How to Start a Plumbing Business: Costs, Steps & Tips

Some services are a luxury, but plumbing isn’t one of them—after all, no one is going to wait on fixing a burst pipe. Not only are plumbing services perpetually recession resistant, but they can also be highly profitable when you have the right systems in place.

Before you get started, it’s important to learn the ins and outs of how to start a plumbing business that keeps you competitive. In this guide, we’ll bring you from research to launch day, talk costs, and provide expert tips for avoiding common mistakes. 

TL;DR: How to start a plumbing business

Every plumbing business is different, but there are a few standard things to know going in if you want your small business to last.

How to start a plumbing business:

1. Research your local market
2. Choose your business model (residential, commercial, emergency, or niche services)
3. Handle core plumbing licenses and business permits
4. Register your plumbing business with the state and apply for an EIN if needed.
5. Buy essential tools, vehicles, and equipment new or secondhand
6. Set pricing and services with the goal of hitting a 12%-18% profit margin
7. Get your first customers through small business marketing and word of mouth

What you’ll learn in this guide:

• The actual cost of starting and running a plumbing business
• How to start a plumbing business with no money
• What to know before starting a plumbing business (and common mistakes to avoid!)
• Tips and tools that make owning a plumbing business sustainable

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Is it a good idea to start a plumbing business?

Starting a plumbing business is a good idea if you come in with a solid plan and a willingness to hustle. Because there’s no way around it: running a small business is difficult enough that 20% of small businesses don’t make it through their first year.

However, owning a plumbing business has some unique perks:

• Demand stability: When things get tough economically, retail and restaurant businesses can land in tight spots. But for plumbers and other tradesworkers, demand will never disappear.
• Margins vs labor costs: For service-focused plumbers, the average net profit margin comes in around 12%–18%. To stay sustainable, hitting a 20% margin within a couple of years is ideal. If you can make good choices around labor costs, you can make good profit.
• Local competition realities: Plumbing isn’t an uncommon profession, and unskilled plumbers don’t last long in the business. Tight systems and operations are the deciding factor in keeping you competitive with other skilled professionals. 

How to start a plumbing business step by step

Curious about how to start a business from scratch? The name of the game is preparation. Here are the basic steps to follow when learning how to start a plumbing business in your community.

Step 1: Research your local market

You know what they say about assumptions. Even if you’re confident in your plumbing skills, don’t go in guessing when it comes to actually starting a business.

Plumbing businesses tend to operate on a local level, so get an idea of your community’s needs by researching:

• How many plumbing businesses already operate nearby
• Who your major competitors are (especially franchises)
• Which services competitors advertise and their price range
• Any service gap complaints in Google reviews
• Local housing trends (old homes vs. new builds vs. growing commercial spaces)

Before you pursue a plumbing business, have a clear idea of what it is that will make you competitive. Then you can start building a one-page business plan with that information in mind.

Step 2: Choose your business model

There are many ways to utilize your plumbing skills, and your business model should match your experience, start up costs, and preferred lifestyle.

Common options include:

• Residential plumbing for homeowners and landlords
• Commercial plumbing for offices, restaurants, and retail spaces
• Emergency plumbing services with speedy after-hours availability
• Niche services like drain cleaning, water heaters, or remodeling work

Your primary services will determine how your marketing and networking should be managed. While it’s possible to offer a very wide range of services, doing too much can make day-to-day operations harder to manage. 

As you determine your business model, ask yourself if you’re willing and able to:

• Drop what you’re doing for emergency call-ins
• Dedicate extra time to operations
• Invest in additional training
• Manage hiring and onboarding

If you’re thinking about how to start a plumbing business without being a plumber, consider how your administrative role can help your technicians focus on their specialities.

Step 3: Handle licensing, permits, and insurance

Before you buy any new tools, get your paperwork sorted. Plumbing license requirements and business permits vary by state and city, so be sure to check in on your local laws.

You’ll likely need:

• A plumbing license or contractor’s license
• Local business permits
• General liability insurance
• Zoning and health permits if you’re in a physical space

Step 4: Register your plumbing business

Ready to make your plumbing business official? You’ll need to legally register both with your state and the IRS.

