Think like a business owner not an electrician!

In ramblings by David Parden

Making the transition from electrician to the owner of an electrical contracting company requires one to change their mindset about what it is they do if they want to be successful. Lets examine what electricians versus owners do in their day-to-day duties.

Electricians are concerned with trouble shooting and installing electrical apparatus. Foremen are concerned with ordering material, manpower, and schedule. Basically they are concerned with getting the job done only!

The primary function of the owner is getting work for the company and making a profit on that work. A good business owner is first and foremost a great salesman. As stated in previous blogs, the two most successful electrical contractors I knew were not even master electricians.

An electrician’s salary is paid from the labor built into the estimate. Business owners are paid from the overhead bid into the estimate. If you do not understand overhead you better become familiar with it really fast or your destined to join the ranks of failed contractors. Electricians are paid for everything they do. Business owners are paid for little they do. Electricians work 40 hours per week. Business owners work a whole lot more! Electricians get to leave the job at work. Owners are always working.

Electricians use tools like side cutters, crimpers, and screwdrivers. Owners use tools like calculators, accounting software, and scale rulers. If you’re an owner of a business and you are primarily are using your hand tools your probably not going to make it in the long term. What happens to your little company when you get sick or take a vacation? Does it just cease to operate? How much grace period do you think your clients will give you before moving on to another electrical contractor?

If you are just starting out or never really made the transition to owner here are some essential things you should be doing as a business owner or have available to you.

  1. Marketing your business
  2. Estimating work
  3. Payroll and accounting
  4. Working with your CPA
  5. Working with your business attorney
  6. Project Management
  7. Safety


None of the items listed above have anything to do with actually installing or trouble shooting electrical work. You are in the business of SELLING electrical work that your company just happens to install. The art of running a business isn’t so much about the product but the art of selling the product. There are a million and one electrical contractors out there on any given day and probably 25% of them are about to fail. Are you going to be one of them? If you do not get your head right you likely will be! To Learn more developing your skills as a business person click here