How Much Money Can You Make Hanging Christmas Lights Professionally?
Putting up Christmas lights at home each year makes a lot of people look longingly at street-corner signs advertising professional Christmas light installations. For other people, who love getting out there and attempting a personal best with their lights every year, those signs bring a different thought to mind: “I wonder if I could make some money doing this for other people?”
The short answer to that is, “Yes.” If you’re willing to take the effort seriously, there’s a surprising amount of money to be made. Doing it as a side-gig during the holidays, you could come away with between $5,000 and $15,000 per season. A larger, more serious enterprise could bring in profits well into six figures. Solidly built, larger size Christmas companies enjoy hundreds of thousands in annual net profits.
Those six-figure years don’t just happen right away. This is by no means a get rich quick type of business. Just like any other business, it takes hard work, dedication and perseverance. Professional installers don’t tend to see good profitability until at least their third season in business; the first two years are generally spent breaking even or bringing in a very small profit. But the potential is there to make some serious money as long as you’re willing to take the time to learn about the industry, hone some necessary skills and run it like a business and not just a side hobby.
Determining your potential for profit
Before making the leap into starting your own Christmas light hanging business, you’ll want to consider a few things to ensure that taking the next step is right for you.
Location: Can your local population and its average income sustain an installation business? If you’re in an area with less than 50,000 people within 30 miles of where you live, then you may not have the population base to support a Christmas installation business. If the population is sizable, is the average income adequate to support your business? Most of your customers will be upper middle class and wealthy residents. You’ll find that average middle-class families don’t have enough disposable income to be able to justify paying for professional Christmas services. Check the demographics in your region and look for areas where the average household income is $90,000 a year and higher.
Competition and Demand: How many other installers are there in your area? Is the market already saturated? Do some research and see how many Christmas light hangers you find via Google and Facebook. But just because you find a lot, doesn’t necessarily mean there’s too much competition. That could be a sign that your area is very hot, and it can support a lot of installers. Your goal with this step is to see how many fellow pro installers you’ll be competing with as well as if there’s a good demand for these services. Again, don’t get too concerned if there are a lot of folks already in the business. In the Dallas/Fort Worth area there are hundreds of pro Christmas installers, but there’s still demand for even more.
Acumen: Do you have experience running a business? Have you ever managed employees, sold products or services, or had a chance to gain experience in marketing? Fortunately, a Christmas installation business can be grown slowly over time in order to allow you to gain experience in any areas that you may be weak in. But if you’re coming into this business with previous business experience, it can help fuel your growth faster and help you expand your business in a shorter period of time. But be warned….…this business is not like anything you’ve done before. Previous business experience can help significantly, but running a company that does virtually all its annual income in a 90-day period creates some unique challenges that you probably haven’t faced in previous businesses that you’ve worked or owned.
Time: How much time do you have available for building your business? Are you currently working a full-time job and planning to install Christmas lights on the side? Are you already involved running another business? Do you have a lot of extra time available or perhaps a flexible schedule with your other job? Your answer will play a significant role in the development of your business. Like anything else, the more time you put in, the more you’ll get out. But limited time doesn’t mean you shouldn’t consider starting your own Christmas business. It just means that you may have to start slow and only handle a handful of jobs each season until you have more time available.
Money: Do you have money to invest into a new business? Fortunately, a Christmas installation business doesn’t require a significant upfront investment, but there are some expenses that you’ll need to incur in order to get your business up and running. I’ve seen Christmas businesses started on a shoestring budget of less than $1500, but it will make it a slower and more difficult process to grow your business. If you’re looking to setup a serious Christmas business, then it’s best to have $10,000 to $15,000 available to help get it off the ground.
How big can a Christmas installation business get?
The image above shows a tree with professionally installed wraps.
A pro installer would charge anywhere from $15,000 to $25,000 for a tree like this.
Okay. You’ve decided you’re in a position to make a go of hanging Christmas lights professionally. Just how big a business are we talking about? Christmas installation businesses can get huge. It all depends on just how big your personal measure of success is and how much oversight you have the stomach for.
For instance, building a business that goes beyond $1 million in annual revenue takes a lot of overhead and a year-round staff; that means a lot of administrative maintenance on the part of the owner and a year-round payroll. My own experience with pro Christmas business owners is that they typically find that once they cross the $1 million annual mark, they begin to see profits drop significantly due to the increased overhead. So remember, bigger is not always better.
You may want to set your sights slightly lower; some of the most profitable installation businesses handle between $250,000 and $750,000 in business each year. Keep in mind that your revenue generation time period is 90 days or less. So generating half a million of revenue in 90 days is no small feat.
Of course, if you’re the go-big-or-go-home type of entrepreneur and you’re looking to create a true Christmas empire, the opportunity for big money is there. Some of the older, most successful Christmas installation businesses handle $5 million-plus in annual installations.
Obviously, a lot of money can be generated from a Christmas installation business, but it’s important to understand that your measure of success shouldn’t just be the top line number. You can be selling millions a year in installation services, but at the same time losing hundreds of thousands of dollars each season. Revenue may measure the size of your business, but not the health of your business. Focus more on maintaining a profitable business and everything else will take care of itself.
There’s no denying that a lot of wealth can be generated from a Christmas lighting business, but it doesn’t come without hard work. After more than 20 years in this industry, I’ve had the chance to talk to thousands of pro installers and many of them have done great in this business. Some operate very large businesses, but others operate smaller installation companies with only a few installers, but make very good annual profits.
If you’re contemplating going into this business, don’t focus as much on how large you want to grow your business, but instead focus on the next step you need to take. Learn more about the industry, figure out if this is something that is right for you and then get your business up and running. Build a solid foundation and the business growth will take care of itself.
Where to go From Here
Looking to learn more about starting your own Christmas light hanging business? Be sure and grab a copy of our book, Starting Your Own Christmas Lighting & Decorating Business. It’s packed full of techniques and inside knowledge that will shave years off your business building journey. With over 330 pages and hundreds of color images, it’s a great next step on your Christmas adventure.