Electrical Contractors: Things You Need to Know

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Have you ever wanted to step into the wonderful and crazy world of being your own boss and becoming an electrical contractor? In today’s episode of Electrician U, Dustin gives his top 8 things that everyone wanting to own an electrical contracting business should know.
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1. Work For Yourself/By Yourself. When you are first starting out, you will be constantly figuring things out. How to get the work, how to keep the work, how to DO the work, how to collect your money, and how to pay your bills. Not having another person right out of the gate will take the pressure off you of what to do with employees. It will also cut down on your initial expenses.
2. Keep a Balance in Your Checkbook. Maybe it’s $10,000 or maybe it’s $20,000, but you need to keep operating expenses in your account. You will need to buy materials and pay for services BEFORE you get paid for jobs. And if you let your account run dry, you won’t be able to pay for your next job.
3. Hiring. When you DO become ready to hire (when you can no longer bid the work, DO the work, review the work was done properly, and collect for the work) consider a journey worker at first. This type of employee will bring in revenue as opposed to an apprentice that’s still learning and only costs money. A journey worker is also a much smaller drain of your time, which is already at a premium! The time will come when apprentices are needed, but at first it should be a skilled employee.
4. Stick With What You Know. Don’t go too far out of the realm of what you know. If you are great at Industrial electrical work, don’t open a residential wiring business. The learning curve while you are figuring the business aspect out is tough enough without adding to that stress!
5. Find Your Niche. The electrical industry is VAST. Find what you are good at and enjoy doing and stick with it. Try to not answer EVERY call that comes in and do EVERY job. Be the best at what you do. You can charge more and work less and be that stellar electrician that folks want to use and don’t mind paying the premium for the excellent service that you are known for.
6. Stop Using Pen & Paper. There is so much technology available in today’s contracting world. There is software available and Apps that help you develop quotes, schedule your work, and even help track the metrics of the work so that you become more proficient the more you do. Plus, let’s face it, would you rather have someone with a truck full of pads of paper with notes on scraps of paper, or someone who has everything logged down in an easily searchable laptop, phone, or tablet?
7. Use Reviews to Your Benefit. In today’s world, people have an unbelievably large number of places to search for contractors and see reviews of how they perform. Be the contractor that is in the top searches and has the most stars of their performance. Know that you will probably have to PAY to be in the top, but the results of being higher up in the searches will pay off greatly.
8. Treat People Well. Respect the customer. When the phone rings, answer it pleasantly, not like you are over stressed and busy. Be friendly with your customers and interact with them in a friendly way. Ask them about their lives and conversate with them in lieu of them being a simple monetary transaction. Respect their values- if you see a pile of shoes at the door, consider taking yours off before entering (or ask them if wearing cloth booties over your shoes). They will remember that respect and will most likely call you back for the next work they need.
We hope this has given some helpful tips when considering starting your own electrical contracting business. Is there a topic you would like to see discussed on Electrician U? Leave us a comment in the comments section and let us know. Please continue to follow Dustin Stelzer and Electrician U as we are constantly adding new content to assist our followers in becoming the best electricians that they can be.
#electrician #electrical #electricity #businesstips #business #electrical #contractor

[@allenmodro3041]

49 years in the trade. I listened and found every word to be truth. First be a good person. Care about the customer and their lives. Do things right. Your absolutly right on the financial part. I know so many that took their 401 k to open the bussines and loans that go under in short orde. take time to build a good customer base. Keep up the good work.

[@donhozy]

Great content. As a contractor, good customer service takes you much farther than expertise alone. This channel is golden.

[@_Roik]

Spot on. I agree, this channel is Gold 100%.

[@bradkolb4228]

Good stuff, Dustin. Running a business is a big thing. Most people would do well to take a class. It's good to learn about insurance & liability, taxes, "knowing your numbers" (expenses, overhead, profit margin, gross vs net profit, etc), and simple bookkeeping like excel or sheets.

[@Bidenlost2020]

I'm almost 20, and I'm looking to be an apprentice in TX, yet I'm currently a CA resident working at TCF. But some gig that helps me out is TaskRabbit. I get to meet customers, do work, and be 100% self-responsible that all goes well.

