5 Things to Consider Before Starting a Construction Business

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Brenda Nyawara

Brenda Nyawara is an editor at Archute. She is a graduate architect with a passion for edge-cutting ideas in design, fashion, art and modern world interests.
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Until the world population stops growing, there will always be good demand for construction services of some kind, and plenty of construction business loans to go around. But construction is a complex industry with so many things that could go wrong. Here is what you need to know before you get started. 

Health and Safety Requirements 

The evolution of construction has brought not only technological innovations but also a greater emphasis on health and safety requirements. Health and safety are at the heart of the construction business. In this way, they all complete each other rather than compete. What does this mean for you?

As a construction business owner, the amount of money you will spend to keep up with health and safety regulations will be an expensive, yet worthwhile reminder to care for your employees, clients, and suppliers too. It goes without saying, the world is much safer when health and safety measures are in place. 

Image source: safetyculture.com

Right from the start, health and safety are contractually agreed upon when starting jobs, big and small. It is a level of care and control that is spelled out in building codes and construction laws, but compliance is a collective responsibility of everyone involved. If you need help with that I suggest you check out the law office of Scott Ives.


Any risk can change the fortunes of your construction business really fast, and that’s why it is a good idea to have business insurance to keep your business moving. Simply going into business without any kind of safety net from uncertainties may expose you to problems down the road. 

Perhaps unsurprisingly, in some states, you are required to get insurance for your construction business. It is the law! Insurance will help you mitigate the risk associated with a construction site (of which there are a lot, and may lead to loss of life in some instances). 

Image source: shimininsurance.co.ke

All said insurance delivers something incredibly valuable yet completely intangible – peace of mind. That means you can go into so many business ventures and explore any entrepreneurial opportunities while shifting the risk to the insurance company. 

Licenses and Permits

Get in touch with the local business registration agency to get to know the licenses and permits you are required to obtain to start a construction business. There is no standard for licensing and permits, the number you need depends on the state and the scale of operations you are putting up. 

If your construction business will offer specialty services, then you may need to obtain a license for the service from the relevant body. You can get reliable information on licensing from your local council office where you can speak to qualified clerks about the legal papers you need. 

Image source: thespruce.com

Don’t forget permits, even when the state does not require you to secure permission for whatever service you are offering. These legal documents will ensure you stay on the right side of things in case of accidental damage to a client’s property or injury. 

Office Location

The office is, for any entrepreneur, a second home. You will find yourself spending every waking hour in the office attending to business matters. You get where I’m going with this, right? The choice of where to base the operations of your construction business is critical. 

It needs to be accessible to your target audience, but it should also be in a location that has the amenities to support both you and your team. Before you identify locations, set your sights on an area where you can be close to your talent pool. 

But before you can even get to that, you need to identify what the office will be used for. This is something you will have to take seriously because it determines the type of space and features you need. In any case, you might want to factor in the cost of making such an investment. 

Purchasing Equipment

The investment decision an entrepreneur makes at the start of a business venture can set them up for one of two situations – success or failure. You may find yourself buying equipment that makes you work better, but the toll taken on your account might set you back for quite some time. 

Equipment will take a significant chunk of your startup funds. Once you have decided on the equipment you need for the smooth operations of your construction business, you must figure out how much you need to acquire the equipment. Luckily, you can get financing for equipment instead of stretching your funds thin.

Image source: constructionreviewonline.com

Leasing is an option too – but for some, the lifetime cost of leasing equipment is considerably high as opposed to buying the equipment at the onset. However, you choose to go about handling equipment for your construction company, it is going to cost you. 

Closing Thoughts

The complex business model means you might need some time to plan and collect the resources you need to get your business off the ground. But the simple truth is, once you have the checklist above checked out, it is easy to start and expand as you get more construction jobs. 

Image source: become.co

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About the author

Brenda Nyawara

Brenda Nyawara is an editor at Archute. She is a graduate architect with a passion for edge-cutting ideas in design, fashion, art and modern world interests.
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