How to start a kitchen and bath remodeling company

This guide follows the path to opening a kitchen and bath remodeling company in the US: the license class that fits the work, deposits and cancellation rights, the dust hazards in the shop and on site, and the first clients. The finding that catches most new owners is how much of the money is set by law: California caps a deposit at $1,000 or 10 percent with no exception for special-order cabinets, and gives buyers 65 and older five business days to cancel.

By Niomi AscotUpdated October 3, 202616 min read

Licensing: State by state; California's B-2 is built for remodels of three or more trades, and Texas has no state remodeler license
Deposits: California: $1,000 or 10%, whichever is less; Pennsylvania: one-third above $5,000
Right to cancel: Three business days for home sales; five in California for buyers 65 and older
Lead paint: EPA firm certification to work on or advertise pre-1978 renovations: $300 for five years
Silica: OSHA cited violations in 149 engineered stone inspections from September 2023 to July 2024
Who homeowners hire: General contractors on 48% of kitchens and 52% of baths (Houzz, 2026)

What the business is, and the ways to set it up

California’s remodeling license reads like a job description for this trade: drywall, finish carpentry, flooring, insulation, painting, plastering, tiling, and swapping electrical and plumbing fixtures “such as faucets, sinks, toilets, and tubs” (CSLB B-2). A kitchen and bath company runs those trades in the two rooms a family can least do without.

The shape of the firm decides the license and the paperwork:

Design-build with a studio or showroom. A paid design agreement, then the build. A deal negotiated at your place of business falls outside the federal three-day cancellation rule and California’s version of it, which is one reason showrooms pay for themselves.
In-home sales and install. The consult and the signature happen at the homeowner’s table. That brings cancellation rights and, in California, a registered salesperson.
A single-trade specialist. Cabinets, tile, countertops or tub-to-shower conversions. California licenses these as separate classes, and its remodeling class cannot take a one-trade job.
Franchise or independent. A franchisor must hand over its disclosure document “at least 14 calendar-days” before you sign or pay (16 CFR 436.2).

Know who homeowners hire now. In Houzz’s 2026 kitchen study, general contractors were the most common hire at 48 percent, ahead of building specialists at 42 percent and cabinetmakers at 34 percent (Houzz Kitchen Trends 2026). For baths, general contractors led at 52 percent, with bathroom remodelers and cabinetmakers at 23 percent each (KBB on Houzz Bathroom Trends).

The outlook: crews, spending and a flat 2026

The trades you hire are tracked on O*NET OnLine using Bureau of Labor Statistics data. Carpenters earned a median $29.12 an hour, or $60,580 a year, in 2025; 959,000 were employed in 2024, with growth of 5 to 6 percent projected to 2034 and 74,100 projected openings. Tile and stone setters earned a median $26.77 an hour, or $55,690; there were 52,600 in 2024, and O*NET projects growth of 7 percent or more, much faster than average.

The jobs are large and slow. In the Houzz & Home 2026 study of 20,358 homeowners, kitchens took 9.5 months of planning and 5.8 months of construction on average, and primary baths 8.4 and 4.8. Median spend was $24,000 for a kitchen and $15,000 for a primary bath, and Houzz’s kitchen study put a major kitchen at $55,000 against $20,000 for a minor one. These are homeowner-reported medians, not prices.

2026 is a holding year. The NKBA expects kitchen and bath revenue to stay “essentially flat at $228 billion,” while pro-led spending rises 5.3 percent and outpaces do-it-yourself work (NKBA outlook update). Its member firms cut their own forecast to a 2 percent revenue decline for 2026 (NKBA Kitchen and Bath Market Index), and Harvard’s remodeling indicator, as reported by NARI, expects growth to slow to 0.5 percent by the second quarter of 2027.

There is no separate count of kitchen and bath firms. The Census Bureau’s NAICS index files remodeling under Residential Remodelers, and County Business Patterns counted 135,337 of those establishments with paid employees in 2023, 81 percent with fewer than five. Most competitors are small.

