Every year, many individuals admire the street-corner advertisements for professional holiday light installations while setting up their own decorations. However, for some enthusiasts who strive to outdo themselves each season, these advertisements spark a different question: “Could I potentially earn money by doing this for others?”
The brief answer is, “Absolutely.” If approached with dedication, there's a significant earning opportunity. As a seasonal side job during the holidays, you could earn between $5,000 and $15,000 per season. A more substantial, dedicated business could generate profits well into six figures, with larger Christmas companies earning hundreds of thousands in annual net income.
Achieving six-figure revenues doesn't happen overnight. This is far from a get-rich-quick venture. It requires substantial effort, commitment, and resilience. Professional installers typically only see substantial profitability by their third season; the initial two years are usually spent breaking even or making modest profits. Nevertheless, the potential for significant earnings is there if you're prepared to invest the time to understand the industry, refine essential skills, and run the business professionally rather than as a mere hobby.
Evaluating Your Profit Potential
Before launching your own holiday light installation business, consider several factors to determine if this step is suitable for you.
Location: Does your area's population and average income support an installation business? In regions with fewer than 50,000 people within 30 miles, the population base might be insufficient for a Christmas installation service. Conversely, if the population is large enough, is the average income adequate to back your business? Most of your clients will be upper-middle-class and wealthy households, as average middle-class families typically can't justify paying for professional holiday services. Investigate the local demographics and identify areas where the average household income is $90,000 or higher annually.
Competition and Demand: How many installers are currently in your area? Is the market saturated? Research the number of holiday light installers via Google and Facebook. A large number of competitors might indicate high demand rather than an oversaturated market. Assess both the competition and the demand for these services. Even in densely populated markets like Dallas/Fort Worth, where there are hundreds of professional installers, there remains an ongoing demand for more.
Business Acumen: Do you have previous experience managing a business? Have you handled employees, sold products or services, or gained marketing experience? Fortunately, a Christmas installation business can be gradually scaled up, allowing you to build experience in areas where you may be less knowledgeable. However, if you already possess business experience, it can accelerate your growth and help expand your business more rapidly. Still, be aware that this business is unique, especially since it generates most of its annual income within a 90-day period, presenting challenges you might not have faced in previous ventures.
Time: How much time can you dedicate to building your business? Are you working full-time and planning to install holiday lights on the side? Do you have another business, or do you have a flexible schedule? Your availability will significantly affect your business development. Generally, the more time you invest, the greater your returns. However, limited time doesn't mean you can't start a Christmas business; it might just mean a slower start with fewer jobs per season until you have more available time.
Money: Do you have financial resources to invest in a new venture? Starting a holiday light installation business doesn't require significant upfront costs, but some expenses are inevitable to get it started. While some businesses begin with as little as $1500, growing the business will be slower. For a more serious approach, it's advisable to have $10,000 to $15,000 available to launch the business effectively.
How Large Can a Christmas Installation Business Grow?
The image above showcases a tree wrapped by professional installers.
A professional would charge between $15,000 and $25,000 for similar work.
So, you've decided to pursue professional holiday light installation. How large can the business become? The potential is vast. It largely depends on how expansive your personal ambitions are and your capacity for managing operations.
For example, a business exceeding $1 million in annual revenue demands substantial overhead and a year-round staff, translating to extensive administrative duties and continuous payroll obligations. From my experience, business owners often observe that after crossing the $1 million revenue mark, profits tend to decrease due to increased overhead. Therefore, bigger isn't always better.
Setting more modest targets, such as handling $250,000 to $750,000 in annual business, can be quite profitable. Remember, your revenue window is typically just 90 days or less, making it a remarkable achievement to generate half a million dollars in that short span.
However, if you're an ambitious entrepreneur aiming to build a large Christmas empire, the potential for significant earnings exists. Established and successful businesses in this industry can handle $5 million or more in annual installations.
Evidently, a Christmas installation business offers substantial earning potential, but it's essential to prioritize profitability over sheer revenue. You might generate millions in sales yet still incur considerable losses each season. Focus on maintaining a profitable business, and growth will naturally follow.
After over two decades in this industry, I've interacted with thousands of professional installers. Many thrive, with some operating large businesses and others managing smaller operations with a few installers but achieving significant annual profits.
If you're considering entering this field, don't fixate on the scale of your business. Instead, concentrate on the immediate steps you need to take. Learn about the industry, determine if it suits you, and then launch your business. Establish a robust foundation, and growth will ensue.
What to Do Next
Want to delve deeper into starting your Christmas light-hanging business? Grab a copy of our book, Starting Your Own Christmas Lighting & Decorating Business. It's filled with tactics and insider insights to expedite your business-building journey. With over 330 pages and hundreds of colorful images, it's an excellent next step on your holiday business adventure.
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