Dr. Paul Borosky, DBA, MBA
Business Plan Writer · Business Consultant
How to Write a Welding Business Plan That Bids Jobs Without Bleeding Cash
A welding business does not lose money on bad welds. It loses money on bad bids. Build the plan around a shop rate that covers every cost, equipment payments you can carry, and a customer base that does not hinge on one contractor.
Last Updated: 10/30/2026 · Written by Dr. Paul Borosky, DBA, MBA
Watch First
Watch: How to Write a Welding and Fabrication Business Plan
Welding and Fabrication Business Plan Template
Editable Word plan plus an Excel financial model built for a welding and fabrication shop. Enter your rate, hours, and equipment, and the projections follow.
- Word business plan plus a video tutorial that walks you through every section
- Excel financial model plus a video tutorial that shows you how to enter your numbers
An AI template hands you a blank file and walks away. This one comes with Dr. Paul showing you how to fill in the plan and the model, on video.
The Problem
Why Do Welding Businesses Fail?
Most welding businesses that fail were busy. They underbid jobs, ignored overhead, and financed equipment they could not carry on slow months. A welding business plan fixes that by setting a shop rate from real costs, splitting mobile and shop work, and putting every equipment payment in the cash flow.
Here is the pattern. A skilled welder goes out alone. Work comes fast because the price is low. The rate covered the welder's old wage, not the truck, insurance, gas, rods, grinding discs, and the hours spent quoting and driving. Six months in, the shop is busy and the bank account is empty.
Dr. Paul has supported $100M+ in funding across 1,000+ business plans in 14+ years. Trade businesses that last know their numbers per billable hour. Your business plan is where you find that number, before you quote the next job.
Launching a Welding Shop?
Five Fixes
How Do You Write a Welding Business Plan That Works?
1. Set a shop rate from your own costs
Add up monthly overhead, divide by billable hours, add labor cost per billable hour and consumables. That is break even. Add your profit margin on top. Competitor rates are a check, not the starting point. Show this math in the plan.
2. Split mobile repair from shop fabrication
Mobile work carries drive time, a rig, and on-site risk. Shop fabrication carries rent, bigger equipment, and material handling. Price and project them as separate revenue streams so you can see which one actually makes money.
3. Put equipment payments in the cash flow
Welders, plasma tables, press brakes, and trucks are often financed. Every payment is due whether you worked that month or not. List each piece, its cost, and its payment. Then show you can cover them in a slow month.
4. Do not let one customer own you
One general contractor sending most of your work feels great until they stop paying or switch subs. Set a cap on how much revenue any one customer can be, and show the plan to build a wider mix: contractors, farms, manufacturers, and walk-in repair.
5. Charge for materials, and collect a deposit
Steel prices move. Mark up materials, and collect a deposit before you buy steel for a big job. Spell out payment terms in the plan. Fronting material for a slow-paying customer is a fast way to run out of cash.
Section by Section
What Goes in a Welding Business Plan?
- 1
Executive summary
Services, target customers, shop or mobile setup, the amount you need, and when you break even. Write it last.
- 2
Company description
Ownership, legal structure, certifications, insurance, and the type of work: repair, structural, ornamental, or custom fabrication.
- 3
Services and pricing
Shop rate, mobile rate and trip charge, material markup, and minimum charges.
- 4
Market analysis
Who buys welding nearby: contractors, farms, manufacturers, property owners. Who else they call, and why they would call you.
- 5
Marketing plan
Contractor relationships, a portfolio of finished work, local search, and repeat commercial accounts.
- 6
Operations
Shop layout, equipment list, safety program, quoting process, job tracking, and material purchasing.
- 7
Management team
Your trade experience, certifications, and who handles bids, billing, and the books.
- 8
Financial projections and funding request
Equipment and startup costs, monthly profit and loss, cash flow with loan payments, and how the money will be used.
Example Numbers
How Much Can a Welding Business Make per Month?
