strategy
- Business goals
- Financial plans
For electricians, in particular, creating an electrical contracting business plan can help you determine and finalize:
- Which types of electrical work to focus on
- Which electrical services you’ll offer (residential or commercial electrical services)
- Who your target customers are (homeowners, general contractors, etc.)
- Who you might partner with (i.e., a non-competitive construction company or contracting company)
- Which marketing strategies for electricians you’ll use
How to write a business plan for an electrical contractor
Here are some essential steps to create an effective electrical contracting business plan that sets your electrical contractor company up for success.
- Do your research. Find out what other electricians in your market are doing and identify the opportunities and risks for you.
- Clearly communicate your findings and ideas. Depending on who may read this business plan — potential investors, partners, lenders, team members or your future self — you want to put together a plan that’s engaging, informative and easy to understand.
- Be thorough and detailed. If you do it right, your business plan could help guide your overall strategy for years to come.
- Get help. If your expertise lies in offering electrical services but not all the aspects of a full business plan, consider hiring outside resources to help you. They can walk you through developing a marketing plan, knowing which social media channels to use, outlining business operations, preparing balance sheets and calculating your expected profit margin.
How can I get a free business plan template?
You can use the following components to help build your business plan. Use this as a template to define your business, outline your strategy, develop your marketing plan and present your financial projections.
1. Executive summary
In this section, you will summarize key highlights and findings from the rest of your business plan. It includes an overview of your company and business goals, your market analysis and financial outlook.
Although this section appears first within business plan templates, you will probably fill in this part last after you’ve completed the other areas. Think of this section as the key takeaways someone needs to know if they don’t bother reading the entire plan, the 30-second elevator pitch of what you’re hoping to accomplish that draws your audience in to learn more.
2. About the company
This is where you introduce your company to the readers of your business plan. This section should present:
- Your company name
- Your mission statement — your company’s purpose and reason for being
- Your business goals
- What type of company you are creating (LLC, S-Corp, etc.)
- Your team members (if any)
- The electrical services you plan to offer
3. Market analysis
This section should include your market research and cover the following key areas.
3.1 Industry analysis
What is the financial outlook for the overall construction industry? What’s the market size in your area and the potential for a new electrician or construction company in your market?
3.2 SWOT analysis
What are the potential strengths (competitive advantages), weaknesses, opportunities and threats for a new business like yours?
3.3 Target audience
Who are your target customers (residential or commercial or property managers, renters or homeowners)? What are their demographics?
3.4 Four P’s of marketing (product, place, promotion and price strategy)
This section should cover the following four P’s of marketing, essential to any marketing plan.
- Product: List the electrical services you plan to offer
- Place: Define the market or service area you plan to operate in
- Promotion: Go into detail about your marketing strategy — which marketing channels and tactics do you plan to use? How do you plan to reach, attract and convert new customers? Through word-of-mouth, social media or other methods?
- Price strategy: How do you plan to price your electrical services?
4. Financial plan
In this section, you should be prepared to include tables, charts and graphs and provide supporting financial statements for each of the key financials:
- Starting balance sheet
- Startup costs
- Projected cash flow — your financial projections for your income and expenses for the first three years
- Expected profit margin
Depending on the intended audience for this business plan, you may include a specific call-to-action. Direct them to your website to learn more or provide contact information for scheduling a meeting to learn about investing in your business.
What should your business plan cover? Top three questions your electrical contractor business plan should answer
Here are the critical questions you should answer in your business plan.
1. How do electrical contractors get clients?
Your electrical contractor business plan should include your electrician marketing plan , detailing how you plan to get clients, which channels you plan to use (social media, paid advertising, etc.) and your marketing budget.
2. Are electrical businesses profitable?
Your business plan should include a financial plan that lists your financial projections and spells out how you plan to have your own business become profitable. Include your:
- Projected cash flow
- Profit margins
3. What are the risks of being an electrical contractor?
Your business plan should include a SWOT analysis that details the potential strengths, weaknesses, opportunities and threats of starting an electrical contracting business. By proactively identifying risks, your audience will know you have done your homework.
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Electrician business plan template
Download this electrician business plan template in PDF or Word format, or tailor it to your project directly in our business plan software.
Discover our electrician business plan template
Our electrician business plan template gives you the structure to write a professional plan.
Not accustomed to writing business plans? Our electrician business template will turn a typically challenging process into a total breeze.
Modelled on a complete business plan of an electricial business in Normandy, our template features both the financial forecast and the written part that presents the project, its team, the local market and the business strategy implemented by the management.
