Starting and operating an electrical contractor business requires more than just expertise in the electrician trade. It is critical that you understand certain things before you begin:
Along the way, you’ll need to use some important documents and resources to manage your company. We’re here to help with that. Utilizing document templates saves you time and money. It also ensures that you don’t forget important information that is needed to communicate with clients or potential investors.
Business Plan Template for Electrical Contractors
What is a Business Plan?
A business plan is the first and most important document that you’ll need for your business. It describes your business goals and how they will be accomplished. If you are already operating a business, it describes its current details and lays out a growth plan for the near future.
Why do you need a Business Plan?
A business plan provides an overview of your business and is used to define its key elements.
It can be used to assist with fundraising from potential investors.
It describes the types of services that your company provides/will provide.
It provides an analysis of your company, your industry, your customers, and your competition.
It provides your plans for marketing, operations, and finances.
To make it easier for you to write your plan, it’s best to break it down into multiple sections. Each section has its own function.
The Executive Summary is always the first section of a business plan but is the last part written. It functions as an introduction to your plan, and it is used to instantly get the attention of the reader. You should use this section to explain the status of your business and your plans for the future. It should also provide a summary of each section of the plan that follows.
Use the Company Analysis section to provide details for the type of electrical contractor business that you are operating. For example, will you be focused on the residential sector, such as in houses or condominiums? Or will you focus on commercial projects such as in warehouses, offices or schools? Another area of expertise might be with industrial projects such as in factories, shipyards or military bases.
Another thing to focus on in the Company Analysis is to provide general background information about the business, such as its origins.
Use the Industry Analysis section to summarize the electrical contractor industry in general and locally. Your research into this will help you to better understand the industry itself and its associated market trends. It will then demonstrate your understanding of it to the reader
Identify the customers that you plan to serve. Provide details for the following:
The segment that they belong to such as homeowners, business owners, developers, etc.
Their demographic traits, such as age, income, location, etc.
Their wants and needs regarding electrical services, such as new installations, repairs, maintenance, etc.
This section identifies other businesses that you will be competing with. These will usually be other electrical contractors. Provide an overview of their strengths and weaknesses and compare them to your competitive advantages.
Your marketing plan needs to answer the following questions:
What type of products will you offer?
How much will your products cost? How will it compare to the cost of your competitors’ products?
Where will your company be located? How will your location affect your business?
How will you promote your company?
Use this section to describe how you will meet your short-term and long-term goals. Short-term goals can refer to such things as your marketing strategy or project management strategy. Long-term goals can refer to such things as milestones or plans for business expansion.
In this section, you will provide your five-year financial statement. This consists of the following:
An income statement (Profit & Loss)
Your balance sheets (Assets & Liabilities)
Cash flow statement (Incoming & Outgoing Cash)
This section is where you can introduce important people involved in the business. Describe how their experience and skills will help the company prosper.
At the end of your business plan is where you can include financial projections and other supporting documents.
Proposal Template for Electrical Contractors
If you’re competing with other electrical contractors for new projects, you’ll need to stand out in the crowd. That’s why it’s important to write an effective proposal when bidding for a job.
An Electrical Contractor Proposal, also known as a Bid Proposal, is a contractor’s bid for a job from a prospective client. It outlines two important aspects of the job: the estimated cost for the project and the estimated time to complete the project
Other important information in a proposal includes:
- A proposal letter that explains why you are the best choice for the job
- Basic information about your business, such as your company name, logo, date, etc.
- Basic information about the prospective client, such as the client’s contact information, project name, and project location
- The project specifics, such as:
- The scope of work
- The estimated labor cost
- A list of materials needed and their associated cost
- Any required project procedures
Miscellaneous information such as:
The length of a valid proposal, basically an end date for the proposal
What will be done in the case of unexpected issues
A work guarantee or warranty
Discounts for cash payment if applicable
Electrical Contractor Scope of Work Templates
What is a Scope of Work Contract?
A Scope of Work (SOW) contract is an agreement between the contractor and client. It contains information about how the work is performed and how it will be accomplished. It’s not a proposal. It’s typically written up just before you start the work.
Why do you need a Scope of Work Contract?
It’s important that there is an understanding between you and your clients about the details of the work before it begins. It also serves as a legal document once terms have been agreed on.
It can be used for a one-time project or for ongoing service agreements.
The SOW defines the terms of the project, such as:
The work to be done
The process of the activities
The timeline of deliverables
The payment terms
The key components of an SOW template are detailed here:
- Objectives – This is where you want to (re)state your final goal and list the deliverables that will be handed off to the client. Deliverables are the final product(s).
