Who should start a handyman business? Well, it’s a business for the skillful and the handy people. We are talking about the plumbing pioneers, crafty carpenters, and skillful electricians. The need for handyman services keeps growing alongside the housing market in the USA. This makes up for the right opportunity to start a handyman business.
Who are the handymen? These are the remarkable people who are building and keeping this huge world operational with work like carpentry, drywall, plumbing, etc.
Now, before you jump into starting any business, it’s wise to have a clear understanding of the industry you are getting into. Is there substantial growth potential? Do you have any passion for what you are about to do? Is this the right business idea for you to try? Here is a complete overview of the handyman industry –
Pros & Cons
Before you jump into this industry, consider the pros and cons of starting a business as a handyman service provider.
| Pros | Cons |
| Working in this industry is rewarding for people who want to help out a community using their skills. The startup cost required is minimal. Potential to learn new skills. | The industry is highly competitive, and it takes time to build a reputation. There are plenty of risks associated with mistakes. |
Industry: Handyman Industry Size & Trends
A handyman service provider provides different types of services, including repairs, changes, and adjustments to different parts of your home. It could be drywall repair, plumbing work, and carpentry. The industry is a $390.9 million industry with millions of people working under it.
The market share concentration for this industry is low in the USA. It means that the top four companies within the handyman industry generate less than 40% of the industry revenue. As the market share concentration is low, most of the small handyman business owners are non-employers. Only the ones that expanded and grew employ close to three or four employees within their handyman services. Here’s a detailed overview of the industry.
Industry Overview: Handyman Business In Recent Times
Handyman business had a massive surge during the pandemic, with new home improvement trends going viral. However, the poor consumer confidence and limited opportunities for growth have made the handyman industry quite sluggish recently.
In addition, many handyman businesses went into the commercial side of things to experience a new market and more gig opportunities. The marketing for most of these businesses, up till now, has predominantly been through word of mouth. A proven way to get clients for handyman businesses has been by building a strong reputation and working to strengthen it through consistent efforts.
Industry Size & Growth
Here’s a detailed insight into the size and growth of the industry –
Size: The handyman business revenue has faced a slight downfall (by 0.8%) between 2018 and 2023. The push during the pandemic was somewhat positive, but it became sluggish soon. The handyman business industry was approximately estimated at $390.9 million in 2023.
Growth: It has a projected growth leading up to $1.8 market size by the end of 2033 at a CAGR of 16.5%.
Number of Businesses: Currently, there are 162,000 businesses operating in the USA.
Employment: since most business owners are non-employers, the business-to-employment ratio doesn’t have a vast positive difference. Currently, 1,476,820 people work in the U.S. as handyman service providers which isn’t much compared to 162000 active businesses.
Trends & Challenges
Handyman Business Trends:
However, the handyman industry has been through a lot of shifts lately. Here are some key trends that are transforming the handyman industry slowly –
Smart Home Technology Integration: Smart Home Technology installation and maintenance has become mainstream within the past few years. Smart home cameras, thermostats, and voice-controlled door locks are now very common. Handyman service providers will soon require skills to work on smart home devices.
Green and Sustainable Practices: Homeowners are focusing on green energy and eco-friendly homes. This also means that the handyman services have to be eco-friendly. The use of energy-efficient renovations, waste-reducing practices, and sustainable materials are the new ways for house improvement.
Niche based services: Many businesses are expecting growth in their handyman service business by providing niche-based handyman services such as furniture assembly, home organization, custom carpentry, etc.
The landscape of handyman services is also seeing a trend in new services like providing virtual handyman consultation through video calls, etc. These consultations help businesses assess projects, provide advice, and provide estimates virtually.
Most handyman service providers in the USA have a website and some level of social media presence. They also provide online booking services for customers.
Handyman Business Challenges:
Despite the latest trends and growing housing market opening up opportunities, handyman businesses face different challenges. A few common challenges here would be as follows –
- It can be difficult to attract customers in this business if the marketing is not extraordinary. Many businesses have fewer customers due to a lack of effort in proper marketing.
- Some of the handyman services are periodic. Although necessary, handyman businesses stuck at periodic services cannot survive in the long run if they aren’t diversifying their services.
- It’s important to scale a handyman service business. Business owners often find it challenging to employ skilled individuals who are passionate about working in the handyman industry.
- Service providers themselves often lack the skills they need to provide excellent services. This can also lead to employees missing efficient training.
Who Is Working In This Industry?
The handyman industry is usually a male-dominated industry, with 96% male and 4% female employees working in this industry. 41% of them have a high school degree, with most handyman workers with an average age of 47 years.
Startup Cost: How Much Does It Cost To Start A Handyman Business?
