start a local service business

How To Start A Local Service Business The Smart Way

In a nutshell: Starting a local service business is a great opportunity to generate revenue quickly. The competition is much lower than an online based business and they are not leveraging currently technology as much as they should. Going in with a solid plan and an outstanding customer service can get you up and running real fast!

 

Online side hustles are all the rage these days.

Everybody wants to start an ecommerce store, a digital marketing agency, an app or anything that has to do with the online world.

But what about making money offline? Is there still money to be made?

The answer is Hell Yes!

Local services businesses have a lot of major advantages for people who are ready to work hard and wants to make extra money. It may even replace your full-time job.  

Local service businesses

  • Are simple to understand for your potential clients, so easier to sell
  • The competition is local (and mostly weak)
  • The risks of losing a lot of money are low
  • It’s easier to analyze the competition
  • You can start with no experience
  • You can start with no resources, only your time and your smarts!

If your day job experience, involve management, technology, marketing or any business related fields, you can transfer them in your side hustle for strong competitive advantage.

Bringing the best skills you have in a common service business will allow you to make you mark in the local market, generate awareness and generate high margins.

 

Conditions of local service businesses success

There are A LOT of business you could succeed in. There are probably opportunities that are better than others.

It depends on your locationmarket conditions and your creativity

Location:

  • Are you in a big city, suburb or rural area? 

Market Conditions:

  • Is there a lot of competition?
  • Do you need any permits to operate in this space? 
  • Is the demand growing? 

Creativity:

  • Is there a way to the same service, but with a better concept? 
  • How can you execute?

 

List of local service business ideas

Here is a list of businesses that have a high potential for success. I curated the list to show business that takes close to no experience and close to no money. There are a lot of excellent business ideas that require experience, so do not hesitate to drift away if you can. 

  1. Deck Staining
  2. Window Cleaning
  3. Mobile Car Washing / Detailling
  4. Residential Painting
  5. Pressure Washing
  6. Graffiti Removal
  7. HVAC System Cleaning
  8. Carpet Cleaning
  9. Gutter Cleaning
  10. House / Condo Cleaning
  11. Plants / Flower Irrigation 
  12. Hedges Trimming
  13. Wallpaper Installation
  14. Mobile Chef Service
  15. Aquarium Installation
  16. Pet Walking
  17. Local Moving Service
  18. Pool Cleaning Services
  19. Pool Safety Alarm Installation
  20. Boat Cleaning
  21. Plane Cleaning
  22. RV Cleaning
  23. RV Winterizing
  24. Boat Winterizing
  25. Mobile Haircuts
  26. Mobile Makeup
  27. Mobile Teeth Whitening Service
  28. Pest Control
  29. Mobile Manicure/Pedicure
  30. Mobile Tutoring
  31. Mobile Oil Change Service

 

Note: Some of the ideas above require a certification in order to operate. The bigger the “barrier to entry”, the less competitive it is and the most  potential of profit it has! Take this into consideration when looking for the right opportunity.

 

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Making a choice

To help you further in choosing which service business may be right for you. Choose 5 to 10 business ideas while considering the following. 

1.Make sure there is not a lot of competition in your area. Launching with a service business that has close to no competition or weak options will help you in setting yourself as the most professional and will speed up your growth. I will explain later in this guide how to check the competition.

2. You want to operate in a space where the prices have been stable or rising. One way to put you out of business is to be in a market where all the competitors are undercutting each other. Offer a service that is not renown for being cheap. A way to approach this is to specialize. The bigger the city you are in, the more specialized you can get. For example, offering a mobile chef service may be competitive in Brooklyn, NY and it may be harder to not compete on price. Doing the same service, but specializing in Vegan, Paleo or Keto cuisine may help you stand out and put you in a position to raise your prices.   

3.Avoid businesses where the quality of the work is subjective. You want to deliver a service where its clear when the service has been rendered and can be measured somehow. For example, it is clear when a condo has been cleaned, a house painted, a graffiti removed, etc. 

4.Operate in a space where the demand is growing. With some market research and clever tactics, you will assess quickly is the demand is strong. A tool I suggest you use is Google Trends. It will give you an idea of the research for a specific query in the search engine. You can get insights about the seasonality and compare it to other search terms you may have.

 

Once you’ve made a shortlist of local service businesses you may be starting, go through every single one and ask yourself:

  • Is there technological advancement that could be useful that competitors seem not to be doing?
  • How can I apply these technologies to save money and time?
  • Is the industry way behind in terms of online presence (functional and current website, social media presence)?
  • Is this service hard to find other than word of mouth?
  • How much capital am I willing to invest?
  • How quickly will I need to make money?

 

Market Research

Remove half of your choices based on the answers of the previous questions. Now have between 3 and 5 service business ideas that fly high on your radar.

Now it’s time to do some market research on these respective industries.

Have a look in Google for  “[business idea] near me” see what comes out.

