How to Start a Tile Installation Business

Tile is commonly used in bathroom and kitchen walls and an increasingly popular choice for flooring. Demand has boomed in the last decade, driving a 50% expansion in the US flooring industry. If you’re handy with tools, you could start your own tile installation business and ride this growing market to serious success. Best of all, getting started is very affordable and you could even run your business from the comfort of your own home.

But while tiling skills are great, you also need business skills. Luckily, this step-by-step guide will fill you in on all the angles of launching a successful tile installation company.

Step 1: Decide if the Business Is Right for You

Pros and cons

Starting a tile installation business has pros and cons to consider before deciding if it’s right for you. 

Tile installation industry trends

Industry size and growth

• Industry size and past growth – The US tile installation industry is worth $13 billion in 2022 after expanding nearly 50% over the last decade.((https://www.ibisworld.com/industry-statistics/market-size/tile-installers-united-states/))
• Growth forecast – The US tile installation industry is projected to grow modestly in 2022 and in the following five years.
• Number of businesses – In 2021, 47,924 tile installation businesses were operating in the US.((https://www.ibisworld.com/united-states/market-research-reports/tile-installers-industry/)) 
• Number of people employed – In 2021, the US tile installation industry employed 101,443 people. 

Trends and challenges

Trends in the tile installation industry include:

• Tile that looks like wood is becoming increasingly popular, expanding the share of homeowners interested in tile flooring. 
• Tile with patterns, such as Art Deco or North African themes, are all the rage for both floors and backsplashes.

Challenges in the tile installation industry include:

• Supply chain issues are delaying jobs as customers wait for materials.
• There is currently a shortage of skilled tile installers, making it difficult for tile installation firms to hire workers. 

Demand hotspots

• Most popular states – The most popular states for tile installers are Nevada, North Dakota, and Oregon.((https://www.zippia.com/tile-installer-jobs/best-states/))
• Least popular states – The least popular states for tile installers are Arkansas, New Mexico, and Georgia

What kind of people work in tile installation?

• Gender – 5.2% of tile installers are female, while 94.8% are male.((https://www.zippia.com/tile-installer-jobs/demographics/))
• Average level of education – The average tile installer is high school educated.
• Average age – The tile installer in the US is 43.2 years old.

How much does it cost to start a tile installation business?

Startup costs for a tile installation business range from $4,000 to $10,000. Costs include a wet tile saw and other tools, as well as a vehicle to transport tools. The vehicle only needs to be large enough to hold your tools because the customer should generally get the materials delivered directly from the supplier. 

You can learn tile installation for about $500 in just three weeks from the Ceramic Tile Education Foundation, then take an exam to become a certified tile installer. Courses and the exam involve hands-on work, so you might need to travel to one of their sites. You can also search for tile courses near you, or work as a tile apprentice. The best education is hands-on experience. 

You’ll need a handful of items to successfully launch your tile installation business, including: 

• Wet tile saw
• Trowels
• Buckets
• Grout float
• Spacers
• Screw guns
• Nipper
• Grinder
• Marginal trowel
• Drill
• Paddle spinner

How much can you earn from a tile installation business?

Floor and shower tile installation prices range from $8 to $20 per square foot, depending on whether backer board is also installed. Backsplash tile installation is $25 to $30 per square foot. These calculations will assume a $15 per square foot price, and an average job size of 150 square feet. Your profit margin should be about 90% if you’re working by yourself since the customers pay for all materials. 

In your first year or two, you could do two jobs per month, bringing in $54,000 in annual revenue. This would mean more than $48,000 in profit, assuming that 90% margin. As your business gains traction and you begin to get referrals, sales could climb to eight jobs per month. At this stage, you’d hire other tile installers and helpers, reducing your margin to around 40%. With annual revenue of $216,000, you’d make a tidy profit of $86,000.

What barriers to entry are there?

There are a few barriers to entry for a tile installation business. Your biggest challenges will be:

• The skills needed to install tile
• Breaking into a competitive industry

Related Business Ideas

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Step 2: Hone Your Idea

Now that you know what’s involved in starting a tile installation business, it’s a good idea to hone your concept in preparation to enter a competitive market. 

