With a surge in demand for housing infrastructure, the Canadian construction industry is booming like never before and there’s an unmet demand for construction workers and companies alike. If you have been in the industry or just starting out and considering how to start a construction company, this blog will delve into all the things you need to do to establish your construction business. From dealing with harsh weather conditions to meeting all provincial guidelines – there’s a lot to be taken into account when you set up a business.
How To Start a Construction Company – The Research
The first step towards starting a construction business is doing research – this will include many things such as naming rules and regulations to target customers. Here’s a list of things to consider researching before making a plan for your business:
- Area of Construction: Research the requirements and investment needed for different types of construction business – like industrial, commercial, infrastructure or residential. Depending on your expertise, budget and licenses, you can choose a sector that you think is suited to your experience and knowledge and is also profitable. As the different sectors have varied rules, licenses and laws, it’s best to narrow down your choice as the first step so the rest of the steps are more clear.
- Target Audience: Even within the sectors, there can be different audiences for your work. Take a good look at the demographics and psychographics of the area where you wish to work or establish your business. Make a note of the existing companies, their work and what the customer needs. This is also a good time to understand if there are unmet demands and gaps in supply, that you can fill in with your business.
- Paperwork: As much as everyone dreads it, there’s quite a lot of paperwork involved when it comes to establishing your construction business. From registering the company name to getting licenses and permits – there’s a lot to be done, so it’s good to have a mental map of all the things and a plan so you tackle them one by one.
How To Start a Construction Business – The Plan
The business plan before you start a construction business is perhaps the most important part of planning a business. It is crucial to set up operations and maintenance and success and must be on the top of your priority list. This will include some of the things you have already researched and some that you need to research. Here’s a list of some of the things to include in your business plan:
- Company name and registration
- Office space registration
- Licenses and permits
- Company structure and management
- Renting or buying equipment
- Identifying projects and locations
- Estimated costs and expenses
- Size of the company
- Investments and loans
- Administration work
- Marketing strategy for a construction company
While this list covers a lot of the essentials, it may not be exhaustive for your business. Depending on the type of business and sector, you may need to add more things to it. Another important thing to add to your business plan is a roadmap and timeline for setting up the business. With a solid plan in place, you will be set up for success and on track for launching your construction business.
Register Your Construction Company
The first step that feels like the real start of your own business is registering your business. This helps you understand more about the tax requirements of having your business and also protects against any duplication of names etc. While registering your company, you will need an office address and the location where you will be providing your services. You will also need to decide on the type of business – that is sole proprietorship, partnership, co-operative or corporation. The Government of Canada has an official website where you can find out more about how to register your construction business in Canada.
Get The Right Licenses, Permits and Certifications
If you have been in the trades or even studied them, you would know that almost every line of work requires licenses and certifications. Apart from getting the federal licenses and permits, you will also need to follow the guidelines laid down by your provincial government. This would include safety regulations, licenses to operate the business, licenses for operating equipment and more. Also, keep in mind that every individual project will also need permits before you can start working on them.
Get Your Business Covered by Insurance
From insuring your business and employees to protecting your equipment – there are many things to cover in your construction business insurance. As this job deals with heavy machinery etc. it’s best to cover all your bases with a comprehensive insurance plan. From business interruption insurance to business vehicle insurance – there are many things to be considered when finalizing the business insurance. You can also read our comprehensive guide on the different types of insurance needed by a contractor business.
Secure Funding For Your Business
Whether you are securing government grants for your business or finding an investor – it’s important to finalize your funding before you venture into establishing your business. The Government of Canada has many business grants that you can look into. If you have a partner and are co-investing in the business, this would be a good starting point to start keeping a tab on individual contributions and investments.
Build a Team of Workers
When looking up how to start a construction business, many people overlook the mammoth task of hiring the right workers for your business. To operate your business successfully, you will need to hire a team of experienced construction workers. This may range from equipment handlers to on-the-ground workers. Depending on the scope of your work, you may also need to hire electricians, plumbers or flooring experts. If you have decided to take on full construction or renovation projects, this would be a good time to look into the work you will be doing and the work you will be outsourcing. Identify and have discussions with subcontractors that you can hire for additional or seasonal work.
