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BUSINESS PLAN FOR THE SMALL CONSTRUCTION FIRM Management and Planning Series TABLE OF CONTENTS INTRODUCTION A Note on Using This Publication 1 What's in This for You? 1 Why Are You in Business? 1 What Business Are You In? 1
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Construction Business Plan
Ready to start your own construction business? Set yourself up for success by creating a solid business plan. Download this business plan template, with pre-filled examples, to inspire your own plan.
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- A complete business plan Unlike other blank templates, our business plan examples are complete business plans with all of the text and financial forecasts already filled out. Edit the text to make the plan your own and save hundreds of hours.
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Key sections in this construction business plan:
All of our sample business plans are complete and include all of the sections that bankers and investors expect to see. Every plan includes the following sections:
- Executive Summary : A quick overview of your plan and entices investors to read more of your plan.
- Company : Describes the ownership and history of your business.
- Products and Services : Reviews what you sell and what you’re offering your customers.
- Market Analysis : Describes your customers and the size of your target market.
- Strategy and Implementation : Provides the details of how you plan on building the business.
- Management Team : An overview of the people behind the business and why they’re the right team to make the business a success.
- Financial Plan : A complete set of forecasts including a Profit and Loss Statement, Cash Flow Statement, and Balance Sheet.
If you're interested in learning how to write a business plan, read our free in-depth guide to writing a business plan , download our free Business Plan Template , and check out LivePlan —our award-winning business planning software.
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Construction Company Business Plan
Growing a construction company is much more difficult and taxing than completing projects.
From acquiring a new project to meeting deadlines, managing the budget, and many more things in between- you will find yourself drowning in responsibilities when you start a construction company.
A construction business plan can come to your rescue in such burdensome situations. If prepared well, it can become a reference point for your company as it continues to grow.
Confused about how to write a business plan?
Well, this article will serve you perfectly. It will help you understand the contents of the business plan and offer a sample template for your construction company.
So let’s build a solid construction company business plan with this detailed guide.
Let’s dive right in.
- Venture into the market by conducting thorough industry and market analysis.
- Widen the scope of your service offerings to cater varying needs of your target audience.
- Create a detailed operations plan to get thorough guidance in your business operations.
- Conduct a SWOT analysis to identify your competitive edge over the competitors.
- Determine your marketing strategies to launch your business and get it popular amongst your target market.
- Define your business objectives, goals, and mission values to create a foundation for essential business policies.
- Account for various project costs, operating costs, and office expenses to form realistic cash-flow projections.
Why do you need a construction company business plan?
Apart from the fact that investors and banks would ask for a business plan when you seek funding, here are a few more reasons you need a business plan.
- A business plan offers a roadmap to your business. It acts as a guiding block that has answers to all your how, when, where, and what.
- It helps in determining the exact target market for your business and formulating strategies to cater accordingly.
- There are millions of construction companies competing in the industry. You can identify your strengths through a business plan and design a competitive edge to stand apart.
- A well-rounded plan prepares you for emergencies that may arise in your business by making a plan for every situation.
- A whole lot of business processes repeat every day. A business plan helps bring consistency by establishing SOPs for various business activities.
And of course, you get your desired funding with a solid business plan that vouches for the potential of your construction company.
Key components of a construction business plan
Writing a business plan gets much easier with a structurally defined flow. Well, let’s have a look at key components that a construction company business plan must have.
A brief summary of an entire business plan that will encourage the readers to read further.
A brief company description including every detail from company structure to its mission statement and future goals.
A thorough analysis of the construction industry and your target market. It also includes sections for competitor analysis, future market trends, and scope of growth.
Outline the construction services that your company will offer. Highlight any additional services that will make you a distinct player.
Marketing and Sales Strategy
It includes a strategic plan to achieve success through marketing and sales. Determine the best course of action for your business.
Introduce key personnel in managerial and leadership roles. Discuss their roles, qualifications, experience, and expertise.
A detailed plan that streamlines the everyday operations right from construction methods to hiring employees.
A financial plan highlights the prominent figures and key reports of your construction company by making necessary financial projections.
Let’s dive further into these topics and get a detailed understanding of writing your business plan.
Related Construction Company Resources
- Construction Company Marketing Plan
- Key Stats for the Construction Sector
- Start-up Cost For Construction Company
A step-by-step guide to creating a construction company business plan
A poorly written plan serves no purpose. However, with this step-by-step guide, you will uncover every detail that goes into making a fantastic and purpose-serving business plan.
1. Get a business plan template
Writing a comprehensive business plan is taxing and time-consuming. But if you do it well, you will have a guidebook for running your construction company.
Now, there is a lot that needs to be considered, planned, and accounted for as you start writing the plan. Even if you closely follow a construction business plan outline, there are higher chances of you losing track or getting stuck at certain sections.
This is why you need a business plan template to give a solid structure to your business idea. With industry-relevant examples and a guide, the Upmetrics business plan template is easy to edit and customize.
Whether you own a general contracting firm or specialize in residential construction or specialty trades- we have plenty of construction-related templates for you to choose from.
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2. Write an executive summary
The executive summary is a concise yet insightful description of your entire business plan.
This one-page document summarizes the most important questions that a reader might have and offers a peek into what they are about to uncover. Investors take a brief glance at your executive summary before deciding whether to proceed further or not.
An executive summary must outline the following details of your construction business in persuasive consecutive paragraphs.
- The exact business opportunity
- The target market
- The problem and the solution to it
- Products and services offered by you
- Market size and growth potential
- Financial highlights
- Management team
Maintain a personal storytelling tone while writing this section and encapsulate every minute detail that can make a difference.
