How to Start Construction Company

The construction industry is once again booming, especially due to an increase in housing demand, real estate values, and lending activity.

At first glance, launching a construction company may look simple; in fact, it is one of the most popular industries for many start-ups.

However, the reality is that getting into this industry can be challenging, but the results well rewarding.

The best time to start your business is now, so you can take advantage of the boom in commercial construction, a shift in the local housing market, or even a remodeling demand in your area.

Before you set up shop as a construction contractor, you need to be aware of the following.

1. Research

Before starting the business, your first step ought to be carrying out market research to identify the exact construction needs in your location.

Probably, you have done a bit of due diligence and seeing a potential construction boom period or increased activity of people looking for home renovation.

Despite these early indicators, you still need to carry out research using tools like the U.S. Small Business Administration (SBA).

At the same time, talk to construction owners and residents to find a gap in their construction requirements, such as the supply of trench shields by ICON. Once you’re done, you can start your clock on putting together the construction company.

2. A Business Plan

A construction company always requires personnel, equipment and various tools, all of which cost money.

If you have the cash to keep your business afloat for the next six to 12 months, you can move on to the next tip. If you’re like most people, you will need a loan, which requires a concrete business plan.

The business plan demonstrates that you understand what is required to start and run the company.

This critical document covers everything from the structure of the company and target market to tools you will use for employee management and your understanding of the competition.

Drawing up the document can be made even easier using online tools; for example, you can use a weekly timesheet to get accurate figures of how much wages would cost you.

3. Pick a Central Location

You need your construction company to have a headquarter somewhere, and it’s better to choose the location as you wait on the loan.

Fortunately, you can start working out of your home at the beginning. However, many construction companies require having a location where they can safely store their equipment, tools, and supplies.

In addition, you will also need a small room where you can set up the business phone line, but you can always start by using your personal cell phone.

For mail, a P.O. Box is a handy alternative, but get one that comes with a street address so your new business appears professional.

4. Business Registration

You construction business should be registered before you even start working. However, remember that business registration requirements are different across different states.

Some of the things you need are a business name, examination of registration requirements, and paying the appropriate fees.

You also need to ensure that your business structure places you at a position to leverage on tax breaks and liability protection.

Sole proprietorships and partnerships are the most common, but they don’t keep you safe from personal liability.

On the other hand, corporate status is less common for startups in the construction industry, but it allows you to take on huge projects and many employees.


With the basics addressed, the next step is getting your new business some projects so you and your employees are paid. This involves acquiring surety bonds, building permits, and getting the business in the marketplace.

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