Licensing and certification

No federal license covers remodeling. States go three ways: a contractor license (California, Florida for structural work), a registration or local license (Pennsylvania, New York City), or no state license for the remodeler while plumbing and electrical stay licensed (Texas). Two national rules apply almost everywhere.

EPA lead paint. Anyone paid to disturb paint in housing built before 1978 must be certified, and “This includes all firms, even sole proprietorships”; firms “cannot advertise or perform” covered work without firm certification (EPA RRP for contractors). The minor-work exemption stops at six square feet of paint per room inside, and pulling out a run of painted cabinets and the wall behind them disturbs far more than that. As of October 2026, firm certification costs $300 and lasts five years, and renovators take an 8-hour course, then a 4-hour refresher. Fourteen states run their own programs, among them Massachusetts, North Carolina, Oregon and Wisconsin (EPA state programs).

NKBA certification. The National Kitchen and Bath Association’s Certified Kitchen and Bath Designer credential costs $950 and needs at least three years in the industry with one as a kitchen and bath designer, plus qualifying education, or seven years with three as a designer on experience alone (NKBA certifications). Certified members complete 20 hours of approved education each cycle. It signals design skill; it replaces no state license.

State licensing for kitchen and bath remodelers

State	Who issues it	What you need	Key requirements, as the agency states them
California	Contractors State License Board	B-2 Residential Remodeling, B General Building, or a specialty class such as C-6 or C-54	Needed when a project requires a permit, uses other workers or totals $1,000 or more; four years of experience in the class; exam; $25,000 bond; salespeople registered
Florida	DBPR Construction Industry Licensing Board	Building or residential contractor license for structural work	Age 18; four years of experience, one as a foreman; FICO 660 or a financial responsibility course; residential minimums of $100,000 public liability and $25,000 property damage
Texas	No state agency; the residential construction commission was abolished in the 2009 Sunset review	No state remodeler license; plumbing and electrical licenses required for that work	Licensed plumbers and electricians for moved sinks and new circuits; city registration and permits
Pennsylvania	Office of Attorney General	Home improvement contractor registration	Required at $5,000 or more of home improvements a year; $100 every two years; $50,000 personal injury and $50,000 property damage insurance
New York City	Department of Consumer and Worker Protection	Home Improvement Contractor license	Trust fund enrollment ($200) or a $20,000 surety bond; an owner passes the Home Improvement Exam; proof of EPA certification; two-year license

Fees are as of October 2026. Confirm each requirement with the issuing agency, and ask your county or city what it licenses on top.

California. The $1,000 line took effect January 1, 2025, up from $500, and the exemption below it disappears if the work needs a permit or the unlicensed person employs anyone (CSLB AB 2622 bulletin). Then pick the class that matches the jobs:

B-2 Residential Remodeling covers existing residential wood frame structures where a contract uses at least three unrelated trades, and “A residential remodeling contractor shall not take a contract unless the contract includes three or more unrelated trades or crafts.”
B General Building needs at least two unrelated trades besides framing or carpentry for a prime contract (CSLB B).
C-6 Cabinet, Millwork and Finish Carpentry for a shop that builds and installs cabinets (CSLB C-6), and C-54 Ceramic and Mosaic Tile, which includes stone slabs “for bathtubs, showers and horizontal surfaces inside of buildings” (CSLB C-54).

Each class asks for four years of experience in that class, up to three of which can come from training or education, but “At least one year must be practical experience” (CSLB experience). The fee schedule lists $450 to apply, $32 and $17 for Justice Department and FBI fingerprints, and $200 for a sole owner’s initial license or $350 for other entities. The $25,000 contractor bond comes before the license issues (CSLB, issuing your license).

Two California rules shape how you sell. “A salesperson cannot legally sign a home improvement contract for the contractor unless they are a valid, CSLB-registered home improvement salesperson,” and registration costs $200 (CSLB consumer guide). And the license number goes in “all forms of advertising,” with a first-offense penalty of $100 to $1,000; truck lettering must be 72-point type or letters at least 3/4 of an inch high and wide, you may not advertise outside your classification, and you may not tell the public you are bonded (CSLB advertising guidelines).