Cast your eyes on this template to achieve a better understanding of what your bank and investors would like to see, so that you can create a business plan that meets their expectations.
7 day free trial. No credit card required. Electrician business plan template available with paid plans only.
How to use this electrician business plan template
Edit the electrician business plan template online, or download it.
There are 3 ways to use this template:
- Edit it online: you can adapt this template to your business idea by changing the text or the financial forecast directly in our business planning software
- Download in PDF: if you're just after a little inspiration, you can download the electrician business plan template in PDF to read over it
- Download in Word format: want to edit your plan on Word? Simply export the electrician business plan template to Ms Word (.docx) format
Electrician shop business plan template content
This template includes a complete electrician business plan example, with a financial forecast and the following sections:
- 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
- Products and services: here, you'll give an overview of the services or products offered by the company
- Market analysis: the market analysis is where you’ll demonstrate that there is a strong demand for your products and services through a thorough assessment of the industry (customer profile, hot trends, regulation, competition, etc.)
- Strategy: this section highlights the company's game plan when it comes to pricing, marketing and mitigating risks along the way
- Operations: this step lays out the company's operational organisation, including the recruitment plan
- Financial plan: the financial plan includes a table of sources & uses (initial funding plan), and complete financial statements (P&L, balance sheet and cash flow statements).
- Appendices: this part provides the opportunity to include multiple financial appendices generated by our software (debt maturity profile, monthly financial statements, financial analysis, etc.).
Executive summary of the electrician's business plan
The executive summary gives the reader a clear and concise overview of your business idea.
Our electrician business plan example's executive summary is formed of the following subsections:
- Business overview: in this subsection, we outline who the electrician founders are, what legal form they've chosen for the business, and the rationale behind the choice of their location
- Market overview: in this subsection, we summarize the conclusions of the market analysis performed by the electricial business' owners and explain who they aim to target (homeowners, tenants with repair needs etc.)
- Financial highlights: in this subsection, we give an overview of the forecasted financial performance of the electrician over the first 3 years of operation
- Our ask: in this subsection, we outline the amount of financing required to start the electrician and how it's going to be funded (the founders are seeking a bank loan to start their electricial business)
Company overview included in our electrician business plan sample
This section lays out the structure of your business, including its location, management team and legal form.
Our electrician business plan template's company section is formed of the following subsections:
- Structure & Ownership: in this subsection, we outline who the electrician's shareholders are and what legal form they've chosen for the business
- Location: in this subsection, we present the area surrounding the location chosen for the business and the layout and main features of the premises
- Management Team: in this subsection, we give an overview of the background of each of the electrician's founders, explain how they met and why they decided to start a company together
Products and services offered by the electrician
The products and services section is where you will present the different types services offered by your electricial business.
In our electrician business plan template products and services section, we cover:
- Repair services: a choice between electrical installation repairs or emergency repairs (which are available 24/7)
- Renovation services: mainly for outdated electrical installations, helping bring them up to regulatory standards
- Installation services: for new builds that require significant electrical work done such as HVAC (heating, ventilation and air conditioning) or installing smoke detectors
Market analysis for the opening of the electricial business
The market analysis is where you’ll demonstrate that there is a strong demand for your products and services through a thorough assessment of the industry (customer profile, hot trends, regulation, competition, etc.).
Our electrician business plan example's market analysis section is formed of the following subsections:
- Demographics and Segmentation: in this subsection, we explore the market in depth. We look at the supply and demand sides both at the national and local level, analyse the hot trends perceived by the founders, and the key statistics that will help the founders build their positioning
- Target market: in this subsection, our founders explain who they view as their ideal customers (homeowners, tenants with repair needs etc.) and why they chose to target them
- Competition: in this subsection, we take a look at the direct (electricians nearby) and indirect (other ways of carrying out repairs) local competition to ensure we have a differentiated positioning and that the market is large enough to accommodate the arrival of new electricial business
- Regulation: in this subsection, we give an overview of the main regulation applicable to our electricial business
Setting the strategy for our electrician
This section highlights the company's game plan when it comes to pricing, marketing and mitigating risks along the way.
Our electrician business plan template strategy section is formed of the following subsections:
- Pricing: in this subsection, we explain how we set the prices of our main categories of services (repair, renovation, installation) and the rationale behind our choice
- Marketing plan: in this subsection, we explain what action we'll put in place to build awareness and loyalty among our customers
- Milestones: in this subsection, we give an overview of the main goals we set for ourselves for the next 3 years
- Risks and Mittigants: in this subsection, we perform an assessment of the medium and long-term risks that could jeopardize the financial viability of our electrical business and outline how we intend to mitigate them
Operations section of the electrician business plan template
This part lays out the company's operational organisation, including the recruitment plan.