Why? Identify an opportunity

Research tile installation businesses in your area to examine their services, price points, and customer reviews. You’re looking for a market gap to fill. For instance, maybe the local market is missing a marble tile installation company or a stone tile installer.

You might consider targeting a niche market by specializing in a certain aspect of your industry, such as tiling backsplashes or showers.

This could jumpstart your word-of-mouth marketing and attract clients right away. 

What? Determine your products or services

In addition to tile services, if you have the skills, you could install other types of flooring and remodeling or handyman services. 

You should also have a list of tile manufacturers or suppliers you can refer clients to. You can find local companies, or you can find companies online that will deliver. Some include:

• Stone Source
• United Tile
• Fireclay Tile

Some customers may prefer to go to a local tile shop with a showroom. If you find local partners, you may even be able to negotiate a deal with them for a commission when you refer customers to them.

How much should you charge for tile installation?

Prices vary based on location, type of tile, and what’s being tiled. Floor or shower tile with backer board can range from $10 to $20 per square foot. Backsplashes run $25 to $30 per square foot. Check prices in your area to make sure you’re competitive. You should aim for a profit margin of about 90%. 

Once you know your costs, you can use this Step By Step profit margin calculator to determine your mark-up and final price points. Remember, the prices you use at launch should be subject to change if warranted by the market.

Who? Identify your target market

Your target market will be broad so you should spread out your marketing to include sites like TikTok, Instagram, and Facebook. You should also connect with people on LinkedIn. 

Being on LinkedIn gives you much credibility, plus you can connect with realtors who can give you referrals. You can also partner with tile manufacturing companies that don’t do installation.

Where? Choose your business premises

It’s unlikely that you’ll ever need a physical location unless you want to become a tile dealer as well as an installer, and then you’ll need a showroom space. You can find commercial space to rent in your area on sites such as Craigslist, Crexi, and Instant Offices.

When choosing a commercial space, you may want to follow these rules of thumb:

• Central location accessible via public transport
• Ventilated and spacious, with good natural light
• Flexible lease that can be extended as your business grows
• Ready-to-use space with no major renovations or repairs needed

Step 3: Brainstorm a Business Name

Your business name is your business identity, so choose one that encapsulates your objectives, services, and mission in just a few words. You probably want a name that’s short and easy to remember, since much of your business, and your initial business in particular, will come from word-of-mouth referrals.

Here are some ideas for brainstorming your business name:

• Short, unique, and catchy names tend to stand out
• Names that are easy to say and spell tend to do better 
• Name should be relevant to your product or service offerings
• Ask around — family, friends, colleagues, social media — for suggestions
• Including keywords, such as “tile” or “tile installation”, boosts SEO
• Name should allow for expansion, for ex: “Jim’s Bakery” over “Jim’s Cookies”
• Avoid location-based names that might hinder future expansion
• Use online tools like the Step by Step Business Name Generator. Just type in a few keywords and hit “generate” and you’ll have dozens of suggestions at your fingertips.

Once you’ve got a list of potential names, visit the website of the US Patent and Trademark Office to make sure they are available for registration and check the availability of related domain names using our Domain Name Search tool. Using “.com” or “.org” sharply increases credibility, so it’s best to focus on these. 

Finally, make your choice among the names that pass this screening and go ahead with domain registration and social media account creation. Your business name is one of the key differentiators that sets your business apart. Once you pick your company name, and start with the branding, it is hard to change the business name. Therefore, it’s important to carefully consider your choice before you start a business entity.

Step 4: Create a Business Plan

Every business needs a plan. This will function as a guidebook to take your startup through the launch process and maintain focus on your key goals. A business plan also enables potential partners and investors to better understand your company and its vision:

• Executive Summary: Brief overview of the entire business plan; should be written after the plan is complete.
• Business Overview: Overview of the company, vision, mission, ownership, and corporate goals.
• Product and Services: Describe your offerings in detail.
• Market Analysis: Assess market trends such as variations in demand and prospects for growth, and do a SWOT analysis.
• Competitive Analysis: Analyze main competitors, assessing their strengths and weaknesses, and create a list of the advantages of your services.
• Sales and Marketing: Examine your companies’ unique selling propositions (USPs) and develop sales, marketing, and promotional strategies.
• Management Team: Overview of management team, detailing their roles and professional background, along with a corporate hierarchy.
• Operations Plan: Your company’s operational plan includes procurement, office location, key assets and equipment, and other logistical details.
• Financial Plan: Three years of financial planning, including startup costs, break-even analysis, profit and loss estimates, cash flow, and balance sheet.
• Appendix: Include any additional financial or business-related documents.