Florida. A building contractor may remodel any size building “if the services do not affect the structural members,” while a residential contractor works on one- to three-family homes of up to two habitable stories (Fla. Stat. 489.105). Jobs under $2,500 in total are exempt, but not when split up to dodge the law and not for anyone who advertises as a contractor (Fla. Stat. 489.103). Eligibility runs through Fla. Stat. 489.111, the credit rule through R. 61G4-15.006 and the insurance minimums through R. 61G4-15.003. The license number must appear in every advertisement “regardless of medium” (Fla. Stat. 489.119). In our experience counties often license cabinet and tile work that touches no structure, plumbing or wiring, so ask yours.

Texas. The state settled the fate of its residential construction agency in 2009, when “House Bill 2295 failed to pass, abolishing the Texas Residential Construction Commission” (Texas Sunset Advisory Commission), and no statewide remodeler license replaced it. The trades inside the rooms stay licensed: no one may engage in plumbing without “the proper license, registration, or endorsement” (Tex. Occ. Code 1301.351), or perform electrical work without “an appropriate license” (Tex. Occ. Code 1305.151).

Pennsylvania ties registration to proof of liability insurance (HICPA section 4). New York City issues its own license through the checklist in the table; outside the city, ask the county or town what it requires.

Setting up the company

Entity and tax ID. The SBA says an LLC protects personal assets “in most instances” (SBA business structures). Register the entity with your state, then get a free EIN from the IRS.

Sales tax and contract format. The Texas Comptroller shows how much the contract’s form matters. Residential remodeling labor is not taxable. Under a lump-sum contract “you pay tax on all your supplies, materials, equipment, and taxable services when you buy them. You don’t charge your customer tax.” Under a separated contract, you buy materials with a resale certificate and collect sales tax from the customer on the materials charge (Texas Comptroller Publication 94-116). Other states set their own rules.

Insurance. Google’s Local Services kitchen and bath categories require general and professional liability. Florida and Pennsylvania set the minimums in the table, and the SBA adds commercial property to the usual list (SBA business insurance). In our experience a remodeler also needs commercial auto and coverage for materials stored before install, since cabinets often sit in a garage or warehouse for weeks.

Workers’ compensation. A California employer with a single employee must already carry it (California DWC). Florida requires it from the first employee in construction, which includes “substantial improvement in the size or use of any structure” (Fla. Stat. 440.02). “Texas doesn’t require most private employers to have workers’ compensation” (TDI).

Subcontractors. Most remodelers sub out some trades. The IRS weighs behavioral control, financial control and the relationship, and misclassifying without a reasonable basis can leave you owing the worker’s employment taxes.

Tools, dust control, a studio and software

From what we see in the trade, a new firm puts money into these first:

Dust control. Zip walls, floor protection and HEPA vacuums; homeowners notice the dust in the hallway.
Cutting and layout. Track and miter saws, a wet tile saw, laser levels, and shrouded grinders with vacuums for stone. Under OSHA’s construction silica standard an employer either follows “the control methods laid out in Table 1” or measures exposure, and either way needs “a written exposure control plan” and “a competent person” (OSHA silica in construction).
A place to sell. A design studio or small showroom with door samples, tile boards and countertop chips, or a home office plus storage for cabinets waiting to go in.
Vehicles. A van or pickup and a trailer, lettered with the license number where the state requires it.
Software. Kitchen design and rendering, estimating, a CRM that can follow a lead for most of a year, scheduling, change orders and job photos.
Suppliers. Dealer agreements with one or two cabinet lines, a countertop fabricator, plumbing and tile distributors and an appliance dealer. Their deposit terms meet your state’s deposit cap head on.

