How to Start a Construction Company?

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How to Start a Construction Company

When starting any business, it’s essential that you take all of the necessary measures to get your venture off the ground with minimal disruption. With the construction sector experiencing reduced growth and stagnation amidst a turbulent economy, it’s never been more important to ensure that you tick all of the boxes when starting a new business in the building trade – but what steps should you take if you’re looking to start a successful construction company in the UK today?

How to Start a Construction Company?

Draw up a business plan

The first step you’ll need to take when starting a company is writing up a business plan. This should be a thorough breakdown of your business that you can show to potential investors when raising funds – it can also help you to organise and plan ahead of time.

how to start a construction company - Draw up a business plan

The elements of any good business plan include an executive summary, a company description, your marketing and sales strategy, financial projections and a breakdown of your company’s structure.

If you’re going into the construction trade, you’ll also likely need to demonstrate that you’ve secured builders’ insurance or the relevant coverage for your venture. Before writing up your business plan, conduct as much market research as you can and incorporate this into the final document. The better your business plan, the higher your chances of receiving substantial investment.

Get certification

If you’re starting a construction company in the UK, you’ll need to be aware of several rules regarding tax, building regulations and health and safety. You must adhere to the law of the land and acquire all of the necessary certifications you need to operate safely and legally.

In particular, you must register with the Construction Industry Scheme (CIS) (a government scheme designed to process transactions between contractors and sub-contractors), regardless of whether you’re planning to set up shop as either a sole trader, partner or limited company. You’ll also need to make sure that your operations adhere to the Health and Safety at Work Act 1974 and UK construction regulations and provide evidence of adequate skills training for you and your staff.

Consider your finances

While the average budget for setting up a new construction business in the UK stands at around £5,000, it can be considerably cheaper or more expensive depending on how you manage your company’s cash flow.

Consider your finances

While finding the funds to finance your new business can be amongst the most challenging elements of setting up shop, you’re more likely to attract investors if you’ve accumulated the necessary certification and written up a solid business plan. The most typical ways of securing startup funds in the UK include business loans (via commercial lenders or banks), government startup loans ranging from £500 to £25,000, and home equity loans.

Promote your business and get clients

When budgeting for the startup, consider setting aside some funds for marketing and promoting your new business. Whether you do marketing in-house or outsource the work to professionals, you’ll need to get the word out there if you want to attract new customers. Ensure that your company site is up to scratch before launching and don’t hesitate to make use of social media to spread the word!