Expanding a contracting business into a new state presents challenges and opportunities for plumbers and hot water heating professionals. These unfamiliar markets can lead to a larger customer base and increased revenue.
Although circumstances may be favorable, expansion can also be daunting. How should contractors approach the next stage of business development?
Here are seven smart strategies for expanding your business in a new state.
1. Market research
Before creating a business plan, contractors should research their target market. This stage will reveal the local demand for plumbing and hot water heating services. A new city may require more businesses to serve the metropolitan area’s residents, which will result in another plumbing and hot water heating professional being available to serve them. Research will reveal various gaps that contractors can fill with business expansion.
Market research can also help with financial strategy. The information gathered can tell you what other contractors are charging customers for their services. Knowing this data can help plumbing and hot water heating professionals understand pricing structures and whether competitive costs are achievable.
With little competition, contractors can be more flexible with their pricing. This stage also provides information about marketing and labor costs.
2. Build relationships
Expanding into a new state means establishing relationships with suppliers and industry partners and leveraging existing relationships to make the transition smooth. Local chambers of commerce are a great resource for finding the most appropriate industry professionals to help your contracting business. Plumbing and hot water heating contractors will need to find construction companies, HVAC professionals, and electricians to network with in their new region.
Building your network involves reaching out to companies and establishing partnerships. Another effective strategy is to join local trade associations and attend industry events.
These organizations are the hubs of networks, allowing plumbing and hot water heating professionals to meet with key members of their community and leverage their resources, such as the Georgia Plumbers Trade Association (GPTA) Provides updates on continuing education classes and code changes.
3. Learn from the competition
Meeting with industry experts can help you understand strategies for marketing, pricing, project management, and subcontractor relations. While it can be beneficial to copy their approach, new businesses can also successfully expand by finding gaps in other companies’ business plans. For example, a company could grow in HVAC services and create a one-stop shop for customers and their contracting needs.
Advertising is another area to thrive in. Contractor marketing campaigns can be targeted to specific media such as radio and local television, and plumbing and hot water heating professionals entering this field should consider alternative approaches such as the Internet.
Online marketing should be a priority. It has a high return on investment (ROI) and is usually cheaper than radio, television, and print.
4. Hire local talent
As your business expands, you’ll need to hire new employees to serve your community. While you can source talent from your existing locations, it’s best to hire local professionals who are familiar with local customs and can provide personalized service.
One example of the important knowledge that local employees can provide is local building codes — for example, a New York City licensed plumber knows about drains. The point where the septic tank connects must be installed 36 inches below the finished surface.
Local resources also give you an advantage in understanding the city’s nuances. For example, a licensed plumber in the area will be familiar with government permitting requirements. With this knowledge, they can file paperwork more efficiently and have the connections to streamline the process. These experts can also connect your new business to inspectors, HVAC contractors, and other valuable contacts.
5. Use social media
Finding local plumbers and hot water heaters requires job ads and connecting with industry associations. How can contractors take the next step in their recruitment efforts? Leveraging social media allows businesses to expand their online presence and adapt to modern practices. Facebook is a great platform to start with, as it has a wide reach within the community. Instagram is another strategy to target young professionals.
A sound social media strategy helps businesses reach local customers and increase brand awareness. Locally Focused Social Media Differentiating your small business from the competition helps it compete with larger companies A strong social media presence coupled with search engine optimization (SEO) increases the likelihood that customers will find your small business in search results before a national agency like Roto-Rooter A Google Business Profile is a great starting point for your new business.
6. Manage your transportation needs
Contractors typically need transportation solutions to provide services to their clients. The number of vehicles a company has depends on its business and budget priorities. If finances are tight, they can lease vans to ease concerns about maintenance costs. Owning gives you more control but can incur liabilities. For example, worn out parts Poor maintenance can result in costly repairs.
7. Prioritize online reviews
One aspect that some contractors overlook is the power of online reviews. Because plumbing and hydronic heating professionals serve private clients and businesses, quality of work and friendliness are vital to customer satisfaction. Positive reviews can have a big impact on a new company’s reputation and online presence. Businesses should ask their customers to leave good feedback so others in the community can see their excellent work.
How important are online reviews? Experts say online reviews can have a big impact on customers’ decisions about which contractor to hire. According to a 2024 study, Reviews influence 91% of consumers’ perceptions of a brand. While negative reviews are unwanted, contractors can improve their reputation by responding thoughtfully to these comments. Research shows that 88% of people will use a company that responds to reviews, while only 47% will use a company that doesn’t.
Planning for Success
New states present opportunities for plumbing and hydronic heating professionals. Expansion requires careful planning, including a new business plan, market research, and hiring staff. But smart planning can set you up for success after the transition.
Contractors should prioritize finding niches among existing local businesses and leveraging new technologies to stand out. Social media can help contractors find talent and develop cost-effective marketing strategies so they can confidently enter new states and welcome the influx of customers.
Oscar Collins is the Editor-in-Chief of Modded. Follow him on Twitter. @TModded To receive frequent updates on his work.