Pricing, deposits and the right to cancel

No public source with a stated method gives typical remodeling prices or startup costs, so none appear here; the SBA checklist lists the categories to budget. Most firms price a fixed contract from a finished design, with cabinets and materials at cost plus markup, labor by trade, allowances for selections still open, and written change orders for anything added. Budgets slip: Houzz found 75 percent of homeowners set a budget and 37 percent went over it in 2025, and in our experience the overruns that turn into disputes are the ones never put on a change order.

Deposit caps. In California, “the downpayment shall not exceed one thousand dollars ($1,000) or 10 percent of the contract amount, whichever amount is less” (Cal. Bus. & Prof. Code 7159.5), and CSLB adds, “There are no exceptions for special order materials.” The cabinet order has to be funded from progress payments tied to work done, or from your own cash. Pennsylvania caps the deposit on a contract over $5,000 at one-third of the price, or one-third plus special-order materials designated in the contract, and bars any payment before signing (HICPA section 9). In Florida, taking more than 10 percent up front starts the clock: permits within 30 days and work within 90 days of their issue (Fla. Stat. 489.126). Florida residential contracts over $2,500 also carry a recovery fund statement (Fla. Stat. 489.1425) and the lien law notice (Fla. Stat. 713.015).

Cancellation. The FTC’s Cooling-Off Rule gives buyers until midnight of the third business day to cancel certain sales made at home, Saturdays counted, and does not reach a sale completed at the seller’s permanent place of business (FTC Cooling-Off Rule). California allows “three (3) business days (or five business days if the buyer is 65 or older),” again except for contracts negotiated at your place of business (CSLB consumer guide). Pennsylvania lets the owner rescind within three business days “regardless of where the contract was signed” (HICPA section 7), so a showroom signing changes nothing there.

Financing offers. Houzz found 84 percent of homeowners rely on savings and 34 percent use credit cards. If you advertise financing, Regulation Z treats a down payment, a number of payments, a payment amount or a finance charge as a trigger that requires the full terms and APR in the same ad, “even if the triggering term is not stated explicitly but may be readily determined from the advertisement” (12 CFR 1026.24). “From $199 a month” is a trigger; “financing available” is not.

Funding the firm. The SBA says loan eligibility for a new business “is typically based on its owner’s personal credit score” (SBA).

Hiring crews and keeping them safe

Both carpenters and tile and stone setters list titles approved for Registered Apprenticeship on O*NET, and the Department of Labor says the model offers “progressive wage increases, classroom instruction, and a portable, nationally-recognized credential” (Apprenticeship.gov). In California, anyone selling for you needs the $200 salesperson registration before signing a contract.

Silica from stone countertops is the hazard many new owners have not heard of. OSHA says engineered stone “often contains large amounts of silica.” In its 2022 inspections about a quarter of breathing zone samples exceeded the permissible exposure limit, the highest at about 20 times it, and its emphasis program issued violations in 149 inspections between September 22, 2023 and July 8, 2024 (OSHA engineered stone hazard alert). OSHA and NIOSH issued a further hazard alert on countertop fabrication and installation in 2026 (OSHA silica). The construction standard requires medical exams, including chest X-rays and lung function tests, every three years for workers who wear a respirator 30 or more days a year. California goes further: for artificial stone with more than 0.1 percent crystalline silica, high-exposure tasks need “Effective wet methods that reduce exposure levels below the action level” (Cal. Code Regs. tit. 8, 5204). In practice, have the fabricator make every cut it can in its shop.

The usual citations. For fiscal year 2025 OSHA’s most-cited list was led by fall protection, hazard communication and construction ladders, with respiratory protection and eye and face protection also on it (OSHA top 10). And put a certified renovator on every pre-1978 job.

Finding the first customers

Google Business Profile. A rented address where you do not operate is not eligible, and a shared office qualifies only if it receives customers and is staffed during business hours (Google guidelines). A showroom firm lists the showroom; an in-home firm hides its address and sets up to 20 service areas within about two hours’ drive (Google service areas). Google picks the verification method and recommends video when offered (Google verification).

