If you’re starting a painting business with no experience, you might be asking yourself the following question? How much does it cost to start a painting business? The following cost analysis will help you budget and plan.
We’re going to be looking at the costs based on three different routes you might take.
1. The low budget route.
2. The recommended (by me) route.
3. And the optimized route to fast track your success.
Before we get into all the costs, take a look at the results of this poll I made in a Facebook group asking the audience “How much did you spend to start your painting business?”
I will say that your company’s domain name should be your first expense when starting your painting company. This way, you can name your company based on the available domain names. This will ensure you get an optimized domain name.
Very often I see people come up with a company name first. And then in the future, they go and look for a domain name. What’s the problem with this approach? They will likely realize that there are no optimized domain names that suit their company name available. So they have to settle for an inferior domain name.
What’s an optimized domain name? It’s a domain name that’s short, simple, and easy to remember. An inferior domain name is one that’s harder to remember. Things that make a domain name harder to remember are dash marks that don’t fit naturally, long domain names, having to add unnecessary words to the front or end, or using uncommon domain name endings such as .info.
The best domain names are usually your company name + .com.
The reason you want an optimized domain name is that it increases the likelihood of someone visiting your website when they see or hear your domain name. For example, someone might see your domain name on your company vans or yard signs. Or they might hear it over the phone or in person. If your domain name is simple and easy to remember, there is a greater likelihood they will then visit your website. And thus a greater likelihood that they will become a customer.
I recommend Google Domains as the place to get your domains. The price is very reasonable when you take into account that they give you privacy protection for free. And their system is very easy to use, as you would expect from any Google product. The price is going to be between $12 for most available domain names. Some domain endings are a bit more.
Occasionally we here at Scalebloom sell premium domain names for painting contractors. You can check out what we have available here.
|Low Budget Route||$0.00 – Don’t get a domain name|
|Recommended Route||$12.00 – Get a domain name|
|Optimized Route||$12.00 or more for a premium aftermarket domain name|
If you’re on a low budget, you can use a standard email. I recommend Gmail from Google.
But if you want to look more professional, get an email at your domain name. This typically costs $6 to $7 per month.
|Low Budget Route||$0.00 – Use a regular email|
|Recommended Route||$84.00/year for G Suite custom email|
|Optimized Route||$84.00/year for G Suite custom email|
Registering with your Secretary of State
The exact cost of registering your LLC or other business entity varies from state to state. You will also have to renew it every year. Expect to pay between $50 to $500 per year. Some states have extra taxes such as California’s Franchise Tax.
|Low Budget Route||$150 – average (depends on state)|
|Recommended Route||$150 – average (depends on state)|
|Optimized Route||$300 – privacy + charging order protection|
EIN (Employer ID)
The IRS offers this for free on their website. You’ll likely need it in order to open a business bank account.
|All Routes||$0.00 – Free from IRS|
Business Bank Account
Many banks let you open a business bank account for free. But they might have ongoing monthly fees. You can usually avoid the fees by meeting some basic requirements such as having a certain amount in your account (usually less than $500).
|All Routes||$0.00 – Free from most banks|
Take Credit Cards
I recommend using software that doesn’t charge you to set up the service. They will instead take a small fee from every transaction. Even if you buy a physical point of sale system, they will still charge you a fee from each transaction. Software-based systems usually involve sending your customer an email that contains a payment link.
I see no benefit in buying a physical system that lets customers swipe their cards.
|All Routes||$0.00 – Use an online service with no upfront costs|
This will vary from state to state. Other factors are your projected revenue, services offered, employee count, use of subcontractors, etc.
I posted a poll on Facebook to ask what other painting contractors are paying yearly for insurance. Here are the results:
Quite a few painters pay under $1000 per year but the largest group pays between $2000 to $3000 per year.
Speaking of Facebook, please follow us at facebook.com/scalebloommarketing.
|Low Budget Route||$600.00/yr – Low quality insurance – depends on state.|
|Recommended Route||$2500/yr – Average according to my FB poll|
|Optimized Route||$5000/yr – Or more for better quality insurance|
If you want to avoid bookkeeping costs you can track every transaction yourself on a spreadsheet. Make sure to have a field for the category so you can distinguish the types of expenses such as ‘cost of goods sold’ or ‘marketing’.
