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How To Start a Home Service Business | 9 Steps To Profitability

May 2, 2024

by Ippei Kanehara

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 How I make $52K per month

Here is how to start a home service business:

  • Choose a home service business model that aligns with your skills
  • Write out a business plan
  • Create a home service business website
  • Formulate a marketing strategy for your home service business
  • Organize your business finances
  • Register your home service business
  • Set the pricing for your home service business
  • Start performing work for clients and collect reviews and testimonials
  • Keep your skills up to date

To start a home service business, you need a comprehensive and well-structured business plan. This should include your services, target market, brand identity, marketing strategies, and budget. From there, research the market and competitors, as well as legal considerations. Have your whole business documented from start to finish to ensure a smooth operation from the outset. Home service expert and coach Tommy Mello always tells his startups to “act like the business you want to become”. This advice emphasizes the importance of a professional approach from the start.

The meaning of home service in business is that you provide a service to customers in their own residences. This offers convenience by accommodating the schedules and specific needs of your clients. Some home service business examples include cleaning, maintenance, repair, personal care, and tutoring. 

Starting a home service business in 2024 is a great idea. According to Amenify, 80% of people living in US urban areas say that they hire a home service provider whenever they have a need. Each household is said to spend around $5,000 every year for these services. One example of a successful home service is Cleaning Ninjas, a Nebraska-based cleaning service. Today, Cleaning Ninjas earns a six-figure monthly revenue and serves 500+ clients throughout the state. The business found success through its unique branding. Ninjas slashing in, doing their job perfectly, and leaving - as stealthily and quickly as possible. 

Cleaning Ninjas

Although starting a home service business is easier than most physical businesses, it does come with its own challenges. For one, you will need to build trust with your clients even before they hire you. This is because they will be letting you into their homes. If you’re from a big city, you’ll also have to deal with high competition. To give you an idea, a 2021 Census Bureau study found around 56,000 plumbers in Dallas, TX ready to take on plumbing projects. Other challenges you’ll face are managing logistics, dealing with regulatory compliance, quality control, and financial management.  

In this article, we’ll go into more detail about how to start a home service business. We’ll walk you through the 9 steps that will include all the details, and some tips and tricks, to see success and profitability. 

How to Start a Home Service Business in 9 Steps

1. Choose a Home Service Business Model 

Choosing a home service business model should align with your passions, skills, and the demands of the market. All three are crucial if you want your home service business to succeed. First up, you need to choose a home service that you’re passionate about. Chris Ducker, the founder of Youpreneur and author of the bestseller ‘Rise of the Youpreneur’, says that starting a business you’re passionate about will help you persevere when the going gets tough. It will also ensure that you provide the very best service. So if you’re starting a home cleaning service, you should be passionate about making sure that every corner of the house is spick and span. 

Of course, you need to have the skills to provide quality service, too. Depending on the service you’re passionate about, you either have to go to trade school to get a certificate or just improve your skills. To give you a head start, here are popular home service business ideas and the qualifications required:

  • Plumber, electrician, HVAC: Requires a certificate program (6 months to a year), diploma program (1-2 years), or associate degree program (2 years). The higher your degree, the more credible you become - and the easier it will be to get clients
  • Cleaning, lawn care, roofing, painting: No certificate or diploma required. You have to prove your worth by offering top-notch first-time service
  • Hairdresser, landscaping, pool service: Requires certificate or diploma programs (9 months to 2 years), or associate degree programs (2 years)
  • Pet groomer, pest control, handyman, device repair: Requires short courses (a few weeks), certificate programs (a few months to a year), or diploma programs (a year)
  • Interior design, personal tutor, tax accountant: Requires certificate programs (6 months to a year), associate degree programs (2 years), or Bachelor’s degree programs (4 years)

PRO Tip: It’s not just about gaining the skills required for your service. You should also be a good business person. If you want to stand out among the crowd, work on your marketing and people skills, too.