Have a look at the yellow pages website with the same query.

Then have a look at Yelp

Are there many companies operating in your city?

What are the reviews saying?

Do they only have a phone number? An email? A website?

If they have a website, what does it look like? Is it a like a time travel to 2004? But mostly, can you see yourself doing better?

 

Market research II – Time to call them

Now you need to know more. You must call every single one of them and act as a curious customer. Ask them for when you should expect to have a quote and get the service done. 

Ask about the price and what it contains (labor, equipments, etc.) they may not want to justify, but if you’re a client that is just looking what you are paying for, you may get a lot of valuable information. 

The most valuable information you need to know is how quick they are on their feet, because this is often the way you will make a name for yourself, assuming your deliver quality work.

Ask about the seasonality, when would be the best and worst time to ask for the service.

Tel them you are looking but not ready yet to take a decision. Tell them you are expecting to be ready to decide in a week. Are they following up? 

Repeat with each competitor. You will find similarities, and this may help you find an entry point in your positioning.

Try to look for the same local service business idea in other big cities. Is there anyone doing it outstandingly? Study them and try to understand what they are doing right.

If you go through all your business ideas and call the main potential competitors and ask them these question and do your research, you should be able to know which idea to pursue and in which way to position the business.

 

Naming your business

It’s difficult to come up with a business name that is available as an URL and a social media handle. So don’t get discouraged if nothing seem to fit. Here are some guidelines for naming your business:

  1. Try to keep your name as short as possible. “Superquickhousecleaningchicago.com” won’t do it.
  2. Try to name your service and use a random word with it, like a fruit, an animal or a word of another language, or an identifier like gang, squad, crew, etc. Putting geographical location is okay, but I find it may limit you if you want to spread your operations down the line.
  3. Aim for a .com. If your name is easy to remember (e.g. petcarecrew), dot com is the first place they will think of looking. (petcarecrew.com is available at the time of this writing by the way)
  4. Do not use “free”, “cheap” and other similar words in you company name

For searching a business name, I have 2 tools I recommend

Both of them are 100% free and will save you a great deal of time.

I suggest you look to reserve along with the URL, the Facebook page, the Instagram name, and the YouTube name. Even if you are not planning now to use them, it may come a point where you want to and you will thank yourself for having them. For the URL, I suggest you find the cheapest option. Currently, namecheap.com is the best alternative I know.

 

The website

You will need a website. And it will be a central piece of your business. You will want it to go the extra mile on the look because the more professional it looks, the more perceived value your services will have. 

There are 4 choices I recommend for building your website:

    • Are you a former professional designer? Then you can save money and design it yourself. Make sure the UX is top-notch because you want to direct the people on it to get in touch with you. (cheapest)
    • Buy a website builder like Wix and build it yourself. This work best if you have a clear vision of how you want your website to look like, but don’t have the technical knowledge to do it.  Wix is a very popular platform and is very user friendly. (cheap)
    • Use a template. This is my favorite way to build a website. Buy a premium WordPress Template and tweak it yourself. Depending on your budget, there are many ready to go themes you can find on Template Monster or Theme Forrest. Just type in the service you want to provide and browse through! (moderate)
    • Hire a web designer to set it up for you. If you have absolutely no idea of what to do and how to do it and you have some money, the help of a professional is the best option. Just tell him what you want and make sure to give him all the information he needs and he’ll handle the rest. I recommend that you encourage a local web designer if you can. If you are not able to find one locally, try Fiverr or Upwork to find a freelancer (expensive). 
Note: If you decide to hire a Designer Or Web Developper, you have to understand that you get what you pay for. Paying for a professional website is worth it and you shouldn’t cut corners. there is nothing worst than trying to save money with your website and ending up having to starting it all over. Trust me. My personal suggestion and what worked for me (if you are not a tech person) is to buy a  WordPress template that you love, and have it installed buy a freelance developper.

 

For hosting, you need something fast, secure, and not too expensive. Siteground.com is my favorite. Their lowest plans start at $3.95 per month. It does not get better than that. ( Hosting is not needed if you build your website on the Wix platform, as it will be included in the price ).

You want your website to have a home page, an about page, a contact us page, and an FAQ. If you can add some relevant technology like a chat box to get in touch with the visitors, that is even better.

 

Financial Projections

You want to have some clear and realistic goals in term of revenue, expenses, and profits. It is important that you do a financial projection spreadsheet and do your best to not forget anything in terms of expenses.

Pro tip: add 50% to your total expense projections because we always tend to underestimate the costs of operations.

 

For the revenue, look at how much time you will be available to serve clients and find a realistic number. Make sure you make decent margins on your pricing to cover the expenses.

 To operate in the leanest way possible, start with owning as less equipment as possible. Rent everything you can rent and buy as little as possible. Even borrow if possible. You need to figure out your cash flows in the beginning and really have a grasp of how cash intensive the business really is. Cashflow is the name of the game; you want to be as liquid as possible in the beginning.