To make your life easier, there are lots of bookkeeping and accounting software programs out there. They can connect with your bank account to help you track each expense. I recommend a cloud-based program so that you don’t have to go through the inconvenience of installing anything on your computer. From what I have seen, these programs typically cost $20 to $30 per month for the most basic versions.
If you want to save as much time as possible, hire an accountant to do your monthly bookkeeping. Expect to pay about $200 to $500 per month for this service. But you usually get to ask them questions as well which is helpful during your first few years.
|Low Budget Route||$0.00 – Do your own bookkeeping|
|Recommended Route||$300/yr – Cloud based accounting software|
|Optimized Route||$3600/yr – Bookkeeper retainer|
If you use an accounting software program for your bookkeeping, check to see if they also offer tax prep reports or support.
Or you can use your accountant that does your monthly bookkeeping. Tax prep will normally be a separate cost and won’t be included in the bookkeeping fee. Expect to pay $500 to $3000 for tax prep if you hire an accountant.
|Low Budget Route||$0.00 – Do your own tax prep|
|Recommended Route||$300/yr – Cloud based accounting software|
|Optimized Route||$1000 – Hire an accountant for tax prep|
Phones + Phone Plan
To avoid any phone costs you can use your personal phone number. You can also try a free app such as Google Voice.
If you find it’s just not quite the same thing, invest in decent quality but bare-bones work phone for about $150. I would budget replacing it every 2 years but hopefully, you can get more out of it. So remember to annualize your cost down to $75 per year if you pay $150 for a phone that will last 2 years.
I recommend Google Fi for your phone plan. I pay about $40 for each line on my plan.
|Low Budget Route||$0.00 – Use an existing phone|
|Recommended Route||$555/yr – Buy a $150 phone every 2 years + $480/yr plan|
|Optimized Route||$555/yr – Buy a $150 phone every 2 years + $480/yr plan|
T-Shirts & Hoodies
Your team will look much more professional with branded T-shirts and hoodies. You don’t need to supply pants or other attire. But T-shirts are worth the investment for team morale and professionalism.
At a minimum, I would make sure each painter has 5 shirts (one for each weekday). Then they can do laundry on the weekends and wear the same 5 shirts the next week. And plan on replacing those 5 shirts every 3 months at a minimum. That comes out to 60 shirts per painter. Costs per shirt will vary between $6 to $15 per shirt. Hoodies will be between $20 to $60 per hoodie.
|Low Budget Route||$0.00 – Don’t buy branded T shirts|
|Recommended Route||$1000.00 – Buy branded T shirts|
|Optimized Route||$1000.00 – Buy branded T shirts|
There are a few costs involved with having a website:
- Cost to design and set up the website.
- This can be free if you do it yourself. You can make a free website from your Google My Business profile. You’ll still have to pay for the domain name but it’s a pretty great platform for free.
- If you want a more professional website with better features, conversion rate optimization, and custom design, expect to pay between $500 to $3000. That will depend on how custom you want it. I would also ask your web designer if they have experience making websites for painting contractors.
- Ongoing Fees
- Hosting is the most important and unavoidable cost. A website is a collection of files. Those files need to be hosted on an online server in order to be on the internet.
- a CDN (content delivery network) is an optional ongoing cost that will make your website faster. This increases the user experience. Which will in turn help your website get better search rankings.
- Maintenance is another unavoidable part of having a website. Code, plugins, API’s can all get outdated which makes your website vulnerable to hacking, performance drops, and broken features. Maintenance might also include making changes to the content as needed. This would include updating company hours, service offerings, etc.
|Low Budget Route||$0.00 – Don’t buy a website|
|Recommended Route||$1500.00 – Buy a website.|
|Optimized Route||$2500.00 – Buy an enterprise level website|
The above costs were overhead costs. There are also job-related costs, known as “costs of goods sold”. These will include things like supplies, materials, payroll, subcontractors, gas and other travel expenses, etc.
These are paid for by each job. So you generally don’t need to budget too much for these costs. But if you work for customers that take a long time to pay (commercial customers), you’ll need to budget for it.
I did not include advertising costs for the same reason, they can be paid back from each job.
And I didn’t include a section for equipment because this will vary from company to company based on your services and team size. Many companies even hire subcontractors that supply their own equipment. This means they don’t have to buy any equipment themselves.
As you can see, compared to other types of businesses, the start up costs for painting is quite low, which is one of the reasons that I think it’s a good idea to start a painting business.
About the author:
George Leon owns a painting company in North Carolina and is a co-owner here at Scalebloom Web Design.