5 Steps to Get You on the Road to Construction Business Success
By Dan Miller, Payments officer at Bizzmarkblog
Starting a business may seem like something so far-fetched at the moment the idea strikes, that it may sound almost impossible. However, every successful company, from your local successful vendor to Apple has a humble story about a spark that ignited a franchise behind it. Owning a construction business is no exception; it takes guts and a note of fearlessness to get things running, but also a ton of work - from dealing with promotion and marketing, to figuring out how to cover the costs of your new startup. Planning ahead, commitment, passion and focus are the pillars of a successful construction business. Commit and start planning ahead right now!
So, you have a brilliant idea that you are certain nobody has come up with yet. I mean, how could've they? It is that brilliant! There are almost 7 billion people in the world, a large percentage of who are creative enough to come up with your potential idea, so you can rest assured that it has probably already crossed someone's mind. The trick here is not in the idea, but in the resolve to make it happen.
For instance, back when Steve Jobs came up with an idea for starting a company such as Apple, you can rest assured that he wasn't the only one – but he was the only one who had both the opportunity and determination.
Market research is incredibly important here – while it can't guarantee you success, it can certainly show you whether there's an opportunity for your construction business idea.
But what can you do that's that innovative in the construction business? Well, not too much, but innovation isn't the only way to go; try to improve an existing idea, or find a way to make it cheaper and more profitable.
Find the location
One of the most important questions in the world of construction business is one of area-based profitability. Where can you get this information? Your best bet would probably be digging through industry publications in search of information about the construction market trends – this can give you an incredibly valuable, concise story.
Another great source of important information is the U.S. Small Business Administration (SBA); look for similar companies that don't operate in your area and find out all about their services and rates.
A business plan is mandatory
…and this goes for every business idea out there. Without a business plan, you're relying solely on sheer dumb luck, and to say that this is extremely frowned upon in the world of business would be an understatement. A business plan is a document that outlines your business goals and procedures and keeps you focused.
A rock-solid business plan contains detailed sections with information about management, business structure, provided services, workforce, competition, etc.
Finding the financing
This is perhaps the most difficult part of starting a business – obtaining the necessary funds. There are four basic options here: you can get a loan, find an investor, get crowdfunded, or pay everything yourself.
A personal or bank loan is the most certain way to get financed, meaning that you should keep this as the last resort – there are many other better ways to obtain the funds.
Getting invested in is always awesome – you'll get to meet new people, and get your business going; however, keep in mind that investors don't grow on trees.
Crowdfunding is great! Come up with an online campaign and see what happens – not like you can lose anything but time!
Self-financing is, by far, the best way to go here, but the problem lies in the fact that there aren't too many people out there who can actually afford to pay up for all the costs of their first construction business.
These are your options; find the one that suits you best.
You can't work from home
Yes, you'll have to find an office space for your construction business – you're going to need an office for your administrators, a parking lot for construction vehicles, and a decent-sized storage for tools and equipment.
The most important factor here is the storage space – you can't run a construction business without one. If a mobile crane can fit into a storage space, you can rest easy – it's large enough. You don't have to own every piece of equipment, though, especially when it comes to tools and vehicles that you won't be using all the time. For instance, opting for scissor lift hire is always a good idea here.
As for the administrators' office, you don't need to go overboard; a regular-sized space is enough.
Your parking space, on the other hand, needs to be large enough to support construction vehicles, as well as your employees' and customers' personal vehicles.
Once you've covered all of this, focus on all the legalities; stuff like getting licensed, insured and bonded. Research the market first and find your perfect niche and location. Come up with a solid business plan and financing, and equip your construction business' office space – you cannot turn it into a home-based company.