I suggest you open a business checking and saving account to keep the business income and your personal income separate. 

Questions you should have answers for:

  • How much revenue need to come into the business to cover all the expenses?
  • That revenue represents how many clients?
  • How many clients per month would make my month a success?

 

Legal

This part will vary wildly from business to business.

To grow without legal distractions, you need to do your research on the licenses, permits, and insurances.

Let’s say you start a local moving business, do you need a permit to operate? And what if you damage a client’s valuable? Are you protected against lawsuits? These are all elements you never want to happen, but need to be prepared for.

I recommend you consult the US small business administration  or Bizpal (Canada) for all things regarding permits and licenses. In terms of insurrance he most important coverage you should consider is the general liability insurance.

Questions you should have answers for:

  • Am I protected against lawsutis?
  • Do I have all the permits and licenses to operate in this city?

 

Operations

Operations separates a chaotic business from a well-oiled machine. Early local business owners should cultivate a passion for questioning, tweaking and continuously improving operations to make the business run efficiently at the lowest cost possible.

The chain of operations comprise  these 5 systems:

  • Client outreach: This is where you find a way to be visible to your target market. They need to know that you exist and what you do.
  • Lead generation: This is the moment you sell your service. What are you offering them? What is your promise? What differentiates your business from others?
  • Billing and collection: This is as the name states it, it is all the systems involved with collecting payments. How will you collect? When will you collect? What types of payments will you accept?
  • Delivery of service: This is the execution of the service. This is the part where you want to be fast, efficient. You want to keep your costs low and the process standardised and repeatable.
  • Customer care and management: This involves answering customer’s questions and be able to make sure they are happy with your service. Most of the time this is the differentiator between you and the competition. This is the part that you collect testimonials when they are satisfied and referrals for new business.
  • Customer follow up: This is is where you follow up with the clients that told you they were not looking yet, or to get back to them at a later date. Most service companies don’t do this and they are missing out. Following up can, over time, double your revenue.

These are the major systems of your operations. Document and improve on them as you go. Eventually, this will become your playbook and will be worth a lot in training employees or if you eventually want to sell the business.

 

Extra tips :

  1. Find active forums of business owners in your field. Spend a lot of time there learning from others
  2. Your biggest asset to better your operations are your clients. Understand that they are not paying for the service you render; they are paying for the different results that is attached to your service. Things such as convenience, peace of mind and confidence are what they are truly after. Find what they truly need and meet their needs. Better yet, surpass them!

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Sales

This is the most important and most challenging part of most entrepreneurs. Be very aware that your principal performance indicator of how you’re doing is your revenue. So this is the number one activity you should spend time on. Everything else goes second. Here are some key advice:

  • Make sure people you meet remembers what you do and have your business card.
  • It has been proven that the people you know directly will be less inclined to buy from you, but the people you know indirectly are the most inclined to use your services. To leverage this, make sure all your friends and family know about your side business. Do not blame them for not doing business with you and make sure your name comes up when people are looking for your service.
  • The best way (by far) to sell is to do a perfect job. Your work will sell itself.
  • The second best is to follow up. Selling takes persistence. If a client tells you to get back to him in a month, you need to get back to him. Continues until he is telling you a clear no.
  • Upsell. When you are doing a job for a client, look for complimentary things you can do. For example, if you are a graffiti removal service, you can offer complementary glass repair services, or anti graffiti coating for an extra amount. This will allow you to increase the average order value.

 

Sharpening the saw

These are not directly related to business, but are extremely important. Practicing these habits will make your journey more sustainable and enjoyable.

  • Your health comes first. The most important thing you need not forget is that to be at your peak level is to take care of yourself. Make sure you sleep, exercise, have a way to handle stress. You will make better decisions and present your best self to clients, partners, and employees.
  • Celebrate the small victories. You finally have your 10th recurring client? You attracted the attention and the business of a bigger client? You generated your first 25k, 50k, 100k of revenue? Celebrate because you deserve it. Acknowledging these milestones and celebrating them will energize you and the people supporting you. Entrepreneurship is a though journey, and it has to be rewarded every steps of the way.
  • Give Back. Give a portion to a charity that you and your team care about. Show gratefulness to the opportunity you have to be successful in order to help people who does not have that chance or a local cause that will have a positive effect in the community.

 

Conclusion

Starting a local service business presents a great opportunity for people who want to build fast, work hard and make money between $2500 – $5000 per month in 6 months from now. All you have to do is do your homework, rollback your sleeves and just start. This guide strictly covers the essentials you need. There is so much more to cover such as  buying ads online, raising money and all types of other strategies, but these aren’t things that are unnecessary to get started. If you focus on the core elements, keep on selling and improving the way you are executing, business success will come to you much sooner than you think. 

 

Now go and make this bread! 

 

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