Considering how many construction companies there are, it can’t be difficult to start one, right? Well, not exactly. Sure, becoming a contractor is not that hard but starting a construction company that rests on solid foundations is far from easy. Here are five most important aspects you need to address in order to ensure that your construction company startup is on the right track from day one.
Decide on your company’s direction
The most important and, therefore, the first step in the life of every construction company is the choice of the direction it is about to take (the choice of the type). Being a general contractor is completely different from being an owner-builder, whereas a job of a small renovation contractor greatly differs from that of a real estate developer. Either way, the choice you make here will follow you for as long as your company operates, which is why it’s a choice that needs to be made as soon as possible. Moreover, it will be vital in deciding the size of the necessary budget, the number of full-time personnel and the equipment you need to provide for the time being.
Read up the construction industry rules
The next thing you need to get familiar with is the local rules and regulations. Needless to say, these will impact almost every aspect of your company. First, you need to consult your local building code, however, here you have several layers you need to dig through. For instance, a lot of countries have the national building code, on the other hand, in some countries, local jurisdictions decide to take a slightly different direction. This poses a problem, seeing as how it might indicate that even an experienced contractor might suffer due to a company relocation.
This step is, more or less, universal for various forms of startups; however, unlike with starting an online business, you need a bit greater budget. Due to the oversaturation of the industry, some modern-day money gathering techniques like online crowdfunding are seldom a viable option. Therefore, you need to take a bit more traditional approach to the procedure. This means going to a bank or a credit union for a small business loan, selling an asset or selling an equity in your company. Each of these methods comes with its own set of benefits and downsides.
Providing the equipment
Like in any other trade, you need appropriate equipment; still, the minimum you need varies based on the specifics of your contracts. This is also something we thoroughly discussed in the first section. For instance, not all construction companies need cranes, while some may see them as vital for their basic day-to-day operations. Furthermore, you should never look just at the basics. You also need to consider safety and productivity. The latter can greatly benefit from an efficiently-programmed measuring stop combined with an automatic saw. In fact, it can even allow you to hire fewer workers and, in this way, save some money.
Hiring the right people
An accident can happen everywhere, nonetheless, it is far more likely to occur in the construction site than it is in the office. The consequences are usually much more dire, as well. Not only this but a job that is poorly done or a botched attempt might result in an accident later date or, at least, some serious property damage. Needless to say, you don’t want to be the cause of this. The only way to prevent it is by hiring the right people. Previous work experience in the industry should be the main prerequisite.
At the end of the day, starting a construction company isn’t actually that different from launching any other kind of startup. You need a plan, the right gear, the right staff, the finances and, of course, thorough knowledge of the rules of the game. Experience in the field is a vital component to your success but is not enough on its own. In order to make it through, you need to be both businessman and a contractor, in that particular order.