These are example numbers only, to show the structure. Your rate, wages, and overhead will differ. Assumptions: 2 welders paid for 8 hours a day and billing 6 of them, 21 working days a month, a $95 hourly rate, $9,000 in materials billed at a 20% markup, consumables and gas at 8% of labor sales, and wages of $30 an hour plus 20% for payroll taxes and workers' comp.
| Line | How it is figured | Monthly |
|---|---|---|
| Billable hours | 2 × 6 hours × 21 days | 252 |
| Labor revenue | 252 × $95 | $23,940 |
| Material revenue | $9,000 × 1.20 | $10,800 |
| Total revenue | Labor plus materials | $34,740 |
| Material cost | Steel and parts at cost | $9,000 |
| Consumables and gas | $23,940 × 8% | $1,915.20 |
| Welder wages | 2 × 8 hours × 21 days × $30 | $10,080 |
| Payroll burden | $10,080 × 20% | $2,016 |
| Fixed costs | Rent $3,200 + equipment loan $1,500 + insurance $1,100 + truck and fuel $1,200 + other $900 | $7,900 |
| Monthly profit before owner pay and taxes | Revenue minus all costs | $3,828.80 |
Notice the welders are paid for 8 hours but bill 6. That is 75% billable. The other hours go to setup, cleanup, quoting, and driving. Plans that assume every paid hour is billable overstate profit from the start.
Avoid These
What Are Common Welding Business Plan Mistakes?
- Pricing off your old wage. An hourly wage covered your labor. A shop rate has to cover everything else too.
- Assuming every hour is billable. Quoting, driving, setup, and cleanup take real time.
- Buying equipment before the work exists. Rent or lease until steady jobs justify the payment.
- Leaving out insurance and certifications. Commercial and structural work often require both. Budget them.
- One customer, one risk. Show a plan to diversify before a single contractor controls your cash flow.
Real World Use
How a Welding Shop Owner Uses This Plan
The rate that looked fine until the math
Say you run a one-person mobile and shop operation. Monthly overhead (rent, truck, insurance, equipment payment, phone, software) is $6,000. You work 160 hours a month but bill 120. You want to pay yourself $35 an hour, and consumables run about $6 per billable hour. You are quoting $85 an hour.
Overhead per billable hour: $6,000 ÷ 120 = $50. Your pay per billable hour: $35 × 160 ÷ 120 = $46.67. Add $6 in consumables and break even is $102.67 an hour.
At $85, every billable hour loses $17.67. That is $2,120.40 a month you cover out of your own pay. To earn a 15% profit margin, the rate needs to be $102.67 ÷ 0.85 = $120.79. Put that math in the plan and quote from it.
State Commerce officials target aerospace, aviation and advanced manufacturing as key Kansas industries. Welding and parts shops that supply those sectors should name them as customers. More on planning a business for Kansas.
Keep Going
More Videos in This Series
What Is in the Welding and Fabrication Business Plan Template
Dr. Paul walks through the welding template section by section. (9:21)
Welding and Fabrication Pro Forma Financial Projections
He builds welding shop projections and profit and loss statements quickly. (8:54)
Welding and Fabrication Business Plan Template Update
He covers the latest changes to the welding and fabrication template. (5:13)
Questions
Welding Business Plan Questions
How do I write a business plan for a welding business?
How do I calculate a welding shop rate?
Should I start a mobile welding business or open a shop?
How much does it cost to start a welding business?
Do I need a business plan for a welding equipment loan?
A welding shop plan follows the same ten steps.
Dr. Paul's How to Write a Business Plan in Ten Steps walks you through each section in order, including the financials and funding request lenders care about. Pair it with the welding and fabrication template.
Written by Dr. Paul Borosky, DBA, MBA, current college professor, business consultant, and author with 14+ years and 1,000+ businesses served.
This page is for general educational purposes only. It is not financial, investment, legal, or tax advice.