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How to Start a Low Voltage Business (Step-by-Step)

Pick your trade, form an LLC, license and insure the business, set your pricing, then market it and land your first contracts.

Last verified Oct 25, 202617 sources
On this page1. Choose Your Low Voltage Trade2. Write a Simple Business Plan3. Form Your LLC and Get an EIN4. Open a Business Bank Account5. Get Your Low Voltage License by State6. Insurance and Bonding for Low Voltage Contractors7. Startup Costs: Tools, Truck and Software8. Supply House and Distributor Accounts9. Price Your Work10. Contracts, W-9s and Change Orders11. How to Get Your First Jobs12. Market Your Low Voltage Business13. Hiring Your First Tech: 1099 vs W-214. Startup ChecklistSourcesFAQs

To start a low voltage business, pick the trade you will sell, form the company, get your state license and insurance, then price and market your work. General contractors and integrators usually ask for your license and certificate of insurance before your first job, so finish those before you bid. (S1, S8, S12)

1. Choose Your Low Voltage Trade

The main low voltage trades are data and structured cabling, CCTV, access control, alarm and fire alarm.

Your trade decides your license, your insurance and your tool buy. Start with the work you already know and add trades later.

TradeTypical workLicensing note
Data / structured cablingCopper and fiber drops, racks, certificationCovered by low voltage licensing in many states (S1)
CCTVCameras, NVRs, video monitoringSome states license it with alarm work (S1)
Access controlDoors, readers, locks, intercomOften licensed with security or alarm work (S1)
Alarm / intrusionPanels, sensors, monitoringOften a separate alarm license (S1)
Fire alarmFire panels, devices, inspectionsOften a separate fire license; NICET may be required (S1, S7)

If you plan to sell monitored alarm or video, read the wholesale central stations guide before you choose. (S13)

2. Write a Simple Business Plan

The SBA describes a business plan as the roadmap for structuring, running and growing your business, and offers a lean, one-page format. (S2)

  • Trade and services you will sell
  • Service area
  • Who pays you: GCs, integrators, subcontracting firms or end customers
  • Yearly costs and target hourly rate (from step 9)
  • Startup budget for tools, truck and software (step 7)

3. Form Your LLC and Get an EIN

An LLC separates your personal assets from the company's debts in most cases; the SBA compares it with a sole proprietorship, partnership and corporation. (S3)

  1. Pick a name. Confirm it's free with your state before you file.
  2. File the LLC. File with your state directly, or use a formation service. Bizee (formerly Incfile) is one option and includes registered agent service. (S4)
  3. Get an EIN. An EIN is free from the IRS online. (S5)
  4. Save the documents. The bank, the license board and your insurer will ask for the articles of organization and EIN letter.

4. Open a Business Bank Account

The SBA recommends a separate business account for legal protection and simpler taxes. (S6)

  • Bring the articles of organization, EIN letter and your ID (S6)
  • Run every job's income and expenses through this account
  • Use a business card for tools and material

5. Get Your Low Voltage License by State

Each state sets its own rules for low voltage, alarm, access control and fire alarm work, and some cities add their own. Many states license alarm and fire alarm work separately from low voltage, and some require NICET fire alarm certification where you do fire work. (S1, S7) Each LV Handbook state page lists the license type, board, renewal, CE hours and official sources. (S1)

Start with the busiest markets: California, Texas, Florida, New York, Pennsylvania and North Carolina.

All state licensing pages

AlabamaColoradoConnecticut
DelawareDistrict of ColumbiaHawaii
IdahoIndianaIowa
KentuckyLouisianaMaryland
MississippiMontanaNebraska
NevadaNorth DakotaOklahoma
OregonRhode IslandSouth Carolina
UtahWest VirginiaWisconsin
ArizonaNew JerseyTennessee
Washington

Not listed? Use the licensing by state hub. (S1)

  1. Match the license to your work. Cabling, CCTV, access control, alarm and fire alarm can fall under different licenses. (S1)
  2. Check for alarm and fire licenses. Many states license alarm and fire work separately from low voltage. (S1)
  3. Check for NICET. Some states and jurisdictions require NICET fire alarm certification for fire work. NICET certifies engineering technicians, including fire alarm systems. (S1, S7)
  4. Apply through the board. Use the official board link on your state page, and track renewal and CE dates. (S1)

6. Insurance and Bonding for Low Voltage Contractors

Get general liability (GL) insurance, workers' compensation when you have employees, commercial auto and tools coverage before your first job. The insurance carriers guide lists carriers that write low voltage contractors and the limits clients commonly require. (S8)

Some state license boards and some clients require a license or surety bond. Your state licensing page shows whether your license needs one. (S1)

7. Startup Costs: Tools, Truck and Software

Buy for the trade you sell first. Start with the ultimate low voltage tech tool list, then the list for your trade: (S9)

Add a work vehicle with ladder racks and shelving, plus software for quoting, invoicing and accounting. Enter all of it in the Cost Per Hour calculator in step 9. (S10)

8. Supply House and Distributor Accounts

Open trade accounts before your first bid so you get contractor pricing and can pick up material the same day.

