business plan for new construction company

Construction Business Plan Template

Written by Dave Lavinsky

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:

Executive Summary

Business overview.

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.

Product Offering

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

Customer Focus

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.

Management Team

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.

Success Factors

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.

Financial Highlights

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

Company Overview

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.

Company History

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:

Industry Analysis

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.

Customer Analysis

Demographic profile of target market.

The precise demographics for Milwaukee, Wisconsin are:

Customer Segmentation

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

Competitive Analysis

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

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.

Competitive Advantage

VB Residential Construction Company will be able to offer the following advantages over their competition:

Marketing Plan

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.

Promotions Strategy

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.

Print Advertising/Billboard

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.

Website/SEO Marketing

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.

Operations Plan

The following will be the operations plan for VB Residential Construction Company.

Operation Functions:

• 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.

Milestones:

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.

Financial Plan

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:

Key Assumptions

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%

Financial Projections

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

Where Can I Get a Construction Business Plan PDF?

You can download our free construction business plan template PDF here . This is a sample construction business plan template you can use in PDF format.

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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.

Key Takeaways

• 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.

Executive Summary

A brief summary of an entire business plan that will encourage the readers to read further.

Company Overview

A brief company description including every detail from company structure to its mission statement and future goals.

Market Analysis

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.

Construction Services

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.

Management Team

Introduce key personnel in managerial and leadership roles. Discuss their roles, qualifications, experience, and expertise.

Operations Plan

A detailed plan that streamlines the everyday operations right from construction methods to hiring employees.

Financial Plan

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
• Construction Company Financial Plan
• Key Stats for the Construction Sector
• Start-up Cost For Construction Company
• How to Start a Construction Business

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.

Say goodbye to boring templates

Build your business plan faster and easier with AI

Plans starting from $7/month

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.

For instance,

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
• Construction
• 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

Fill-in-the-blanks and automatic financials make it easy.

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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?

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Main Parts of a Business Plan

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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.

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Upmetrics Team

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 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 Business Plan for a Construction Company?

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

Other Helpful Business Plan Articles & Templates

How To Write a Winning Construction Company Business Plan + Template

Creating a business plan is essential for any business, but it can be especially helpful for construction company businesses who want to improve their strategy or raise funding.

A well-crafted business plan not only outlines the vision for your company, but also documents a step-by-step roadmap of how you will accomplish it. To create an effective business plan, you must first understand the components essential to its success.

This article provides an overview of the key elements that every construction company business owner should include in their business plan.

Download the Ultimate Construction Business Plan Template

What is a construction company business plan.

A construction company business plan is a formal written document describing your company’s business strategy and feasibility. It documents the reasons you will succeed, your areas of competitive advantage, and it includes information about your team members. Your business plan is a key document that will convince investors and lenders (if needed) that you are positioned to become a successful venture.

Why Write a Construction Company Business Plan?

A construction company business plan is required for banks and investors. The document is a clear and concise guide of your business idea and the steps you will take to make it profitable.

Entrepreneurs can also use this as a roadmap when starting their new company or venture, especially if they are inexperienced in starting a business.

Writing an Effective Construction Company Business Plan

The following are the key components of a successful construction company business plan:

Executive Summary

The executive summary of a construction company business plan is a one to two page overview of your entire business plan. It should summarize the main points, which will be presented in full in the rest of your business plan.

• Start with a one-line description of your construction company
• Provide a short summary of the key points in each section of your business plan, which includes information about your company’s management team, industry analysis, competitive analysis, and financial forecast among others.

Company Description

This section should include a brief history of your company. Include a short description of how your company started, and provide a timeline of milestones your company has achieved.

If you are just starting your construction business, you may not have a long company history. Instead, you can include information about your professional experience in this industry and how and why you conceived your new venture. If you have worked for a similar company before or have been involved in an entrepreneurial venture before starting your construction firm, mention this.

You will also include information about your chosen construction company business model and how, if applicable, it is different from other companies in your industry.

Industry Analysis

The industry or market analysis is an important component of a construction company business plan. Conduct thorough market research to determine industry trends and document the size of your market. Questions to answer include:

• What part of the construction industry are you targeting?
• How big is the market?
• What trends are happening in the industry right now (and if applicable, how do these trends support the success of your company)?

You should also include sources for the information you provide, such as published research reports and expert opinions.

Customer Analysis

This section should include a list of your target audience(s) with demographic and psychographic profiles (e.g., age, gender, income level, profession, job titles, interests). You will need to provide a profile of each customer segment separately, including their needs and wants.

