Making money as a contractor is an excellent choice for those looking to have control over their income and work schedule. With an increasing number of individuals considering contracting as a viable way to make money and start a business, it's essential to understand how to monetize your skills effectively to succeed in this field. Whether driven by the desire for autonomy, the need for additional income, or the pursuit of a lifelong passion, starting a contracting business can be the key to unlocking personal and financial freedom.
Pro tip: Learn how to start a service business with our guide.
What makes contracting profitable
To make money as a contractor, it's crucial to define what makes contracting profitable. A profitable contracting business is not just about earning money it's also about creating a sustainable model that allows for growth and stability. Here are four key aspects that define a profitable contracting business:
Specialization and expertise
Contractors who specialize in a niche market or possess a high level of expertise can command higher rates and attract clients looking for specific skills. Specialization leads to a better understanding of the market, more targeted marketing efforts and the ability to provide exceptional value to clients.
Efficient business management
Profitability in contracting is also about how efficiently you can run your business. This includes having effective systems and processes in place for tasks such as invoicing, project management and client communication. Streamlining these operations saves time and resources, allowing you to focus more on revenue-generating activities.
Strong client relationships
Building and maintaining strong relationships with clients can lead to repeat business, referrals and a steady income stream. A profitable contracting business often has a loyal client base that trusts the contractor's work and is willing to pay for their expertise.
Scalability
Lastly, a profitable contracting business has the potential to scale. This scalability could mean outsourcing certain tasks, offering new services or even productizing your services to serve more clients without a proportional increase in workload.
10 ways to make money as a contractor
The contracting landscape is diverse, with numerous paths to monetization. Here are 10 contracting business ideas, each with insights on how to maximize their profitability:
01. Home repairs and maintenance
Providing services such as plumbing, electrical work, HVAC repairs and general home maintenance is a traditional way for a contractor to make money. Homeowners often require ongoing maintenance and repairs, creating a steady demand for skilled contractors. Maximize profitability by offering package deals for routine maintenance, build a strong online presence for customer reviews and invest in marketing to reach a wider audience.
NW Roofing Inc. offers roof replacements, roof installations and gutter repairs. Past customers have praised NW Roofing for being professional and communicative.
Learn more: How to start a handyman business
02. Freelance project management
This involves assisting businesses or individuals in managing and coordinating various contractor projects for their own homes, or for commercial projects. You might help house flippers who have bought houses to renovate and resell with their projects. Many clients lack the time or expertise to manage projects effectively, making project management services valuable.
Profitability with this contractor business idea means developing strong organizational and communication skills while considering specializing in a specific industry and leveraging project management tools to enhance efficiency.
Guerrero Brothers specializes in masonry repair and construction. Since its inception in 2005, the company has completed more than 2,800 projects.
03. Custom woodworking
Make extra money as a contractor by creating unique, custom wood pieces such as furniture, cabinets or decorative items. Custom woodworking caters to individuals seeking personalized, high-quality products and can often be sold at a premium. To be effective at making money with this DIY business idea this way it’s important to focus on high-quality craftsmanship and unique designs, establish partnerships with interior designers or furniture stores to sell your work and consider offering workshops or classes as a further means of diversifying your income.
Bauer Woodworking has been creating custom wood pieces since 2020. Their custom pieces range from items from the home, to furniture.
Handy Bran creates wood furniture pieces for every room of your home including kitchen cabinets, fireplaces and wardrobes.
04. Painting and decorating
Contractors can also make money by providing interior and exterior painting services, as well as decorative finishes. Regular maintenance and home improvement projects contribute to a consistent demand for painting and decorating services. It’s also a service most homeowners prefer to outsource to a professional. You can offer a variety of finishes and styles, use high-quality materials, provide accurate and competitive quotes and invest in marketing to showcase your work. To do this consider creating a portfolio website.
YK Painting offers bedroom painting services, for rooms of all services. They also offer consulting services for homeowners who want to redecorate themselves but may need initial assistance.
05. Landscaping and gardening
Make more money as a contractor by designing, installing and maintaining outdoor spaces, including lawn care and plantings. Homeowners and businesses value well-maintained outdoor spaces for aesthetic and functional reasons, creating demand for this kind of service, especially in areas with high numbers of single-family homes. Make sure your idea is profitable by staying updated on landscaping trends, offering seasonal services, providing eco-friendly options and considering bundling services for comprehensive landscape solutions.