But wait, don’t start writing yet. Write your executive summary only after you are done writing an entire plan. This will help you summarize effectively.
3. Prepare a company overview section
This section of a business plan will focus entirely on the details of your construction company.
From the type of construction company to the construction company’s goals- everything in this section is about your company description.
To begin with, highlight the type of construction business you will start. For instance, a residential construction company, general contracting company, industrial construction company, or specialty trade construction.
Clarify, if this will be a new business or an extension of existing business. If the business is already operating, offer a brief description of the business history.
After that, highlight the business structure of your construction company. Are you going to be a sole trader or start a limited liability company (LLC) or a limited partnership firm? The business structure you choose will decide how the finances and taxes will work in your business.
Now, this section is your chance to weave magical stories around your construction company. Present the mission statement, company’s objectives, and future goals over here.
Mission statement : Syncore aims to become a trusted name for sustainable residential construction projects in Arizona by 2028. With our commitment to the highest quality standards, we will penetrate the market with our premium budgeted solutions.
Business goals :
- Onboarding and signing 15 construction projects in a span of 6 months.
- Generating revenue of $2 million by 2025.
Like this, you will write this entire section in parts by offering a brief overview of your construction business.
4. Conduct a competitive and market analysis
In this section of a business plan, you begin with industry analysis and then narrow it down to your particular market segment. This is important to show your potential investors that there are promising opportunities in this market.
Using market research practices determine the target market for your construction business. Create a buyer persona to identify what your ideal customer will look like.
Further, highlight your competitors in this competitive construction industry. Using SWOT analysis and PESTEL, determine the strengths and weaknesses of competing construction companies. In this section, you will also highlight your strengths to gain a competitive edge over existing players.
Don’t limit your market study to merely understanding the current scenarios. Extend the research and identify future trends and growth possibilities in your targeted market.
If you are a residential construction company focused on sustainable building practices, you must include the following details in your market analysis section.
- How large is the construction industry?
- What segment of the construction market will you capture?
- Who will avail of the construction services?
- What is the spending capacity of your target customers?
- Who are the top competing construction companies?
- What are the emerging trends in the industry and how will you leverage those?
- What is the growth potential of your target market?
Focus on quality market research as this will form the base of your further projections and strategies.
This screenshot of the construction business plan example highlights only the market size for HDFL construction. You can also include details like competitors analysis, growth potential, and market trends here.
5. Describe your construction service offerings
What construction services will you offer your potential clients?
Offer a detailed answer to this question, as you write a business plan section for service offerings.
Overall, this section should highlight every service offering that will bring you money. This could include services like,
- General contracting services
- Design and Engineering
- Renovation and remodeling
- Project management
- Specialty services i.e. concrete work, HVAC installation, Roofing services
- Maintenance and repairs
Offer a brief understanding of these service offerings and highlight construction jobs you will specialize in. For instance, remodeling of kitchen and bathroom.
Now, will your construction company sell any construction materials for profit? If so, include details for that as well.
It’s important to consider the breadth of your service offerings to keep the customers coming back.
Overall, this section is your chance to prove to potential investors that your services can stand solid in the competitive construction industry.
6. Propose marketing and sales strategies
According to the IBIS world report , there are more than 3,787,470 construction businesses in the USA. Starting a construction company will add one more to this list, but hey- How do you wish to make a brand that your target audience can recall easily?
All the market assessment and understanding of your potential clients will come in handy at this stage as you make your marketing plan and sales strategies.
Take an opportunity to lay out your sales plan in this section. If you have existing customers, explain how you plan to retain them.
After you are done making your sales strategies, touch the marketing aspect.
Firstly, identify the way you want your brand to be recognized- as an ordinary construction firm, a luxury construction company, a sustainable solutions firm, or an affordable construction company. This will help you make a marketing plan.
Your marketing strategy should answer the following questions:
- Which marketing channels will you use- Online, offline, or a mix of both?
- How will you generate more leads?
- Online marketing methods- search engines, social media, Email marketing, content marketing, etc.
- If you are going to be utilizing social media platforms- which ones?
- How much will you budget for paid ads?
- Will you use billboards, pamphlets, and newspaper advertisements to market your business?
Keep in mind the marketing channels where you can find your potential customers. For instance, you are more likely to find conversions through Email campaigns than social media campaigns, if you are finding clients for commercial construction.
All in all, in this section you have to draw potential investors’ attention with your sales and marketing strategy.
7. Introduce your management team
Everyone is aware of the cutthroat competition in the construction industry. Knowing that you need an able team to transform your business plan into a successful venture.
After laying out your marketing strategy, it’s time to introduce the key management and leadership team to your business plan.
It’s okay to brag about the talented individuals you have in your company. From construction heads to project managers, highlight the achievements, experience, and expertise of these people and prove their asset-worthiness for your company.
Also, draw the hierarchical map to give potential investors an idea of your organizational structure.
This is your time to prove that you have both the means and manpower to run a successful company.
8. Outline your operational plan
You may know construction, but do you know how to run a construction business?
As someone said, “ Seamless operations are the silent engine of extraordinary business achievements”
Before even taking the first project, it’s important to define operations and SOPs for different business activities. Make it so thorough that it can act as a guidebook whenever a problem arises in your construction company.
As you write a business plan for this section, focus on answering the following questions:
- What construction materials will you use?
- What will be the supply chain process in your construction company?
- Who will oversee the project management on site?
- What will be the timeline for completing projects?
- What will be health and safety protocols for construction workers?
- What will be the process of construction work?
- How will the communication flow within an organization?
- What technologies and equipment will you use?
- How will you ensure quality work?