Lastly, you have to consider the demands of the market. Understanding the needs and preferences of potential customers in your area helps identify profitable opportunities. For example, if you’re offering tree trimming services, then you need to serve an area with lots of trees. Moreover, this will have a big say on the success rate of your marketing strategies. According to Invoca, these are the most profitable home service businesses if you’re promoting your business online:

2. Write Out a Home Service Business Plan

Writing out a business plan is crucial as it provides a roadmap for success. It guides your decisions, strategies, and actions. A Next Gen Personal Finance study found that a business is 260% more likely to launch with a business plan. Excellent Business Plans also conducted a study and found that a well-crafted business plan can help a business’ growth by up to 30%. If you have no idea how to write a business plan, here are some tips on what to include:

  • Define your home service business: Detail how your services will address the needs of the target market, and why they should choose your business over competitors
  • Set changeable goals: A business plan is a living document. This means that it will change the more you learn about the industry and market trends, technologies, and all that. So set regular goals. But also set a plan on how to track those goals and when it’s time to change it
  • Establish a brand identity: Come up with your business name, logo, values, tone, visuals, story, and more. This is highly important as it will differentiate you from your competitors and foster credibility and trust 
  • Develop a marketing strategy: Outline a marketing strategy to attract and retain customers. You can do market research to see the best strategies for your service sector and demographic. According to Podium, the top marketing strategies for home service businesses are search engine optimization (SEO), content marketing, social media marketing, and reviews, to name a few
  • Describe your day-to-day operations: This should include equipment, logistics, scheduling, and staffing (if you plan to hire). It’s also the section where you develop systems and processes to ensure efficient service delivery and customer satisfaction
  • Make a realistic budget: Include startup costs, monthly expenses, and revenue forecasts. Do a break-even analysis to determine total revenue to total costs. This will also help you see if you need funding or not
  • Create a pricing strategy: Check market rates, overhead costs, and desired profit margins to determine how you will price your services. For this, you can consider competitive pricing or value-added services for a higher price
  • Detail the legal and regulatory requirements: Besides writing down all the legal and regulatory requirements, you also need to plan out when and how to get licenses, permits, insurance, etc

3. Create a Home Service Business Website

Creating a home service business website is your best strategy to attract customers. A 2022 On The Map study saw a massive 98% of consumers use the internet to find local businesses. Plus, most people who search for home service businesses online don’t have a specific provider in mind. So by creating a website, you increase your chances of attracting and converting these people. To make your website even more effective, follow these tips:

  • Optimize your website: This includes great design, fast loading speed, easy navigation, strategically placed call-to-action buttons, featured location and contact details, and robust security measures. Remember, it only takes 0.05 seconds for a user to form an opinion about your website. If they don’t like what they see right away, they’ll immediately click away, thus increasing your bounce rate
  • Make your website mobile-friendly: According to Zipdo, 56.1% of home service searches happen on mobile phones. If your website isn't optimized for mobile, it will look bad, be hard to use, and take a long time to load. As a result, people may not want to do business with you
  • Produce quality and relevant content: If you want people to stay on your website long enough to convince them to get your services, post informative, engaging, and relevant content. One great strategy that home service businesses like to do is write ‘how to’ and other informational blogs. At the end of these blogs, they add a compelling call to action to get their services
  • Incorporate customer reviews and testimonials: One survey saw a whopping 92% of people say they don’t trust a home service business if it doesn’t have any online reviews or testimonials. So always have a section on your website for this. Also, find ways to encourage old customers to add their reviews
  • Update your website regularly: Fresh content, maintenance, and security updates will help maintain website credibility and professionalism. You should also track website analytics and make improvements to the areas that aren’t doing so well
  • Implement SEO strategies for organic traffic: With SEO, you can boost your website's ranking to the top of Google's search engine results pages (SERPs). A First Page Sage report showed that the first website on the search engine generates 39.8% of click-through rates. The second and third pages get 18.7% and 10.2% of the clicks, respectively. Baker Brothers Plumbing is the first website that appears when you search ‘Plumbing in Dallas, TX’. This gets them 22,6000 organic visitors every month, estimating a traffic value of $386.3k
  • Take advantage of Google ads: Paid ads can raise the costs per click (CPC) by $40 for certain home services. Here are the findings from Invoca’s study on home services and CPC for Google ads:

