Across the country, there’s a growing demand for skilled and experienced plumbers. In fact, according to the United States Bureau of Labor Statistics (BLS), the job outlook for plumbers, pipe fitters, and steamfitters is projected to grow 4% between 2024 and 2034 alone, making now a great time to break into this skilled trade.
As far as business ideas go, the plumbing field is also highly regulated and therefore difficult to break into. Plumbers need to complete the right training and licensure requirements in order to maintain public safety and code compliance in their work.
If you’ve been thinking about starting your own plumbing business, then, there are some things you need to know before you get the ball rolling.
Do you need to be a licensed plumber to start a plumbing business?
This is the single most common question people tend to have when it comes to starting a plumbing business. The simple answer to this question is yes. Plumbing is a regulated and skilled trade—and you must be a licensed plumber (or hire a licensed plumbing contractor as a qualifier) in order to start a plumbing business.
Not only is a license required to legally perform any plumbing work, but it is also needed to pull any necessary permits as part of a plumbing job. Operating a plumbing business without proper licensing can result in severe fines and even legal action—so this is not something you’ll want to take a chance with.
Keep in mind, too, that licensure requirements can vary not just by state, but by municipality. Be sure to research the specific requirements for starting a plumbing business in your county or city for clarification before you move forward.
Journeyman vs. master plumber distinctions
It is also important to note the difference between a journeyman and a master plumber—as journeymen are legally required to work under a licensed contractor. Only master plumbers are permitted to operate their own plumbing businesses.
So, what’s the difference? A journeyman is a plumber who has four years of experience and typically works as an apprentice under a master plumber’s direct supervision. A master plumber, on the other hand, has at least seven years of experience (including two as a journeyman) and has passed state licensure exams.
Those who have just started off in the field are often referred to as apprentices; they are required to work under a licensed journeyman or master plumber, but they are not formally licensed and therefore cannot start their own businesses.
Plumbing contractor license
In the US, requirements for earning a plumbing contractor license vary by state and locality, but you must typically be licensed to legally operate your own plumbing business.
Common requirements to obtain a plumbing contractor license include:
- Being at least 18 years old.
- Submitting fingerprints for a criminal background check.
- Having several years of plumbing experience (often around four years), or a combination of education and hands-on training, including journeyman-level experience.
- Carrying general liability insurance and workers’ compensation coverage (where applicable).
- Passing a state or local plumbing contractor exam.
In addition to obtaining your initial plumbing license, most jurisdictions require periodic renewal—often every 1–2 years—along with completion of continuing education hours to maintain your credentials.
Common barriers when starting a plumbing business
Even once you’ve put in the work (and gained the experience) necessary to earn your plumbing contractor license, there are some additional obstacles you’ll need to overcome in order to start your own plumbing business.
For starters, you’ll need to carry proper liability insurance coverage to protect you in the event of a costly error on the job. Without liability protection, your license may be rendered invalid, and you may be on the hook for costs related to mistakes in your work. If you hire other plumbers, you may also need to carry workers’ compensation. Insurance coverage is costly yet important, so you’ll need to factor this into your operating expenses.
Depending on your service area, there may also be additional permits you need to obtain from your local government or municipality. Be sure to do your research here and familiarize yourself with local plumbing codes to minimize your risk, as errors and regulatory violations can result in suspension of your plumbing license.
Plumbing business startup costs
In addition to general liability and workers’ compensation costs, there are many other expenses involved in starting a plumbing business that you’ll need to prepare for. Here are some common plumbing business startup costs with general estimates to help you get a better feel for what to expect:
- Work vehicle (van or truck) – $45,000-$70,000+
- Specialized plumbing tools – $1,000-$3,000+
- Initial inventory (pipes, fittings, fixtures, and other parts) – $1,000+
- Licensing and exam fees – $500+
- Scheduling and invoice software – $50-$200+ per month
- Marketing and branding – $100+ per month, but this can vary greatly.
Keep in mind, too, that insurance costs can rise as you hire employees, so you’ll need to plan accordingly as your business scales.
How to start a plumbing business with no money
If you don’t have the funds to start a plumbing business from the ground up, there are some alternatives that may be worth exploring. You might consider, for example, starting out as a subcontractor for another plumbing business or even partnering with a licensed plumber—which allows you to bring in an income while gaining valuable experience in your trade.
Some plumbers starting out will also choose to rent/lease tools and vehicles instead of buying them outright, which can cut down on up-front costs.
Financing is another viable option, but you’ll need to be careful about interest rates and repayment terms. SBA loans, specifically SBA 7(a), are a common option offered through the Small Business Administration.
Above all else, it’s important to remember that getting your plumbing contractor license and insurance is essential if you want to start a legal plumbing business. In other words, these startup costs are not optional, and you will need to plan for them accordingly.
Plan your plumbing business before applying for licenses
Before you look into the types of business licenses and permits you’ll need to get the ball rolling on your plumbing business, it’s always a good idea to have a business plan in place. A business plan not only provides a blueprint as you move forward, but can serve as a useful risk mitigation tool as well.
As you craft your business plan, it can be helpful to begin by defining your service focus. Will you offer residential repair, new construction work, commercial plumbing, emergency services, or a combination of both?
Your business plan should also cover:
- Your estimates for realistic startup capital needed (remember that initial equipment investments may be significant).
- Research on local pricing and competition.
- Permit and inspection timelines (as delayed timelines may delay revenue).
- Projections for early cash flow challenges.
Legal and structural setup
From a legal standpoint, there are some additional steps you may need to take as you launch your plumbing business. To protect your personal assets, for example, you’ll want to choose the right business entity structure to suit your needs.
For many plumbing contractors, this will be either a limited liability company (LLC) or a corporation. Likewise, obtaining an Employer Identification Number (EIN) through the IRS will be required if you opt for either of these business structures.
As a business owner, keeping your business expenses separate from your personal expenses is also recommended for easier tax preparation and accounting.
How to start a plumbing business in Florida
To start a business in Florida, remember that the requirements can differ from other states. Here are some things you need to know about Florida-specific requirements for your plumbing business:
- Licensing is handled through the Florida Department of Business and Professional Regulation (DBPR).
- Licensed plumbing contractors must have a minimum of four years of experience to sit for the Florida Plumbing Contractor Exam.
- Plumbing licenses must be renewed every two years with at least 14 continuing education requirements in between.
- Permit and code requirements can vary by municipality.
- Advertising as a licensed plumber without the proper credentials is illegal and can result in fines/penalties of up to $1,000 and one year in jail for even a first offense.
Getting your first plumbing clients
Once your plumbing business is up and running, here are some practical tips you can follow to start building your client base:
- Build a strong local reputation.
- Leverage online reviews and testimonials.
- Join local contractor directories.
- Build relationships with local builders and property managers.
- Offer round-the-clock emergency services.
- Provide customer incentives for referrals.
Conclusion
At the end of the day, a license is required if you plan to open a plumbing business. For many aspiring business owners, licensing is the primary barrier—but it’s essential to maintaining public safety and following code regulations. Through the right apprenticeship and other training, aspiring plumbers can gain the experience needed to obtain their licenses and pursue their dreams of starting a business.
Looking for assistance as you navigate the complex process of starting a plumbing business? Tailor Brands is here to help. With professional guidance and planning, you can reduce your financial and legal risk while preparing for the significant startup costs and insurance/bonding requirements of a plumbing business. Get in touch today to learn more about what the Tailor Brands team can do for you!