Starting a handyman business is easier than you think, even when your budget to launch one is limited.
It comes down to seven steps— establish your services around small odd jobs, fund the basic upfront costs, open a separate account for your business finances, get an LLC, obtain general liability insurance, get any required licenses or permits, and focus on getting your first 3 clients.
Step 1 – Start With Small Odd Jobs and Price Them Profitably
The main complaint people have is that it’s so difficult to find a reliable handyman who shows up on time, charges a reasonable rate, and does the small odd jobs really well.
This is the hole you should fill when starting a handyman business. Go after the jobs no one wants to kickstart your business. Going after the little stuff first allows you to get cash flow and build your skills and reputation. This will lead to new jobs and bigger projects, and from there you’ll be able to take your business to new heights.
Here are some small services to consider offering:
- Assembling furniture
- Doing light fixtures
- Fixing doors and their fixtures
- Cleaning out gutters
- Hanging art or other decor
- Babyproofing homes
- Setting up/repairing smart home fixtures
- Power washing
- Repairing holes in drywall
- Fixing curtains and blinds
It’s also essential to price your services profitably. Just because they’re small odd jobs, doesn’t mean you should do them for pennies. You need to make money too.
The good thing is that you’ll likely get a good amount of business once you get rolling because what you do is in demand.
We suggest pricing per service for small odd jobs. This is because you’ll get them done pretty quickly, so charging per hour doesn’t make a whole lot of sense or money. Here’s a good way to figure out what to charge:
- Determine how much money you want to make per day
- Figure out how much you need for gas per day
- Determine how much you want to set aside for taxes
- Let’s say you want to make $300 a day, gas is $60 a day, and you want to set aside 15% for taxes. Charge $138 to assemble a large furniture piece ($100 for service, factor in $20 for gas, and $18 for taxes) and do three of those a day to make your goal. This is a rough estimate. But you want to factor in everything that could impact your profit.
You’ll also want to research how much the average handyman is charging for a specific service just to make sure you’re within a range people will actually pay for.
But keep in mind that once you master the services you’re doing and build a reputation for showing up on time and getting the job done with no BS, people will be more willing to pay whatever you charge.
Step 2 – Make Sure You Have Enough Money to Fund The Basic Upfront Costs
You may need to do a couple of jobs first to save up enough money for everything on this list. But these are the most basic upfront costs you’ll need money for:
- Business Registration- You need to register your handyman business to look and be more professional. You’ll need to register your business name (avg. $90). And we suggest getting an LLC ($129 on avg.) over a Sole Proprietorship so that none of your personal property and money are on the hook if someone sues you or you get into legal trouble. The exact amount you’ll pay depends on your state.
- Licenses and/or permits- You may need a contractor’s license and/or permits specific to the type of services you want to offer (HVAC, appliance installation, carpentry, drain cleaning, fencing, etc). Many states don’t require additional licenses or permits but if they do, it can cost up to $1,000. For example, construction contractors must be registered in Washington state and have a contractor’s license. The fee is $124.70. But a general contractor’s license isn’t required in Colorado.
- Tools and Equipment- Many people already have the tools they need to start their handyman business (tape measure, level, hammer, pliers, drills, flashlights, shop vac, gloves, safety equipment, saw, knives, etc). The cost of tools and equipment vary greatly. However, you’ll find the best deals at garage sales, thrift stores, and platforms like Facebook Marketplace or OfferUp. You may get lucky and find people who want to give tools away, especially at garage/estate sales, on FB marketplace, and on OfferUp.
- Insurance– Insuring your handyman business is non-negotiable. General liability insurance ranges from $500-$2500 per year, which usually works out to about $20-$200 a month.
- Transportation– The most ideal scenario is you already own a truck and only have to worry about gas, insurance, and maintenance costs. However, a common scenario is having to purchase a new or used truck. You’ll be on the hook for a monthly car payment (avg. $735 for new cars and $523 for used), gas (avg. $100-$150/mo), insurance (avg. $100-$300), and maintenance.
Again, these are just the basics. You’ll get away pretty cheap if you own a truck, have or thrift all of your tools and equipment, and don’t need any extra licenses or permits.
Step 3 – Open A Separate Bank Account for Your Handyman Business Finances
One of the most important but overlooked steps is opening a separate account for your business finances. It’s a way to ensure all your purchases, bills, etc., go through a unique account so that you have a detailed history of what’s going on with your business.
If you don’t have an LLC yet or don’t have money to put into a business account, you can usually open another personal checking or savings account for free without an initial deposit. Call your bank or go to a branch and sit with a banker to find out the requirements for a free account.
It’s also important to establish a single location for all of your business receipts and business finance-related documents. This can be a paper folder you already have lying around the house. Or you can use Google Drive for free if you want to organize everything digitally.
Step 4 – Get an LLC
There are two main reasons why we suggest an LLC over a Sole Proprietorship. First, LLCs give you an extra layer of liability protection. So if something goes wrong on a job, which can definitely happen in this industry, your personal assets will be protected if a client sues you.
Second, forming an LLC helps legitimize your business. It tells your future customers that you’re not just some guy with a truck. People will be more likely to let you into their homes or offices if you’re operating as a real business.
