Construction business fundamentals: How to start a construction business in 2021

Start a construction business

Start a construction business

Are you exploring reliable ways to start a construction business in 2021? Or Are you struggling to begin your career in the field of construction?

If the answer to both is yes, you are on the right platform.

This guide will help you to land your first job in the construction business market. It highlights the strategies of developing relationships with clients and winning jobs.

Everyone knows that the Pandemic has distorted everything and doesn’t allow anyone to work freely on their own.

Thus, every other contractor needs to contribute and start a construction business in 2021.

Being a contractor, the contracting business has portfolios of commercial and residential. Taking the plunge, deciding on a specialty, and converging the focus on a specific market.

Either a General Contractor or subcontractor should understand the following prerequisites and processes to dive into the contracting business. Landing on your first lead, turning it into your project and making a lifelong client requires certain steps to be undertaken at first.

From the past 6 – 10 years, the construction industry has shown an average increase of 150% that turns into $1.74 trillion in 2020.

If you plan to put yourself into a quick version of the process to start a construction business in 2021, follow the below-given steps and make your construction company distinctive.

  1. Explore a productive business idea
  2. Make a formal business project plan
  3. Plan Lead generation strategies
  4. Start Estimating and Bidding
  5. Follow up and Submittals
  6. Make your construction project legal
  7. Open a new business bank account

1. Explore a productive business idea to start a construction business

Idea to start construction business

A productive construction business idea isn’t everything that turns into a reliable profit. Your business is for the future, and it is necessary to pick something you can rely on for life. Try to explore and select a good strategy that fits you, your target market and your location.

  • Conduct a SWOT analysis on yourself to identify your strengths and weaknesses
  • Your construction business idea must cater for your strengths
  • Research explicitly

Tip: Try to write a constructive business plan to run your construction company in an appropriate direction and make yourself stick to it

2. Make a formal business project plan to start a construction company

It is essential to plan and market your construction company among other contractors and competitors. Your business plan is a perfect opportunity to outline different aims, goals and business objectives on a simple paper.

It allows you to analyze the procedure to start a construction business idea into a viable venture vividly.

Usually, contractors fail while acquiring new construction projects because they haven’t researched “how to start a building company” or “how to start a construction company with no money”.

Market research is essential to start a construction company. It will assist you in evaluating whether or not your construction company will survive among other competitors and provide the same services as yours.

Tip: Consider your option/idea carefully before taking steps to start a construction company. It will inquire whether you want an independent contractor or looking for a construction firm to start a construction business?

3. Plan Lead generation strategies to start your own construction company

It is evident that a contractor mainly has to begin with different lead generation strategies to start a construction business in 2021.

Exploring a construction project often seems difficult; thus, follow the below-given strategies to improve the leads to start a construction company.

  • Make your construction business website
    • Register a domain name
    • Purchase hosting
    • Build your contracting website
    • Get your site listed on specific key directories
  • Sign up with a company email and social media accounts on different platforms
  • Generate trendy and modern business cards, flyers/brochures, marketing material, etc.
  • Organize an opening day through discounts
  • Acquire tons of invitations to bids
  • Make a productive business phone setup (toll-free)
  • Create a logo to establish your brand

Tip: It is essential to do your market research, analyze efficient competitors, particularly in a local area and explore a niche where all the construction businesses stand collectively for every customer before taking a step to start a construction company with no money

4. Start Construction Estimating and Bidding

Every construction business demands construction estimating and bidding services to make it successful among other competitors. After estimating and taking a step to start your own construction business effectively, try to invest in submitting certain bids for an average of 30 days.

Contractors demand construction takeoff and quantity takeoff services for their construction projects through expert estimators of competitive platforms like World Estimating.

Get tons of invitations to bid through the following tips

Schedule an in-person meeting

Try to communicate with your client face to face before proceeding with a bid or if you are not able to meet them, call or email them and introduce yourself.

Otherwise, there’s no use of bidding and it is only regarded as a waste of time in comparison to other competitors.

Generate a specified email for your client

Try to create a specific professional email that is dedicated to your construction estimating service. Usually, contractors demand electrical estimating services for different electrical purposes of a construction project. Try to generate a pertinent email and send it through a professional company email like info@worldestimating.com

Sign up as a general contractor and as a subcontractor

Signing up as a general contractor is quite effective because you can easily contact an owner as a potential general contractor bidder and call the architect to become bidder as a GC after receiving an email.

Make them realise your presence

When you get the plans, go through the project details of architects, project owners and prime contractors.

Subcontractors start visiting different clients like general contractors, large residential developments, older residential communities, suppliers and vendors and ask them to get on their bid lists.

Tip: Try to outsource construction estimating services for your construction project from professional platforms that can manage things easily to provide a diverse range of construction estimating and takeoff services

Contractors get ease after relying on professional construction estimating companies for the construction takeoff of their construction project. They can easily focus on dealing with a diverse range of clients and plan to start a construction business on their own.

5. Follow up and Submittals to start your own construction company

Follow up is one of the most important parts while bidding and construction estimating a construction project. It is suggested that subcontractors follow up with the contractors and save their effort to submit a bid.

Usually, sub-contractors don’t follow any general contractor after submitting their bid proposal that demands hours and hours to prepare it.

It is essential to not rely on one contractor while bidding because it won’t be beneficial. Try to bid on a maximum number of general contractors associated with the project to maximise the probability of getting a job and take a regular follow-up from them.

It will increase the bid winning ratio for a subcontractor and efficiently proceed with their construction projects.

It is evident to fully inspect whether you have considered all the necessary checks required to begin with a new construction project. Consider a few things given below.

  • Have you registered your construction business name legally?
  • Have you applied for any local or state licenses?
  • Have you obtained employer identification numbers?

Make your construction project legal

Try to follow the few essential things given below before starting your own construction company

  • Decide either you want to follow a legal structure or business structure
  • Register your construction business name
  • Register for a construction domain name that is similar to your business name
  • File your business for trademark protection while using your business name to identify a product or services
  • Acquire all the federal and state licenses that are essential
  • Take your specified federal business tax ID number (also called your employer identification number)

For example, it is essential to have licenses to install HVAC equipment or perform subcontracting work. Every other contractor needs a license and permits to bid on different government contracts that vary or are based on where you operate efficiently.

Tip: Follow the rules and regulations of the construction trade while complying with the most efficient health and safety, building, VAT and CIS regulations

7. Open a new business bank account of your construction company

After licensing your construction business, try to open up a new business account for your construction project.

A business bank account benefits your customer by having a greater payment method through credit or debit cards. It uplifts a level of professionalism and secures your payments from clients.

Explore the best banks around your locality that offers:

  • The lowest interest rates for lines of credit
  • The highest interest rates for savings accounts
  • The cheapest transaction fees
  • No early termination fees
  • No minimum account balance fees

Conclusion

Constructing a new construction business is quite difficult, but the steps mentioned above can ease everything and lead you to run a successful construction project.

World Estimating is one of the professional and constructive platforms for every other contractor or subcontractor to provide accurate construction estimates and consult clients to opt for the most productive ways of running a successful construction project.

Contact us through a phone call or email and upload your construction project plans on the “Contact us” section

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