Delaware Landscaping has over 15 years of experience working in landscaping and they offer a wide range of lawn care and landscaping services. They also offer property management services for a well-rounded service offering.
06. Virtual design consultation
A unique contractor business idea is offering exterior or interior design services remotely through virtual consultations to clients. Virtual consultations are convenient for clients and allow you to reach a broader market than just your immediate area. However, it may limit the services you can offer, as some contractor consultations work only in person. To make this money-making idea work, invest in technology for virtual meetings, start building a website and offer flexible pricing structures.
07. Online courses and workshops
You can also explore creating and selling courses or workshops in your area of contractor expertise. Sharing your knowledge can be a scalable business idea and passive income stream, as in you create once and sell your course indefinitely. Get started making money online this way by identifying niche topics, marketing your courses effectively, using multimedia to enhance learning and engaging with your audience for feedback and improvement.
08. Commercial construction projects
Undertaking construction projects for commercial clients, such as offices, retail spaces or industrial buildings can be a highly profitable way to make money as a contractor. Commercial projects often involve larger budgets and can lead to long-term relationships with businesses for future work. Make sure to build a strong reputation, establish relationships with suppliers and consider specializing in a specific type of commercial construction.
Kane Home Repairs has been servicing clients in Waukesha County, Wisconsin since 2016. This family-owned business offers everything from carpentry and remodeling to commercial maintenance.
09. Property maintenance
Make money as a contractor by providing ongoing maintenance services for residential or commercial properties. Property owners often seek reliable contractors for routine maintenance to protect their investments. Increase profitability potential by offering subscription-based maintenance plans, provide quick response times and use technology for efficient scheduling and communication.
10. Home technology installation and management
Consider installing and managing smart home technologies, security systems and audiovisual setups in homes and offices as another way to make money as a contractor. The demand for smart home technologies is on the rise and many homeowners need professional assistance with installation and management. Be sure to stay updated on the latest technologies, offer bundled services for comprehensive solutions and provide excellent customer education and support.
How to get started making money as a contractor
Define your niche and services
Clearly defining your niche and the services you offer helps you target a specific market and stand out from competitors to make money.
Identify your skills and expertise - is it private home contractor services, or commercial properties?
Research the local market to understand demand.
Choose a niche or specialization based on your skills and market demand. For example, if you live in an area where most people don’t have lawns, a landscaping business or service is not a good idea.
Clearly outline the services you will provide.
Business planning
A well-thought-out business plan provides direction and addresses legal considerations associated with starting a business, including business type, registration and business name.
Create a business plan outlining your goals, target market, competition and financial projections. Learn more about creating a specific contractor business plan.
Choose a legal structure for your business (sole proprietorship, LLC, corporation.).
Register your business and obtain any required licenses or permits.
Set up a business banking account to separate personal and business finances.
Build a website
A website helps potential clients find you and establishes credibility for your contracting business.
Use a website builder to create a website showcasing your services, portfolio and contact information. Looking to sell products related to your contractor business? Consider making an eCommerce website.
Set up social media profiles on platforms relevant to your target audience.
Optimize your online presence for local search engine optimization (SEO).
Collect and display customer testimonials and reviews.
Marketing and networking
Effective marketing and networking increase your visibility and attract potential clients.
Develop a marketing strategy that includes online and offline methods.
Use social media, local advertising and search engine marketing.
Attend industry events, join professional associations and network with other contractors.
Offer promotions or discounts for initial projects to attract your first clients.
Financial management and pricing strategy
Proper financial management and a well-defined pricing strategy are crucial for profitability and sustainability.
Set up accounting systems to track income and expenses.
Determine your pricing strategy by considering costs, competition and perceived value.
Create clear and detailed contracts for your services.
Establish payment terms and methods and send professional invoices promptly.
Learn more:
How to make money as a contractor FAQ
What type of services can I offer as a contractor?
Contractors can offer a wide range of services depending on their skills and expertise. Common services include home repairs, maintenance, construction, landscaping, consulting, project management and technology installation.