How to Run a Service Business: 9 Effective Strategies

The service industry is already booming in 2024. This is a good thing, considering thousands, if not hundreds of thousands, of service businesses, declined during 2020 because of the pandemic and resulting lockdowns. Global service businesses are worth $15,365.25 billion as of 2023 and will grow to $16,707.58 billion in 2024. This business sector is popular because it offers valuable services to other businesses, tourists, and individuals.

So, if you are starting a service business this year or want to learn how to run a service business, it is the absolute best time to do so. You can work for yourself and use your service skills to meet consumer needs.

What Service Business is Most Profitable?

What is a service business, exactly? Service businesses deliver services that help customers to complete a task. This includes specialized services, expertise, and labor. If you want to learn how to start a service-based business, it is crucial to understand which service business sectors are most profitable.

Business Consulting

Business consulting is a high-value service business option. Business consultants are exceedingly qualified to help people start and grow their own companies. They are often freelancers who work according to their own schedules and have many business connections from their earlier office careers.

IT, Tech Support

IT and technical support are two of the most profitable service sectors in the world. Considering how interconnected everything has become, these professionals can charge high fees (including call-out fees) when helping businesses and individuals with IT issues.

Cleaning Services

During the pandemic, health organizations greatly emphasized cleaning and disinfecting high-use areas. This rolled over to the post-pandemic years, with people still using cleaning services. The cleaning services industry is competitive but lucrative. Plus, learning how to start a service business in the cleaning sector is easy.

Accounting / Tax

Accounting and tax businesses collectively employ more than 300,000 people. It is a profitable sector mainly because accounting and tax preparation is complex, and people would rather have someone do it on their behalf.

Auto Repair

Drivers rely on their vehicles for personal use and business. If a vehicle emergency happens, it is more than just an inconvenience, it costs time and money to fix. This is why the auto repair service sector is so successful. Even one-person auto repair companies can earn top dollar per year. Most people cannot fix their own cars and must rely on qualified mechanics. Auto repair centers also prevent vehicle emergencies by performing regular inspections and car services.

Real Estate

Real estate is another highly competitive but exceptionally lucrative business sector. Just look at the flippers and resellers in the U.S. alone. Moreover, real estate offers a massive profit margin for leasing and selling. Agents can work according to their own schedules and aim to sell more expensive properties as they gain experience.

Online Courses

It is abundantly clear that the pandemic has led to a boom in specific sectors and a decline in others. Online learning platforms experienced (and still experience) a growing demand for online learning courses. This sector offers teachers an opportunity to teach from home. And it gives students more chances to upskill themselves. Online courses include anything from graphic design to stock market business skills.

Web Design

Speaking of graphic design, these skills come in handy when designing websites. Most companies have a website and require someone to design a brand look and feel. This includes the website itself and all other marketing materials. Most service businesses outsource web design requirements to designers who work from home. This helps designers save money on travel and earn more per hour.

What is the Most In Demand Service?

If you are starting a services business, but most of the above options do not appeal to you, consider one of the most in-demand services of 2024. These include:

HVAC

If you like working with your hands, you should consider starting an HVAC service-based business. It is one of the most in-demand services because of the need for heating, cooling, and air quality in homes and businesses. Moreover, HVAC companies also offer emergency repairs, which is invaluable to homeowners.

Plumbing

Plumbing installation and repair are another sought-after business sector. Plumbers install new systems in newly built houses and repair or replace old systems. They also handle emergencies like burst pipes and malfunctioning faucets and water heaters.

Accounting

Accounting is a must-have skill for business owners, whether they do the accounting themselves or outsource it. Accountants handle all financial aspects of businesses, including account analysis, financial statements, tax returns, and audits. Accountants help business owners make the right financial decisions for the success of their businesses.

Roofing

Roofing is difficult and expensive work. But it is a highly profitable service business option. Old houses need re-roofing, and when homeowners cannot do this themselves, they call in roofing experts. Roofing companies also perform roof inspections and can fix leak repairs, increasing the value of a property.

Locksmith

People who do not do locksmithing often forget about locksmiths until they need one. Locksmiths do not only unlock house and car doors but also provide security by installing new locks and repairing damaged ones. This is an in-demand service sector that continues to grow.

House Cleaning

Many professionals do not have the time to clean their houses every few weeks. Some are so busy that they do not even get to do surface cleaning. For them, house cleaning services are a lifesaver. House cleaning companies are popular because they offer flexible schedules. They also come at affordable prices that suit different budgets.

Pool Cleaning

Pool cleaning is not for everyone. Some homeowners despise doing it and would pay a high monthly rate for a professional person to do it. Pool cleaning also requires expert knowledge for testing and balancing chemicals and skimming debris and dirt. It is a must-have service for many homeowners.

Lawn Mowing

Lawn care and mowing is another activity many homeowners cannot get into. Landscaping companies thrive because of this and their expertise in gardening, fertilizing, and landscape design.

Personal Care

Personal care businesses have always been in demand and continue to grow in popularity. Consumers love hair and nail salons, barber shops, and spas. Recently, many estheticians have grown their businesses rapidly because of the demand for expert beauty and skin care services.

How To Run a Service Business Successfully

While you should choose a service business idea that resonates with you and your customers, you must know how to run your business successfully. Use the following tips to get off to the best possible start:

Refine Your Business Idea

Chances are that when you select a business idea, you will already have competition. It is essential to refine the idea, so your business appeals to a larger audience. For instance, if you want to start a dog-walking service, you could include a doggy spa in higher-tier packages. Doing this will help your business stand out and potentially beat the competition.

Create a Service Website

You cannot run a service business without a website. When you settle on a business idea, you must design a website that aligns with your business goals. For example, if you want to open a B&B, your website must allow for online bookings. If you want to start a tax consulting business, your website must have a FAQ section and online contact forms.

Write a Business Plan

A business plan is crucial for all service companies. Writing an official business plan will help you visualize the steps of starting your business. This document should include why you want to start a service business and where you plan on operating. It should detail your available finances, cash flow, and the projected revenue of your business.

Organize Your Finances

The overhead costs of running a business and the startup costs of that same business are not the same thing. You need to have enough money to buy the equipment and hire the staff you need while keeping some funds for said overhead costs. It is critical to organize your finances properly so that you do not run into cash flow issues before your business has had a chance to grow.

Register Your Business

Register your business and get an Employer Identifying Number (EIN) for tax purposes. Your tax ID number will entitle you to personal business protection and tax benefits, and you can hire employees as your business grows.

Develop a Pricing Plan

Depending on what type of service business you start, you must develop several pricing plans. You can charge per hour or package. You can even create value-based pricing based on different services.

Level Up Your Skills

The service industry is constantly changing to keep up with consumer demand. No matter which service business you start, you must continuously level up your skills to ensure you provide customers with the best possible service and value for their money.

Promote Your Business

Moreover, if you want your service business to succeed, you must promote it on several platforms. You can create several social media profiles and use email marketing for promotions. Set up or claim your Google Business Profile and add your business contact information and address. You can even use print advertising, depending on the service you promote and your target audience.

Deliver Outstanding Service

Once you start promoting your service business, you must live up to your promises of excellent customer service. Always aim to meet and exceed expectations and retain customers. This process will help you get positive business reviews, attracting even more customers.