[@anthonyesparsen7776]

Yes, the most challenging part of owning your business is that it's all on you. You must sell your services out there, or you will be dead in the water. Many guys who start a business are not good salesmen, which can harm the company's health. You have to be really people-friendly; if you are shy or timid, it's not good for you. Another thing I see a lot is guys underselling their services, basically paying themselves to have a job like wages working for someone else.

[@IGotDT]

You speak the truth. I had my own thing in another field, but did basically everything you said. I went from just one customer to a base of over 100 in just two years by doing everything you said. Respect for the customer, knowing you limits, and honoring you word can take your business to a whole new level.

[@OPiguy35]

Next tip: structure your company to limit liability (eg LLC) Same with insurance Would love to hear you opine on this.

[@redbonegaston2010]

I work for a small electrical company now. It’s almost 2 yrs. old. The owner set it up as an LLC BC the owner of the last company we both worked for is being sued into oblivion. He thought that bc he was a good salesman, he could upscale a mid-sized HVAC company into a complete Mechanical, Electrical, and Plumbing company. It was a complete bust. Over 100 of us were laid off. Every vendor in 3 counties never got paid. Jobs had to be finished with bonding companies. I had never been part of such a s**t show.

[@wiebowesterhof]

The 10k in the account is something I agree with (and understand). I'm not in the US, but we use USD as well. I have to send invoices abroad to get paid, and sometimes stuff is slightly delayed. You still have to pay your taxes, employees, materials etc. You may also be unable to work for a brief time. It is better to have some reserve to be able to say no to bad clients or low-paid high-effort jobs. I'm not in the electrical business [although I am licensed] these days, but the other thing is to make sure you have enough money and jobs to do, for any person you are responsible for in your team/company.

[@gslavik]

There is no double taxing of income. There is FICA tax, which is really social security and medicare tax that is split between employee and employer. It is sometimes called "self employment tax/penalty" because when you pay yourself you pay both sides of FICA tax.

[@johnhamby4656]

Hey Dustin, I live in North Carolina and I do mostly new residential electrical and I actually have my licensing test tomorrow. I’ve learned quite a bit from watching your videos and have a membership as well. You have a brilliant way of explaining things and I wish I had someone of your tier to work alongside to not just learn more but to better develop my own character. Thank you so much for what you do, for keeping it so interesting and having such a charismatic way of doing what you do. I truly hope and aspire to be even half as good as you are at this!

[@MattJMT]

Hey John, I live in North Carolina as well and I’m studying for my exam. How did you do? Any advice?

[@johnhamby4656]

Hey buddy I just came back to this video and noticed your comment. I actually just passed my limited exam yesterday! I failed my first exam for single family dwellings and was discouraged but bought a new study course called fast trax by Paul Abernathy. I credit that course to helping me a lot. My 2nd try for the limited was a success! My advice would be to not be afraid to fail atleast once if you think you’re ready, that way you know what to expect next time. Read every question carefully and DO NOT skip a question without putting an answer even if it’s only a guess. Don’t get stuck on any one question for too long, it will affect the whole test. Hope that helps some.

[@redbonegaston2010]

@@johnhamby4656Congrats on your license! I live in SC and work mostly in NC. I plan on testing myself. I just feel like doing my own thing is the only way I’m gonna really get ahead.

[@garyalan82]

I’d did JCR productions online course for my NC Limited License. Passed on first try. The online study is videos, questions and comes with 5 100 question practice exams. It is well worth the money. Made like a 50 my first practice test and tested over 80 by my exam time.

[@Enlightn76]

Excellent advice especially on not acquiring debt to get going. Use what you've got, build up steady and organically. I'd also add •For larger jobs especially ones with factory ordered parts like panels and lighting get a non refundable deposit from owner/rep before its even ordered. Once it ships THEY DON'T WANT IT BACK, it's yours. I had a customer change his mind in the middle of a job and I thought I was going to be stuck with about 5k worth of panels and breakers that I may or may not use on another job. It was resolved but that was too near a miss for me to not take note.

[@josephnicolas2158]

Such amazing advice as usual! Thank you for contributing to bettering the entire industry by making these videos regularly!