- How will you hire employees?
- What accounting software will you use?
This is just a general gist of questions that can help you prepare this section. Consider it as a living document that will undergo various changes as the business commences and grows.
A thorough operations plan will lay a clear groundwork for running a company. Moreover, it will instill investors’ faith in your ability to run a construction company.
9. Create a financial plan
Writing a sound financial plan is a challenge but nothing that your determined mind can’t handle.
Whether you plan to raise funds or get bank loans, you need a sound financial plan. Investors will analyze this section and only if they find your business financially viable, will they invest.
In this section, you will make financial projections and estimates for your construction company. This includes forecasting sales, estimating startup costs , projecting overhead costs, and making a pricing plan.
Using the startup costs projection, determine how much funding is essential to start your own construction company.
Also, prepare different reports like income statements, cash flow statements, balance sheets, and break-even analyses using the projections made earlier.
To make a financial plan more relevant, consider various progressive and aggressive situations.
Lastly, prepare graphs, charts, and diagrams to make this section visually appealing and easy to grasp.
Now, stop. Don’t start writing a financial plan yet. You need a financial forecasting tool from Upmetrics to help you with projections and calculations of cash flow, sales, revenue, and everything else. Simply enter the data and it will make detailed and precise calculations for you.
Trust us, you don’t want to scratch your heads writing the entire plan from ground level.
And that’s it! With all this information you pretty much know everything that a construction business plan must have.
Construction Industry Highlights 2023
Now that you are almost set to open a construction company, here are a few industry statistics that might interest you.
- Market size : The US construction market sector was valued at 1.8 trillion US dollars in 2022.
- Growth of the virtual construction market : The global BIM market is 7.9 billion US dollars . North America is projected to be a market leader capturing 30% of this market.
- Rise in prefabrication and modular construction : Healthcare facilities followed by hotels/motels and educational institutions are most likely to avail of modular construction facilities.
- Major concerns : The leading concerns encircling the construction industry are inflation and supply chain disruptions faced by nearly 90% of constructors.
- Sustainable and green building : There is a continuous increase in demand for sustainable and green building solutions. As for 2021, the green building market in the USA was reported to be approximately 83 billion dollars .
- Growing investment in smart cities : According to IDC, the investment in smart cities is expected to grow to 203 billion dollars by 2024.
From sustainability to tech-centric processes, the construction industry is making huge shifts in trends. Both, small businesses and large have to evolve according to changing times to keep themselves relevant.
Download a sample construction business plan
Facing difficulty writing a business plan? Well, we have a perfect resource for you.
Download the Upmetrics sample business plan template. Our template offers step-by-step instructions and prompts to ease the entire plan writing process. It’s designed to meet modern market needs and is perfectly detailed with construction-relevant examples.
The Quickest Way to turn a Business Idea into a Business Plan
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Upmetrics is an intuitively designed business planning app with more than 400+ sample business plans . Our business planning tool features AI assistance that will transform your business writing process. Not only that, it allows you to design, collaborate, and share your business plan in real-time with your team.
So what are you waiting for?
Let’s Build your plan with our business plan builder.
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Frequently asked questions, what kind of market research should i include in my construction business plan.
The market research for your construction business plan must include the following details:
- The market size of your targeted market, i.e. commercial construction, residential construction, etc.
- The target audience of your services and their buyers’ persona
- Top competing firms and companies offering similar services
- Emerging trends in your market
- Growth potential for your firm
Is a SWOT analysis necessary for a construction company business plan?
Absolutely yes. There are more than a billion construction companies in the USA itself. Starting another business won’t guarantee success unless you have a business that can withstand the dynamic competitive environment. SWOT analysis will make you aware of the company’s strengths, weaknesses, and the opportunities it can avail
What are the initial startup costs for a construction company?
It is possible to start a construction company with as little as $10,000. However, if you plan to set up a mid-sized construction company, expect to spend anywhere around $50,000-$250,000 on getting a basic setup. This includes accounting for licenses, insurance, office setup, construction materials, and payroll for the initial months.
Can I get government grants for a construction business?
Yes, you can apply for government grants to start your construction business. Check the local, federal, and state regulations to see which grants are applicable to your business. Check the eligibility and apply accordingly.
How often should I update my construction business plan?
A business plan is a living document that can guide you toward success if mapped properly. Ideally, you should update your business plan every 4-6 months to make it relevant. Set aside time to do so as a renewed plan will offer deep and meaningful insight into your business goals.
About the Author
Upmetrics is the #1 business planning software that helps entrepreneurs and business owners create investment-ready business plans using AI. We regularly share business planning insights on our blog. Check out the Upmetrics blog for such interesting reads. Read more
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Construction Business Plan Template
Construction business plan.
You’ve come to the right place to create your construction business plan.
We have helped over 100,000 entrepreneurs and business owners create business plans and many have used them to start or grow their construction companies.
Sample Construction Business Plan Outline
Below is a construction business plan example to help you create each section of your own construction business plan:
VB Residential Construction Company is a startup construction company located in Milwaukee, Wisconsin. The company is founded by two cousins, Victor Martinez and Ben Schmidt. Together they have over 20 years of experience in constructing homes from design concept, remodeling and renovating homes. They are highly skilled in all aspects of construction and have garnered a positive reputation in the local construction community for their ethical practices and competitive skill set. Now that Victor and Ben have an extensive network of clients and contacts, they have decided to begin their own residential construction company.
The following are the services that VB Residential Construction Company will provide:
- Custom home building/design build
- Home remodeling and renovation
- Project Management
- Kitchen and bath construction
VB Residential Construction Company will target those individuals and industry professionals requiring home construction services in Milwaukee, Wisconsin. Those individuals are landowners looking to develop homes on their lots, architects who have clients needing homes built, developers who have the vision but need a company to make it a reality, and households needing home remodeling services.
