According to the United States Bureau of Labor, the construction industry is set to grow 11 percent between the period 2016 to 2026. It is also expected to add 750,000 jobs. Overall employment for those who work in construction is expected to grow 5 percent from 2019 to 2029, faster than almost all types of occupations. There’s no denying that no pandemic or crisis can stop the growth of the construction industry, and entrepreneurs would be smart to get a piece of the pie. If you’re thinking of launching a construction startup, here are some tips to get you started.
Find the best team possible
No matter your occupation, whether you’re an engineer, architect, or contractor, you would benefit greatly from having the best team to work with. When it comes to the construction industry, you’re only as good as the people you work with; it is not a one-man job. Find the best, most reliable, knowledgeable, and skilled people in your staff. Here are some qualifications and characteristics you need to watch out for:
- Make sure they have the necessary licenses and certifications. The last thing you want is to violate your state’s laws and regulations on who can do certain things in your construction business. If you have people in your team who are skilled at what they do but don’t necessarily have the certifications, have them book CSCS blue card certification exam to have the tools and knowledge they need to safely and effectively work for your company.
- Look for people who are team players by nature. So much of construction work involves teaming up and partnering with so many types of people, from architects to engineers, from carpenters to electricians—not to mention the clients! So make sure the people you invite onboard value teamwork, collaboration, and cooperation and will put these values above their own interests.
Gain a keen insight into your local market
If you have a passion for construction and not necessarily the business side of things, now is the time to change that. This is the part where you need to apply so much research into your local market, so you should at least have a basic understanding of key business principles like researching your target demographic and figuring out the best ways to meet their needs. Market research is crucial at this stage of your planning, and so is looking into your closest competitors and rivals. Here are some things you need to know about your potential customer base:
- Their basic information like age, occupation, marital status, and others
- How many people you are most likely able to cater to in your area
- What their interests, values, and purchasing behaviors are
Moreover, here are some things you need to know and understand about your closest and fiercest competitors—the existing construction companies in your area:
- How many construction companies are already operational in your vicinity
- What their specializations are
- Their pricing structure
- If their clients are happy with their work and what their overall reputation is
Knowing the answers to these questions will help provide you with a competitive edge so you can step out into a more level playing field when you launch your company.
Establish a detailed business plan
Your market research should also answer questions like how many times your company will be hired in a year and what customers look for in contractors. You can find answers to these questions by sending out surveys and questionnaires, inviting potential homeowners to focus group discussions, or conducting individual interviews. The answers to these surveys will help you draft a business plan that details how you can keep the company on track and the steps you and your team need to take to increase your business’s likelihood of success. The business plan should also provide your lenders and investors with information on how you’re planning to grow the business, giving them an incentive to partner with you in the work. Here are the essential parts of a good business plan:
- Business structure
- Services to be provided
- Jobs you’ll need to bid on
- Target market
- Number of employees
- Marketing plan
- The estimated cost of launching and maintaining the company for the first few years
- How you plan to make a profit into your first year, as well as other crucial KPIs
If you have a passion and knack for construction, and if you can find business-minded people, consider starting a construction company. There is a demand for it, and you might find yourself succeeding where most contractors fail.