This usually involves:

• Selecting a structure like a sole proprietorship or LLC
• Determining your official business name
• Registering your business with your Secretary of State
• Applying for an Employer Identification Number (EIN)

Even if you don’t plan to hire employees, you need an EIN for filing taxes, opening a business bank account, and running payroll.

Step 5: Buy tools, vehicles, and equipment

Make a list of the core plumbing tools that you already know how to use and know will be necessary for the services you already offer—wait on specialized tools until you need them. If you want to keep the cost of starting a business down, you can always begin with reliable used or refurbished options.

One of the most important things you can have when running a plumbing business is a trustworthy vehicle to safely carry your equipment and tools. When a customer needs you, being on time is non-negotiable.

If you’re buying a vehicle, try to form a good relationship with a local dealership. This might get you good deals in the future if you scale and need a fleet.

Step 6: Choose your services

The services you offer should align with your business model, experience, and ability to handle larger jobs. You don’t need to expand beyond your capacity to get customers.

If you’re just starting out, focus on core services likes:

• General plumbing installation, maintenance, and repair
• Leak detection and pipe repair or replacement
• Fixture installation and repair (toilets, sinks, faucets)
• Drain cleaning (basic clogs and slow drains)
• Water heater repair and replacement
• Emergency plumbing services

As your business grows, you can start adding services that require specialized licenses and certificates or equipment upgrades. That might mean taking on gas or sewer line work, sump pumps, or even larger remodel projects. If you notice gaps in your local market—like septic repair or water filtration—building skills in those areas can be a smart way to stand out.

Step 7: Set your pricing

Next comes the question of pricing. How you price your services is a major factor in the success of your business, but it can be hard to know where to start.

In order to stay competitive without sacrificing sustainability, be sure to consider:

• Local market rates
• Operating costs and insurance
• Time required for each job
• Materials, tools, and equipment wear
• Mileage and travel time

Most plumbers use one of two pricing models:

• Flat-rate pricing: Simple and predictable for customers; best for smaller jobs, but riskier if work becomes more complex than anticipated.
• Hourly pricing: Transparent and flexible, especially for larger projects, but less predictable for customers and messier to track without the right tools.

Homebase Tip: Do you like the idea of hourly billing but time-tracking feels like a headache? Our all-in-one mobile app streamlines everything from scheduling to time tracking to payroll, and includes GPS features for more accurate time-tracking so every hour lines up.

Step 8: Get your first customers

Simple, practical outreach is the best way to put yourself out there. Let as many people as you can know that you’re officially in business, both in person and on social media. Word-of-mouth is powerful, so ask friends, family, and other relevant contacts for referrals.

You can also make your plumbing business visible by:

• Creating a simple, attractive, SEO-optimized website
• Maintaining an accurate Google Business Profile
• Posting in local Facebook groups or community boards
• Providing business cards to real estate agents or property managers
• Encouraging and replying to Google reviews

How much does it cost to start a plumbing business?

Depending on whether you’re starting small or aiming for a massive launch, starting a plumbing business typically costs anywhere between $10,000 - $50,000+.

Similar to starting a construction business, a low-budget approach might mean using some of your own tools and personal vehicle at first. For a fully-equipped setup, you’ll have to budget in the cost of a branded vehicle, professional tools, comprehensive insurance, and a detailed marketing plan.

Here’s a rough sense of common cost ranges: categories and ranges:

• Tools and equipment: ~$5,000 – $15,000
• Vehicles: ~$10,000 – $40,000
• Licensing and insurance: ~$500 – $5,000
• Marketing and admin costs: ~$1,000 – $5,000

How to start a plumbing business with no money

No matter the industry, most aspiring owners want to know how to start a business with no money. Truthfully, it’s not possible to start with nothing, but you can keep costs low if you get resourceful with your planning.

Here are four tips to lower the cost of running a plumbing business:

• Start as a subcontractor. Working under established plumbing companies helps build relationships and avoid major upfront costs while you learn the business side of things.
• Use a personal vehicle. Many owners begin with their own truck or van to start. Add a sticker or a decal with your business logo, and you’re good to go. 
• Look into financing options. Small business loans, equipment financing, or supplier payment plans protect you from major up-front costs you can’t afford.
• Scale gradually. Get clear on your goals and be realistic with your timelines. Staying disciplined when it comes to reinvestment will set you up for long-term stability when you’re truly ready to grow.

