How to become a self-employed tradesperson in 7 steps
Want to start a construction business? Thinking of becoming an electrician, plumber or handyman? This launchpad guide has you covered
Do you have a set of practical skills and the ambition to work for yourself? Want to have total control over how, and when, you do business?
If the answer is yes, then a career as a self-employed tradesperson could well be for you.
Between 2008 and 2016, the number of self-employed workers rose from 3.8 million to 4.6 million according to the Office of National Statistics, of which 30% were full-time skilled tradespeople.
Many of these tradespeople turned away from company jobs during the economic downturn, trusting their own skills and judgement to provide an income. It appears to have paid off with a UK self-employed person's mean earnings now standing at £5,000 more than the average UK annual salary.
If you want to set out on your own as a self-employed tradesperson, we've put together a list of seven essential things you need to consider before you do. Read on to find out more…
1. Get relevant business experience and training
Not just anyone can become a self-employed tradesperson: you need the right level of experience and skill to be able to complete jobs alone while keeping your customers happy. A specialisation in the field you want to work in is essential, whether you've gained this through an apprenticeship or another qualification.
Think carefully about the industry you want to go into; do you want to become an electrician or is a career as a plumber more appealing to you? Which trades are more aligned to your skills? Use the guides below to find out more about what each trade will require from you:
- Become an electrician
- Start a plumbing business
- Start a handyman business
- Become a painter and decorator
- Start a construction company
It's important you check that you have the relevant training and experience for your role. You can use the National Careers Service's job profile index for instance to find out what the requirements are for your trade of choice.
Developing some basic accounting skills will also help out when it comes to dealing with your finances and taxes. For help on this, view our guides to bookkeeping and managing your cashflow.
2. Put together a business plan
Once you've gained all the skills and experience you need, it's time to put together a business plan for your future career as a tradesperson. Though you might not need to share it with anyone, a realistic business plan will allow you to work out what finances you will need to set up and run your business, how you will grow your business, resources you'll need and so on.
3. Get your legalities and licences in order
Your first step towards making your business a reality is to set up a legal structure, which determines how you will operate.
There are a few options for this, but most people starting out on their own choose to become a sole trader, which is the simplest, most cost-effective option.
Our guide to registering as a self-employed sole trader is your friend here as it takes you through your responsibilities when it comes to paying tax and VAT, as well as naming your business.
You may also need a particular certification, permit, or licence to work legally in your chosen field. The information you need can usually be accessed by getting in touch or visiting the website of the relevant trade association. BritAssoc is a good resource for finding out who you will need to contact within your industry.
4. Manage your finances
Managing your finances can be the toughest part of establishing yourself as a tradesperson, especially in the beginning.
Try to keep your expenses to a minimum and don't purchase anything that is non-essential until you really need it. Don't allow invoices or bills to go unpaid either, as you will need to forge good working relations with suppliers to ensure they are comfortable working with you well into the future.
You will need some funds to pay for start-up costs like buying equipment, paying fees, and travelling.
There are quite a few different start-up grants that you can apply to for assistance, the majority of which are listed on the government's business finance and support database. This tool also includes local organisations who can give you free advice on setting up your business, as well as other topics, too.
5. Take out the right business insurance
Your fledgling business will need to take out the right type of insurance to protect both you and the public should something go wrong. Public liability insurance, which covers against injury, death, or damage as a result of your work, is going to be the main focus of any policy that you decide upon.
You can then compliment this with other cover, such as insurance for professional indemnity, tools, and stock, should your operation require it. You can compare the best tradesperson insurance on comparison websites, while you can find further advice in our business insurance section.
6. Invest in quality tools and equipment
As the saying goes, “a workman is only as good as his tools” and this counts double when you're trying to make a positive impression on new clients.
Having the right kit to carry out the job is absolutely essential, so you will need to make a significant investment early on to ensure you complete your work efficiently and to a high standard.
Shop with a trustworthy retailer like Cromwell, who you know will only sell premium equipment (they also offer free delivery over £20). But, make sure you keep your new purchases secure as tool theft has risen by 30% in 2017, according to Simply Business.
Take care to move your gear to a secure location whenever you're storing them and try to avoid leaving them in your vehicle overnight. If you must leave them, ensure your van is securely locked and fitted with an alarm.
7. Market your business effectively
Once you have everything in place and you get your first few jobs, it's time to look at marketing your services to a wider audience. Early publicity will come from word of mouth, so be sure to leave clients satisfied with your work so they recommend you to their friends and family.
You will also have to invest some time and resources into online and offline marketing. Begin by advertising in the windows and noticeboards of local businesses and get your business listed in regional newspapers and directories. Online listing sites like Craigslist and Gumtree are free and well worth your time, and you may wish to appear in local online directory sites too.
To increase customer trust, engagement and the prospect of more work, you should also invest in a website for your business. Nearly half of small businesses in the UK don't have a web presence so don't let your business be a statistic. You can get quotes on web design and how much it will cost to create a website for your business here.
Social media is a great place to get reviews and share photos of your handiwork as it's free. Check out our marketing your business guides for more tips for getting the word out about your business.
Follow these seven steps and you'll be able to set up yourself as a self-employed tradesperson successfully in no time. Good luck!