5 Things to Know Before Starting a Construction Company
If you’re one of the 8% of workers employed in the building sector, you may be itching to step up your game. Have you always wanted to start a construction company? While there’s plenty of demand for skilled contractors, make sure you use the right strategy to launch your business.
Read on to discover 5 things to know before starting a construction company!
1. A Business Plan Is Essential
Wondering how to start a construction company? Start by mapping out a clear and complete business plan to establish accountability.
Establish a mission statement and measurable goals. Include a budget with projected expenses and revenue. And determine how many employees you will have to start, as well as their job descriptions.
Additionally, you should outline what your regional competition looks like—plan on having quarterly meetings with key stakeholders to evaluate progress.
2. Determine the Need in Your Area
As a new construction company, you’ll need to define your niche. Do you want to focus on remodeling dated kitchens and bedrooms? Or are you hoping to become the local titans of window installation?
You’ll need to gauge construction business voids in your area. In other words, if the area is saturated with home builders, you should find another focus.
3. Find Your Funding
Unless you’re independently wealthy, you’ll probably need to take out a small business loan or find an investor to get started. Shop around with local banks to secure the best interest rate on a loan you can find.
The cost of starting a construction company includes equipment, safety gear, and facility space. Map out upfront costs and make monthly projections for ongoing costs. That way, you can anticipate how much capital you’ll need.
4. You Need to Invest in Marketing
When considering what you need to start a construction company, don’t overlook marketing. Hire a web designer to create a website that states your company’s mission, contact information, and services. Include photos and a biography section where you can outline your qualifications.
Use a strong logo designed by a graphic designer. And place it on all invoices, social media pages, and swag. Distribute business cards in local businesses or neighborhoods, too, to jumpstart your client list.
5. Get Licenses and Insurance
Start a construction company the right way by taking care of logistical matters before securing clients. Make sure you’ve checked local or state laws regarding permit and license requirements. And look at local zoning ordinances to determine where to set up your business.
Get general liability insurance and workers’ compensation insurance to get started. This will keep you covered in the event of an accident. And it will reassure your clients.
While you’re compiling paperwork, look into conditional and unconditional lien waivers. These provide a mechanism to ensure you are paid for your work. You’ll also want to have contracts, invoices, and other documents ready to go.
Focus on Starting a Construction Company
Starting a construction company requires knowing the needs of your area and developing a business plan to define your focus. Get the right permits and equipment. And then deploy a marketing strategy to gain business.
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Ben Stern wrote this article on behalf of FreeUp. FreeUp is the fastest-growing freelance marketplace in the US. FreeUp only accepts the top 1% of freelance applicants. Click here to get access to the top freelancers in the world.
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