VB Residential Construction Company will be led by Victor Martinez and Ben Schmidt. Together they have over twenty years of construction experience, primarily in residential builds, remodeling, and renovation. They both started at a young age working and learning from their fathers. When they graduated from high school, their fathers got them jobs at the construction company they were employed at. The four family members worked together for ten years at the construction company. The fathers recently decided they were going to retire from the industry which prompted Victor and Ben to branch out on their own and start their own residential construction company.
VB Residential Construction Company will be able to achieve success by offering the following competitive advantages:
- Friendly and knowledgeable contractors who are able to take any project from concept to reality.
- Unbeatable pricing – Clients will receive the best pricing in town for services on any project while maintaining the best quality and customer satisfaction.
VB Residential Construction Company is seeking $200,000 in debt financing to launch its construction business. The funding will be dedicated towards securing a small office space, purchasing two trucks, and purchasing all the construction equipment and supplies. Funding will also be dedicated towards the advertising agency and three months of overhead costs to include payroll of the staff, rent, working capital, and monthly fees to the accounting and human resources firm. The breakout of the funding is below:
- Trucks: $40,000
- Construction equipment, supplies, and materials: $100,000
- Advertising agency in charge of promotions: $10,000
- Three months of overhead expenses (rent, payroll, HR and accounting firms): $40,000
- Working capital: $10,000
Who is vb residential construction company.
VB Residential Construction Company is a newly established contracting company located in Milwaukee, Wisconsin. Founded by cousins, Victor Martinez and Ben Schmidt, they have over 20 years experience in the construction industry. VB specializes in residential remodeling, kitchen and bath construction, as well as custom home building. VB Residential Construction Company also offers residential design, construction, and project management services. VB prides itself in delivering a level of expert craftsmanship to fulfill the vision for the client while exceeding expectations at exceptional value.
VB comes from the initials of the owners, Victor Martinez and Ben Schmidt, two cousins who have been working in the construction industry most of their lives. Both of their fathers spent decades as contractors and raised their sons working and learning the construction trade. The four have been working for another residential contractor in Milwaukee and have built and remodeled numerous homes for multiple builders and clients. Now that both of their fathers are retiring from the construction industry, Victor and Ben have decided to start their own residential construction company and use their years of experience, expertise, and contacts to be an independent residential contractor.
Since incorporation, VB Residential Construction Company has achieved the following milestones:
- Registered VB Residential Construction Company, LLC to transact business in the state of Wisconsin.
- Located a small office space to have a physical address for the company as well as a receptionist.
- Reached out to their numerous contacts to include real estate agents, developers, architects, and landowners to advise them on their upcoming construction company in order to start getting construction contracts.
- Began pricing out costs for trucks and necessary construction equipment.
- Began recruiting a team of contractors that cover different areas of construction to include mechanical, plumbing, electricians, and roofing.
The following will be the services VB Residential Construction Company will provide:
Revenue for the Construction industry is expected to continue growing over the five years as demand for new housing expands. Revenues are expected to reach $107 billion.
Relatively low interest rates, coupled with rising per capita disposable income, is expected to support individual investment in new homes, providing an opportunity for industry revenue growth over the next five years.
Per capita disposable income is expected to rise steadily over the next five years, while concurrently, unemployment will drop, proving favorable conditions for industry growth.
Housing starts are expected to rise an annualized 2.9% and this growth is projected to stem partly from forward-looking consumers that choose to purchase homes while interest rates are low. Relatively low housing stock and relatively low interest rates are expected to lead demand for industry services to increase over the next five years.
Demographic profile of target market.
The precise demographics for Milwaukee, Wisconsin are:
VB Residential Construction Company will primarily target the following customer profiles:
- Households in search of home remodeling services
- Landowners who would like to build homes on their lots
- Architects who have clients that need home building or remodeling services
- Developers who have already partnered with landowners and/or architects and are in search of a residential contractor
Direct and indirect competitors.
VB Residential Construction Company will face competition from other companies with similar business profiles. A description of each competitor company is below.
JM Remodeling has been in business in Milwaukee, Wisconsin since 1990. They are a full-service design and build company. JM Remodeling specializes in residential and commercial restoration and renovation including custom carpentry, kitchens, bathrooms, roofing, siding, dormers, additions, home gyms, home offices, porches and decks, and mechanical services. JM Remodeling carries a staff of plumbers, electricians, journeymen carpenters, restoration specialists, roofers, siders, sheet metal workers, and expert estimators. JM Remodeling also has an apprenticeship program to train employees within the company. They are licensed, bonded and insured and also part of the National Association of Remodeling Industry (NARI). JM Remodeling also provides warranties on all their services. The work is guaranteed by labor warranties, factory warranties, and extended warranties.
Cream City Construction
Cream City Construction has more than 50 years experience in home design, remodeling and renovation in the Greater Milwaukee area and Southeastern Wisconsin. The home remodeling services they provide are additions, whole house remodeling, kitchens, bathrooms, lower levels, master suites and historic renovations. Cream City Construction is a design build company that works with the client to create the design plans, generate project costs, and build the project.
Cream City Construction is owned and managed by Todd Badovski and Jim Grote. Together they have decades of experience and have spent years refining the skills required to run a high end, quality driven remodeling company. The majority of their projects come from repeat business or referrals from clients delighted with their previous service. Cream City Construction is also a member of the National Association of Remodeling Industry (NARI) as well as the Historic Milwaukee Incorporated.
