New business owners need at least 33k for new trades company
As unemployment rates continue to rise, many tradespeople may consider turning to entrepreneurship for the benefits of being their own boss at an uncertain time. Although this means more flexibility and independence, it also comes with risks, as new business owners need to spend £33,975.34, on average, when embarking on a new venture.
According to new research by Dickies Workwear, landscaping is one of the most expensive trades to start – with an essential investment of £34,782.79 needed to get a company up and running. However, with an average annual salary of just over £22k, new business owners are unlikely to make their investment back in their first year of independence.
Transport is the aspect that all tradespeople will spend the most money on, with a van, insurance and fuel coming in at a high £31,502.75.
To provide more guidance, the trade lifestyle experts at Dickies Workwear have delved into the essential overheads faced when starting five of the most popular trades professions:
Overhead costs by trade
Plunging into Plumbing – True Cost: £32,846.42
In addition to transport and safety equipment, necessities such as a work jacket (av. £52.44), a pressure tester (av. £203.40) and – something lots of us forget to factor in – insurance (£407.01 per year) drive up the overheads for starting a plumbing business.
A common problem that plumbers find is that customers can purchase the equipment online at decent prices, so may want to give the task a go themselves. They might change their mind however when a small leak in the bathroom turns into a very big problem…
Average Salary – £31,370 | Average Hourly Rate – £11.39
Becoming an Electrician – True Cost: £33,312.32
A spokesperson from All Sparks Electrical Sources said that building a customer base and finding work is the biggest challenge a new electrician can have.
Figures from Dickies also conveyed that protective gear and equipment for electricians are slightly more expensive than for plumbers, but safety is a crucial expenditure. The average cost of essential safety gear alone is £1,402.56 and includes: safety boots (av £52.76), insulated gloves (£6.83) and safety glasses (av £8.17).
Average Salary – £31,167 | Average Hourly Rate – £13.66
Constructing a Plan for a Construction Company – True Cost: £34,221.13
Construction businesses require heavier pieces of equipment to get up and running. £2,311.47 of the total cost of starting up will be spent on essential equipment like a laser level (av £192.55) and drywall sander (av £581.51).
T H Electricals also reminds newbies that having a clear business plan is extremely important in running a successful construction business. They will more than likely be in charge of their own books, so becoming savvy with numbers and admin is also helpful.
Average Salary – £42,500 | Average Hourly Rate – £12.07
Carving out your Future in Carpentry – True Cost: £34,714.05
Lots of people start carpentry as a side hustle, using their creative juices to carve stunning bits of work.
Good quality electrical tools are a MUST when it comes to owning a carpentry business. Saws (av £239.43), knives (av £10.12) and extension cords (av £15.18) are all essentials, while niceties include air compressors (av £216.32) and cordless nail guns (£414.15).
Average Salary – £27,503 | Average Hourly Rate – £13.41
Landing a Landscaping Business – True Cost: £34,782.79
Owning a landscape business not only has the same requirements as other trades, but owners will also have to factor in the weather.
It’s important to buy equipment that can withstand rough climates if necessary. Cordless lawn mowers (av £300.92) and waterproof overalls (av £95) are just two examples of items that add up to give landscapers the largest upfront cost of these five trades.
Average Salary – £22,492 | Average Hourly Rate – £9.54
Mark Tapper from Dickies Workwear said:
“It can be tempting for those in the trade industry to want to work for themselves and we can see why. Having these overhead costs broken down can help provide an understanding of what people need to embark on this new adventure.
“At Dickies Workwear, it is our goal to ensure tradespeople have the correct equipment, with safety being our top priority. Investing in quality equipment and workwear goes hand-in-hand with doing a fantastic job and making customers happy.”
To view the full guide on the true cost of owning a trades business, check out the Dickies Workwear blog here.
