Starting a new business can be tough, and construction companies have a lot of complexities to consider if you want to operate successfully. This guide is intended to help you with your broad management responsibilities, so you can better manage your construction company.
A business plan documents what you want your business to do, and how you are going to achieve those goals. This should include what your business goals are, an outline of how you are going to achieve each goal, and any other supporting information such as:
Business plans are used to help secure funds from financial institutions, but they also help your business to continue to stay aligned to your original goals. After you have created your business plan, don’t let it gather dust on the shelf, keep it easily accessible and regularly update it as your business changes and evolves.
Most construction companies start out at the owner’s home, but eventually you will need to consider moving into a more official premise. Construction companies typically have a lot of equipment, and having a secure place to store and access the equipment, as well as park company vehicles, is a great help for keeping operations smooth as your team grows.
When choosing to move your base of operations, consider what you need for your business processes, and look for a site that fits those best.
Depending on the country you operate in, your company can have a lot of legal obligations such as regulations, standards, health and safety requirements, and other matters you will need to comply with. Your tax requirements will vary as well, but you will need to be prepared to make sure any possible audits happen without issue. Research the legal and tax requirements for your local area and integrate them into your business plan, or hire a lawyer and accountant if necessary.
Insurance is another similar point of consideration, depending on your country you may need to cover not just your business assets, but yourself and your employees in the event of work-related accidents. Talk with a local insurance agent to better understand your responsibilities for insurance.
Operating a construction company can require a lot of upfront investment for payroll, rent, leasing/buying equipment, and other bills. To secure the funds to get going, typically you will need to apply for financing. Typically, this will be a bank loan, which will require at least a business plan, and sometimes a form of security if you want to borrow a lot; talk with your local banks early on to learn how you can best get financing for your construction company.
Your team is one of the most critical aspects of your business, as they will be the people that carry out the work. When considering members for your team, look for knowledgeable and skilled workers that exhibit traits like dependability, honesty, and an all-round good work ethic.
One consideration is whether you should hire contractors or employees. When you’re starting out, contractors can be great because you pay them when you need them, which is suitable for irregular cash flow. As your business grows and your forecasted sales becomes more reliable, consider getting full time employees so that your business has the resources to operate smoothly.
Invest in digital technology where possible to simplify, automate, and optimize your business where possible. Technology integrates with the construction industry to meet a variety of needs, one way you can leverage technology is with a mobile data collection app. A mobile data collection app can help your team to enter data or complete checklists using any mobile device, which is all then stored in one central place for your team to leverage. By ditching paper forms and checklists and instead using a mobile data collection app such as Locale Central, you can improve your team’s productivity and data accuracy.