4. Formulate a Marketing Strategy for Your Home Service Business

Formulating a marketing strategy for your home service business is a big factor in success. This is because it involves finding the best promotion channel for your service. So study what your target audience likes and how they behave. Look at your competitors. Choose the best platforms to effectively connect with and attract potential customers. Here are some of the best marketing channels to consider:

  • Search engine optimization (SEO) - 98% of people use the internet to find local services, making this the best marketing strategy
  • Google Local Service - This is a paid advertising platform dedicated to local service providers. 82% of consumers are likely to choose a local service that is advertised on Google
  • Google Business Profile - Home service businesses with a verified Google Business Profile listing are 2.7 times more likely to be considered reputable 
  • Social media marketing - Social media is where 45% of customers find home service providers. What's more, most customers like to engage with local businesses through social media
  • Content marketing - Businesses that blog receive 97% more links to their website. This will help boost your website to the top and get more traffic and leads 
  • Email marketing - This helps home services generate 50% more leads for 33% less investment
  • Referral programs - When looking for a home service provider, 92% of people trust referrals from people they know
  • Review sites - 82% of customers looking for home service providers say that review sites are very valuable to their search
  • Community involvement and sponsorships - 91% of people in a local area are likely to get a service that supports a good cause, given similar price and quality
  • Networking and word-of-mouth - 50% of home service decisions are heavily influenced by word-of-mouth recommendations

PRO Tip: Choose only the most effective marketing strategies for the type of service you provide. Avoid spreading your marketing efforts too thinly so that you can fully focus on the most relevant channels.

5. Organize Your Home Service Business Finances

Organizing your home service business finances will give you a good idea of your overall costs. It will also show you whether you need funding or not. According to Jobber, it costs around $1,135 to $18,50+ to start a home service business. Here is their breakdown:

Besides that, you’ll need to add in your other expenses. This includes:

  • Training and certification - $500-$5,000

  • Marketing budget - 10-20% of your expected revenue

  • Monthly operational expenses - $500-$2,000

  • Vehicle expenses - $300-$1,000

  • Office expenses (if applicable) - $200-$800

  • Staff salary or contractor payments (if applicable) - $1,000-$5,000

  • Taxes - around 25% or 35% of your expected gross revenue

  • Legal and professional fees - $500-$2,000

  • Miscellaneous expenses - $200-$1,000

Remember, these prices are just estimates. You need to make a more direct pricing depending on what you need. From there, add everything up and see the total budget you’ll need for the first couple of months without income. If you can’t afford it, consider funding from the US Small Business Administration (SBA), local bank business loans, a business credit card, or equipment financing. However, you need to come up with a plan on how to repay those loans or investments should anything happen. Also, most of these funding options require a detailed business plan with an executive summary and total expenses at the end.

6. Register Your Home Service Business

Registering your home service business will depend on the type of service you provide, your location, and the scale of your operations. So you’ll need to do your own research about the specifics. If you’re required to register your home service business, one of the most important things to consider is your business structure. Let’s go over these:

  • Sole proprietorship: This is the most common business structure for a home service provider. This setup means that the business is owned and operated by a single individual (you). This also means that you’re liable for all the debts and obligations of the business
  • Partnership: This business structure means that there are two or more individuals that share ownership of a business. A general partnership means that everyone involved has equal rights and responsibilities. A limited partnership means that a person(s) has more liability
  • Limited Liability Company (LLC): The LLC structure combines a sole proprietorship or partnership with a corporation. Here, you are only considered a member of the home service business. So if your business gets sued or can’t pay its debts, your personal stuff - like your house, car, or savings - will be safe. Your legal responsibility is limited to what you’ve invested in the business
  • Corporation: This is the least common business structure for small business owners. This is because, though it has the most liability protection, it comes with complex requirements. This includes issuing stocks, keeping detailed records, and having regular meetings

Once you choose your business structure, you can now register your business name, obtain necessary permits and licenses, register for taxes, open a business bank account, and secure insurance coverage. The steps for these will depend on your area and type of service.

