If you’re interested in becoming an entrepreneur, you probably have plenty of different industries that interest you. You might be considering working in real estate, the tech sphere, or another fast-growing industry. However, while these can be lucrative worlds to get into, you can do just as well in a more down-to-earth business. Running a construction company comes to mind right away.
Starting your own construction company takes hard work and dedication, but it can also be incredibly rewarding. To do it successfully, you’ll need certain qualifications, skills, and resources, which we’ll outline in the sections below. This is just a basic guide, but it will get you started down the right path and give you some insight into what to expect.
How Much Does It Cost To Start a Construction Business?
When you’re seriously considering a business venture, you have to be realistic about the financial burden you’ll take on. Starting a construction company requires a major upfront investment, which can go towards construction site equipment, buying or renting an office, and staffing. Depending on how small or large-scale you want your operation to be, you can expect to invest between $50,000 to around $500,000 before you get your first client.
While this might sound like a major financial strain, the investment can pay off if you run your business well. In addition, you don’t need to have that massive sum in cash to get your business underway; you can get working capital in the form of a loan if needed. However, be very careful and strategic when incurring business debt. Look into the finer details of the terms of any loan, carefully taking note of interest rates and any repayment terms that might be difficult to sustain or fulfill.
When Will a Construction Business Become Profitable?
How soon you turn a profit after starting your business will depend on the size of your initial investment. If you decided it would be best to own a large amount of expensive construction site equipment rather than renting, for example, the amount of time you have to wait to profit might be longer.
On the other hand, you can potentially turn a profit faster if you aim for a lean business structure. This approach means using as few resources as possible to accomplish as much as you can. It might look like working with a small but efficient team and taking on only projects that you can handle at your current scale. After enough sustainable success at that level, you can consider scaling up.
What Do I Need To Start a Construction Business?
To run your own construction company, you’ll need some essential equipment and certifications. Without the right gear and credentials, you can get in trouble with the law and set yourself back professionally by years.
First and foremost, you’ll need a Construction Safety Certification from OSHA. Earning this certification can take between 10 and 30 hours to complete (depending on the course you choose), and it prepares you to use construction site equipment safely, manage a team, and minimize the risk of on-site injuries. Don’t skip this step for any reason.
In addition, you may need to be a licensed contractor in the state where you work to take on construction projects. This can depend on the nature of your projects and whether you’re involved hands-on or managing a group of contractors.
Of course, you’ll also need to have access to high-quality construction site equipment, either that you own or rent. As we discussed earlier, your equipment will most likely be your biggest upfront cost. It includes any tools, vehicles, and protective gear that your team will need, as well as site-specific safety measures like security cameras and cones.Â
When you’re building up your initial inventory, try to be as economical as possible without sacrificing quality. To be more specific, find the lowest-cost equipment made by reputable brands. If you don’t know where to start, try asking connections in the industry for their recommendations. You might end up finding a supplier who ends up working with you for decades.
Finding Success in the Construction Industry
Running a successful construction business takes hard work, careful planning, and an upfront investment. Your initial work can eventually pay off, but it can take some time. Before you get into this industry, count the cost and make sure you’re ready for a potentially bumpy road.
If you decide that the pros of running a construction business outweigh the cons, get ready for a fast-paced, rewarding career that will leave a lasting impact on your work ethic and help you build real-world skills. Even though the industry can be tough, the resilience and expertise you’ll gain is one of the biggest payoffs you can get.