- Scope of Work – This is where you define the following details about the work:
- What is the work that will be completed?
- What will be the steps taken to complete the work?
- What are the deliverables that the client will get upon completion of the project?
- Schedule – This is where you set the dates for the completion of each project. It is also where you define who will perform each project.
- Price Section – This is where you will state the price for the work done. It should include a breakdown of the cost of labor, materials, and anything else needed for the project. It should also identify any deposits or payment milestones required. This includes payment schedules and/or payment terms.
- Acceptance – At the end of the document, there is a section for acceptance of the agreement. This is where the client will sign the SOW document. Once it is signed, the document becomes an enforceable contract.
Electrical Contractor Service Agreement Templates
What is a Service Agreement?
A service agreement is a contract between a contractor and a client. It provides ongoing services to the client over a specified time.
What are the Benefits of Having a Service Agreement with Your Clients?
These agreements are beneficial to both the contractor and the client.
For the contractor, it provides regular business and less uncertainty of constantly looking for new business. The client is less likely to change service providers, assuming that they are satisfied with the contractor’s work. This also means that the contractor saves money spent on new customer acquisitions.
For the client, having a service agreement means that there is no need to search for an electrical contractor every time the need arises. It also provides the possibility of a long-term relationship with an important service provider.
A service agreement contract should include the following items:
A detailed description of your exact responsibilities/deliverables for the duration of the agreement and the location of work
The length of time for the agreement with conditions written on how it can be terminated early
Payment terms and amounts
The client’s duties, such as allowing easy access to the contractor
Details regarding insurance and liability
Details regarding a warranty, if applicable
Over time, you will probably accumulate many service agreements with different clients. Each one will likely have different responsibilities, durations, and expiration dates. Management of these agreements can be challenging. There are many issues that can arise such as billing issues, overscheduling, missed appointments, and tracking renewals.
We recommend that you use specialized software to manage your service agreements. This will help you to:
Organize members so that it is easy to see who is due for follow-ups and maintenance calls
View status updates for jobs in real-time
Keep updated with members that are up for renewal or upgrades
Electrical Contractor Invoice Template
What is an Invoice?
You can think of an invoice as a bill. All businesses need to submit an invoice to their clients to get paid for their work. Invoices used by electrical contractors should have a descriptive list of electrical services that have been provided, along with a breakdown of their costs.
All invoices should include the following items:
business name and contact information
business branding and logo
client’s name and business and contact information
unique number for the invoice
invoice date and payment due date
detailed list of the electrical services provided and costs for each
There are many different types of invoices that can be used for various situations:
Standard Invoice: This simply states what the client owes for services.
Recurring Invoice: This is used to accept ongoing or regular payments.
Prepayment Invoice: This is used to collect a deposit or part of the cost of services before they are performed.
Time-Based Invoice: This is used to bill clients for time that has been tracked while you performed your electrical work. An example would be an hourly invoice.
Credit Invoice: This notes a credit that has been made to the client’s account such as a rebate or refund.
Debit Invoice: States an increase in the amount that the client owes for services.
Mixed Invoice: Includes a detailed list of charges and credits made to a client’s account.
How Contractors Can Use Lighting Plans to Grow Their Business
What is a Lighting Plan?
A lighting plan helps you to determine the following:
The kind of fixtures to use
Where / how to place the fixtures in an indoor or outdoor space so that their light is balanced evenly across it
A lighting plan helps you to determine what kind of fixtures to use and where/how to place them in an indoor or outdoor space so that their light is balanced evenly across it. Each plan considers the dimensions of the space. It also considers the specifics of the fixture used. This includes wattage, lumens, color temperature, optics, and mounting height and/or angle.
A photometric lighting plan uses a specialized software application. This application digitally simulates the light output from each fixture and then applies it to the dimensions of your space.
When does it make sense for a contractor to use a Lighting Plan?
The ideal time to devise a lighting plan is before a lighting project is begun and before the associated fixtures are bought. It can help determine how to best arrange the fixtures for your space so that it is properly illuminated. This can help to ensure your customer is happy with the results. When completed, it provides the buyer with a report that can be used to determine what lighting solution is best for the customer.
LED Lighting Supply offers free lighting plans.
We offer free lighting plans to contractors as a value-added service. We can run both indoor and outdoor lighting plans. This applies to:
More information is available here.
About the Author
Dwayne Kula is President of LED Lighting Supply. On any given day, Dwayne is writing content for the site and helps manage the marketing initiatives that are on-going. He has a Software Engineering degree and still dabbles in writing software for the company as needed. When not working, he enjoys spending time with his family, working out, playing the occasional game of golf and exploring New England.