Construction is one of the biggest industries in the country. It employs millions of people, and it’s continuing to grow. Joining the construction industry can, therefore, be a profitable decision.
By starting your own construction company, you even help contribute to making the economy grow, but how exactly do you do that? What are the steps to starting a construction company?
This article will give you all the answers you need. Read these tips, absorb the information, and you’ll be ready to make your construction dreams come true. Let’s start!
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Do Your Research
This part is thankfully a whole lot easier these days using the Internet. Some of the best sources of information you can have are government websites, like those of the US Small Business Administration and the US Bureau of Labor and Statistics.
You will also do well to research in industry publications and statistics as well as local industry publications. Research is not obligatory, but it will save you a whole lot of trouble down the road, especially when writing up your business plan.
Write Up a Business Plan
A business plan is essential for any new business, and a construction company is no different. Among other things, your business plan should identify your target market (who you will be building for) and your budget, both to start the business and to sustain it.
Definitely, you also need to create a marketing strategy as part of your construction business plan. Lastly, define your goals for your business, both short-term and long-term.
Register Your Business
Before you can register your business, you obviously have to decide on a business name and a business structure (sole proprietor, an LLC, a C-corporation, or an S-corporation).
Once that’s out of the way, you can register yourself across all the levels. First, with the federal government, your state, and then a local agency.
Get Licenses and Insurance
You’ll probably need two licenses to operate as a construction company: a general contractor’s license and a specialty contractor’s license for the specialty work you do, like electrical, roofing, etc.
Then, get your business insured. There are six types of insurance you need for a construction company: general liability, property, vehicle, workers comp, unemployment, and state disability.
With both your licenses and insurance in place, you should be ready to open a company!
Get Funding
You’d like to ensure you have the financial capability to start and run your construction business. You can get funding from many places, from private lenders to credit unions and even the government.
Aside from basic financing, you’ll also want to plan how to fund your day-to-day business. You need to buy construction equipment, and pay employees.
This is because billing cycles can be erratic, you need to ensure that your business can run while payments haven’t come in.
These and more are the reasons you need to have sufficient funding before even starting a construction business. With all of the above in place, you should be ready to open a shop in no time!
Starting a Construction Company Made Easy
If you’re thinking about starting a construction company, this guide is a great starting point. It covers the basics of what you need to do to begin, from writing a business plan to finding funding.
The only thing you need to do is to get the ball rolling!
Continue reading our blog for more guides to help you with your next projects!