If you’ve never created a business plan, it can be an intimidating task. You might consider hiring a business plan specialist at Fiverr to create a top-notch business plan for you.

Step 5: Register Your Business

Plus, registration is exciting because it makes the entire process official. Once it’s complete, you’ll have your own business! 

Choose where to register your company

Your business location is important because it can affect taxes, legal requirements, and revenue. Most people will register their business in the state where they live, but if you’re planning to expand, you might consider looking elsewhere, as some states could offer real advantages when it comes to tile installation businesses. 

If you’re willing to move, you could really maximize your business! Keep in mind, it’s relatively easy to transfer your business to another state. 

Choose your business structure

Business entities come in several varieties, each with its pros and cons. The legal structure you choose for your tile installation business will shape your taxes, personal liability, and business registration requirements, so choose wisely. 

Here are the main options:

• Sole Proprietorship – The most common structure for small businesses makes no legal distinction between company and owner. All income goes to the owner, who’s also liable for any debts, losses, or liabilities incurred by the business. The owner pays taxes on business income on his or her personal tax return.
• General Partnership – Similar to a sole proprietorship, but for two or more people. Again, owners keep the profits and are liable for losses. The partners pay taxes on their share of business income on their personal tax returns.
• Limited Liability Company (LLC) – Combines the characteristics of corporations with those of sole proprietorships or partnerships. Again, the owners are not personally liable for debts.
• C Corp – Under this structure, the business is a distinct legal entity and the owner or owners are not personally liable for its debts. Owners take profits through shareholder dividends, rather than directly. The corporation pays taxes, and owners pay taxes on their dividends, which is sometimes referred to as double taxation.
• S Corp – An S-Corporation refers to the tax classification of the business but is not a business entity. An S-Corp can be either a corporation or an LLC, which just need to elect to be an S-Corp for tax status. In an S-Corp, income is passed through directly to shareholders, who pay taxes on their share of business income on their personal tax returns.

We recommend that new business owners choose LLC as it offers liability protection and pass-through taxation while being simpler to form than a corporation. You can form an LLC in as little as five minutes using ZenBusiness’s online LLC formation service. They will check that your business name is available before filing, submit your articles of organization, and answer any questions you might have. 

Step 6: Register for Taxes

The final step before you’re able to pay taxes is getting an Employer Identification Number, or EIN. You can file for your EIN online or by mail or fax: visit the IRS website to learn more. Keep in mind, if you’ve chosen to be a sole proprietorship you can simply use your social security number as your EIN. 

Once you have your EIN, you’ll need to choose your tax year. Financially speaking, your business will operate in a calendar year (January–December) or a fiscal year, a 12-month period that can start in any month. This will determine your tax cycle, while your business structure will determine which taxes you’ll pay.

The IRS website also offers a tax-payers checklist, and taxes can be filed online.

It is important to consult an accountant or other professional to help you with your taxes to ensure you’re completing them correctly.

Step 7: Fund your Business

Securing financing is your next step and there are plenty of ways to raise capital:

• Bank loans: This is the most common method but getting approved requires a rock-solid business plan and strong credit history.
• SBA-guaranteed loans: The Small Business Administration can act as guarantor, helping gain that elusive bank approval via an SBA-guaranteed loan.
• Government grants: A handful of financial assistance programs help fund entrepreneurs. Visit Grants.gov to learn which might work for you.
• Friends and Family: Reach out to friends and family to provide a business loan or investment in your concept. It’s a good idea to have legal advice when doing so because SEC regulations apply.
• Crowdfunding: Websites like Kickstarter and Indiegogo offer an increasingly popular low-risk option, in which donors fund your vision. Entrepreneurial crowdfunding sites like Fundable and WeFunder enable multiple investors to fund your business.
• Personal: Self-fund your business via your savings or the sale of property or other assets.