Account typeWhat it's for
Local electrical supply houseWire, boxes, conduit, fittings, same-day pickup
Low voltage and security distributorCameras, access control, alarm panels, cable
Data and fiber distributorCable, connectivity, racks, fiber
Manufacturer dealer programDealer pricing, training and support for brands you install

Most trade accounts ask for your EIN, business license, resale or tax-exempt certificate and trade references. Apply for net terms once you have a payment history.

9. Price Your Work

  1. Know your cost per hour. Enter a year of insurance, vehicle, tools, software, phone and licensing costs, plus your billable hours, in the Cost Per Hour calculator. (S10)
  2. Add your pay and profit. Your labor rate is cost per hour plus what you pay yourself plus margin.
  3. Price by the drop or device. Time a typical drop, camera or door, multiply by your labor rate and add material at your markup.
  4. Check subcontract rates. Compare a firm's posted pay with your cost per hour before you accept. (S12)

10. Contracts, W-9s and Change Orders

  • Written quote or contract with scope, exclusions, price and payment terms
  • Form W-9 with your EIN, which clients use to report what they pay you (S11)
  • Certificate of insurance (S8)
  • Change-order form with your price for added work, signed before you do it

11. How to Get Your First Jobs

New companies usually win work three ways: subcontracting, general contractors and direct customers.

  1. Subcontracting. Marketplaces, integrators and rollout firms are the fastest first revenue. The subcontractor companies guide lists who hires subs, their pay terms and insurance minimums. (S12)
  2. General contractors. Send your packet to local GCs and electricians who need low voltage partners.
  3. Direct customers. Property managers, offices and homeowners. Use photos and test results from earlier jobs as references.
  4. Build your packet. W-9, COI, license number, HireLV profile link, services and coverage area. (S8, S11, S15)

12. Market Your Low Voltage Business

  • Claim your Google Business Profile and add your services and area (S14)
  • Build a simple website with services, service area, license number and contact info
  • Use the exact same business name, address and phone everywhere
  • Create your HireLV profile so companies can find you: techs join here, companies sign up here (S15, S16)
  • Put your profile link in your email signature and subcontractor packet

13. Hiring Your First Tech: 1099 vs W-2

The IRS decides 1099 versus W-2 by how much control you have over the work: behavioral control, financial control and the relationship. If you control how and when the work is done, the tech is likely an employee. (S17)

  1. 1099 contractor. Runs their own business, uses their own tools and carries their own insurance. Collect a W-9. (S11, S17)
  2. W-2 employee. You withhold taxes and add workers' comp before they start. (S8, S17)
  3. Recheck licensing. Some states license individual techs as well as the company. (S1)

14. Startup Checklist

  • Trade chosen and simple plan written
  • LLC approved, EIN issued
  • Business bank account open
  • State license (and alarm/fire license or NICET where required) issued
  • Insurance bound, bond in place if required, COI ready
  • Core tools, truck and software set up
  • Supply-house and distributor accounts open
  • Cost per hour and labor rate set
  • Contract, W-9 and change-order forms ready
  • Google Business Profile, website and HireLV profile live
  • Packet sent to subcontracting firms and GCs

Sources

FAQs

Do I need a license to start a low voltage business?

In many states, yes, and the license depends on the work you do. Check your state in the LV Handbook licensing by state hub. (S1)

How much does it cost to start a low voltage business?

It depends on your trade, state fees, insurance and tools. Add up your real costs in the LV Handbook Cost Per Hour calculator and the trade tool lists. (S9, S10)

What insurance does a low voltage contractor need?

General liability, workers' comp once you have employees, commercial auto and tools coverage. The insurance carriers guide lists common client minimums. (S8)

Do I need a bond?

Only if your state license board or a client requires one. Your state licensing page shows whether your license needs one. (S1)

Can I do low voltage work without an electrical license?

In many states a separate low voltage or limited license covers this work, but some states require an electrical license. Check your state page. (S1)

Do alarm and fire alarm work need a separate license?

Often, yes. Many states license alarm and fire work separately, and some require NICET certification for fire alarm. (S1, S7)

How do I get subcontract work as a new company?

Apply to firms in the LV Handbook subcontractor companies guide with your W-9, COI and license, and create a HireLV profile. (S12, S15)

LLC or sole proprietor?

An LLC usually protects your personal assets from business debts; a sole proprietorship doesn't. Compare them on the SBA business structure page. (S3)

How much should I charge per cable drop?

Time a typical drop, multiply by your labor rate from the Cost Per Hour calculator, and add material at your markup. (S10)

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