Do you have an eye for crafting functional and visually pleasing spaces? Then it’s time to up your game by starting your own contracting business. Venturing out with your own business can be a rewarding way to share your expertise with clients.
Read on to find the complete guide to starting a contracting business!
Create a Business Plan
You’ll need a cohesive document outlining your goals and financial details when you’re going into construction contracting. This document is known as a business plan. Think of it as the foundation of your business.
A business plan should map out your business structure. Include your short-term goals as well as goals that stretch five or ten years into the future. Outline the structure of your business, the number of employees you’ll have, and your funding sources.
Identify income projections based on anticipated business. And balance that with anticipated costs. Keep this plan handy, as you’ll want to refer back to it for quarterly reviews.
Look at Licensing Requirements
Starting a business means obtaining the necessary documents to run it legally. This translates to getting a business license so you can be a general contractor. You’ll need to look at your state’s requirements since each state has different benchmarks.
Plan on needing to take an exam and verify your readiness to start a business. You may need to have endorsement letters or other forms of proof that you know what you’re doing. After all, clients will want contractors who can build and repair structures safely.
In addition, get insurance coverage. You’ll need general liability coverage, but you may need to cover any vehicles you drive. Plus you will want workers’ compensation for the employees you hire.
Without insurance or licensing, you’re taking severe risks. You could ruin your business if you’re practicing as a contractor without a license. And if someone gets injured on the job when you haven’t provided insurance coverage, you’ll end up paying the bill.
Construction equipment is expensive. But you’ll need to be prepared and have it ready when you get your first job. If you don’t have the upfront cash to make purchases, you’ll need business loans to help.
You can look into Small Business Association loans to get started. These loans offer extended repayment plans and reasonable interest rates. They can help you finance equipment like forklifts and backhoes.
Other financing options include grants or investors. With the latter option, you’ll have to present your business plan and get buy-in from investors.
While you’re at it, be sure to incorporate your business. Doing this helps keep your assets secure while making your business a legal entity. Forming a limited liability company, for instance, is the best choice when you’re the sole owner.
Find the Right Employees
A business is never better than its employees. So, as the one running the show, you’ll need to invest in a skilled, productive workforce.
You may only need an employee or two when you’re getting started. But it’s imperative that they are responsible and eager learners. Otherwise, your business could crumble faster than it started.
Good employees will pass background checks and have a work history to prove their diligence. They’ll have some experience in the construction industry. Even if they don’t have much experience, as long as they’re willing learners, you can teach them what to do.
You may want to offer training sessions to new employees, too. The quality of your work is critical when you’re hoping to stay active as a business. You will need to be mindful of quality control and be sure to check everyone’s work.
Running a business involves managing lots of tasks at once. You’ll also be managing lots of people. Homebuilding software can make this process easier.
With the convenience of an online platform, you’ll be able to assign and track tasks. That way, nothing will fall through the cracks. And every job will be completed.
You’ll be able to create timelines for projects. At the same time, you can track budgets. You’ll be able to see if the actual costs for a renovation match projected costs, for instance.
Multiple people will be able to access the platform from their phones. This makes it easy to keep communication active and check progress. If any hiccups arise, it’s also easier to pivot when you’re able to see the big picture more easily.
Open a business bank account, too. This will let you make payments from your business rather than from a personal account. You’ll appear more professional as a business and avoid entangling personal and business costs.
Using software makes doing data comparisons easy. Make a point of doing financial audits to look for places where you can trim costs. Compare vendor prices and check to ensure your cash flow is in good shape.
Develop Marketing Strategies
Marketing your business is essential if you hope to score clients. If no one knows you exist, they won’t be able to contact you.
First, establish a brand identity that you can use on all digital media, invoices, and more. A logo is a visual graphic that will help people remember you. Consult a professional graphic designer to create one that reflects your strengths and goals.
Create a website where you can list contact information and showcase a portfolio of projects. The website should be mapped out clearly and it should be mobile-friendly. Make it easy for people to get ahold of you, too.
Build a social media presence on at least two platforms. Post daily, showing behind-the-scenes looks at projects or offering updates on your business. Potential clients will take note when they see quality work!
Plan on Starting a Contracting Business
Starting a contracting business can be a rewarding venture if you’re methodical about it. Create a business plan and secure financing for big-ticket equipment. Then hire the right employees and develop a marketing plan that will generate visibility for your company.
Need more tips to build the business you’ve always dreamed of? Check back soon to find new and informative articles!