Our electrician business plan example's operations section is formed of the following subsections:
- Personnel plan: in this subsection, we explain what our opening hours will be and explain the responsibilities of each of staff member in our electricial business
- Key assets and IP: in this subsection, we list the assets and intellectual property rights which are critical to our business operations and explain how we will secure and protect each of these
- Suppliers: in this subsection, we give an overview of the main suppliers we will use our what commercial terms have been negotiated with them
Financial plan included in our electrician business plan template
This section presents the expected financial performance of the electrician over the next 3 years.
Our electrician business plan example's financial plan is formed of the following subsections:
- Start-up funding: in this subsection, we list the cost of each item required to launch the electricial business
- Important assumptions: in this subsection, we explain the methodology and the main assumptions used to build the electrician financial forecast
- Sales forecast: in this subsection, we detail the expected revenues and growth rate for our electricial business in the coming years
- Cost structure: in this subsection, we list all the expenses required for our electricial business to operate smoothly
- Projected Profit & Loss statement: in this subsection, we analyse our forecasted P&L and comment on the expected profitability of our electricial business over the next 3 years
- Projected cash flow statement: in this subsection, we analyse the expected cash generation of the electricial business
- Projected balance sheet: in this section we give an analysis of the liquidity and solvability implied from our balance sheet
Appendices of the electricial business plan template
This part provides the opportunity to include multiple financial appendices generated by our software (debt maturity profile, monthly financial statements, financial analysis, etc.).
Our electrician business plan template's appendices include:
- A maturity profile chart showing the principal repayments of their loans over the next 3 years
- A monthly cash flow forecast: showing how much cash is being generated or consumed each month over the first 3 years of operations
Electrician business plan template sample
Executive summary, business overview.
Elec Eco Repair will be an installation, renovation, and electrical repair company located at 25 Rue des Roquemonts, in the city of Caen. The business will be situated close to major roads, to facilitate easy travel.
We will specialise in energy-efficient renovations by offering regulated electrical radiators, thermodynamic water heaters, and much more. This will likely bring long-term benefits to homes within Caen.
Our industry accreditation means that we can guarantee our customers a high-quality service. This accreditation gives us credibility because it ensures that our installation complies with regulatory standards. Our customers will also benefit from subsidies provided by the government.
We will set up a limited company with a total share capital of €8,000. The business will be managed by Victor D. and Marie A.
Our managers both have complementary experience. Victor worked as an electrician for a large company for nearly 10 years. Marie worked at an electrical installation company, providing energy-efficient renovations for 8 years.
Turnover of the sector
According to the CAPEB (Confederation of Small Construction Companies), small construction companies generated turnover worth €84.3 billion in 2019 - this represented 64% of the overall turnover that year for the construction industry.
Companies with fewer than 10 employees carried out most of the housing and non-housing work in 2017.
Non-housing work generally includes work for public buildings or businesses such as hotels, offices, shops, and restaurants.
Housing work includes the construction of new properties or renovations. In 2018, 43% of work was carried out on new builds, while the 57% remaining were for improvement or maintenance.
Number of companies, workforce, and employment
In 2018, there were 555,261 small businesses in the construction sector, with 98% of them employing fewer than 20 employees. Altogether, these businesses employed a total of 640,621 employees - representing 59% of the overall number of workers in the construction sector.
Small companies trained 55,370 apprentices in 2019, representing 79% of all apprentices in the construction sector.
In Europe, 97% of companies during the same year had fewer than 20 employees and they accounted for 80% of all construction turnover in the Europe.
Figures for Normandy
According to The Regional Economic Unit for Construction, Normandy's construction sector was worth €10 billion in 2018 - a 4% growth in comparison to 2017 figures. The sector accounted for 6% of Normandy's total economy at the time.
There were 28,644 construction businesses in the region:
- 30% were companies employing between 1 and 9 employees
- 64% were self-employed establishments
- 6% were companies employing more than 10 employees
The CAPEB report also indicates that companies employing fewer than 10 employees generated turnover worth €4.3 million in 2017, i.e. 43% of the regional turnover. There were 2,239 new construction companies created in 2017.
The counties of Seine-Maritime and Calvados accounted for the majority of turnover in the region in 2017.
Figures for Calvados
The county of Calvados generated a turnover of €2.2 billion in 2017 and accounted for 21.2% of the region's turnover in the building and public works sector. 7,164 such businesses were operating in the region.
