Did you know that the global construction industry will grow to over $10 trillion by the year 2023? With the field showing no signs of slowing down, it might be the perfect time to start a construction company.
You may be overwhelmed thinking about how to start a construction business. Here are some of the steps you can take to form the best construction company, from market research to construction accounting.
Conduct Market Research
Before starting a business, you need to research your local market. If there is not a need for your type of industry, then you may not make a good investment in your business.
Luckily, there is always a need for construction. However, if you live somewhere that is rural, you may have better luck conducting your business in a more urban area, such as a nearby city.
Obtain Permits and Licensing
Once you come up with a business plan, you need to register your business. The requirements for business registration depend heavily on where you live and what type of business you want to establish. For instance, requirements for a limited partnership differ from a corporation.
For a construction business, you will need specialized permits beyond your traditional business licensing. You should also see what types of permits you may need for the jobs you want to do.
Equipment can be one of the most costly aspects of running a business in the construction industry. First, you should decide if you want to purchase your equipment, rent it, lease it, or a combination of the three.
Some of the most common types of equipment you will need include cranes, bulldozers, forklifts, tractors, and excavators. You should also invest in smaller tools that your employees can use, like hammers, saws, and drills.
Choose an Accounting Method
Managing your money is a vital part of your business, for tax purposes, payroll, and making sure that you have enough to stay afloat. Depending on the size and complexity of your construction company, you need to choose an accounting method that works best for your needs.
For larger companies with high-profile clients, it may be best to go with an experienced accounting firm. They can keep track of your bookkeeping and handle your tax return annually.
However, if you plan on staying small for a while, you can handle your finances with a software program like Quickbooks. Check out this article to find out all about Quickbooks for contractors.
Learn How to Start a Construction Business
If you want to know how to start a construction business, you should not let anything keep you from your dreams. With these steps, you will be on your way to success in the construction industry.
Would you like to learn more about how you can start your own business? Take a look at the Business section of our website for all of the answers and advice you will need to get your company up and running.