How to start a plumbing business: licensing, money, pricing and your first customers

Step 1: Get the right license for your state

Licensing is the first gate, and it is different everywhere. The U.S. Bureau of Labor Statistics notes that most states and some localities require plumbers to be licensed, usually after 2 to 5 years of experience and a passing exam. Some states also require a separate license for gas lines.

Working as a journeyman under someone else's license is not the same as running your own shop. Many states require a master plumber license, a plumbing contractor license, or both before you can pull permits and bid jobs in your own name. Some cities add their own registration on top.

• Find your state plumbing board or contractor licensing board and read the requirements for a business license, not just a personal one.
• Ask whether you need a bond, proof of insurance or a minimum net worth to get the license.
• Check the cities and counties you plan to serve for local registration and permit rules.
• Put renewal dates and continuing education hours on a calendar now.

Step 2: Set up the business and insure it

Form an LLC

Most solo plumbers start as an LLC. The SBA explains that an LLC generally protects owners from personal liability in most cases, and profits can pass through to your personal tax return, though you still owe self-employment tax. Register with your state, get a free EIN from the IRS, and open a separate business bank account. Never mix personal and business money; it makes taxes painful and can weaken the liability protection.

Buy the insurance you actually need

• General liability: covers damage to a customer's property. Many licenses, general contractors and property managers require it.
• Commercial auto: your personal auto policy may not cover a work van on the job. Ask your agent directly.
• Workers' compensation: required in most states once you hire, and rules for owners vary.
• Tools and equipment coverage: protects what is in the van if it is stolen.

Get quotes from an agent who writes policies for trade contractors. Keep your certificate of insurance handy as a PDF; commercial customers and Google will ask for it.

Step 3: Equip one van well

You do not need a fleet. You need one reliable van that lets you finish the most common calls on the first visit. Prices depend on your market and whether you buy new or used, so build your own budget. Here is a worksheet with example numbers to show the shape of it:

In this example, that is roughly $45,000 up front plus monthly costs. Keep at least three months of personal and business expenses in reserve. Slow weeks happen early, and a broken drain machine should not end the business.

Step 4: Price from your own numbers

New owners often charge what they earned per hour as an employee, plus a little. That almost always loses money, because the shop you worked for was paying for the van, insurance, software, marketing and all the hours nobody was billing.

1. Add up a year of overhead: van payment, fuel, insurance, software, phone, marketing, accounting and your own salary.
2. Estimate billable hours honestly. Drive time, estimates, supply runs and paperwork are not billable. Say you are on the clock 2,000 hours a year but only bill 1,100.
3. Divide overhead by billable hours to get your break-even rate, then add your target profit.
4. Build that rate into flat prices for common jobs so customers see one number before you start.

Say your example overhead including your salary is $140,000 a year and you bill 1,100 hours. Break-even is about $127 per billable hour before parts. Add a 20% profit target (divide by 0.8) and you need about $159 per billable hour. Parts get their own markup on top, so you are paid for sourcing, carrying and warrantying them.

Step 5: Win your first customers

Google Business Profile

Claim and verify your Google Business Profile before you open. Pick plumber as the primary category, list the cities you serve, add real photos of you and your van, and post your hours. Ask every happy customer for a review the same day you finish the job. Reviews are how a new shop earns trust when nobody knows its name.

Local Services Ads

Local Services Ads sit at the top of Google for searches like "plumber near me" and you pay per lead, not per click. Google screens businesses before they can run them, which may include license, insurance and background checks depending on your category and location. Start the screening early, because it can take weeks.

Referrals and relationships

• Tell every past customer and employer contact you know that you are on your own.
• Introduce yourself to local real estate agents, property managers and home inspectors. They need a plumber they can trust on short notice.
• Partner with an HVAC or electrical shop that does not do plumbing, and send work both ways.
• Leave a magnet or card at every job. Plumbing is a repeat need.

Step 6: Answer the phone when you are the only tech

Here is the problem every solo plumber hits: the phone rings while you are under a sink with both hands full. Homeowners with a leak usually call the next plumber on the list if nobody picks up. Each missed call can be a job you paid for with ads or a referral you earned.

Whatever you choose, set it up before your first ad goes live. Write down which calls are emergencies (active leaks, no water, sewer backups), what you charge for after-hours visits, and which jobs you do not take. That script is useful whether a person or software answers. Our plumbing answering service page explains the options in more detail.

Where Fullweek fits

Fullweek answers missed and after-hours calls for plumbers in English and Spanish, flags emergencies, filters spam and books jobs straight into ServiceTitan, Housecall Pro or Jobber. It also manages your Google Business Profile and asks customers for reviews automatically. Plans start at $497 a month, month to month. See pricing or get a free city audit to see how your market looks before you launch.