Here’s what you need to know about starting a construction company
If you’ve spent several years working your way up from apprentice to a full-time contractor, you may be considering the option of starting your very own building business. It can be incredibly rewarding if you have the entrepreneurial skills to match your building knowledge. The fantasy, however, can be very different from the reality of running a business from the admin side of things. If you’ve been considering this option for a while, here are a few things to consider first.
Find your construction niche
Just like any industry, construction businesses can be sorted into different areas of expertise. Particularly in the case of building in construction, there are a few typical areas of specialism:
- Renovation
- Owner-builder
- Contractors with multiple trades
You will need to research all three of these construction business categories and decide which one best suits your ambitions. On top of this, you will also need to register with HMRC as either a sole-trader or limited company. Know that in a limited company, you are personally separate from the company as a whole; which means it’s much more appropriate for large-scale business.
You will also need to find a name that isn’t already registered at Companies House.
Don’t forget supply chain and inventory management
You’ve probably heard the phrases ‘supply and demand’ plenty of times. Working in construction involves just as much supply chain management as working in, say, a shop or any retail outlet that is constantly monitoring stock and sales. Inventory management is also necessary when it comes to monitoring what is coming in and what is being transported and sold. If you’re worried about the back-end bureaucracy of running a construction business, then you will find valuable sources for understanding the basics of inventory management online.
Undergoing some basic business training can also be helpful in monitoring the financial end of a business.
Get certification
You may have already heard that this isn’t a necessary demand when it comes to starting your own construction company; however, it’s wise to think about it from the consumer’s point of view. Would you rather hire a contractor with proven certification or one without? While it may be a small delay to the set-up of your company, it could ultimately win you business in the future. A card from the Construction Skills Certification Scheme (CSCS) is just one way of proving to clients that you are completely up-to-date on health and safety. In order to do this, you will have to obtain an NVQ to pass the test. There are also additional qualifications you will need to get in order to work with equipment and materials such as gas, scaffolding, and even skips.
Finding reliable tradespeople and business partners are two key components to setting up a successful construction business. You may need to invest some time in obtaining the correct qualifications and certification, but if it means that you will be seen as more trustworthy, it will ultimately be worth it.