Sazama Design Build Remodel, LLC
Former restaurant owner Don Sazama established Sazama Design Build Remodel, LLC in 1987 after becoming a Master Carpenter. He wanted to merge his passions of business and design and expand his skills in carpentry and architecture. Don’s firm has completed over 700 homes and won 11 awards from the Milwaukee Home and Living magazine. Sazama Design Build Remodel builds homes that are modern and luxurious and have completed many large remodels of bathroom and kitchen renovations. Sazama likes to collaborate with firms such as Ivy Interiors and an award-winning landscape designer, Gingko Leaf Studio. Sazama Design Build Remodel can build and design all aspects of a home – from a home office, outdoor entertaining area, serene spas, and inviting kitchens. The team at Sazama is able to do a historic renovation, build or renovate into something modern and posh, or keep it traditional.
VB Residential Construction Company will be able to offer the following advantages over their competition:
Brand & value proposition.
VB Residential Construction Company will offer the unique value proposition to its clientele:
- Highly trusted and professional contractors with over 20 years of experience remodeling, renovating, and building homes.
- Unbeatable pricing to its clients – VB Residential Construction Company does not mark up its services at a large percentage. They will offer the lowest prices in town.
The promotions strategy for VB Residential Construction Company is as follows:
Word of Mouth/Referrals
Victor and Ben have built up an extensive list of contacts over the years providing home construction services for numerous highly satisfied clients. Most of the clients are repeat customers and have also referred them to other associates for home projects. These referrals and repeat customers are very likely to use VB Residential Construction Company instead of the previous construction company Victor and Ben were employed at.
Professional Associations and Networking
VB Residential Construction Company will become a member of construction and professional associations such as the National Association of Remodeling Industry (NARI) and the Milwaukee Chamber of Commerce. VB will also become a member in associations where other builders, developers, and architects are a part of. They will focus their networking efforts on expanding their client network.
VB Residential Construction Company will invest in professionally designed print ads to display in programs or flyers at industry networking events. They will also invest in two billboards to display in highly trafficked areas of town.
VB Residential Construction Company will utilize the same advertising company that designed their print ads and billboards to also design their website. The website will be well organized, informative, and list all their services that VB is able to provide. The website will also list their contact information and a gallery of pictures that show their previous projects. The advertising company will also manage VB’s website presence with SEO marketing tactics so that anytime someone types in the Google or Bing search engine “Milwaukee residential contractor”, “contractor near me”, or “residential contractor near me”, VB Residential Construction Company will be listed at the top of the search results.
The pricing of VB Residential Construction Company will be moderate and on par with competitors so customers feel they receive value when purchasing their services.
The following will be the operations plan for VB Residential Construction Company.
- Victor Martinez and Ben Schmidt will be the owners and managers of the company. They will oversee all staff, contractors, and subcontractors. They will also act as project managers for every job they receive and handle all pricing and bids to the client.
- Victor and Ben will employ a team of contractors under them that will have an array of skill sets. The contractors will be trained and experienced either in plumbing, mechanical, electrical, roofing, or siding. Not all contractors need to be certified in all trades, but they need to be certified in at least one of the trades.
- Office manager/assistant to be located at the small office. This person will handle all incoming calls, assist with visiting clients, bookkeeping and maintain files.
- Victor and Ben will utilize a third-party human resources company to handle all hiring, onboarding, payroll, and benefits for the staff. The HR company will also handle all employee issues.
- Victor and Ben will also pay a third-party accounting firm to manage all the high level accounting and tax payments.
VB Residential Construction Company will have the following milestones complete in the next six months.
3/1/202X – Finalize contract to lease small office space
3/15/202X – Execute advertising agency contract 4/1/202X – Begin networking and placing bids for construction jobs
5/1/202X – Begin recruiting and hiring team of contractors
5/15/202X – Purchase all necessary construction equipment, supplies, and trucks
6/1/202X – Start on first official job as VB Residential Construction Company
Victor and Ben are highly skilled at project management and residential construction. They are also both certified in plumbing, electrical, and mechanical. In the next few years, they will be certified as Master Carpenters.
Key revenue & costs.
The revenue drivers for VB Residential Construction Company are the upcharge they will charge to the clients for their services. VB will purchase or subcontract a service at cost and will charge a 15% markup in order to obtain the markup fee. 15% is below the normal 25%-30% that other competing residential contractors charge.
The cost drivers will be the overhead costs required in order to maintain a construction company. The expenses will be the costs to purchase and maintain construction equipment and trucks, payroll and overhead costs for the staff, and rent and utilities. Other expenses will be the cost for the advertising agency, accounting firm, human resources firm, and membership association fees.
Funding Requirements and Use of Funds
VB Residential Construction Company is seeking $200,000 in debt financing to launch its construction business. The funding will be dedicated towards securing a small office space, purchasing two trucks, and purchasing all the construction equipment and supplies. Funding will also be dedicated towards the advertising agency and three months of overhead costs to include payroll of the staff, rent, and monthly fees to the accounting and human resources firm. The breakout of the funding is below:
The following outlines the key assumptions required in order to achieve the revenue and cost numbers in the financials and in order to pay off the startup business loan.
- Initial Monthly Average Contract Amount: $20,000
- Growth in Average Monthly Contracts: 10%
Income statement, balance sheet, cash flow statement, construction business plan faqs, what is a construction business plan.
A construction business plan is a plan to start and/or grow your construction business. Among other things, it outlines your business concept, identifies your target customers, presents your marketing plan and details your financial projections.
You can easily complete your construction business plan using our Construction Business Plan Template here .
What Are the Main Types of Construction Companies?