With the majority of businesses employing fewer than 10 employees (28%) and micro-businesses without employees (67%), the Calvados sector was predominantly occupied by small companies.
We expect to be profitable in our first year of activity with sales of €157,200 and an EBITDA of €6,112 (with a 3.89% margin) for year 1.
We expect to be able to continue to grow our business to reach €198,080 in sales and €15,952 in EBITDA (with a 8.05% margin) by year 3.
Operating cash flow generation is expected to be positive for the entire duration of the plan, and the company should be adequately capitalised to enable us to meet our loan repayments while retaining sufficient liquidity to deal with any unforeseen circumstances.
We estimate that we need a total of €28,000 to open our electrician.
Our partner will contribute €18,000 (64.2% of the total amount).
We would like to obtain a bank loan of €10,000 to complete this amount.
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Quite frankly excellent because I was able to finalize my business plan in less time than expected. This software offers a very coherent and complete approach to writing your project.
It is a very well designed software that allows you to visualise each step of your project, understand if the idea is viable or not and think about the steps needed to start your business.
The software is just impeccable. Of course, it meets the requirements of people starting a business. In addition to having a tool for putting together a proper financial forecast, there is also a tool to help write the business plan.
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Electrician shop business plan template faq.
A electrician business plan is a written document that sets out the commercial, operational and financial objectives of the company over the next 3 to 5 years.
It consists of two main parts:
- A written part that presents, in detail, your electrician business, the team, your strategy, and your medium-term objectives.
- A financial forecast that highlights the expected profitability of the electrician and the initial funding requirements.
The lack of business planning is one of the main reasons why more than 50% of startups fail within 5 years. If you're starting a electrician, writing a business plan is a must-have in order to reduce the risk of failure of your project.
Business plans are also required by most lenders and investors in order to secure financing, therefore a business plan is also highly recommended if you're seeking a loan or equity investment for your electrician.
Writing a electrician business plan without The Business Plan Shop can be both error-prone and time-consuming - whether you're new to entrepreneurship or experienced:
- You'll need to research the structure of a business plan, what to include in each section, and what key elements investors and lenders expect to see
- You may encounter writer's block (especially if it's the first time you're writing a business plan for your electrical company)
- You'll need to create a financial forecast on a spreadsheet which requires a solid understanding of accounting and financial modelling in order to be done without error
- You'll need to spend hours formatting financial data on Excel or Sheets before it's ready to integrate into your business plan
- Any updates to your electrician business plan or financial forecast will need to be done manually
Luckily for you, The Business Plan Shop's online platform and electrician business plan template guide you through every stage of writing a business plan, so that you can spend more time managing and growing your business instead.
Our editor follows a best-in-class structure for professional business plans. Each section and subsection includes examples and instructions to help you, while our business plan templates provide further inspiration if you're stuck.
Our financial forecasting software helps you create a forecast and integrate it into your business plan with ease. Anytime you update your data, your business plan automatically updates.
And with our forecasting software all the calculations are done for you, without errors.
The budget to start and run an electricial business will depend on the exact concept and location.
A large electrical business operating in the heart of London would require much greater startup costs than one operating in Newcastle due to higher overhead costs (advertising, insurance, rent).
As an example, in our electrician business plan template the total initial funding requirement amounted to €28,000, with the founders contributing €18,000.
In order to assess the exact budget for your electrician idea, you need to do a financial forecast using a financial projection tool such as the one we offer .
The package we offer at The Business Plan Shop goes way beyond a simple blank template you need to fill. With our platform you get:
- Access to one of the best business plan software on the market
- Access to our electrician business plan template which contains a complete example of a written business plan and financial forecast to start an electricial business
- Access to our entire business plan templates library - giving you dozens of examples to take inspiration from
- Access to our financial planning and analysis platform so that you can track the actual performance of your business against what you had planned in your business plan and re-plan easily
But you shouldn't take our word for it: try our solution for free and make your own opinion!
The free trial enables you to try the software for free during 7 days in order to verify that it meets your requirements before buying.
Some features are limited during the free trial, the main limits are:
- You can only create one business plan
- The financials of the first year are visible, but data for other years are hidden
- You can export your plan in PDF but not in Word or CSV
- No access to our business plan templates
You can create your account and start your free trial here .
Access to our template is included with all our paid subscriptions.
Please visit our pricing page to learn about this in more detail.
Other business plan templates and resources to discover
How to Write a Business Plan for a Electrical Contractor
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?
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.
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.
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.
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.
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.
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.
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.
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
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)?
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.
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.
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.
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.
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.