The construction industry is expansive, with a wide variety of roles in it that are diverse in skill requirements and specialities. Starting a construction business includes that. Starting your own construction project is probably one of the harder roles one may take up within the industry, that is, to lead your own construction business. Let’s go through step by step to start a construction building business.
Leading your own construction business can be time consuming compared to other businesses and requires a host of skills in a variety of areas. Sales, negotiating, budgeting and various other skills are needed if you want to grow and create a sustainable construction business.
Starting a construction company has the benefit of allowing you to start small, maybe one project a year for example. From there you can start to build and expand your business expanding the number of projects you take on. Obviously, as you begin, while skills such as sales are required, you do not need to be an all out expert from the get go. You’ll grow with the business, as you take on more projects, your business also becomes better and you can take on more projects and more employees.
Another great reason for starting a construction business is the lack of technology. The construction industry is lagging far behind other industries in the adoption of technology. The good news is that there exists technologies out there that can aid someone starting and maintaining and growing their construction business. Specifically, construction management softwares.
Construction management softwares can help you manage your construction project and essentially streamline a lot of the processes involved in a construction project making it all smoother for yourself. For instance, software can help you by providing an estimation tool, scheduling tool, CRM, data storage(tasks, documents, supplier and subcontractor price lists).
A lot of builders will utilise their tried and tested techniques such as using a spreadsheet to estimate the costs for a construction project due to the fact that they are used to it, however, they don’t realise the margin for error in their methods and how much easier it is to use a software to aid in this task. This can save a lot of time and money from the get go.
Before diving into setting up your future construction company there are some realities you must investigate. That is, the market need for another construction company is what you want to investigate. If there is not currently a need for another construction company is one, as well as the fact that perhaps most individuals are serviced by a few large companies. Maybe there are a whole host of construction companies that have saturated the market. Depending on these factors it may be a bad idea to heedlessly jump into the industry headfirst as an over saturated market may not yield the results you are looking for.
Once you’ve found your entry into the market, and you are sure you want to go ahead, make sure you have a good business plan that will get you started and enable you to forge a plan ahead as this is a crucial step in starting your journey in building your construction business.
Also make sure you know what you’re doing. Previous experience in the construction industry is crucial in having a solid foundation to understand the ins and outs of working in construction which help in your business. Understanding how a construction project works is crucial.
Something that can help speed up the learning curve is by undertaking a course like the Diploma in Building and Construction. A Diploma is a level that exists within the AQF which stands for the Australian Qualifications Framework. This framework separates the different qualifications that exist in relation to education and training with the diploma sitting at the 5th level.
You will learn a variety of things in the course with it giving you a comprehensive level of understanding across different areas of construction, such as applying principles of OHS risk management, controlling project quality and risk and applying building codes and standards to construction processes and more. The idea is you are more prepared with different aspects of running your own construction company such as skills to look for in any hires, how to plan the scope and budget for a project and so on.
Furthermore, having skills in mathematics at a basic level to help you with the financial aspects of running the business such as budgeting and accounting is a necessity. Even if someone else is doing this, you need to keep up with it, knowing the financials of your business is extremely important.
You are essentially solely responsible for the money coming in and out of your business. If managed poorly you can be out of a business. It is worth talking to an accountant to help you manage things, however you can always be self taught in basic accounting while utilising third party softwares such as Xerox. If you have decided to utilise a top notch construction management software to help run your business, it should be able to integrate with these accounting tools and extract data from your construction projects such as timesheets, purchase orders and other financial transactions.
One must also be a good communicator and have adequate social skills in dealing with the variety of employees (labourers/general employees) and subcontractors and suppliers as well as clients and potential investors. This variety of people you are dealing with demands competency in your interpersonal skills as you will need to switch the way you communicate depending on who you are talking to and what you are trying to accomplish.
An important thing you want to do is figure out how you want to structure your business. There are four ways you can structure your business, the first one to look at is sole proprietorship, this simply means that you are the singular owner of the company and the main decision maker, everyone else is an employee of some sort.
Other options include a limited liability company which is a private company that has several owners. Each of these owners have a stake depending on the capital invested in the business. In this instance the business is a private one.
As opposed to having a private company, you can also have it set up as a public company. This means that shares of the business can be bought by the public, not just those you choose to sell to. The money gained from the buying of shares can be utilised for the benefit of the company.
Lastly, you can set up a trust. This is one way to set up your business where an appointed trustee will be the one who will manage the assets inside the trust. Those assets can be utilised to the benefit of the company. Regardless of which option you choose you should seek the help of a professional to determine what the best structure for your business is.
Once you’ve decided your company’s structure you will want to register your company and attain an ABN or Australian Business Number through the Australian Government’s Business Registration Service online. You must have a tax file number on hand to proceed with your application as well as register for GST.
To run your construction company registering it is the easy part, you need to ensure you are even qualified to do the job. This means you are going to need to also attain the necessary licences such as the individual contractors licence before you start any residential/commercial work and a company contractor’s licence which is required for making contracts and subcontracts with others. However, there are more licences you will eventually need to obtain. This information can be found here.
Finally, you can now start building projects for clients, all you need are employees and staff to help you in any matters you deem necessary so you should be drafting appropriate job requirements to start hiring staff for your company. You will also want others to know about you so increasing your presence and letting others know they can find you and your services through marketing will help greatly. Establish your brand and market it, utilising digital marketing as well as having a fantastic website that encompasses and details what your service is all about and what you offer will help to.
If you are looking for a good construction software that makes use of good project management functionality, estimate and financial/accounting tool functionality, job management, scheduling and planning and support functionalities and more. WunderBuild is a construction management software that aims to provide all of these functionalities and more to bring out the best outcomes for a project.
It is currently offering a free trial, visit here to try WunderBuild for free.