Construction companies can be classified according to the type of constructions that they perform. Some are small renovation contractors, others are new home builders and others are commercial construction companies.
What Are the Main Sources of Revenues and Expenses for a Construction Company?
Construction companies get their primary source of revenue from individual contracts for new homes, remodeling projects or commercial projects.
The key expenses for construction companies are office space rent, salaries and wages, and equipment costs.
How Do You Get Funding for Your Construction Business Plan?
There are many options for financing a construction company like SBA loans, commercial loans, personal loans, or line of credit. There are also equipment funding opportunities that cover expenses associated with necessary tools, machinery and other equipment. Personal savings, credit card financing and angel investors are also popular forms of funding.
What are the Steps To Start a Construction Business?
Starting a construction business can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.
1. Develop A Construction Business Plan - The first step in starting a business is to create a detailed construction business plan that outlines all aspects of the venture. This should include potential market size and target customers, the services or products you will offer, pricing strategies and a detailed financial forecast.
2. Choose Your Legal Structure - It's important to select an appropriate legal entity for your construction business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your construction business is in compliance with local laws.
3. Register Your Construction Business - Once you have chosen a legal structure, the next step is to register your construction business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws.
4. Identify Financing Options - It’s likely that you’ll need some capital to start your construction business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms.
5. Choose a Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations.
6. Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events.
7. Acquire Necessary Construction Equipment & Supplies - In order to start your construction business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation.
8. Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your construction business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising.
Learn more about how to start a successful construction business:
- How to Start a Construction Business
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Construction Business Plan PDF Free Download
How to Start a Construction Business - Free Book
Are you considering starting a Construction and you’re in need of a construction business plan PDF? if yes, you'll find this free book to be extremely helpful.
This is a practical guide that will walk you step by step through all the essentials of starting your business. The book is packed with guides, worksheets and checklists. These strategies are absolutely crucial to your business' success yet are simple and easy to apply.
Don’t Start a New Construction Business Unless You Watch This Video First!
Checklist for Starting a Business: Essential Ingredients for Success
If you are thinking about going into business, it is imperative that you watch this video first! it will take you by the hand and walk you through each and every phase of starting a business. It features all the essential aspects you must consider BEFORE you start a business. This will allow you to predict problems before they happen and keep you from losing your shirt on dog business ideas. Ignore it at your own peril!
Here’s a Valuable Free Gift for You This is a high quality, full blown business plan template complete with detailed instructions and all related spreadsheets. You can download it to your PC and easily prepare a professional business plan for your business. Click Here! To get your free business plan template
The Single Most Important Ingredient for Business Success
The first and most important thing you need to acquire in order to succeed in a small business is... knowledge.
Sounds exaggerated? Listen to this...
According to research conducted by Dun & Bradstreet, 90% of all small business failures can be traced to poor management resulting from lack of knowledge.
This is backed up by my own personal observations. In my 31 years as a business coach and consultant to small businesses, I've seen practically dozens of small business owners go under and lose their businesses -- not because they weren't talented or smart enough -- but because they were trying to re-invent the wheel rather than rely on proven, tested methods that work.
Conclusion: if you are really serious about succeeding in a business... If you want to avoid the common traps and mistakes... it is absolutely imperative that you acquire the right knowledge.
"Why Invent Mediocrity, When You Can Copy Genius?"
That's an excellent quote I picked up from a fellow business owner a few years back. What this means is that you should see what is working and try to duplicate it. Why go through all the trouble of inventing something new, that you don't even know will ever work, when you can easily learn from and duplicate something that has been a proven success?
[ Note: One of the BIGGEST mistakes almost all new businesses make is that they WASTE tons of valuable time, energy and money on trying to create something "new", that has never been tested or proven... only to find out later that it was a total loss. Don't make the same mistake! ]
Hi! My name is Meir. I'm the founder and president of BizMove.com, a successful Internet based information business. I'm also the author of numerous books, mostly in the area of small business management.
I've been involved in small business for the past 31 years of my life, as a business coach, manager of a consulting firm, a seminar leader and as the owner of five successful businesses.
During my career as a business coach and consultant I've helped dozens of business owners start their businesses, market, expand, get out of troubles, sell their businesses and do practically every other small business activity you can think of. You see, I have been there .... done it ... and bought the Small Business t-shirt! -- This free book contains techniques and strategies I've learned during my 31 year small business career.
Here's what you'll discover in the 'How to Start a Construction Business' book:
Success Tip: Setting Goals
Good management is the key to success and good management starts with setting goals. Set goals for yourself for the accomplishment of the many tasks necessary in starting and managing your business successfully. Be specific. Write down the goals in measurable terms of performance. Break major goals down into sub-goals, showing what you expect to achieve in the next two to three months, the next six months, the next year, and the next five years. Beside each goal and sub-goal place a specific date showing when it is to be achieved.
Plan the action you must take to attain the goals. While the effort required to reach each sub-goal should be great enough to challenge you, it should not be so great or unreasonable as to discourage you. Do not plan to reach too many goals all at one time.
Establish priorities. Plan in advance how to measure results so you can know exactly how well you are doing. This is what is meant by "measurable" goals. If you can’t keep score as you go along you are likely to lose motivation. Re-work your plan of action to allow for obstacles which may stand in your way. Try to foresee obstacles and plan ways to avert or minimize them.