Local Services Ads. Kitchen remodeling and Bathroom remodeling are separate categories, both requiring general and professional liability and state licenses where they apply, both carrying the Google Verified badge, and screening averages three to four weeks. Neither category was in the first group moved into Google Ads in August 2026; later phases run through late 2026 and 2027 (Google Ads migration).

Screening. Google’s Kitchen remodeling ads run business and owner background checks on every advertiser, while Bathroom remodeling checks only select users (Google Local Services requirements). The checks cover identity, criminal history and, for the company, civil litigation such as judgments and liens (Google background checks).

Reviews and photos. In BrightLocal’s 2026 survey, 47 percent of consumers said they would not use a business with fewer than 20 reviews and 74 percent only care about reviews from the last three months (BrightLocal). Photograph every finished room from the first job. The FTC’s 2024 rule bans fake and bought reviews, with civil penalties.

Follow-up for most of a year. With kitchens planned for 9.5 months on average, a first inquiry is usually research. In our experience the new firm that keeps in touch, with a finished project or a timing note every month, signs jobs that a faster-talking competitor dropped in week two.

Partners. Cabinet and plumbing showrooms that do not install, interior designers, real estate agents preparing homes for sale, and general contractors who sub out kitchens. Houzz says its platform reaches more than 70 million homeowners and 3 million professionals, its own figures; judge it by contracts signed.

When you are ready to build demand, our page on marketing for kitchen and bath remodelers covers the long follow-up, both ad categories and the copy rules. A website with galleries by room and a Google Business Profile set up correctly come first.

What trips up new kitchen and bath firms

Cash under a deposit cap. California’s $1,000 or 10 percent with no special-order exception means you fund the cabinets.
The wrong license class. A California B-2 cannot take a contract with fewer than three trades, and a Texas remodeler cannot move a drain without a licensed plumber.
Cancellations after an in-home close. Five business days for California buyers 65 and older, and three in Pennsylvania wherever the contract was signed.
Silica at the island. Dry-cutting quartz in a client’s kitchen is the exposure OSHA has been citing.
Losing to generalists. General contractors are hired on about half of kitchens and baths, so a specialist has to show what it does differently.

Questions people ask before starting a kitchen and bath company

Do you need a license to remodel kitchens and baths?

In most states, yes, but the kind varies: California requires a CSLB license from $1,000, Florida a contractor license for structural work, Pennsylvania registration from $5,000 a year and New York City its own license. Texas has no state remodeler license, though plumbing and electrical work must be done by licensed trades.

Which California license fits a kitchen and bath company?

The B-2 Residential Remodeling license fits most firms, since a full kitchen or bath combines three or more unrelated trades. A cabinet-only or tile-only shop needs the C-6 or C-54 instead, and the B General Building license covers remodels and new work alike.

How much deposit can a remodeler take?

In California, $1,000 or 10 percent of the contract, whichever is less, with no exception for special-order materials. Pennsylvania allows up to one-third on contracts over $5,000, plus designated special-order materials, and Florida sets permit and start deadlines once a deposit tops 10 percent.

Can a homeowner cancel a remodeling contract after signing?

Yes, for sales made in the home: three business days under the FTC rule, and five in California when the buyer is 65 or older. In Pennsylvania the three-day right applies wherever the contract was signed.

Do I need EPA lead certification for kitchen remodels?

Yes, for paid work disturbing more than six square feet of paint per room in homes built before 1978. Firm certification costs $300 for five years as of October 2026, and an uncertified firm may not even advertise that work.

Is NKBA certification worth getting?

It helps once you qualify, but it is voluntary and replaces no license. The CKBD costs $950 and needs three to seven years in the industry, depending on education, so most founders earn it after opening.

What are the silica rules for countertop work?

OSHA’s construction silica standard requires either its Table 1 controls or exposure monitoring, a written exposure control plan, a competent person and medical exams for regular respirator users. California also requires effective wet methods on high-silica artificial stone.

Sources

Checked on October 3, 2026. Rules and fees change, and many are set state by state or city by city: confirm the current requirements with the agency that issues them before you apply.

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