Handyman business is easy to start. The main reason for that ease is a low startup cost. Business owners can invest in old equipment to reduce the startup cost. As the business goes up and the revenue sees a boost, owners can invest in better equipment. Overall, a minimum startup cost ranging between $2300 to $5900 is necessary for starting a handyman business. Here’s a breakdown of the startup cost you have to gather –
| Start up cost | Ballpark range |
| Naming & Incorporation | $150 to $200 |
| Licenses & Permits | $100 to $300 |
| Insurance | $100 to $300 |
| Business Cards & Brochures | $200 to $300 |
| Website Setup | $1000 to $3000 |
| Marketing budget | $200 to $500 |
| Total | $2300 to $5900 |
Earning Potential: How Much Can You Earn From A Handyman Business?
The earning potential from any business has a big say in whether you should start it or not. Handyman business is no exception. In this case, your earnings will depend on two most important metrics –
- The number of customers a business is acquiring.
- The ongoing expenses and expenses related to hiring staff.
However, if you know of a few hacks, your earning potential will go up. For example, when you pass on the expenditure related to any materials to your customers, the earning potential goes up. Service providers charging their clients $50 per hour with a minimal amount spent on materials can keep a profit margin of 90% in the handyman business. It’s a matter of good marketing and calculation, management, and communication.
Handyman business owners work solo during their first one or two years. They usually work 15 hours a week, which is good enough for them to earn $39000 in annual revenue. The minimum profit generated by a handyman business amounts to close to $35000.
As the business gains momentum, a handyman service provider can work 40 hours a week with staff added. They can also charge clients with $65 per hour for the services provided. Once your business gains a good reputation, you can also hire another handyman to work for you. This way, the business will expand, but the profit margin might slow down a little bit.
Entry Barrier: Common Entry Barriers In The Handyman Industry
It’s not hard to notice that the handyman industry is populated with many service providers. So, the entry barrier is quite high for handyman service businesses as well. It will be difficult to attract your customers, and retaining them is more difficult in a competitive market. However, word-of-mouth referrals should help you gain some edge over your competitors.
It’s a big challenge to manage an inventory with different types of tools, supplies, and materials. Successful businesses track their system properly, prioritize their supplies, and keep their workspace well organized.
Most handyman business owners are either baby boomers or Gen X, so integration of new technologies is very overwhelming to most of them. Without proper tech integration, getting into the handyman service business will be difficult.
Also, the repair cost related to handyman business equipment can be straining for small businesses starting it for the first time.
Handyman Business Opportunities: Who Are Your Potential Customers?
If you are up for a challenge, start looking for handyman business opportunities in your area. Start by analyzing the services your customers are already providing. For example, if your local market doesn’t have a handyman who does electrical work, you can fill in that gap.
However, it’s important to understand who your target customers are in the handyman business industry. Your target customers are homeowners and commercial building owners. It would be best to identify and understand different customer segments. Each segment has its specific needs, and your services should be tailored to help a particular segment that you can serve the best. In addition, take the market gap into account when choosing your customer segment.
Good customer segmentation means deciding if you will provide smart home appliance maintenance to homeowners or plumbing services to big corporate buildings. Even all your handyman business marketing efforts are also linked to choosing the right customer segment for the business. Now, here is a list of potential target audiences you can choose according to the customer segmentation –
- Homeowners: These customers are usually looking for maintenance, repairs, and home improvement. Homeowners look for reliable services from skilled handyman service providers.
- Businesses: business owners who need such services require usually look for repair services, installations, and maintenance. They want timely service and efficient skills.
- Property Management Firms: handymen usually do repair work and serve tenant requests for the property management firms.
- Seniors and Elderly Individuals: modification and safety improvements are two big demands of the elderly individuals in this industry.
- Single Women Living Alone: these customers usually look for home improvement, maintenance, and safety-related repairs.
Frequently Asked Questions
Here are some common questions related to the handyman industry –
1. What Type of Incorporation is Best for a Handyman?
It’s mandatory to run and operate a business as a separate legal entity from the business owner. This gives the business owner liability protection and helps them save their businesses. A handyman business owner can set up the business as a sole proprietor or as an S Corporation.
2. What Handyman Jobs Pay The Most?
If you are thinking of choosing the right market segment for a handyman business, here are some of the best-paying services you can provide –
- Shovel Operator
- Tradesman
- Swamper
- Gardener
3. What are the Weaknesses Of Handyman Services?
Some handyman service providers lack the skills and experience to nail the job they do. Some tasks may sometimes require advanced skills, tools, and materials. Local handymen lacking in all these areas might struggle to gain of their clients.
Conclusion
Even as a competitive industry, the handyman business attracts people who want to start a business. A minimal startup cost and a high profit margin are two important reasons for starting a handyman business. But before you choose this idea to be your best business idea, consider all the challenges and opportunities present in the market. Take a close look at your competitors and go through their customer reviews and testimonials to identify gaps to fill in.
So, what do you think of this business idea? Do you plan to start a handyman service? Share your inputs through the comment section.
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