You can go to your state’s government website and fill out and pay for the LLC application yourself ($90 to register your business name, $129 on avg. to get an LLC).
If you’re nervous about getting the details right, use a business formation service. It adds an extra cost, but you’ll have peace of mind knowing it’s getting done right.
ZenBusiness is an excellent solution to consider. Just follow the prompts on their website, and they’ll legally register your handyman business in your state. You pay $0 for their service, but you’re on the hook for state filing and formation fees.
Step 5 – Get General Liability Insurance
You need general liability insurance at the bare minimum to operate safely. General liability insurance covers various claims, like property damage, bodily harm, and advertising injury.
While having an LLC does add some liability protections, it doesn’t pay out claims if something goes wrong. For a handyman, proper insurance can be the difference between bankrupting your company or just paying a deductible. It’s better to be safe than sorry and protect yourself.
General liability insurance ranges from $500-$2500 per year, which usually works out to about $20-$200 a month. You should have at least $10,000 in general liability coverage with personal injury protection.
Consider getting the following insurance when you become profitable and the circumstances are appropriate:
- Inland marine insurance– covers materials and equipment in transit or those stored in a place away from the business’s primary location, like a warehouse.
- Worker’s compensation insurance– helps pay for medical bills, loss of wages, rehabilitation, etc for employees who get hurt or sick on the job
- Professional liability insurance– protects you from financial loss resulting from you or someone on your team providing inaccurate or unprofessional advice to a client
- Handyman bonds-protects you from potential losses and liabilities when you fail to meet the terms of an agreement or contract
Step 6 – Get Any Required Licenses/Permits
Fortunately, you may be in a state like Kansas, Colorado, or Iowa, where you don’t need any permits or licenses outside of your business license to operate, saving you a good chunk of money at the start.
On the other hand, you may need a contractor’s license and/or specific permits to do the type of services you want to offer (HVAC, appliance installation, carpentry, drain cleaning, fencing, etc). License and permit costs vary but can reach up to $1,000.
For example, you need a contractor’s license in Washington state if you’re doing construction contracting work. You need a contractor’s license in Georgia if you’re going to work on projects valued at $2500 or higher. And you need a state license to work as a contractor in Florida.
Like your LLC, you can go to your state’s government site to get your licenses or permits yourself, or you can use a service like ZenBusiness to do it for you.
Step 7 – Get Your First 3 Clients
The foundation, structure, and legalities of your handyman business are taken care of. Now it’s time to get your first three clients.
The first one will probably be a friend or family member. The second one will feel like luck, maybe a referral from that family member or friend. And then comes the third client, which will be the start of your “legit” clientele that you got through real marketing.
You don’t have a lot of (if any) money to invest in marketing. But you do have a lot of time and there are a good chunk of basically free marketing channels and ideas to try. Many ideas will fail right now because you’re learning. But you’ll get the hang of it the more knowledge and experience you gain.
As mentioned above, homeowners complain a lot about not being able to find a handyman who shows up on time, charges reasonable rates, and can do small odd jobs really well. So, we suggest targeting middle-class homeowners as your ideal clients.
Establishing an online presence is a good first step because you can reach a lot of people and can keep costs low.
Start with a website. It doesn’t need to be anything fancy. Just have something out there so people can look through your services, see what you’re offering, and find out how to contact you.
If you have to create a free one, do it. It’s better than not having a website at all. But if you can afford to purchase a domain name and subscription to a website builder like Wix, do this instead. Your own website (www.myhandymanbusiness.com) looks more professional to people than a free one (www.myhandymanbusiness.wix.com).
And the customization options with a subscription to a website builder are way better. Wix has over 800 templates and plenty of options to consider that fit handyman services.
You can also add a blog to your website, where you can take advantage of search engine optimization (SEO) tactics that help your site and blog pop up when people search for your particular services.
In addition to your website, build a social media presence. Social media is perfect for any business owner with a limited budget because all of the major platforms are free to sign up for and use.
The marketing results you get on social media comes down to the content you post, how often you post it, and how you engage with others on your chosen platforms.
You should post a mix of quality content (images, videos, audio, livestreams, surveys, polls, etc) that your specific audience would resonate with that piques their interest in your handyman business.
You should post everyday, up to 3 times a day when just starting on social media to get the algorithm to recognize you as a legit user of the platform and start pushing out your content to people’s feeds.
And finally, you should answer every comment and direct message you get, as well as acknowledge every shoutout and repost. Join communities where your ideal customers are too.
As good as digital marketing is, don’t forget about offline marketing tactics. Leave flyers in neighborhoods, coffee shops, and other local businesses homeowners frequent. You could go to your kids’ school PTA meetings and talk to parents and homeowners there. You can plug into community events too.
Have a simple pitch prepared that highlights exactly what your ideal clients want, someone with a reasonable rate, who shows up on time, and can do all the jobs other handymen don’t want to do, really well.
How to Start A Handyman Business When Your Finances Are Limited
- Start with small jobs and price them profitably
- Make sure you have the money to fund the basics (business registration, licenses/permits, tools and equipment, insurance, transportation)
- Open a separate bank account for your business finances
- Get an LLC
- Get general liability insurance
- Obtain any required licenses and permits you need
- Get your first 3 clients
