Starting an Electrical Business
If you’re a qualified electrician and you’re thinking about being your own boss, this could be the right time to take the plunge.
A shortage of skilled electricians in the UK[i] could mean you’re rarely short of work – provided you get the basics right at the outset and establish your firm as competent and trustworthy, you could quickly find yourself at the helm of a thriving business.
Of course, starting a business is not for everyone. It brings extra work and responsibility – not just carrying out electrical work, but all the admin that goes with running a business too.
That is why it is so important to have a plan before you start. After all, there are risks as well as rewards, so it’s important to plan ahead – to consider those risks and minimise them before you get started.
To help you decide if starting a business is for you, and get off on the right foot, we have put together a few tips on starting an electrical business.
Starting an Electrical Business: Build a Business Plan:
Think carefully about the kind of electrical business you want to run – for instance domestic or commercial ‒ how you will run the business, where you will find the skilled people you need to grow, and the prices you will charge. It’s important to be realistic and understand that opening a business is hard work and the financial rewards may take a little time to arrive.
Starting an Electrical Business: Get Help from an Accountant
There is no doubt that running a business is very different from working in one. Starting your own business brings with it a whole new set of responsibilities – from quotes and invoicing to business administration and payroll if you take on any employees.
But you can minimise that extra workload by finding an experienced, competent accountant to help with everything from company registration and book-keeping, to annual returns, paying your staff and tax.
Starting an Electrical Business: Invest in Equipment
Clearly, electrical work requires not just specialist knowledge and skills, but tools too. Think carefully about the tools you already have and identify any you’ll need to buy as part of your business start-up.
Given the nature of the work, a vehicle will be important too – a reliable, secure van to carry you, your tools, and materials to and from every job.
Having a realistic idea of those costs before you start could help you to avoid unpleasant surprises later.
Starting an Electrical Business: Accreditation and Support
Trust is vital – growing your business will depend on customers having confidence that you are professional, trustworthy and have the skills and knowledge required to carry out safe electrical work.
Registering as an accredited NICEIC contracting firm can be completed in three weeks[ii] and helps to give customers the peace of mind they need ‒ it also offers a wealth of support to help you make a success of your new electrical business.
Starting an Electrical Business: Get Insurance
Effective electricians or electrical contractors business insurance could be the most important tool in your bag. It should be there to help to keep your business moving should things go wrong and, if you employ people, relevant insurance is a legal requirement – so don’t overlook it.
Some of the most important insurance covers to think about are:
- Public liability insurance: This is designed to help cover costs and compensation if someone is injured or their property is damaged because of your work.
- Employers' liability insurance: If you employ people this cover is usually a legal requirement. It is there to help minimise financial losses if an employee is injured or becomes ill through their work for you.
- Personal accident insurance: What happens if an accident or injury leaves you unable to work? Who will pay the bills? This cover can help to cover lost income and medical costs.
- Tools insurance: If your tools and equipment were lost or stolen, you could find yourself faced with an unexpected bill to replace them. The right tools insurance can help to cover these costs and get you back to work quickly, but be careful to look out for exclusions – for instance, some tools insurance products won’t cover your losses if tools have been left in a van overnight.
- Commercial vehicle insurance: For most electricians, a van or other business vehicle is vital to getting to and from each job. This cover is designed to get your business back on the road quickly if your van is stolen or damaged in an accident.
Of course, every electrical business is different so success can never be guaranteed. But, given the current shortage of skilled electricians[iii], this could be a good time to take the plunge and go it alone.
However, remember that planning ahead is crucial to making a strong start, and that the right business insurance could play a vital role in defending your livelihood if something were to go wrong.
And, the best bit...
Registered NICEIC contractors get 10% off the cost of their insurance!