Construction business start up costs are perceived, as many businesses are, as being really high and sometimes out of reach. Much of this is due to not understanding the difference between resources and resourcefulness, and how construction business start up costs can be actually be minimized depending upon what niche you’re trying to get into…
But in this article, we’ll discuss the mandatory construction business start up costs that every contractor should expect to pay, and how these specific costs, though minimal, can help you turn big profits in your first year of business. The first two are pretty basic, but the last tip is where most contractors screw it all up…
Construction Business Start Up Costs: Licensing, Bonding & Insurance
This should be a no brainer, but this is by far the most important of construction business start up costs that you should be willing to pay and get in order.
Being a licensed and insured contractor gives you a much higher “perceived-value” in that your clients will trust you and your word more because they know that the state will hold you accountable if anything goes wrong. It also proves to your clients that you’re a skilled tradesmen, and that you understand your craft and the laws surrounding your business to ensure that you and your clients are both protected.
And to help you understand how minimal your construction business start up costs can be, I will avoid the issue of incorporating your business, because to be honest with you, you don’t need it when first starting out… You can focus on building up your reputation as a sole proprietor and get some money in your pocket before you ever think about incorporating…
But this doesn’t mean that incorporating your construction business should be a low priority for you because there are some serious tax advantages as well as the ability to protect your personal assets that comes with incorporating your business.
We’ll get to that in another article….
Construction Business Start Up Costs: Tools Of Your Trade
This is another of many construction business start up costs that you have to make sure to cover when first starting out… And the expense will definitely reflect the trade that you are in and the niche your are targeting…
For us, our construction business start up costs were pretty minimal in the area of tools simply because we were only doing kitchen remodels. And we were able to create a “McDonalds” like system 80% of our tools by only needing to fill a backpack.
The big expenses for us were purchasing a table saw, a chop saw and drills. Everything else was minimal, or if it was something special that needed to be done, we would rent the tool and make sure we made up the rental fee somewhere in the clients bill.
All in all, are construction business start up costs for tools was about $1,000… Not too bad at all…
And lastly, and most importantly…
Construction Business Start Up Costs: Your Website & Marketing Your Construction Business
This is where so many contractors BLOW IT! I’m taking a wild guess here, but I think the reason most contractors avoid building a website or doing any kind of direct response or more targeted advertising & marketing is due to the conceived complexity of it all.
So many contractors spends TONS of their construction business start up costs on buying stickers for their trucks, business cards, bulk mailer ads, phone book ads (yes, they still do this), door-to-door flyers, etc… The problem with this is that it’s a shotgun approach to marketing.
Here’s what I mean…
When you’re firing a shotgun, you’re hoping that at least one of those BB’s firing from the shell will hit your target. It’s a spray and pray mentality that most contractors have; and they’re hoping to just throw themselves out there and are praying that they get a response.
Problem is, response with these methods is harder to get…
And with it being so difficult to see any ROI (return on investment) with this kind of blanket advertising, I always recommend that my marketing clients take a sniper approach instead.
Now, being a sniper with your advertising will eat up some of your construction business start up costs, but there is a higher chance that you’ll see greater returns for the money you invest.
Imagine being able to but yourself in front of people that are actually looking for what you and your business has to offer… And then imagine being able to be in the search results on Google the moment they search for the service or product that you have to offer… And THEN imagine having this system run for you, 24 hours a day, 7 days a week, rain or shine, and whether you’re sick, out of town on vacation, or are hanging out with your friends and family…
Think of how much easier building your construction business would become if you were able to set your marketing system up one time and have clients continue to call or show up to your place of business without having to actively be involved…
This my friend is the power of building a marketing website for your construction business that drives traffic, makes your phone ring, and brings customers to your door…
And if you’d like more information on how to better spend your construction business start up costs, or you’d like to sign up for a free marketing strategy session, simply enter your name and best contact info in the form below…
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