Starting a remodeling business is a smart move if you enjoy fixing things and renovation projects. No matter what the current state of the real estate market is, remodeling services are always in demand. Homeowners never stop looking for ways to upgrade their homes. In case you’re serious about trying your luck in this line of job, there are a few steps to take to increase your chances of success.
Types of Services
To decide what services to offer, the important step is to identify and evaluate your skills. Whether it’s plumbing or flooring, skills you’re best at should be your primary services at the very start.
If you are aware of your strengths and you use them in your remodeling business, you will be more motivated to work. And that’s what will make you stand out – the love of the work.
However, don’t forget to account for local demands. For example, if you live in the area where the price of real estate is on the rise, homeowners are more likely to want elegant upgrades, such as remodelling front doors or renovating siding. In case you’re near the sea or ocean, people in your area could look for water-resistant decking.
Choose Your Business Structure
Your business structure is quite complicated to change later, so you better make the right decision from the very start. There are four main types to choose from:
Sole proprietorship – the best choice if you’re planning to work alone or perhaps with your spouse. They are not expensive, while the process is simple – you won’t have a lot of taxes. However, all the debts are your liability.
General partnerships – you and your partner will share responsibilities, profits, and debts. Each one of you is liable for half of everything. You’re obliged to file an annual tax return, while your personal income taxes come separately.
Limited Liability Corporation (LLC) – whether it’s one or more owners, the members get to decide how they want to be taxed – as a corporation, a partnership, or even sole proprietors.
C Corporation – in case you have bigger plans – to grow business further after some time – this is the way to go. However, it’s the most complex structure, being its own entity where owners are protected from personal liability (as they are only shareholders).
Tools and Equipment
The moment you decide what type of services you’ll provide, start investing in the right tools. In case your initial budget is modest, look for clearance sales at the local home improvement shops. Thrift stores can offer small items cheaply, including pipe wrenches, screwdrivers, hammers, and nails, but sometimes even power tools and leather work boots.
However, bigger home remodelling projects will require some serious equipment and vehicles. They include a work truck, a reliable pallet jack, a forklift, and others, depending on the type of your service. Make sure you get them from a trusted supplier.
Obtain Business Permits and Licenses
Most remodelling businesses have to obtain some form of a building permit. While some of them are regulated by a contractor’s board as well. There could be some exceptions for certain handyman services, meaning you don’t have to obtain a full-fledged contractor license.
It’s your job to research as every country or state have their specific requirements. Small repairs may go without a license but you don’t want to risk ticketing or shutting down completely because you haven’t obtained all the necessary permits.
Insurance is also highly important. First, you should get general liability insurance for accidents like falls and injuries on-site or damages you make in your client’s home. Furthermore, take care of workers’ compensation, as it pays for their medical bills in case of an accident. Next, commercial insurance involves your property, including equipment and furniture. Auto insurance covers all your company’s vehicles. Lastly, consider data breach insurance as you’ll have access to some sensitive info on your clients.
Connect with Suppliers and Vendors
Your supplier can have a lot of influence on the success of your job, so don’t make this decision lightly. If your supplier can deliver you the materials on time. You’ll be able to finish your job on time or even earlier than planned. Which creates a positive image of your company. However, delays or wrong orders lead to dissatisfied customers and schedule chaos.
So, it’s highly important to establish firm relationships with your vendors and suppliers, as well as subcontractors. You should trust your partners when it comes to material supply while subcontractors have to trust you and vice versa – after all, it’s your name on the overall work.
A good marketing plan will give you an advantage in comparison to your competition from the very start. Your community needs to become aware of your remodelling business through every media possible – the radio, newspaper, internet. Offer specials that are in line with sales at your supplier’s store, as well as promotional projects. As this line of work usually grows in popularity through word-of-mouth, make sure to set up a referral program. Satisfied customers always agree on spreading the good word. Especially if they’re going to be rewarded for it in some way.
Staring your own remodelling business is potentially highly profitable, as well as rewarding if you enjoy what you do. These tips are here to make sure you start with your business in the best possible way and increase your chances of success.