Starting Your Own Construction Business

While starting a construction business can be a lot of hard work, it can also be rewarding, both financially and personally. If you run a construction firm, you get to work on a lot of exciting projects, and you get to be your own boss and make the decisions. While you might have the enthusiasm and drive to start a business, you may be struggling to put your plans into action, so here are some steps to help you get started.

Decide What You Want to Do

Your current idea may simply be ‘start a construction business,’ but there are actually many different types of construction firms under that umbrella, so you should try to decide what you want to do and the kind of customers you’ll be seeking, early on. Many tradespeople start small, so it’s a good idea to focus on home renovations or general contracting work. However, once you grow, you can start to offer more services, as you’ll have the skills and experience needed.

See What’s Already Available Locally

Put yourself in the shoes of a local customer and do some research online to see what’s available. From a Google search to social media, it’s easy to find tradespeople in your area, and you can then see what services they offer and at what price. If there are already a lot of people in your area offering your specific skill, then you may want to up skill or offer something a little different to ensure you stay ahead of the crowd.

Work Out Your Finances

Can you afford to start a construction business? While you don’t need an office or huge items of machinery in the early days, you will need a reliable truck, your own tools, and some supplies. Check Tradefix Direct to find out the prices of the things you need, so you can work out your initial start-up costs. Keep in mind that you may not be fully booked up right away, so you might need a safety net to see you through the first few months. Many people start a business using their savings, or you can research getting a small business loan to get things off the ground.

You’ll also need to think about what you can charge. Look at your monthly operating costs, which will probably be fairly low when you start small and add on your salary. Then, add another 25% to account for things such as tax, vacation pay, and admin expenses. You can then divide this figure by the number of hours you intend to work each month and come up with a rough hourly rate. Of course, this figure may vary based on where you live and your skill set, so compare it to similar tradespeople who work locally.

Create A Business Plan

Whether you’re going to be looking for a business loan or not, it helps to make a business plan for your construction firm. This is a good exercise for you, as it means you’ll need to think about what you want to achieve with your business and decide whether it’s feasible. Many people start small businesses without making a plan and find out later down the line that they aren’t making much money or there’s not the customer base they hoped for.

Your business plan could include information such as:

• Your company’s mission
• Who’ll work for you and in what capacity, defining roles, etc.
• What equipment you’ll need
• Initial costs and investment
  How much you intend to charge and projections of how much profit you might make
• Your strategy for marketing and sales

Make Sure You’re Covered Legally

When you work in construction, you’re going to be using a lot of dangerous equipment in people’s homes and on work sites, so there’s the potential that someone could get injured, or that you could accidentally cause damage. In these cases, you’ll need to be covered, so you should make sure that you have the right insurance for the type of work you’re doing.

Depending on where you live, you’ll likely need to be licensed in your trade, and also have a business license. If you aren’t sure about local requirements, get in touch with the chamber of commerce in your area, as they’re often helpful for small business owners who are just starting out.

If you want to start a construction business, then it’s tempting to quit your day job and just dive straight in. However, a well-planned approach is better in the long-term, as it means you can plan for where you’re going to take the business. Many construction firms start off small, often as one-person operations, but as time goes on you can add more staff, bid for larger contracts and generally grow your business. Who knows? You may go from doing small home renovations to landing big business contracts one day.