The Australian plumbing industry is split into two main factions: residential and commercial. With between 70,000 and 100,000 working professionals, you can opt for the residential market, which requires quick response times and direct dealings with consumers, or the commercial sector’s more complex engineering and rigorous compliance frameworks.
The industry overall has a severe skills shortage. Apprenticeship commencements are down 9.2%, but demand for residential and commercial plumbing work remains high. Let’s explore the differences between the plumbing industry’s project types.
What residential plumbing jobs typically involve
Residential plumbing focuses on homes, townhouses, and small-scale multi-unit dwellings and can include installation, maintenance, and repair work. While kitchen, bathroom, and laundry fixtures with single plumbing lines are the most common areas requiring work, other projects like overall drainage, outdoor fixtures and more can be present.
Most residential plumbing involves day-to-day maintenance tasks, which can include:
- Repairing leaking taps
- Unblocking toilets
- Servicing domestic hot water units
- Fixing burst pipes
While these seem like straightforward tasks, around 92% of Australian households have some sort of active home maintenance requirement. Reliable, efficient service providers who are comfortable with the on-demand nature of this work will have no shortage of projects to keep the books full.
Beyond maintenance, residential plumbers will often work on renovation and upgrade projects for bathroom and kitchen modernisations, which can include:
- Relocating pipework
- Installing designer fixtures
- Integrating water-efficient solutions (solar-boosted, high-efficiency tankless gas systems/WELS-rated low-flow toilets)
- Integrating smart home technology
The smart bathroom market is projected to reach $20.13 billion globally by 2031. To a degree, this requires new skill sets, such as knowledge of traditional hydraulic principles and modern electronic controls. Whole-house filtration systems, for example, are becoming standard requests, as are high-efficiency fixtures, which have seen a 20% bump in demand as sustainability is now a core consumer requirement.
What business types exist in residential plumbing?
The most common business types in the residential sector are sole traders and small-scale contracting firms. Word of mouth, local SEO, sites like hiPages and tender platforms like E1 (EstimateOne) are the predominant necessities for success in the industry. Response times and online ratings are critical, as is work outside of standard business hours for emergency call-outs. As residential plumbers have direct interaction with homeowners, communication skills and accessible language are as important as technical expertise itself.
Qualified residential plumbers can expect to earn between $85,000 to $100,000 a year, with specialist roles jumping to $120,000 or more.
What do commercial plumbing contracts involve?
Commercial plumbing contracts are often for large-scale environments, including office high-rises, shopping centres, hospitals, universities, and industrial complexes. These systems are used by large groups of people, and their failure can lead to an expensive pause in business operations.
The engineering side of commercial plumbing can be more complicated than residential systems. For example, a multi-story office building’s water infrastructure requires a consistent pressure from high-capacity pumps and pressure-reducing valves. Pipe networks can be more complex, spanning multiple floors with peak demand periods that far exceed the expectations of residential systems.
Mechanical plumbing is another faction of the commercial sector that features the installation and service of large-scale climate control, ventilation, and heating systems. Commercial plumbers must be well-versed in trade waste management, grease traps, oil arrestors, and chemical neutralisers. Backflow prevention is mandatory, with annual testing and maintenance a requirement for devices protecting public water mains. Fire safety isolation is critical for multilayer gas piping, and industrial gas mains management means expertise with large-scale boilers and industrial-grade water heaters. As you can see, the commercial sector has opportunities for more specialised expertise, but is also much more complicated to navigate.
What are the regulatory and compliance considerations in commercial plumbing?
Commercial plumbers operate under a high level of regulatory scrutiny with local council approvals and strict health and safety codes. Hospitals and food processing plants, for example, have sanitation codes that require regular testing and certification. The aforementioned backflow prevention also requires regular testing, with thermostatic mixing valve audits thrown into the mix as well. While it may seem tedious, these tasks create long-term maintenance contract opportunities, which mean stable, recurring revenue for commercial plumbers.
The commercial sector is all about preventative maintenance (residential is reactive repair). System failure costs are high, so commercial property managers put a big focus on scheduled maintenance plans. This can include work like regular drain cleaning, pipe inspections, and water heater servicing. Preventing unexpected breakdowns is a much cheaper solution than fixing things after the fact.
As a result, commercial plumbing work must minimise business disruption, which means plumbing contractors may work during off-peak hours, weekends, or public holidays.
How work is awarded: informal quotes vs structured processes
Winning work for a residential tradie differs from that for a commercial contractor due to differences in risk levels, contract values, and the type of clients each serves.
In the residential market, procurement is somewhat more informal. Decisions often need to be made quickly, and jobs are awarded on simple quotations, with value-for-money, local availability, and quality being the main drivers. Word-of-mouth and repeat customers are the bread and butter here, and the informal nature of the approach means contractors are reliant on trust that invoices will be paid when the work is complete (deposits are also quite normal to help mitigate this).
Commercial and government plumbing work is awarded through multi-staged procurement processes. These can begin with Expressions of Interest (EOI), with contractors evaluated on a range of categories like capability, experience, financial capacity, and more, as opposed to just cost alone. Some providers will be invited to submit formal Requests for Tender (RFT), or the tendering process might be open for anyone to apply.
Platforms like E1 have live tender opportunities for subcontractors across Australia to make it easy to connect directly with builders and submit quotes for a range of commercial construction jobs.
How do plumbing contractors stay financially viable?
To survive in the plumbing industry, businesses must master the balance of volume and efficiency. As plumbing businesses grow their profits, the expenses increase as well. Small firms have lower overheads and labour costs, especially in the residential sector, when compared to larger businesses that handle the complex compliance requirements of commercial contracts. While the commercial work can be worth millions, the high volumes of labour and material costs can make it difficult to remain financially viable.
Insurance is another big consideration that can make it hard for smaller businesses to move into commercial market entry. In the residential sector, a $5 million Public Liability policy will suffice; however, most commercial and government sites mandate minimum $10 million or $20 million coverage. Professional Indemnity insurance is also essential for commercial plumbers who offer design-and-construct services or compliance sign-offs.
The distinction between Registered and Licensed plumbers also affects liability. In Victoria, for example, Registered Plumbers cannot issue Compliance Certificates or work without the supervision of a Licensed Plumber. Licensed Plumbers hold the legal and financial responsibility, and are the only ones who can certify that work complies with relevant regulations.
What are Security of Payment Acts?
For subcontractors on large commercial sites, Security of Payment Acts exist in each state to provide statutory rights to progress payments. This protects plumbers in the unfortunate case of a payment dispute. New South Wales, for example, sets strict payment deadlines for payments from head contractors to subcontractors, and Queensland makes it even simpler with the BIF Act 2017, which allows invoices to count as payment claims as long as they clearly state amounts and work completed.
How to stay ahead in the commercial construction industry
E1 provides real-time data and live feeds for thousands of plumbing tenders, contract opportunities, and project leads across Australia. We make it easy for you to efficiently find and manage your quotes and submissions with job opportunities from leading Tier 1, Tier 2, and Tier 3 builders. Improve your tendering success rate and win more work with E1 plumbing tenders today.
Alexander
Green
General Manager - Subcontractors
