Setting up a business can be very profitable if appropriately handled and started up effectively with some primary metrics put into consideration first. The electrical industry is one peculiar business sector that has experienced growth and increased demand in the past few years.
This increase in demand for electricians could be a result of the increase in the use of electronics and electrical appliances in the world following even more recent technological advancements. Technology has made work easier for most people in several sectors of life, ranging from businesses, companies, homes, recreational spots, etc. A majority make use of technology in one way or another to make work easier and more efficient.
However, one often overlooked fact is that this increase in the use and adoption of technology has also increased the demand for and importance of the electrical business sector. This increase in demand for electricians has simultaneously increased the market value of the electrical business sector because it has created several profitable businesses for most people.
The increased relevance and importance of the electrical sector were mostly felt in the heat of the COVID-19 pandemic, which saw a large percentage of companies lay off staff in their multitudes due to a halt in business activities as a result of the pandemic regulations. However, the electrical business sector was barely affected by this break in activities; instead, it was recorded that there was an increase in the number of employees in the electrical business sector.
Several sectors within the electrical business sector can be profitable, but choosing a profitable niche is very important as that would determine the overall success or failure of the business altogether.
In this article, we will discuss the significance of as well as some key factors to consider when selecting a profitable niche before starting an electrical business.
Who is an Electrician?
Trying to describe the electrical business and what it entails is very important, but before that, why not explain who an electrician is? According to Career Explorer, an electrician is someone who is in charge of handling and setting up structures for wiring systems. The electrician handles a wide range of wiring and electrical responsibilities, such as installing, maintaining, designing, and troubleshooting wiring systems.
Most electricians start as contractors within a single category, handling electrical contracts for different office buildings, home appliances, etc. as independent contractors. It is also important to note that electricians are divided into different categories, which include outside linemen and inside wiremen.
The inside wiremen are in charge of handling, maintaining, and installing wire systems and structures within homes and residential buildings, as well as adding and fixing electrical constructions and systems within older industrial buildings. Inside wireman, as their name implies, mostly work indoors for most parts of the year since their job description mostly deals with electrical systems that are found indoors and working with building blueprints to ensure proper wiring.
Outside linemen, on the other hand, handle electrical constructions and setups in larger electrical setups such as transformers, electrical stations, and so on. The linemen spend most of their time working outside, unlike the wiremen, who work indoors. The outside linemen also have to endure elements of the weather since they work outside and are sometimes required to climb up trees in cases where there is no lift bucket available.
Is Electrical Business profitable?
The electrical industry is set to see an even greater increase in demand for electricians given that there are so many electrical appliances in the world. The more the world increases its usage of electrical appliances and technology, the more the electrical business sector continues to thrive.
Right now, almost every office, home, residential area, hospital, corporate space, etc. have a large percentage of electronics. This is because the world is largely dependent on the use of computers and other technological applications for ease of work and to make work more effective.
According to statistics, there are over 700,000 electricians in the United States, and this number is set to increase in the coming years. The electrical industry has provided a lot of employment for most people to be trained as electricians and become part of this highly valuable business sector that has so many uses for electrical appliances. The electrical industry was valued at over $100 billion in 2020 and is expected to grow by more than 7% between 2023 and 2030.
This also means more employment opportunities will be made available to more people, and there are also more contracts available to electrical business owners. There are so many benefits to launching a profitable electrical business; however, figuring out how to start an electrical business can become another challenge.
Some of the benefits of owning an electrical business include
- High demand for electrical contractors
- Ability to build credibility and become an expert
- It is a recession-proof business service
- There is an unlimited earning potential
- High customer retention ability
Importance of finding a niche in the electrical business
In almost every business enterprise, there is a huge importance attached to finding and choosing a niche to specialize in. This is because having a specific niche and a specific target audience helps the business target and focus all efforts on strategically succeeding in the specific niche.
A “niche” in a business is a specialized area that is part of the broader market but enables the business to focus on a specific area of specialization and therefore have an edge over the competition.
Choosing a niche is one of the most important factors any business should consider because it helps the business specialize and easily dominate a specific area rather than compete with the broader population in the broader market.
Some benefits of finding a niche include
- reducing the competition
- It helps the business to gain an edge over competitors
- It helps to streamline and focus marketing efforts
- There is a higher chance of getting more target customers
- It helps the business position itself as the go-to brand for that specific service
How to Choose a Profitable Niche before Starting an Electrical Business
Statistics and reports discussed earlier in this article show that it is critical to select a profitable niche to remain profitable and expand in the industry. Choosing a profitable niche in the electrical business is very important, as it can greatly influence the level of growth and profitability the business can experience.
Here are some important ways to choose a profitable niche in the electrical business.
Know yourself and what you want
This is a very important aspect of growing your business and choosing a profitable niche. As a business owner entering the electrical business space, it is important to know yourself, as that will influence the niche that you will mostly expand and position based on your strengths and weaknesses.
Know your strengths and the level you’re willing to work towards, your goals, and your areas of interest, and base your research on those metrics to find the best niche to get into.
It is easy for most new business startups to set unrealistic goals based on the excitement of starting a new business and the initial rush. However, it is critical to set realistic goals and conduct extensive market research for the most profitable and easily scalable electrical business niches.
Also, when looking for a profitable niche to establish in, it is important to consider the amount of capital that is currently available, as well as the quality and level of equipment and resources required to realistically start up the business to determine what can be done with the available resources.
Know Your Target audience
The most important aspect of choosing a niche is having a targeted audience or buyer persona. The specific target audience on which you want to base your electrical business will greatly influence the particular niche to work with as well as whether or not there is a scalable and profitable market for it.
The target audience helps the business have a targeted focus on marketing efforts toward creating a profitable and successful business. Although there are generalists who serve everyone, having a specific buyer persona in mind when starting a business greatly influences the type of niche to best work with.
Take Action and Make Adjustments Based on Feedback
Taking action on the plans laid out is the crux of the entire business planning phase. If, after all the planning, research, and analysis, no action is taken, then it all becomes a waste. Taking action also helps the business try and test out different strategies to find out what works and what doesn’t, find the most profitable niche, and hit its target.
Collecting feedback based on the actions taken helps the business find out and analyze through proper personal data what works and what the customers prefer or do not want. This is the best way to build a profitable business.
Choosing a niche is highly essential when starting a new business, especially in the electrical business sector. The market value and size of the electrical business sector keep increasing as more people come to realize its potential. As a result of that, remaining a generalist might not remain profitable, especially for business growth, which is why choosing a niche is very much needed to grow and expand profitably in the electrical business sector.