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For many plumbers, getting to the point of being your own boss in your own business is the ultimate goal.

You’ve done the hard slog of your apprenticeship, you’ve spent a few years on wages honing your skills, and now it’s time to go out on your own.

It’s not a difficult process, but there are plenty of things to consider.  There is licensing, business structures, insurance and even marketing.

In this guide we’ll touch on each of these topics and try to point you in the right direction.

Licensing

Wherever you are in Australia, you’ll need to be properly licensed in order to operate your plumbing business.

Each state looks after their own licensing, so your first point of contact will be the state government.

Whilst is does vary from state to state, often you’ll find that being a trade qualified plumber isn’t enough to obtain your licence.  You may also need to complete some additional business modules.

We’ve put together a list of contacts for each state:

QLD – QBCC – Website – 139 333

NSW – Fair Trading – Website – 133 220

VIC – VBA – Website – 1300 815 127

SA – State Government – Website – 131 882

WA – Plumbers Licensing Board – Website – 1300 489 099

TAS – CBOS – Website – 1300 654 499

ACT – State Government – Website – 132 281

NT – Plumbers and Drainers Licensing Board – Website – 08 8936 4083

At this point you’re more so looking at what is required for your plumbing licence rather than applying.  The reason is that before you apply, you’ll need to decide how you’re going to structure your plumbing business.

So next up we’ll take a look at business structures.

Business Structures

There are a few different ways that you can structure your plumbing business.

The four main structures used by plumbing businesses are as follows:

  • Sole trader
  • Partnership
  • Company
  • Family Trust

Which one is right for you really depends on your own circumstances, and your accountant will be able to provide some further advice here.

Setting up as a sole trader is certainly the cheapest and easiest option, but it doesn’t provide much flexibility in terms of asset protection and tax management.

Going with the company or family trust option is more expensive and time consuming, but provides greater benefits when it comes to asset protection and tax.

We’ve put together a guide on choosing between a sole trader and company structure.  It’s worth a read, but we do recommend speaking with an accountant as well.

Industry Associations

Many plumbing business owners choose to become a member of an industry association, such as Master Plumbers.

There are plenty of benefits in doing so, and one of the main benefits for a brand new plumbing business is the credibility you receive from being able to use the Master Plumbers name and logo.

Here are the links to each state’s association:

QLDMaster Plumbers Association of Qld

NSWMaster Plumbers Association of NSW

VICMaster Plumbers Victoria

SAMaster Plumbers South Australia

WAMaster Plumbers & Gasfitters Association of WA

TASMaster Plumbers Tasmania

ACTMaster Plumbers ACT

NT – Refer to the SA association

Insurance

As a plumbing business owner you’ll be exposed to a whole host of risks that you wouldn’t have had whilst on wages.

There’s the risk that you damage someone else’s property, or worse, that you cause personal injury to another person.

These risks are so great that most Australian states require that licensed plumbers hold mandatory insurance in place to cover such risks.

This type of policy is known as public liability insurance.  It’s the most common form of insurance for any trade business, not just plumbers.

It will cover you in the event that you cause property damage or personal injury to a third party as a result of negligence.

Licensed plumbers in Victoria are required not only to hold public liability, but they must also have an additional warranty option included in the cover.

If you are licensed in Victoria, make sure your insurance company or broker understands the state requirements, otherwise your insurance might not meet the licence requirements.

Of course here at Trade Risk we know the Victorian requirements (not to mention all of the other states) and will be able to ensure you have the right cover and certificate for your licence.

If you’re at the point of starting your own plumbing business you’ll likely have a big collection of tools and equipment.

This gear is so important to your livelihood, so if you haven’t already insured it, now is definitely the time.  Tool insurance is relatively inexpensive for plumbers and will be invaluable in the event of claim.

Once you’re out on your own you can say goodbye to paid sick leave, and depending on your business structure and the state you operate in, you might lose access to workers compensation.

This means if you suffer an injury or illness and cannot work, your income is gone.

For any self-employed plumber income protection insurance is vital.  If you can’t work due to injury or illness, this insurance will replace a large percentage of your income for a period of time.

There are plenty of different insurances that a plumbing business may need, but if we had to pick two that you need from day one, it would be public liability and income protection.

Of course we can help you out with both here at Trade Risk.  It’s what we do!

Marketing

Your new plumbing business isn’t going to last long unless you’re bringing in work.

To start with you might be able to pick up work from other contacts within the building industry, but if you want to build a sustainable business (especially if you’re in maintenance plumbing) you’ll need to do some marketing.

It really depends on what you’re going to do with your business though.  If you’re setting up a plumbing business purely to subcontract, you might not need to worry about a logo, stationery and all the rest of it.

But if you’re chasing work from clients, especially maintenance plumbing work, you’ll at least need a decent logo, business cards and some marketing.

A good logo can help to build your brand in the early days, and it’s quite cheap and easy to get one now without spending thousands on a graphic designer.

Here at Trade Risk we used 99designs for our original logo, and seven years later it’s still a logo that we love!

99designs operates on a crowdsourced model, so once you detail your needs and wants for a logo, hundreds or potentially thousands of designers from around the world will submit their ideas.

The same service can be used for the rest of your design needs, such as your business cards, stationery and even your website.

A fancy logo alone won’t bring in business, so you’ll need to get your name out there.

At Trade Risk we rely heavily on online marketing, and there’s no reason why the same shouldn’t work well for a plumbing business.  We’ve put together a guide on online marketing for tradies that is worth checking out.

Many trades businesses rely on directories and other “find a tradie” type websites to bring in business.  There are strong opinions both ways on whether these are any good or not, but it’s certainly worth having a look at.

Budgeting

It’s easy to get caught up in the exciting parts of starting a plumbing business, but there’s something very important to consider before you throw in your existing job.

“Is my business going to work?”

Obviously you hope the answer is yes, but you really need to think about it before you go all-in.

You need to think about how much money you need each week, not just for your business, but to keep your household functioning and the mortgage or rent paid.

Business can be a tough slog, and you can’t bank on the fact that money is going to be rolling in every week or fortnight like it does when you’re on wages.

Here at Trade Risk we see the great side of business every day, but we also see the not-so-great side.  This is when a client calls to cancel their policy as they’ve just closed their business.

The reason is generally always the same, which is simply that they couldn’t bring in enough cash to keep going.

We’d never want to discourage a tradie from going into business for themselves, but we strongly believe in being 100% prepared for what’s ahead.

So as part of your new business planning, put some time aside to think about how much money you need to keep going, and how much you genuinely think you can bring in on a consistent basis.

More Information

This is by no means a comprehensive guide, but it should give you a good idea of what you need to start your plumbing business.

You need to choose your business structure, get your licence, sort out your insurance, join an association, do some marketing, win some jobs and make some money!

As insurance brokers, our specialty is quite obviously the business insurance side of things.  If you’d like to have a chat about your insurance needs, please get in touch with us for an obligation free chat.

On the business structure side we recommend speaking with an accountant, and for licensing you should contact the relevant state government using the contacts we provided earlier.

You might also find that the Master Plumbers Association in your state can point you in the right direction on various matters.

Thanks for reading our guide.  We hope you’ve gotten something out of it, and we genuinely wish you all the best for your plumbing business.  It’s not always easy, but it can be very rewarding in so many ways.

Good luck!

Starting a plumbing business

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