Are you interested in starting a construction company? If so, there’s a lot you need to be aware of. Whether it’s the correct permits to apply for or if you want to specialize in something, there’s a lot to consider.
While it might seem overwhelming, there are a few things to keep in mind that can help guide you through the first few steps. Below are some steps you can follow to ensure the process goes smoothly.
5 Tips for Beginning a Construction Business
1. Write a Business Plan
One of the first things you’ll want to do is create a strong business plan. While you can change it up a bit later on, having a basic plan will help guide you during the first few steps. It will show what you aim to do with your business and critical elements you need to focus on if you want to succeed.
There are multiple things you’ll want to ponder when writing one. Some are:
- Your overall company mission and values
- Major competitors and why they are
- Your marketing strategies and goals
- Who is your target market
In your plan, also consider whether you’d like to specialize in a specific area or will offer general construction services. If you do decide to, you’ll want to look at if there are extra legal requirements for that particular specialization.
2. Research Local Legal Requirements
After writing up a basic business plan, you’ll want to investigate your region’s legal requirements. While most will require you to have some type of permit, others might also require that you take certain classes to confirm your skills.
Some permits/licenses a construction company usually needs are:
- General business license
However, like painting, certain construction aspects don’t always require a permit. When applying for them, you’ll want to carefully double-check local and federal requirements for your specialization and region.
Besides this, you’ll likely need to purchase some form of insurance, especially if you plan to hire employees. In most cases, you’ll want to have general liability coverage. This protects you from general issues that could occur, like broken equipment or injuries. However, professional liability might be ideal if you want more intricate coverage. This type focuses not on broader issues but more complex ones, like a wrong estimate or missing a critical deadline.
3. Advertise Yourself
Starting a new business can be overwhelming, especially when you’re first trying to find clients. You’ll have incredible competition, so you want to showcase why you’re the ideal company to choose from.
To market yourself, consider aspects like a slogan and logo. These will help customers quickly identify you and can also be a way to catch their interest. In addition, you’ll want to use these in other marketing tools (like commercials or social media ads) so people can quickly recognize you. This recognition will pay off as it shows your brand is easily noticeable and has impacted viewers.
Make sure also to utilize social media. Whether with consistent Facebook posts or catchy Instagram photos, social media is your friend. With it, you can show off your services and interact with followers. This is a great way to display your business while also allowing you to communicate and be personable with potential customers.
Apart from this, reach out to local companies and consider sponsoring nearby events. This will get the word out about you and that you have a community focus. Surprisingly, this can play a positive role in helping people decide whether or not to hire you.
4. Invest in Quality Equipment
You’ll need to purchase a lot of equipment for your new company. However, as a new business, you might be on a budget. This could make it tempting to buy used or low-quality tools to save money.
While this isn’t always bad, you’ll definitely want to purchase high-quality ones. This shows you’re serious about your work and willing to do the best job possible. For instance, pallet forks are essential for most construction businesses. You’ll want to make sure to invest in durable ones that will last and help you get jobs done quickly but safely.
5. Look Into Funding
Having a strong budget is critical if you want your business to succeed. However, this can be tricky in the beginning, especially if you’re low on funds. Because of this, carefully set a budget and see if you might need financial assistance.
If you do, there are plenty of options to look into. One is Small Business Administration loans. These range in their offerings and can be customized to fit your needs. Better yet, because they’re designed for small businesses, they tend to have lower down payments and sometimes no collateral.
As you continue on in your business, make sure to have a strong payment plan as well. You’ll need to decide if you prefer to have payment upfront or if you’re willing to have incremental payments.
Starting a construction company can be rewarding but involves a lot of intricate details. With these tips, you can prepare yourself for what’s ahead so you can create a successful business.