Do you want to know how much money locksmith owners make yearly? If YES, here are 6 factors that determine the income & profit margin for locksmith businesses. In order to have an idea of the amount a locksmith business is expected to make monthly or yearly, you should clearly define the service offerings of a locksmith business.
A well – established locksmith business is expected to provide professional locksmith services like nonresidential security system installation and repair, residential security system installation and repair, residential and nonresidential system services with monitoring, key cutting and duplication services, resale of locks and security merchandise, renting and reselling security system products, such as mechanical and electronic locking devices, safes and security vaults and other related locksmith services.
With that in mind, we can estimate what a locksmith business is expected to make but it is important to point that there is no one-mold-fits-all when it comes to how much a locksmith business is expected to make. There are some factors that we are going to look into before giving an estimate of how much an average locksmith business make yearly and these factors are;
6 Factors That Determine How Much Money Do Locksmith Businesses Make
Table of Content
- 1. The Size of the Locksmith Business
- 2. The Location the Locksmith Business is Covering
- 3. The Management Style of the Locksmith Business
- 4. The Business Approach of the Locksmith Business
- 5. The Advertising and Marketing Strategies Adopted by the Locksmith Business
- 6. The Number of Years the Locksmith Shop is in Business
- Estimated Profit Margin for a Locksmith Business
1. The Size of the Locksmith Business
One cannot conveniently state the amount a locksmith business is expected to make yearly if you do not know the size of the locksmith business. As a matter of fact, you cannot equate the amount a locksmith business that is just starting out with a well – established locksmith business that offers robust services and operates from a standard office facility.
We must not rule out the fact that the location the locksmith business is covering is a major factor that will determine the amount he or she is expected to earn monthly. The truth is that you will struggle to make good money as a locksmith if you locate the business in an area filled with low income earners or in a ghetto.
If you locate your locksmith business close to a highbrow area or an area with loads of residential properties, offices, automobile repair garages and automobile owners, you are likely going to make good returns from the business.
3. The Management Style of the Locksmith Business
Another key factor that will determine the amount a locksmith business is expected to make yearly is the management style of the business. Trust me, the results you will get when you are good manager will definitely be different from a locksmith business with a poor manager. The idea is that a good locksmith business will not just retain old customers, they will also keep getting new customers especially through recommendations.
4. The Business Approach of the Locksmith Business
There are different business approaches that a locksmith business can choose from and no doubt it will greatly influence the amount they make monthly and yearly. Of course, we know that locksmith business may decide they want to work alone and do their marketing alone or they may decide to partner with other businesses that will recommend clients to them.
It is easier to find locksmith businesses that partner with construction companies, automobile repair companies, schools and government contractors that deal with locks and keys. In essence, a well – organized locksmith business that works with others will surely make more money than a solo locksmith business.
5. The Advertising and Marketing Strategies Adopted by the Locksmith Business
Another key factor that will determine the amount a locksmith business can make yearly is the advertising and marketing strategies adopted by the management of the locksmith business. Trust me, there are several advertising and marketing strategies that can help a business increase their earnings, but you may be expected to spend more.
But the results you will make will far outweigh the amount you spent on advertising and marketing. Of course, you don’t expect a locksmith business that is engaging in aggressive advertising and marketing to make same amount yearly with a locksmith business that is passive with its marketing.
6. The Number of Years the Locksmith Shop is in Business
In business, the number of years you are in existence will go a long way to determine the amount you will make especially if the business is well – managed and creativity always come to bear. For example, in your first fiscal year (FY1) you might make one hundred and twenty thousand dollars ($120,000), in your second fiscal year (FY2) you might make one hundred and fifty thousand dollars ($150,000) and in your third fiscal year (FY3) you might make two hundred and fifty thousand dollars ($250,000).
Estimated Profit Margin for a Locksmith Business
When we talk about the profit margin a locksmith business is expected to make, we must establish the amount a locksmith charges per job and the amount spent or expenditure they put in to get the job done.
On the average, the monthly salary or earning of a small scale – one man operated locksmith shop is between $2,500 to $3,255, weekly earnings between $577 and $751 and hourly earnings of $14 and $19. So, an average locksmith earns anywhere between $40,000 to $60,000 per annum.
A locksmith company is expected to make at about 50 percent and above profit margin from whatever they charge their clients. In some cases, it may be higher especially if the cost of carrying out the project is low, if you are not going to be travelling far for the job and if you are not going to be purchasing any material to execute the job.