Click here! to download your Construction Business plan PDF book for free
Here're other free books in the "how to start a business" series that may interest you:
Here's a Sample 'Executive Summary' for a Construction Business plan :
Introduction COMPANY NAME plans to become the leading provider of concrete formwork services in the area. This means always having the best and most efficient facilities, processes, and people. To achieve this, COMPANY NAME is investing in many ways that will pay off in competitive advantages for its customers. The company's overall strategy will be based on a continuing improvement process of setting objectives, measuring results, and providing feedback to facilitate further growth and progress. COMPANY NAME is a California sole-proprietorship company established in 1991. INSERT NAME leads the company team with over thirty years of experience in the concrete construction industry. Products/Services COMPANY NAME has developed sophisticated formwork solutions for some of the most complex construction projects being done today. The company's standard form systems are versatile and completely adaptable to a variety of configurations such as Y-walls, shafts, and circular walls. COMPANY NAME can adapt to almost any construction requirement that calls for forming. The company's expert staff has the capability to design and manufacture any custom component or accessory item that may be required to complete the formwork package. The primary function of the Company is to provide concrete and construction work for residential homes and commercial businesses. The purpose of this plan is to attain grant funding in the amount of $300,000 to pay down existing short and long-term debt, upgrade equipment, purchase a metal building and to add additional employees to assist in the work demands.
COMPANY NAME has the following objectives.
1. Work efficiently and effectively - The company prides itself in doing the job right the first time. Completing work in a timely basis within budget. The Company has been in business since 2001 and guarantees the work.
2. Expand Territory - The Company currently works in the Ukiah, California area and is one of the largest in Mendocino County. The Company would like to expand to the surrounding areas and service more clientele.
3. Customer Service - Give our customers the highest quality service.
4. Hire Construction Employees - The Company wants to hire additional employees in 2010 and one in 2011. COMPANY NAME prides itself as a company people want to work for. The company will offer a fair hourly pay with benefits and pension plans.
5. Purchase Trucks and Equipment - The Company wants to update the truck fleet and pay off existing debt on equipment.
The mission of COMPANY NAME is to provide quality service at competitive pricing. COMPANY NAME wants to remain one of the largest concrete construction companies in Mendocino County and aims to expand to surrounding territories.
1.3 Keys to Success
V keys to success are:
- Over 30 years of experience in the concrete and construction industry.
- An understanding of what must occur for the success of the project at time of completion as well as long term.
- Have the well rounded knowledge and skill to successfully complete any project.
- Guarantee of the company using the highest grade of materials available.
- Proper staffing to complete jobs on a timely basis and within budget.
COMPANY NAME is a California based sole-proprietorship company formed in 1991. The primary function of the Company is to provide concrete and construction work for residential homes and commercial businesses.
2.1 Company Ownership
The company, COMPANY NAME, is a sole proprietorship registered DBA by the owner, INSERT NAME. Some thought has been given to incorporating COMPANY NAME, but a decision has not yet been reached.
2.2 Company History
COMPANY NAME was formed in the State of California in 1991. The Company was formed and owned 100% by INSERT NAME. The Company is run by INSERT NAMES.
COMPANY NAME consistently provides innovative quality products and services that meet builder and homebuyer expectations and satisfies all codes, regulatory and safety requirements.
From site preparation to the inspection of the finished slabs, COMPANY NAME highly skilled team delivers full value and service to projects large and small.
COMPANY NAME was founded in 1991 by INSERT NAME, a member in the community of Ukiah, California for 55 years. Dedicated to satisfying customers, INSERT NAME has created a successful company which serves Mendocino County and its surrounding counties. Together with his team of professionals they have poured thousands of yards of concrete. With over 30 years of concrete experience, many long working days, a supportive family, he continues to still be number one in Northern California in customer satisfaction and service.
Table: Past Performance
COMPANY NAME can be adapted to almost any construction requirement that calls for forming. The company's expert staff has the capability to design and manufacture any custom component or accessory item that may be required to complete the formwork package. Owners, developers, construction managers, general contractors, and concrete subcontractors have realized substantial savings in labor and material costs by using structural contours construction methods, systems and equipment. Applications include commercial and residential structures, educational projects, recreational projects, civil projects, tunnels, utility projects, environmental projects, and virtually every other type of concrete construction. COMPANY NAME formworks will offer major advances, complete adaptability, and high strength-to-weight ratio, and all at cost effective prices. Assembly will be quick and easy. During form use, maintenance will be minimal. COMPANY NAME will recommend, as a safety precaution, occasional inspection for bolts and nuts that may have loosened from handling. The required formwork drawings that COMPANY NAME will furnish to the contractor eliminate all guesswork. The company will specify the order of assembly and erection including the location of the strong backs and joists, the location and actual loading of the form ties, location of all accessories and advise clients of the maximum allowable rate of concrete placement. Accident prevention is the cornerstone of COMPANY NAME safety commitment. The company will strive to eliminate foreseeable hazards which could result in personal injury or illness; at COMPANY NAME, health and safety will not be compromised. The company will sell its services clients in the area of commercial construction.
How to Use the Telephone More Effectively
The telephone is effective when used efficiently, sparingly, and within the framework of a plan. This list includes some tested guidelines for making the phone a tool that works best for you!
1. Know the purpose of your call.
Most of us talk on the phone too long. Have the purpose of your call clearly in mind before dialing. If helpful, write down a "statement of purpose", together with 3 main points you want to make on a scratch pad prior to dialing. Then "go for it"!
2. Know the audience you are calling.
Unless you're conducting "cold calling" for marketing or polling research, you probably know something about your "audience" on the other end. Think of the needs of the person/people you are calling. Then revise your "statement of purpose" accordingly prior to making the call.
3. Start off right!
State your purpose at the outset, and always ask if it is a good time for the other person to talk. If not, set a specific time to call back.