7. Set the Pricing for Your Home Service Business

Setting the pricing for your home service business requires careful consideration of your costs, competitors' pricing, market demand, and the perceived value of your services. The goal here is to aim for a balance between competitiveness and profitability. Here are some of the typical pricing for the most common home service businesses:

  • Plumbing - $120-$350 to $500-$800

  • Cleaning - $120-$130 to $350-$400

  • HVAC maintenance - $100-$300 (can go higher if you discover any issues)

  • Electrical - $150-$600

  • Landscaping - $1,258-$6,031

  • Painting - $4.69 per square foot

  • Pest control - $300-$500

  • Pool services - $150-$300

  • Interior design - $150-$200 per hour

PRO Tip: It’s a good idea to offer value-added services. For this, you need to think of additional services or upsell opportunities that complement your core offerings. This can include add-on services, maintenance plans, or premium packages. You’ll be able to increase revenue and profit margins.

8. Start Performing Home Service for Clients and Collect Reviews and Testimonials

To start performing your home service business, you need to get your first few clients. Here are some strategies you can follow for that:

  • Tap into your network: Reach out to your friends, family, neighbors, and acquaintances to let them know about your new home service business. Ask if they want to try out your services or if they know someone who does
  • Offer promotions or special deals: This will attract new clients to try out your services. You can give discounted rates for first-time customers or package deals for multiple services. You then need to promote these offers through social media, word-of-mouth, flyers, etc. A Reddit user said his power washing service became known in the neighborhood because of flyers he left in everyone’s mailboxes
  • Partner with established local businesses or organizations: This will help you grab qualified leads if the community group complements your home service business. For example, if you offer landscaping services, you can partner with real estate agents, property managers, or gardeners. They will recommend you whenever someone needs your service, and vice versa

You can encourage repeat business and referrals for your home service business by providing excellent customer service and ensuring customer satisfaction. This will also make your clients very willing to leave a positive review online. According to LocaliQ, 92% of customers will trust a home service provider if it has at least a 4-star rating. So go above and beyond when offering your services. 

However, people only tend to leave reviews when they aren’t happy with a business. This is why you should always ask and encourage clients to leave a review. One way to make it easy for them is to send a thank-you email, say that you’ll greatly appreciate a review, and then provide a link to a review platform.

9. Keep Your Home Service Skills Up to Date

Keeping your skills up to date is super important to remain relevant in the industry - if not required. A home service business that deals with hazardous wastes requires annual OSHA training to ensure safety for everyone. In many areas, plumbers must complete courses to maintain their licenses or certifications. Even if training is not required, it’s still highly advisable to keep up with the evolving preferences of your audience. 

One great example of this is Sarah’s Sparkling Services. The owner, Sarah Smith, invested in attending industry events and online courses to acquire new techniques and optimize her cleaning processes. Her biggest win was recognizing the growing demand for eco-friendly cleaning products. After much researching, sourcing, and studying, she added an option to use eco-friendly products and equipment. This strategic move not only set her business apart but also earned her a loyal client base in her local area. 

What Are the Top Home Service Lead Generation Companies to Help You Get Customers?

The top home service lead generation companies to help you get customers include:

  • HomeAdvisor: This website connects homeowners with local service professionals across various home service industries. You can sign up here to receive leads matching your service offering and geographic location
  • Angi: This website provides a platform for homeowners to find and review service businesses in the area. You can use this to generate leads and build your online reputation with positive reviews
  • Houzz: This website is where homeowners go for home improvement professionals. You can create a profile to showcase your work and connect with potential clients. This is best for interior designers, remodelers, and landscapers
  • Nextdoor: This website is an online social networking app that can turn your neighbors into customers. You can create a business profile to engage with them and offer your services as needed

Why Is Local SEO the Key to Success When Starting a Home Service Business?

