The new financial year may bring with it a sense of renewal and a reassessment of your career plans.
As of 2022, there are reportedly 300,000 construction companies in the UK – 99% of which are SMEs. The sector is worth an impressive £110 billion each year to the UK’s economy and offers a lucrative opportunity for those looking to go it alone and set out self-employed.
While a new business venture can be a potentially daunting task with much to consider from financial planning and marketing to recruitment and personnel. When done right, the benefits can outweigh the risks – from strong earning potential to a flexible lifestyle and your own independence.
Here are some practical tips for each of these areas, to help set you on the path to success.
Devise your business plan
Any construction company worth its bricks needs to think carefully about what it can bring to the table. Do your research and find your ‘why’. What is your purpose and reason for being?
Perhaps you want to hone your crafts in a larger organisation? Have you spotted a gap in the market for services currently underrepresented? Has new government legislation made certain jobs easier to access or skills more in demand?
The temptation to pick up your tools and get cracking is understandable but take your time to fully compile your market research and determine the profitability of your business idea. Experts say actually writing a business plan makes you 250% more likely to start a business.
Understand the legal requirements
Understandably, in a sector which potentially involves high-risk working environments, it’s important to understand the accompanying legal responsibilities. Decide whether to inaugurate your company as a limited, sole trader or partnership company with Companies House, and make sure to register with the Construction Industry Scheme (CIS) whether you’re working as a contractor or subcontractor.
Of course, an understanding of Health & Safety regulations is also crucial so make sure to familiarise yourself with laws and ensure all training qualifications are up to date through the Construction Industry Training Board.
You may also want to apply for third-party accreditation to demonstrate your company’s competency.
Sound financial planning is key
Setting up alone can be cheaper than you think with the average budget for a UK start-up construction company sitting around £5,000.
Often, due to the nature of construction work, all work will be completed on-site. There’ll therefore be no need for premises, and any paperwork can be managed at home. Fortunately, many start-up construction workers are also likely to have the necessary equipment from working in the trade.
Make sure that your budget accounts for everything from worker salaries to raw materials to transport and van leasing.
Jonathan Beadle, Commercial Manager at UK van leasing company, Van Ninja explains, “The benefits of leasing are greatly apparent. Leasing means not having to dip heavily into capital, freeing up money to spend elsewhere and bringing greater control of your finances with a fixed monthly leasing cost.
“Leasers also need not worry about unexpected repair costs or depreciation as they can simply return the vehicle when the contract ends.”
Consider your marketing tatctics
Developing a marketing strategy will allow you to promote your company’s services and attract potential customers. Consider which tactics may be best to put you in the spotlight. This may include social media, radio, print or online advertisements.
Also, think about how to position your brand. Are there any USPs you may wish to accentuate in your marketing? Perhaps you’re embracing cutting-edge technology solutions or promoting workplace inclusivity. Whatever your specialisms, make sure to shout about these from the rooftops!
Gather your team together
Whether you’re a one-man band, a team of trusted associates or a larger people-led enterprise, it’s important that your team should be at the centre of everything you do.
Assess whether you want employees or contractors and consider the possibility of apprenticeships to coax young people into the business. This can often be a very financially viable option with the government paying 95% of the cost of an apprentice’s training.
Building a business from scratch can be a scary prospect but with some careful planning and the right guidance, this can be one of the most exciting opportunities out there. You got this!