4. Use names whenever possible.
Identify yourself at the outset of each call. Spell it out, or sound it out, if necessary (e.g. I always tell people "My last name is Vuocolo; Vuh-co-lo; think "Coca-Cola!"). Establish the other person's name early in the conversation, and use it often throughout the call!
5. Pay attention and be aware of your tone.
Ask open-ended questions that invite response. Give the conversation your undivided attention - don't be tempted to do two or three things at once and expect it to be a productive call. Smile! This helps to make your voice sound friendly. If you're angry or anxious - put off the call until a later time, unless it's an absolute necessity to conduct it now.
6. Listen carefully.
Pay attention to the first words spoken by the person called. You can learn a lot in the first few seconds by listening carefully. Did you catch the person eating, arguing, gardening or partying? Decide whether to proceed with the call or to call back, depending upon what you hear in the background of the call. It's better to arrange to call back another time than to interrupt - and you'll probably get a better audience!
7. Avoid initiating major business, if possible.
Always save the most important business to be conducted in person, if possible. If not, make a careful transition from introduction to purpose of the call. Remember that a ringing phone virtually always interrupts the party being called - so give them time to adjust before hitting them with something major.
8. Avoid confrontation.
If you have bad news, or a difficult issue to discuss with someone, don't do it by phone unless it's the only way.
9. Be assertive - not aggressive!
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Construction Business Plan Template
Construction company business plan template.
If you want to start a construction business or expand your current one, you need a business plan.
Over the past 20+ years, we have helped over 10,000 entrepreneurs and business owners create business plans to start and grow all types of construction businesses, including commercial construction, building construction and residential construction.
Construction Business Plan Outline: How To Write a Construction Business Plan
Below are links to each section of a construction business plan:
- Executive Summary – The executive summary is the most important part of your business plan. It’s where you explain what your business is and why it will be successful.
- Company Overview – This section of your construction business plan should include a brief business description, your vision and mission statement, and the company’s core values.
- Industry Analysis – This section of your plan will provide an overview of the construction industry, including market size, growth outlook, major players, and competitive landscape.
- Customer Analysis – In this section of your plan, you will identify and describe your target market(s).
- Competitive Analysis – In this section, you will analyze your competitors and explain how you plan to differentiate your company from them.
- Marketing Plan – Your marketing plan should include an overview of your marketing goals, strategies, and tactics.
- Operations Plan – Your operations plan should describe how you will produce your product or service, as well as the people and resources needed to do so.
- Management Team – In this section, you will introduce the members of your management team and their experience and qualifications.
- Financial Plan – Your financial plan should include your financial statements such as the income statement, balance sheet, and cash flow statement.
- Appendix – The appendix of your plan should include any additional supporting materials, such as market research reports, resumes, licenses and permits.
Next Section: Executive Summary >
Construction Business Plan FAQs
What is the easiest way to complete my construction business plan.
Growthink's Ultimate Construction Business Plan Template allows you to quickly and easily complete your Construction Business Plan.
Where Can I Find a Free Construction Business Plan PDF Download?
You can download our construction business plan PDF template here . This is a business plan template you can use in PDF format.
What Is a Construction Business Plan?
A construction business plan provides a snapshot of your construction business as it stands today, and lays out your growth plan for the next five years. It explains your business goals and your strategy for reaching them. It also includes market research to support your plans.
Why Do You Need a Construction Business Plan?
The construction industry is tough. If you’re a contractor looking to start a small construction business or construction services company, you need a business plan. A business plan will help you raise funding, if needed, and plan out the growth of your construction business in order to improve your chances of success. Your business plan is a living document that should be updated annually as your company grows and changes. As always, we are here to help you write a business plan and guide you through the steps of taking your business idea from dream to reality.
What Are the Sources of Funding for Construction Businesses?
The main sources of funding for a small construction business are bank loans and angel investors. With regards to bank loans, banks will want to review your business plan and gain confidence that you will be able to repay your loan and interest. To acquire this confidence, the loan officer will not only want to confirm that your financials are reasonable. But they will want to see a professional plan. Such a plan will give them the confidence that you can successfully and professionally operate a business.
The second most common form of funding for a construction business is angel investors. Angel investors are wealthy individuals who will write you a check. They will either take equity in return for their funding, or, like a bank, they will give you a loan. Venture capitalists will generally not fund a construction business.
How Do You Start a Construction Business?
Please see this article on our website: How to Start a Construction Business
What Are the Keys to Success for a Construction Business?
Below are some of the keys to success in the construction business:
- Vision & Focus: determine the type of construction business you want to operate and stick to that vision.
- Create your business plan: Your plan will help you set goals and outline how to achieve them.
- Get licensed, bonded, and insured: before you can bid on your first job, you need to investigate and meet the requirements for local and state licenses and do what you need to do to secure them, get your worker’s compensation and liability insurance, and find out how much you need to be bonded for.
- Build a winning team: Hire and train a team of employees with the right skills. Remember that since construction is seasonal and cyclical, you must also be willing to downsize if/when the workload decreases.
- Purchase wisely: be careful not to overspend on salaries and equipment. Consider renting equipment when possible.
- Properly price jobs: Keep factors such as overhead and actual production costs (materials, labor, inspections, etc.) in mind when pricing jobs to ensure a healthy profit on all projects.
CONSTRUCTION BUSINESS PLAN OUTLINE
- Construction Business Plan Home
- 1. Executive Summary
- 2. Company Overview
- 3. Industry Analysis
- 4. Customer Analysis
- 5. Competitive Analysis
- 6. Marketing Plan
- 7. Operations Plan
- 8. Management Team
- 9. Financial Plan
- 10. Appendix
- Construction Business Plan Summary