Local SEO is the key to success when starting a home service business because Google is the number one place people search for these providers. A Semrush study found that 46% of Google searches were for local businesses. This skyrocketed “business near me” searches by 400%. Through local SEO strategies, Brody Pennell, an HVAC company in Los Angeles, CA, gets 4,700 visitors to their website every month. This equates to a traffic value of $52,6000!

It costs $3,000-$5,000 to start a home service business, according to the US Small Business Administration. This already includes all your finances - from training and certification to taxes and monthly operational expenses. You need to save this much or more to start with a stable financial foundation. However, you can get funding if you want to start right away. 

It’s a good time to start a home service business in 2024 as the market is projected to grow annually by 18.91% (source: Invoca). As households increasingly prioritize convenience, the demand for in-home service professionals is great. Plus, the need for basic home services will always stay relevant as long as there are homes. The home service industry is worth $600 billion and is still growing today!

The skills you need to start a home service business include:

  • Proficiency in the service you offer
  • Strong communication
  • Customer service
  • Time management
  • Organizational
  • Basic business

  • Field service management 

  • Marketing

  • Financial management

  • Problem-solving

  • Adaptability

The legal requirements for starting a home service business include:

  • Registering your business with the appropriate government authorities
  • Obtaining any necessary permits or licenses
  • Getting liability insurance
  • Complying with tax laws and regulations
  • Following local zoning regulations and obtaining any required approvals
  • Ensuring compliance with health and safety regulations (if your business involves hazardous materials or equipment)
  • Creating legally binding contracts and agreements for your services
  • Protecting any intellectual property associated with your business
  • Understanding and complying with any industry-specific regulations or standards

Remember, not every service-based business needs these legal requirements. You’ll have to research the specifics of your home service business and local area.

SUMMARY

If you want to expand your home service business and unlock its full potential, learn how to do local SEO with local lead generation training. You’ll learn all you need to know to rank your home service business website on the first page of the Google SERP. This will give you 60% of the consumers that search for your service. 

Which Courses Can Teach You How to Start a Home Service Business?

Home Service Academy

The Home Service Academy by Johnny Robinson and Sergio Silesky teaches you how to start a remote home cleaning business. The course curriculum takes you through setting up your business, finding contractors to outsource work, and generating home cleaning leads. To learn this type of home service business, you can get their course for $2,600. The course overview includes:

  • Business Foundations

  • Finding Service Providers

  • Customer Acquisition 

Home Service Launch

The Home Service Launch by Oliver and Josh Lester is a coaching program about how to start and scale a door-to-door window cleaning business. The program's main focus is to improve your D2D sales techniques and hire a team of workers. The $7,500 program comes with this comprehensive course overview:

  • Buyer Psychology

  • Seller Psychology

  • How to Get Started

  • Doubling and Tripling Your Numbers Overnight with Workers

  • How to Sell Jobs Going Door to Door

  • On the Door Training

  • In Field Footage

Conclusion: Should You Start a Home Service Business?

conclusion-lead-gen-maps

You should start a home service business if you’re passionate about a certain trade, enjoy working independently, and genuinely want to help others. These three factors serve as the foundation for success in the home service industry. It will encourage you to learn the necessary skills, go through the startup challenges, and provide the best service possible. 

However, if that’s not for you, you can consider helping other home service business owners through the local lead generation business. With local lead generation, you can earn $50,000 a month without leaving your house! You don't even need to go through the challenges and risks of starting a business. All you need to do is create a website for a specific home service, rank it in Google using local SEO, and rent it out to your potential clients. Since these home service businesses want to be on top of the Google SERP, they will be willing to pay you big for an already-ranked website. This is one of the best alternatives to starting a home service business as you’ll be helping households find good services. 

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Ippei Kanehara
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$52K per month providing lead generation services to small businesses

Ippei.com is for digital hustlers, industry leaders and online business owners.

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