Starting a construction business can be very exciting due to the limitless possibilities, but it is crucial for anyone looking into this sort of venture to be aware of the factors involved.
There are tons of things to think about, such as securing financing, establishing work policies, and where you're going to get all the construction and hauling equipment. It can be a lot to take in and can feel overwhelming.
While it will be tough to start your construction business, it helps to understand some key factors needed to get your business off the ground. Here are six factors to consider when starting a construction business.
Before you even begin to think about starting a construction business, it's important to have a clear vision of what you want the business to become.
You have to consider why you want to start a construction business. You'll need to think about what your goal is. Maybe it's to one day be bought by another company. Maybe you want to be your own boss, and construction is your passion.
Either way, you need to have a clear goal in mind when you start your business. Otherwise, starting a construction business might not be the right career path.
In addition to having a clear goal, you’ll need to know what your construction business will specialize in. You'll need to consider the different types of construction business you can start, such as general contracting, home building, or something in-between.
Each type of construction business requires a different specialty. For example, when you’re constructing homes, you need to be well-versed in building codes and local ordinances. That knowledge isn't as necessary when you're doing road construction however, you will need to know about working with asphalt for various uses.
Additionally, you'll need to figure out how to get the construction equipment you'll need, both for the work and the tech equipment for the management of the business. For instance, you may need to buy certain heavy construction equipment. However, you may not want to buy a trailer to transport your heavy construction equipment and instead outsource the service. On the tech equipment side, top construction firms such as Verti-Crete Ireland swear by using online platforms.
You’ll need to consider how you’ll secure financing for starting your business. The cost of starting a construction business can be staggering, so you’ll need to have a fair amount of money.
One option to secure funding is through investors. Seeking an investor is a good way to raise capital for your business. However, if you're a first-time entrepreneur, an investor will be going out on a limb with you, which means they'll have some say in how the business is run. You may have to share control of your business, which may not be ideal, but having someone to help support your ideas can be beneficial.
Another option is to take out a loan for a construction business. This will give you a lump sum of money to start your company and is usually done through traditional lenders like a bank.
Getting your first customers can be a struggle, so you'll need a game plan.
There are tons of ways you can advertise your services. You can go old-fashioned and buy yellow page ads, or you could invest money in social media ads.
Ideally, though, you'll want to gain customers through word of mouth and references. That means you'll have to build a strong reputation for your business by taking one small job at a time and providing excellent customer service along the way.
You’ll need to consider how you’ll want to run your business and what type of boss you’ll be. Will you be a strict boss or laxer? Or will you strive to achieve a balance? These are questions you'll need to ask yourself.
For example, if you decide to be stricter with potential employees, you might be able to keep them in line, but you might have a higher turnover.
On the other hand, if you're lax, you might be able to have a higher retainment in employees, but your employees might not perform at the work standard you'd like
In addition to deciding what type of boss you’ll be, you’ll also have to consider what work policies you’ll have for your business.
There’s a lot you have to factor in when you’re creating policies for your potential construction business. Some of the policies you’ll need to think about are insurance, workmen’s compensation, and hiring.
You'll also need to factor in certain specifics. For instance, almost every company has a drug policy put in place. However, not all drug policies are the same. Some policies require you not to take drugs at all, while some drug policies will allow for marijuana use as long as you don't use it while on the job.
Starting a construction business is not an easy task. There are many things to consider before getting started, so it’s important to take your time when considering whether or not this career path is right for you.
If you’re passionate about construction and do your homework, then you can start a successful construction business. It’s tough, but it can be worth it.