Bank and SBA loans are probably the best option, other than friends and family, for funding a tile installation business.

Step 8: Apply for Licenses/Permits

Starting a tile installation business requires obtaining a number of licenses and permits from local, state, and federal governments.

In some states, you may need a general contractor’s license depending on the type of work that you do. Check with your state for requirements.

Federal regulations, licenses, and permits associated with starting your business include doing business as (DBA), health licenses and permits from the Occupational Safety and Health Administration (OSHA), trademarks, copyrights, patents, and other intellectual properties, as well as industry-specific licenses and permits. 

You may also need state-level and local county or city-based licenses and permits. The license requirements and how to obtain them vary, so check the websites of your state, city, and county governments or contact the appropriate person to learn more. 

You could also check this SBA guide for your state’s requirements, but we recommend using MyCorporation’s Business License Compliance Package. They will research the exact forms you need for your business and state and provide them to ensure you’re fully compliant.

If you feel overwhelmed by this step or don’t know how to begin, it might be a good idea to hire a professional to help you check all the legal boxes.

Step 9: Open a Business Bank Account

Before you start making money, you’ll need a place to keep it, and that requires opening a bank account.

Keeping your business finances separate from your personal account makes it easy to file taxes and track your company’s income, so it’s worth doing even if you’re running your tile installation business as a sole proprietorship. Opening a business bank account is quite simple, and similar to opening a personal one. Most major banks offer accounts tailored for businesses — just inquire at your preferred bank to learn about their rates and features.

Banks vary in terms of offerings, so it’s a good idea to examine your options and select the best plan for you. Once you choose your bank, bring in your EIN (or Social Security Number if you decide on a sole proprietorship), articles of incorporation, and other legal documents and open your new account. 

Step 10: Get Business Insurance

Business insurance is an area that often gets overlooked yet it can be vital to your success as an entrepreneur. Insurance protects you from unexpected events that can have a devastating impact on your business.

Here are some types of insurance to consider:

• General liability: The most comprehensive type of insurance, acting as a catch-all for many business elements that require coverage. If you get just one kind of insurance, this is it. It even protects against bodily injury and property damage.
• Business Property: Provides coverage for your equipment and supplies.
• Equipment Breakdown Insurance: Covers the cost of replacing or repairing equipment that has broken due to mechanical issues.
• Worker’s compensation: Provides compensation to employees injured on the job.
• Property: Covers your physical space, whether it is a cart, storefront, or office.
• Commercial auto: Protection for your company-owned vehicle.
• Professional liability: Protects against claims from a client who says they suffered a loss due to an error or omission in your work.
• Business owner’s policy (BOP): This is an insurance plan that acts as an all-in-one insurance policy, a combination of the above insurance types.

Step 11: Prepare to Launch

As opening day nears, prepare for launch by reviewing and improving some key elements of your business. 

Essential software and tools

Being an entrepreneur often means wearing many hats, from marketing to sales to accounting, which can be overwhelming. Fortunately, many websites and digital tools are available to help simplify many business tasks. 

You may want to use industry-specific software, such as FONN, JOBBER, or Octopuspro, to manage your estimates, projects, schedule, and billing.

Accounting

• Popular web-based accounting programs for smaller businesses include Quickbooks, Freshbooks, and Xero. 
• If you’re unfamiliar with basic accounting, you may want to hire a professional, especially as you begin. The consequences for filing incorrect tax documents can be harsh, so accuracy is crucial.

Marketing

Some of your business will come from casual online visitors, but you should still invest in digital marketing! Getting the word out is especially important for new businesses, as it’ll boost customer and brand awareness. 

