Top 5 Most Profitable Niches For Plumbing Businesses In Australia

If you’re running a plumbing business in Australia, the key to growing and sustaining a healthy operation is having consistent profit. And the way to get bankable profit is finding your niche and owning it.

Reports from market researcher IBIS World shows that there are over 28,000 plumbing business in Australia. Think that’s a lot? It is. And it’s an increase of 1% on the previous year. If you’re in the plumbing industry and you’re waiting for the competition to die down… There’s a saying that comes to mind; “In business, you’re either growing or you’re dying.”

I’ve been coaching plumbing businesses since 2002 so let me explain the top 5 most profitable niches for plumbing businesses in Australia. Whether you’re looking to expand your current operations or set up shop for the first time, these niches offer the best opportunities to boost your earnings and secure your financial future.

Commercial and Industrial Plumbing Services

Providing plumbing services for commercial buildings like offices, retail premises, hospitals, schools, and industrial warehouses can be a lucrative niche.

Reason: Maintenance work in the commercial sector is generally resistant to the peaks and troughs that the residential building market suffers from. By earning a reputation as a reliable and cost-effective commercial maintenance plumber, you can secure repeat contracts. When it comes to submitting tenders, a history of consistent work can give your bid a winning edge.

Infrastructure and Non-Building Construction Projects

There are opportunities for specialist plumbing services in non-building markets like water, sewerage, irrigation infrastructure, and water treatment projects.

Reason: these projects are driven by government capital expenditure. Installing and maintaining high-pressure gas and liquid piping systems for industrial applications is another potential niche. However, my advice to plumbers considering this niche is to be aware of the changes in legislation for gas supply in Victoria.

Residential Renovation Services

Offering plumbing services for home extensions, bathroom and kitchen renovations, and entire home plumbing upgrades can be a profitable niche.

Reason: The increase of remote work and hybrid working arrangements mean that more people are spending more time at home. Homeowners may notice plumbing issues more readily or decide to upgrade fixtures/systems while at home. And as home is also now the office, homeowners are investing in upgrading their functional areas (kitchens, bathrooms, laundries).

The changing demographics in Australia is seeing more multigenerational family dwellings. Young adults are living at home for longer and an elderly parents are moving in with their adult children. These movements driving demand for bathroom improvements and add-on living spaces such as pods and granny flats.

Green/Eco-Friendly Plumbing Solutions

With the rise of environment responsibility sustainability, providing eco-friendly plumbing techniques like water conservation systems, greywater recycling, and energy-efficient fixtures is an increasingly profitable niche market.

Reason: research commissioned by the Australian Institute of Company Directors found that 41% of ASX 200 companies now have a dedicated sustainability committee. That represents a 10% increase on the previous year. As Australia’s largest corporations put more effort into their environmental responsibility, this is a niche ripe for capable plumbers.

Specialised Services for Older/Historic Homes

Developing expertise in plumbing solutions tailored for the unique needs of older or historic homes can be a profitable niche.

Reason: Degradation in outdated materials often require specialised knowledge and techniques.

Putting a value on the profitability of a niche

When considering which niche to explore, it’s important to understand the potential profit uplift. Here are some key factors that can influence the profitability of different plumbing niche markets:

Specialisation and Expertise

Niches that require specialised skills, training or certifications tend to be more profitable as plumbers can command higher rates.

Demand and Competition

Niche markets with higher demand and less competition, such as trenchless sewer repair or backflow testing, can be more lucrative. With fewer players, specialists can charge premium rates for their services.

Project Scope and Scale

Larger commercial, industrial or infrastructure projects generally have bigger budgets and higher profit margins compared to smaller residential jobs. Plumbers equipped to handle these complex, high-value projects can boost their profitability.

Customer Profiles

Serving affluent residential areas or high-end commercial clients allows plumbers to charge higher rates for their services, increasing profit margins compared to working in lower-income markets.

Operational Efficiency

Plumbers who streamline operations, invest in training/technology, and optimise scheduling can improve profit margins across any niche by reducing overhead costs and increasing productivity.

So what’s the actual value? It’s hard to be specific as there are so many variables but you could expect a positive bump of 2%-5% to your net profit.

By focusing on these specialised niches, plumbing businesses in Australia can differentiate themselves, cater to distinct customer needs, and potentially command higher rates for their expertise and services compared to general residential plumbing work.

For advice on how to apply these tips on your specific business, contact Tenfold.