Welding Business Plan
For most solo welders starting a mobile welding business, a 1-2 page lean plan is enough. For welders applying for SBA financing on a shop or equipment, a more formal plan is required. This article walks through both.
It's part of the Welding Business guide.
When you need a formal plan
You need a formal plan if you're applying for:
- SBA financing for shop space, equipment, or working capital
- Equipment financing on a major mobile rig ($30,000+)
- A business line of credit
- An investor or partner contributing capital
For a solo mobile welder paying cash for a $15,000-$25,000 starter rig, the lean version below is enough.
The lean plan (1-2 pages)
1. The pitch
"Sandhill Welding & Fabrication is a solo-owned mobile welding business operating in [county/region], offering on-site welding repairs for farms, ranches, construction sites, and small commercial customers. The owner is an AWS D1.1 certified welder with [X] years of experience in [structural/fabrication/repair] work."
2. The customer base
"Target customers are family farms and ranches in [county/region], small construction contractors, and equipment maintenance customers. Local rates for mobile welding are $80-$140/hour based on calls to existing competitors. Initial customer acquisition is through word of mouth, vehicle signage, networking with local farm supply stores, and asking friends and family for referrals."
3. The pricing
| Service | Rate |
|---|---|
| Mobile callout fee | $75 (waived for jobs over 2 hours) |
| Hourly rate, standard work | $95-$120/hour |
| Hourly rate, certified structural | $130-$160/hour |
| Material markup | 20% over cost |
4. The startup costs
| Line | Cost |
|---|---|
| LLC, EIN, banking | $250 |
| Insurance (year 1) | $2,800 |
| Engine-driven welder generator | $7,500 |
| Welding leads, ground clamps, accessories | $400 |
| Tools, grinders, cutting torches, plasma cutter | $2,500 |
| PPE, hood, gloves | $400 |
| Used pickup truck (if not already owned) | $0 to $15,000 |
| Toolbox and storage in vehicle | $800 |
| Initial rod, wire, consumables | $400 |
| Vehicle decals, business cards | $200 |
| Buffer | $750 |
| Total | $16,000-$31,000 |
5. The year-1 revenue projection
| Months | Estimated revenue |
|---|---|
| 1-3 (ramp) | $1,500-$3,500/month |
| 4-6 | $4,000-$7,000/month |
| 7-12 | $5,500-$9,000/month |
| Year 1 total | $45,000-$80,000 |
6. The year-1 operating costs
| Line | Annual |
|---|---|
| Insurance (full year) | $2,800-$4,500 |
| Vehicle fuel and maintenance | $4,000-$8,000 |
| Welding consumables (rod, wire, gas, tips) | $3,000-$8,000 |
| Equipment maintenance and parts | $500-$1,500 |
| Software, banking, fees | $300-$600 |
| Marketing | $100-$500 |
| Total | $10,700-$23,100 |
7. The year-1 profit estimate
Revenue $45,000-$80,000 minus costs $10,700-$23,100 = $34,300-$56,900 net before self-employment tax.
After 15.3% self-employment tax,1 roughly $29,000-$48,000 take-home before regular federal and state income tax.
8. The risks
"Main risks: (1) seasonal slowdown in winter for outdoor mobile work; (2) major equipment failure on the welder generator (mitigated by warranty and small reserve); (3) injury or property damage claim from a job (mitigated by insurance); (4) competition from larger fabrication shops on bigger jobs."
That's the lean plan.
The formal plan structure (for SBA)
For an SBA loan, expand into the standard structure:
- Executive Summary
- Company Description
- Services (with certifications and specializations)
- Market Analysis (regional welding demand, customer segments, competition)
- Marketing and Sales Strategy
- Operations Plan (equipment, workflow, safety procedures)
- Management Team (owner experience and certifications)
- Financial Plan (projections and historical if applicable)
- Funding Request (use of funds)
- Appendix (resume, certifications, insurance certificates)
For an SBA microloan ($5,000-$50,000) or 7(a) loan ($50,000-$300,000) on a welding business, the plan can be 12-25 pages. Use the SBA's free templates and don't pay for a "business plan writer" service.
Next steps
- How to Start a Welding Business - the sequence
- Welding Business Insurance - the insurance side
- Welding Business For Sale - if you're buying an existing operation
Or back to the Welding Business guide for the rest.