[@stephenbowles3007]

THANKS for doing this! I’m about to make the jump in about a month or two! I might be crazy for leaving a good paying union job but something keeps telling me to go my own way!

[@gregorysemones7480]

I’m wanting to do the same. How has it been for you?

[@garyalan82]

I’m a year in. I would recommend Profit First and Profit First for contractors. Both make the money side of your business easy. Started a helper about 2 months ago doing residential. Has been a great help with new wires and rewires. All great info. Definitely the niche and knowing what jobs you want to do. Word of mouth is definitely best. If people like you and think you do good work they will suggest you to everyone.

[@Taliaher3]

Great comminucation with your customer is the utmost importace. Being freindly showing that you are attentive to when they are talking and are going to handle business, and being respectful is a great way to get call backs.

[@AzeveidoMateus]

I’m really glad you mentioned the way that you speak to customers is important. When I hire contractors politeness and courtesy go a long way with me. If they have an attitude on the phone like they’re doing me a favor and they can take or leave my business, not only is it unpleasant to deal with them but in my mind it tells me they’re more likely to not show up on time, not respect my wishes on how I’d like the project done, etc. If a contractor is polite and speaks to me with respect I’m more than twice as likely to hire them. Some contractors are so blunt and rude. I’ve always wondered how they can speak with clients that way and stay in business. I guess their trade is in such high demand that some clients will put up with that due to lack of options.

[@terrenceboylanjr]

I am going to hire you just for the simple reason to speak with my employees about all these issues. So dead spot on point!!

[@marcberm]

CRM = Customer Relationship Manager/Management.

[@EMMANUELDAVID-yj3di]

Thank you sir for encouraging me

[@mikef2618]

Every tradesman and/or business owner should be required to buy a copy, and actually read, a book titled, "How to Win Friends and Influence People" by the late Dale Carnegie. This is not some new-age gobbledygook, but time-tested principles for dealing with people. It's been on the bestseller list since its original printing in the 1930s. Knowing the principles Dale brings out in this book will make Dustin's point number eight become second nature. I'm retired now, but if I started a new business, every employee would be required to read this book, and we'd have discussions on it in staff meetings. Anyone can learn how to wire up something, but the person who excels in the fine art of dealing with people is worth their weight in gold.

[@slimtattooz7125]

Great book!

[@LaminarSound]

Tons of great advice here man. Lot of things that you would think should be obvious but many guys just dont realize or care about and these things are crucial to success.

[@SeanDuffy21]

Love learning about the business side of my job. you rule Dustin!

[@justinscholes1236]

I’m literally on the cusp of starting my shop up in Idaho and this gave me a ton of confidence and somewhat of a clearer path forward.

[@garyalan82]

Read profit first for contractors or get the audio book.

[@wayne5447]

Your best video yet! Treating people with respect can lead you to places you never imagine!!!

[@Bidenlost2020]

Thank you Dustin, you are a true inspiration! God bless!

[@vaulmoremack3072]

Bro not gonna lie ...contemplating running my own business not electrical but welding....and I honestly think alot of the stuff is transferable and I think I need to reevaluate certain decisions ....the timing of this video is god sent

[@jacobplank]

This is such great content!! So many great tips, I can definitely relate to a lot of it as being a polite and likeable guy! I'm needing to try out the software you mentioned as I'm tired of having so many different apps to do my business with.

[@The360Electrician]

let me know what you think, i've never heard of it.

[@johnsingleton7548]

This is all very true, and advice I would give. The roller coaster bank account is stressful. Always answer your phone and show up when you say.

[@ngqabuthongwenya3286]

great advice, good customer care takes you and your business far!!! thank you for an amazing advice!!

[@praisebotha5123]

this video is so dope, just started my company and am currently doing alone with few helper as per need.

[@johnnysimes5082]

Great advice! Not just for electricians, but for anyone starting a business. I sent this to a relative starting her own wedding business.

[@darrbest]

Well said, treat others the way you want to be treated. So simple very effective.

[@hectormartinezjr3117]

Man, thanks for the advice. You brought up a bunch of good things to think about

[@markbell1]

That's a great use of the CRM software -- That is to make xhort notes about the client so that you can remember details for your next visit. So their kod's 'footbal thing' can be a quick note to refer back on your next visit. I would also make notes about things I might notice for potential future work. The R in CRM is relationship so use the software to build one!

