The electrical contracting business is dominated by small businesses. Around eighty percent of firms in this space employ less than ten people. This means that there is plenty of room for new small businesses too. The question for those with the right education and experience is how they can do it as well. Let’s look at how to start a successful electrical engineering company.

Research the Market

Most electrical engineering firms work on traditional power and lighting projects. However, contractors are diversifying into new areas. This includes but is not limited to home automation, industrial automation, internet of things installations, and green energy projects.

Determine what niche you’d like to serve. Then, identify your target customer market, and learn what certifications or credentials they consider essential. This ensures that you aren’t fighting for customers in a declining market when you start your business. It also guarantees that you have a solid business plan before you start hiring talent and buying equipment. Try to find an area where you can compete with big firms without having to commit the same amount of capital and resources. If there is an underserved niche you can serve, your research will help you identify and market to them.

Lay the Groundwork

To start an electrical engineering company, you need to have the necessary skills and experience to serve your customers. So, we’ll assume you either have them or have arranged the necessary training before you officially launch your business.

You now need to set up the right type of legal entity for your business. For example, you may want to set up your new business as a limited liability corporation at the start so that your personal assets aren’t at risk if your new business is sued.

Do your research, as you may need to secure the necessary licenses to design or install electrical systems or upgrade existing systems. Learn what is necessary to open a small business in your area such as insurance or business licenses. For example, nearly every electrical engineering firm will need professional liability insurance, also known as errors and omissions insurance. General liability insurance, property insurance, and a business owner’s policy may be appropriate in your case. It is only necessary to get intellectual property insurance if you are developing new products for clients such as new circuit boards.

If you’re going to be working in electrical design, buy software to simplify tasks like HDI layout on printed circuit boards. Tools like Upverter allow you to create advanced designs, as the software will help you stick to strict design rules that ensure manufacturability while efficiently laying out and connecting components. It also allows multiple people to work on projects in real time and facilitates input and collaboration.

Determine which permits you need to do work at residential or commercial sites, and get a Federal Tax Identification Number and an Employer Identification Number, which is necessary to hire employees.

Set Up Operations

Don’t start your business in your home without verifying that local zoning regulations will allow you to do so. If it is not possible, you’ll have to buy or rent a commercial location for your new business. You’ll want both an office and a storage area for supplies and equipment. This has the side benefit of giving you legitimacy when you’re opening trade accounts with electrical equipment suppliers and a place to receive deliveries. You may need to buy or lease a vehicle to transport equipment and supplies to the customer’s site.

While the electrical engineering sector is growing at a steady state, there is plenty of room for innovators. Those who offer novel or value-adding services can certainly compete as small businesses in this space.

Contact Us

Please call us now at +1-510-761-5895 so we can best help you.

You may also schedule a call using our self-scheduling tool at
or complete our the contact form and we will get back to you as soon as possible.


  • How can we help you?
  • This field is for validation purposes and should be left unchanged.

Subscribe to our Newsletter

Subscribe To Our Newsletter

Join our mailing list to receive business growth advice and VIP event invitations.

You have Successfully Subscribed!

Subscribe To Our Newsletter

Subscribe To Our Newsletter

Join our mailing list to receive the latest news and updates from our team.

You have Successfully Subscribed!


Download Influencer Outreach Guide Now

We need to know how to reach out to you to send the Influencer Outreach Guide. Please fill out the form here!

You have Successfully Subscribed!