What to know before starting a plumbing business

Being a plumber is different from owning a plumbing business. While technical skill is what’ll build your reputation, understanding how to manage the business side of things is equally essential to keeping you afloat. That starts with realistic expectations.

Here’s what to know before starting a plumbing business for yourself:

• Cash flow challenges: Late payments, “feast or famine” windows, shifting supply costs, and surprise equipment repairs can strain your finances, especially early on.
• Emergency calls and scheduling: There’s money to be made when you can sweep in and save the day, but that often comes at the expense of your personal schedule.
• Customer expectations: Customers will question prices, want to haggle, or hover when you’re working—especially if you’re charging an hourly rate.
• Regulations and inspections: Mistakes with codes, permits, and inspections can be hugely expensive. Stay on top of local rules so you don’t land in a tight spot.
• Burnout risks: Long hours and very physical work add up over time, especially when financial pressure hits. Strong boundaries can protect you from getting hurt in the name of the hustle.

Running and growing a plumbing business

Once your plumbing business is up and running, steady growth comes down to how solid your operations are. 

Here are some tips for managing the admin that come with running a plumbing business:

• Hiring and managing technicians: When you bring on new plumbers, it’s best to have all of their paperwork in one place. With Homebase, you can manage certifications, run background checks, create a custom handbook, and automatically file tax forms.
• Scheduling and dispatch: Inefficient schedules are a fast way to add up wasted drive time and lose profit. Automated scheduling software takes the tedious work out of organizing hours so you can focus on creating efficient routes.
• Tracking time and jobs: Over the first few months, look into your time-tracking data to get an idea of how long jobs typically take. This will help you manage pricing, scheduling, and estimates moving forward.
• Customer communication: Staying on top of updates and making time for follow-ups builds trust with customers who are wary of plumbing scams. Professionalism is the way to happy customers, who are more likely to refer you to their friends.

Common mistakes many new plumbing business owners make

Starting a small business already comes with a learning curve—there’s no need to also fall victim to common mistakes if you can avoid them.

When you’re working on how to start a plumbing business, watch out for:

• Underpricing: Charging too little might win jobs, but it will quietly drain your energy (and bank account) over time. Research local rates to stay competitive without landing in the hole.
• Poor scheduling: Overbooking or inefficient routes frustrate customers and, if you have a team, strain your technicians. Don’t lose good opportunities to bad systems.
• No systems early on: Don’t wait to set up processes until you’re drowning in how badly you need them. Streamlining scheduling, time sheets, and payroll makes growth exciting instead of chaotic.
• Trying to do everything solo for too long: If running your own business is draining instead of filling your cup, hiring help can protect you from burning out—and eventually make your business more profitable!

FAQs about owning a plumbing business

Are plumbing businesses profitable?

Yes, plumbing businesses can be very profitable when they’re managed effectively and priced well. There is always a demand for plumbing services, and customers will pay for fast, reliable work when emergencies happen. With efficient ongoing systems in place, plumbing businesses can begin to steadily scale.

What kind of plumbing makes the most money?

Higher-earning plumbing work often comes from specialized or emergency services. Plumbers who are a part of unions typically make more money, and have more specialized healthcare benefits, training, and safety standards.

When it comes to career growth, getting a Master Plumber license is the best way to increase your salary.

Can a plumber make $100,000 a year?

Yes, plumbers can make $100,000 per year. However, reaching that level depends on location, experience, the type of service provided, and how well the business is run. Breaking six figures has less to do with hours worked than it does business operations.

Running a plumbing business that works for you

Strong trade skills open the door to owning a plumbing business, and strong operations help keep it running. Cover your necessities, lean into your strengths, and take growth slow and steady—you don’t need to overinvest to do your job well.

With smart scheduling and transparent pricing, you can become your community’s top choice for everything from scheduled maintenance to late-night emergencies.

Want to make sure you spend more time in the field than at your desk? Drop us a line to learn how Homebase can help organize the scheduling admin that goes on behind the scenes.

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