Once your website is up and running, link it to your social media accounts and vice versa. Social media is a great tool for promoting your business because you can create engaging posts that advertise your products: 

• Facebook: Great platform for paid advertising, allows you to target specific demographics, like men under age 50 in the Cleveland area. 
• Instagram: Same benefits as Facebook but with different target audiences.
• Website: SEO will help your website appear closer to the top in relevant search results, a crucial element for increasing sales. Make sure that you optimize calls to action on your website. Experiment with text, color, size, and position of calls to action such as “Get Free Quote Now.” This can sharply increase purchases. 
• Google and Yelp: For businesses that rely on local clientele, getting listed on Yelp and Google My Business can be crucial to generating awareness and customers. 

Kickstart Marketing

Take advantage of your website, social media presence, and real-life activities to increase awareness of your offerings and build your brand. Some suggestions include: 

• Flyering – Distribute flyers in your neighborhood and at industry events. 
• In-Person Sales – Offer your tile installation services at tile stores.
• Email marketing/newsletter – Send regular emails to customers and prospects. Make them personal. 
• Start a blog – Start a blog and post regularly. Change up your content and share on multiple sites.
• Seek out referrals – Offer incentives to generate customer referrals to new clients. 
• Paid ads on social media – Choose sites that will reach your target market and do targeted ads.
• Pay–per-click marketing – Use Google AdWords to perform better in searches. Research your keywords first.
• Do a webinar – Share your tile installation expertise online with a video seminar.
• Testimonials – Share customer testimonials about how your tile installation helped them.

Develop your website

Website development is crucial because your site is your online presence and needs to convince prospective clients of your expertise and professionalism. They are unlikely to find your website, however, unless you follow Search Engine Optimization (SEO) practices. These are steps that help pages rank higher in the results of top search engines like Google. 

You can create your own website using services like WordPress, Wix, or Squarespace. This route is very affordable, but figuring out how to build a website can be time-consuming. If you lack tech-savvy, you can hire a web designer or developer to create a custom website for your business.

Focus on USPs

Unique selling propositions, or USPs, are the characteristics of a product or service that set it apart from the competition. Customers today are inundated with buying options, so you’ll have a real advantage if they are able to quickly grasp how your tile installation business meets their needs or wishes. It’s wise to do all you can to ensure your USPs stand out on your website and in your marketing and promotional materials, stimulating buyer desire. 

Global pizza chain Domino’s is renowned for its USP: “Hot pizza in 30 minutes or less, guaranteed.” Signature USPs for your tile installation business could be:

• Professional, reliable tile installation for any surface
• Boost your home’s look and value with stunning new tile floors
• Expert tiling and remodeling for all your home improvement needs

Networking

You may not like to network or use personal connections for business gain. But your personal and professional networks likely offer considerable untapped business potential. Maybe that Facebook friend you met in college is now running a tile installation business, or a LinkedIn contact of yours is connected to dozens of potential clients. Maybe your cousin or neighbor has been working in tile installation for years and can offer invaluable insight and industry connections. 

The possibilities are endless, so it’s a good idea to review your personal and professional networks and reach out to those with possible links to or interest in tile installation. You’ll probably generate new customers or find companies with which you could establish a partnership. 

Step 12: Build Your Team

If you’re starting out small from a home office, you may not need any employees. But as your business grows, you will likely need workers to fill various roles. Potential positions for a tile installation business include:

• Tile Setters – set pre-cut tiles
• Tile Installers – measure and cut tiles, install tiles
• General Manager – scheduling, accounting
• Marketing Lead – SEO strategies, social media

At some point, you may need to hire all of these positions or simply a few, depending on the size and needs of your business. You might also hire multiple workers for a single role or a single worker for multiple roles, again depending on need. 

Free-of-charge methods to recruit employees include posting ads on popular platforms such as LinkedIn, Facebook, or Jobs.com. You might also consider a premium recruitment option, such as advertising on Indeed, Glassdoor, or ZipRecruiter. Further, if you have the resources, you could consider hiring a recruitment agency to help you find talent. 

Step 13: Start Making Money!

Everyone needs flooring, and more and more people are choosing tile these days, which is why now is a great time to get in and ride this growth wave. If you’re into tiles and have a passion for perfecting a craft and a desire to help people upgrade their homes, a tile installation business could be perfect for you. 

After reading this article you’ve got the business part down pat, so now it’s time to get to work and launch your successful new tile business!