[@English-li9cq]

Thanks for the great tips thinking about starting my own business great contents

[@phillip53]

Ya, saying no is so hard. I always say yes to nightmares and minimize the ugly reality of the situation to the customer.

[@jadejohnson561]

Thank you for making this video; it is very informative

[@mr.x1510]

Very well thought out, smart

[@Gruntled2001]

Yes. I agree with EVERYTHING you say Dustin 👍🏼🤝

[@RedneckAsianHomestead]

I really appreciate your videos !

[@mauroaparicio1855]

great information thank you for sharing

[@rafaelangel955]

Thank you so much bro I’ve learned a lot God bless America !

[@user-hj9jn1oh4s]

Watching from Philippines, Thanks Electrician U

[@inothome]

Awesome you touched on the shoes!! I live and do electrical work in Vietnam and it's customary to take shoes off before entering a house. BUT...... I have a problem with working on the shady ass electrical shit I run in to here with bare feet or feet in socks on concrete floors. Distribution here is all 230V as well, so even though your rubber soled shoes may not be EH rates, just having the rubber under your feet vs bare or socked feet does make a difference. We still use the lighted screwdrivers here to find the hot vs neutral and there have been plenty of times where the light won't light when wearing shoes, but once your feet are on the bare floor, it lights. So, I always ask if it is OK for me to keep my shoes on. I'd hate to be the electrician they pick up off the floor that got electrocuted while standing on a bare concrete floor, sweating your ass off because it's 100f out and have bare feet. Will it prevent every shock or electrocution? No, will it help, for sure! One thing you didn't mention, or I missed is to clean up after yourself!!!! What is with a lot of electricians who leave a mess of insulated bits, wires and just generally no housekeeping? Whether in residential or industrial. I always try to leave a location BETTER than how I found it and I have gotten so many compliments, here in VN and in the US about them thanking me for cleaning up when I am done. To me, it's just a no brainer. But we have all seen it, someone does some work and walks out the door and leaves a mess for the customer to clean up. C'mon man, have some respect. Anyway, as always, you made some great points in the video.

[@PacRimElectric]

Great topic. I recently got my C10 license and I feel lose. I have all my knowledge in commercial lighting

[@Sembazuru]

A good follow up to this video for those of us who enjoy your videos but aren't in the trade. How to evaluate contractors when hiring them from outside the industry. How does Joe or Jane homeowner know if they will be hiring someone who does quality work and avoid the ones who do crappy or simply sloppy (even if to code) work? What red flags should we look for?

[@DanielGarcia-ct8nd]

Probably if they don’t any of the things that he advised in the video lol

[@drewaksparky1013]

Great content, my coworker recommended your channel to me.

[@Dave-bd5nj]

your wise to the buzz man , shoutout from ireland ,

[@user-if9bh9um1g]

well done sir ,thank you for much for the information,it's my great honor sir.

[@seanokeeffe3255]

Hey Dustin, great content! Quick question, have you heard of guys using an admin assistant to grow their business? Did it make a big difference?

[@alexramos9459]

I been keeping all this tips I just started my electric company I was going for my master this year but after 10 years of running big jobs for a company on minimum wage I just when and apply for a business license and just gonna take my gc license and electrical contractor

[@richardcamarena5448]

Good video. More business videos would be great!

[@stephanreuben5330]

Great video 📹 👍

[@anthonyesparsen7776]

I see a lot of guys in their business who are busy but underpaid, which is not good for the trade; their prices are so low that they can't even afford to pay a correction fee of 47.00 from the county government or city

[@grandmasterbriggiddy]

This video actually made me stop and think about what I “like” doing. I really do like working for GC’s but I really do not like going to people’s homes and working for them.

[@JadedMax]

Dude, the bank flux is crazy. I have to have 30k roughly to keep things flowing. It's fucking crazy

[@Shrampion]

How much net profit a day on average do you do?