Buy or Lease The Required Equipment
Depending on your scope of work, buy or lease the equipment you will need to complete projects. This is also a good time to look into companies that lease equipment long-term as it can save you money. Some companies also include maintenance in their contracts, so it can take some time off your hands. Also, make sure to look into seasonality and check if there are any specific times when renting is cheaper. You will also need to arrange a space for storing your equipment when not in use.
Decide On The Business Accounting
It’s important to keep an account of your expenses, investments and other paperwork for equipment etc. right from the start. So look into if you want to hire a bookkeeper or administrative assistant to take care of these things for you. You will also need to invest in payroll and people management when your team grows significantly. Professionals can help you draw up contracts and also manage the payroll and other expenses. When running your own construction business, you will also need to look into the taxes and a professional tax accountant can do that for you. They can also help you look into government grants and rebates, depending on the category of your business.
Set the Right Business Objectives
It may be exciting to start a construction business but it’s good to keep your short and long-term goals in sight. Before you start your first project or right after you finish one successfully, take some time to go over your short-term goals and long-term aspirations. At this point, you will have a better idea of the timeline, and the workload and also understand how weather and permits can affect your workload. This will help you understand how many projects you can take up and finish successfully in a year. This is also a good time to sit down with your long-term aspirations and plan on how to achieve them. Make a realistic plan on how you can grow your business every year and what more work you can take on. You can also look into how you can expand your business by taking up seasonal work or adding more services to your business. Also, look into what other licenses or certifications you may need to expand your business categories.
Network In Your Industry
A good way to stay up-to-date on industry trends and also get more work is by joining relevant industry groups. There are many government associations and private groups where you can advertise your services and also get more industry knowledge. This is also a good way to find subcontractors if your business needs additional workers or workers from a different industry. These groups and associations can also aid in finding more workers or sourcing equipment for your business.
Have A Marketing Strategy in Place
As a construction company owner, you will also need a robust marketing strategy for your construction business. Here are some ways you can expand your business and spread the word about your services:
- Set up a website: Every business needs a company website – this has many benefits. Apart from helping your local listing online, the SEO in your website can also help you get found easily and also make the business look legitimate.
- Claim online profile listings: From Google My Business to Yelp – there are many platforms to source free leads for your construction business. These listings help you get found locally and also boost your SEO.
- Join social media platforms: With every person spending more and more time on social media, this is a good place to market your services. Check homeowner groups on Facebook and find your relevant audience on Instagram to spread the word.
- Explore email marketing: Email can be a powerful tool when spreading the word about your business. While it may take some time to build an email list with relevant audiences, it reaps many benefits in the long term. You can keep your audience engaged with construction trends, seasonal promos and other such ideas.
- Reap the Rewards of Reviews: Reviews are the cornerstone of every successful business and they can help you acquire new customers. When you finish projects successfully, ask your customers to leave positive reviews on Google and other such platforms.
Join HomeStars for Tailored Construction Business Marketing Solutions
HomeStars stands as an invaluable platform for construction professionals seeking to broaden their client base and expand their business horizons. Upon joining HomeStars, you unlock access to a comprehensive profile that serves as a showcase for services, licenses, and past projects. This platform allows for tailored customization, aligning offerings precisely with homeowners’ preferences, significantly elevating the prospects of attracting ideal clients.
The platform introduces trust indicators such as the Star Score, a rating system portraying the business’s standing and the probability of homeowners endorsing its services. Furthermore, the Verification Badge acts as a seal of approval, signifying the HomeStars team’s vetting process, and instilling trust and credibility among homeowners. Rigorously vetted customer reviews add a protective layer to the profile, safeguarding it from unwarranted negative feedback, thus enhancing the business’s reputation.
Moreover, HomeStars presents an opportunity to attain the esteemed Best of Awards, an accolade reserved for the top 2% of service professionals. This recognition significantly amplifies profile visibility, distinguishing the business from competitors and markedly increasing the likelihood of being chosen by homeowners. The Best of Award serves as a prestigious distinction, setting businesses apart in the industry landscape.
If you would like to know more about how HomeStars can help market your business, get in touch with us today!
