This question comes from Chuck in NY.
Have been doing handyman type jobs for people for many years but mainly as a help for them and little profit for me. Now, having retired from teaching, I’d like to turn it into a small business. My main questions would be:
— How to legally get started without pricing myself out of this smaller (cheaper) market for people to turn to rather than going to a contractor?
— What is an acceptable fee to charge a customer for various tasks around their houses? Do I start with a set fee, say 65$ for the first hour and $45 per hr thereafter or figure the main jobs they want and come up with a total? Many times I’ll be at a house and they will add several other jobs that in their estimation will take a couple extra minutes but involves more time and running to the local Home Depot for parts.
— What is a fair hourly wage if I get someone to help at times?
— I also wonder if you have any particular Insurance companies you can recommend that would give some good rates on the liability insurance for a handyman business. I asked my insurance agent who is with Nationwide Insurance and he thought it would be about $2K a year through them. Any companies you know of that are more small business friendly?
I don’t like to charge hourly personally. I like to have the customer show me the projects they want done and then I give them a flat rate. That way, they know exactly how much they are going to pay and I know exactly how much I’m going to make.
You’ll have to check the laws in your state but you’ll want some generally liability insurance and you’ll have to check on the the types of projects that require a contractors license. Here in California, anything under $500 doesn’t need a contractors license.
If a customer wants to add on extra jobs while I’m at the house I take a look at what it is and I tell them how much the extra charge will be. If I know I’ll need to go to Home Depot, I make sure I price that in as well.
If you do end up going hourly there really is no standard “fair” hourly wage. There’s guys that charge anywhere from $15 an hour (which is ridiculous and unsustainable) all the way to $150 an hour. It’s going to depend on your level of experience and the type of customers you are servicing.
If you need help with jobs at times you’ll have to decide what is fair for the person you are using. I usually pay a minimum of $15 per hour for helpers. If they are better than just a helper and they can do projects on their own while we’re at a job site, I have no problem paying them $20 or more per hour. It really all depends on their worth to you. If they are actually making you money (which they should be), you should definitely pay them what they are worth.
As far as insurance goes, the best deal I’ve seen anywhere for limited liability insurance for a handyman business is from ACHP.
I hope that helps.