[@LK69DOE]

Can you make a video on electrical terminology. For example transformers, primary and secondary power, AWG, ground neutral and hot, electrical panels,circuit breakers etc

[@anthonyesparsen7776]

the smartest move you can make is to befriend a long-standing electrical inspector who knows the code to advise you on code issues that you are not knowledgeable about

[@user-hk7bg9gi7r]

I always tell my customer I need to keep my safety boots on even when entry their house, because I need my safety boot rubber insulation to prevent electrical shocks when working on their house wirings! Works all the time hh

[@stanleykania7184]

Had to turn down a bathroom vent fan install, no time.. first floor install and no circuit. I was researching on how to vent it.. lol

[@kevinsahakyan9273]

Thanks for the video. If you need free consultation about software let me know. I have 7 years of experience in managing large-scale electrical projects. I can share with you which software you can use for your needs

[@godslayer5102]

Favorite line that I’m stealing: “ Never run into that before but I’m really good at figuring stuff out. Let me do a little bit of research and I’ll get an answer back to you.”

[@gslavik]

Another way to find local tradespeople: drive to local home center or trade material supplier and write down numbers on the side of the truck. :)

[@DrEw-cx9pt]

How do you suggest breaking into commercial or industrial as a new company? Thats all i have ever done, but the cost barrier to entry is way higher than residential work.

[@carsonb8952]

could you do a video on semiconductors and diodes?

[@kgrainey1]

Can you do a video with more about Markate ?

[@ericperalez7088]

So if you are starting by yourself can you still do new commercial work?

[@anthonyesparsen7776]

yes I have seen many bottom feeders in the trade working hard but basically broke , which is not a good thing

[@bradawilliams1]

What's funny... I went from Industrial to residential and I actually did okay. By my 5th house I was off and running but not without A LOT of code reading and asking everyone I knew to give me knowledge.

[@PSwayBeats]

As a man all you got is your word and your ⚾⚾s and you don't want to lose either of those things 13:20

[@charlesjimenez8692]

How do you feel toward electrical contractor school or courses

[@RediTtora-sx1hb]

There I like when you said you have three more jobs comma to me that sounds wonderful period

[@ryanbowden7569]

Do a video on bids. I need help with that.

[@brianapel8404]

Also-shop for deals on new bank accounts. I started my own electrical contracting business at the start of this year. I got a $300 bonus after meeting a few requirements for my business checking account, and I got a $900 bonus with my business credit card. Free money…

[@The360Electrician]

That's awesome, which state?

[@brianapel8404]

@@The360Electrician Illinois. Chase. But I don’t think the state matters.

[@The360Electrician]

No it shouldn't. If a contractor is good at paying off on time, I would put everything on a travel card or bonus card as you said. Take great vacations once in a while, buy tools with points etc. We put at least 20k a month on our business card. That pays for my flights to Los Angeles from Montana, where I run my company and channel.

[@drich1s]

The showing respect to the customers home has won me more jobs than anything else. Take the shoes off. Even without asking. They love it. Touch the mezuzah. Show that respect… you’ll win those jobs almost 98% of the time regardless of your price

[@jamesnewsom5899]

Great advice here. I do not finance my customers jobs. Smaller work of a few hundred dollars no problem anything larger than several thousand dollars, I get a 50% deposit or whatever it takes to cover the materials and more. Again, I am not a financier for my customers.

[@SicknTwistedx]

Dustin I have a question. I was recently sent over to the supply house to buy 6/2 SOOW cable. But the supply house was charging it as 6/3- black white and green. I’m confused as to why SOOW is classified differently than romex,bx, etc. Do you know why this is?

[@calebtownson8888]

Same here in Canada. All the conductors are insulated in flexible cable so they count the green (bond) as one of the conductors. Where as in Romex and bx usually the bond conductors are bare and not included in the count.

[@Shmade0304]

Could ighting maintenance be considered as facility maintenance

[@andrewfunk9167]

@ #5 - I'm in a very niche market in my area, and there's nothing i hate more than when someone comes in and starts to bottom feed. I have a friendly competition with a few other contractors. Everyone almost takes turns with the bids as they come out. I totally understand the draw to the customer base we work for, but please don't be a low-baller. If possible, talk to your competition. If there's room for more competition, than everyone should win in the end. No one should race to the bottom.

[@estevaness]

I use square app ha, Im just used to it and I’m solo, I should try other apps though

[@ricardoavilaaguayo]

What's the name of the app?

[@declanfarber]

Do you ever get asked about whether you or anyone who works for you has a criminal record? And how do you respond to that? I think you’ve mentioned this before.

[@matthewroman5928]

I didn’t know Dustin was an anime head lol respect

[@rfpeace]

whenever I do ANY residential, I always make sure ALL of my tools and bags/belt (I wear a tool belt) are clean so when I touch them I stay clean, and I don't leave paw prints behind EVER! Pro tip ALWAYS have a couple of "Mr Clean" brand magic erasers handy. I always use, at a minimum, old (thrift store) clean, bedsheets, as drop cloths. For bigger gigs proper painter's drop cloths (fabric and/or plastic) and "Blue 3m" painters tape. I also NEVER wear outdoor shoes/ boots in anyone's home (mine included) I like to use clean shower shoes or those wet/dry beach shoes over booties but never shoes that I've worn walking around outside. I've had this very wealthy client now for about 20 years, this dude is a total germaphobe. His home is white on white and is spotless, (he keeps staff on 24/7) I'm the only electrician he ever uses because I get his flavor of crazy, and I can cater to it! I hope this helps! cheers

[@Theyareout2getme]

Customer service, old fashion business practice

[@nelsonalexramirez]

can i call you for some question?

[@PSwayBeats]

Please add some videos about Illinois in your educational courses you don't like Illinois😢 Lol 😂 I'm just f in around

[@malawigold747]

Thing is, most jobs your gonna need an Apprentice

[@bassman87]

another tip is to find a business peer group. Unless you are in a partnership, you will never have someone in your company with your perspective as the owner. A peer group is a group of business owners (usually not competitors) that grill eachother about their businesses. They are a great place to bring business related issues to, and they play the devils advocate to make your business more efficent.

[@The360Electrician]

Pear KZbin channel 🤫

[@jessepks5627]

Bro do you have mangekyo sharingan tattooed on the inside of your left bicep?

[@marshallnmoonshine]

Man... I was on a ship where they told me to take "that old Simpson" cuz nobody uses them anymore. To be fair... That's kinda true. A Simpson has no business on a container ship. You need a Fluke 117 or something similar. Something you can drop 3 or 4 decks in a cargo hold. (Yeah, I've done it.) But I can't believe I didn't grab that Simpson VOM. I feel pretty retarded about it. It was still in the box, with Styrofoam and everything. To make it up, another ship forced 2 Hameg O-scopes and a function generator on me because "nobody ever knows how to use them." Haha. I just brought them home for working on guitar tube amps. I'll add that whatever I do, customer interface is my least favorite thing on earth.

[@maximuspareo]

Makate , is only for us , canada anf aus. Unfortunately...

[@andrewjackson6122]

Used different others and it was pricey and Markate has more features and works well for us in USA. Which country are you in?

[@maximuspareo]

@@andrewjackson6122 Romania

[@patricklachance8750]

Wish I had 10k to have in my account when I started my business. Holy privilege Batman😅😅😅

[@Jordan.west808]

If you stick to your guns where’s the room for growth though? If you fail isn’t that when you learn the most ? Would you rather have a pocket knife with one blade or multiple blades for all situations. Study code hard before new work you are unfamiliar with!

[@jimmiegill3981]

Taxes insurance gas all the miscellaneous is what can drag you down

[@dmope22]

nice video and great advice. shouldn't an electrician have insulated boots on at all times? why take you boots off, the booty is a good idea.

[@montrichins6040]

The market is over saturated. Do yourself a favor and buy property or get into some other kind of business. All we are doing as electricians is keeping our prices down through over competition.

[@samfish6938]

work for building contractor you will get more work

[@Bidenlost2020]

Hopefully in 16 years (when I hope to become a master), this AI rubbish will be a thing of the past.

[@Enlightn76]

AI can't even do predictive text properly. I'm personally not at all worried about it taking over the world. I still l remember when we were supposed to have flying cars by the year 2000. Pfffft!

[@gmr228]

I can't stand listening to this guy saying all this common sense stuff like we are a 5 year old kid

[@milkman6300]

Angi Leads is such a waste of money. Overpriced, poor quality leads.