For example, a construction company business’ customers may include:

• Businesses (e.g., office complexes, restaurants, retail stores)
• General contractors
• Other construction companies

As you conduct your customer analysis, keep in mind that your target customers may not be aware of your company or product right away. You will need to have a marketing strategy to reach them and get them interested.

You can include information about how your customers make the decision to buy from you as well as what keeps them buying from you.

Develop a strategy for targeting those customers who are most likely to buy from you, as well as those that might be influenced to buy your products or construction company services with the right marketing.

Competitive Analysis

The competitive analysis helps you determine how your product or service will be different from competitors, and what your unique selling proposition (USP) might be that will set you apart in this industry.

For each competitor, list their strengths and weaknesses. Next, determine your areas of competitive differentiation and/or advantage; that is, in what ways are you different from and ideally better than your competitors.

Marketing Plan

This part of the business plan is where you determine and document your marketing plan. . Your plan should be clearly laid out, including the following 4 Ps.

• Product/Service : Detail your product/service offerings here. Document their features and benefits.
• Price : Document your pricing strategy here. In addition to stating the prices for your products/services, mention how your pricing compares to your competition.
• Place : Where will your customers find you? What channels of distribution (e.g., partnerships) will you use to reach them if applicable?
• Promotion : How will you reach your target customers? For example, you may use social media, write blog posts, create an email marketing campaign, use pay-per-click advertising, launch a direct mail campaign. Or you may promote your construction company business via word-of-mouth.

Operations Plan

This part of your construction company business plan should include the following information:

• How will you deliver your product/service to customers? For example, will you do it in person or over the phone only?
• What infrastructure, equipment, and resources are needed to operate successfully? How can you meet those requirements within budget constraints?

The operations plan is where you also need to include your company’s business policies. You will want to establish policies related to everything from customer service to pricing, to the overall brand image you are trying to present. Finally, and most importantly, in your Operations Plan, you will lay out the milestones your company hopes to achieve within the next five years. Create a chart that shows the key milestone(s) you hope to achieve each quarter for the next four quarters, and then each year for the following four years. Examples of milestones for a construction company business include reaching $X in sales. Other examples include hiring a certain number of employees, signing up a certain number of customers, or completing a certain number of projects.

Management Team

List your team members here including their names and titles, as well as their expertise and experience relevant to your specific construction industry. Include brief biography sketches for each team member. Particularly if you are seeking funding, the goal of this section is to convince investors and lenders that your team has the expertise and experience to execute on your plan. If you are missing key team members, document the roles and responsibilities you plan to hire for in the future.

Financial Plan

Here you will include a summary of your complete and detailed financial plan (your full financial projections go in the Appendix). This includes the following three financial statements:

Income Statement

Your income statement should include:

• Revenue : how much revenue you generate.
• Cost of Goods Sold : These are your direct costs associated with generating revenue. This includes labor costs, as well as the cost of any equipment and supplies used to deliver the product/service offering.
• Net Income (or loss) : Once expenses and revenue are totaled and deducted from each other, this is the net income or loss.

Sample Income Statement for a Startup Construction Company

Balance sheet.

Include a balance sheet that shows your assets, liabilities, and equity. Your balance sheet should include:

• Assets : All of the things you own (including cash).
• Liabilities : This is what you owe against your company’s assets, such as accounts payable or loans.
• Equity : The worth of your business after all liabilities and assets are totaled and deducted from each other.

Sample Balance Sheet for a Startup Construction Company

Cash Flow Statement Include a cash flow statement showing how much cash comes in, how much cash goes out and a net cash flow for each year. The cash flow statement should include:

• Cash Flow From Operations
• Cash Flow From Investments
• Cash Flow From Financing

Below is a sample of a projected cash flow statement for a startup construction business.

Sample Cash Flow Statement for a Startup Construction Company

Finish with an appendix section which will include:

• Your complete financial projections
• A complete list of your company’s business policies and procedures related to the rest of the business plan (marketing, operations, etc.)
• Any other documentation which supports what you included in the body of your business plan.

Writing a good business plan gives you the advantage of being fully prepared to launch and/or grow your construction company. It not only outlines your business vision but also provides a step-by-step process of how you will accomplish it.

A well-written business plan is an essential tool for any construction company. The tips we’ve provided in this article should help you write a winning business plan for your construction company.  

Finish Your Construction Business Plan in 1 Day!

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How to Write a Construction Company Business Plan (12 Steps)

You are starting a construction business. You own a construction company. Do either of those statements sound like you? If so, you need a construction company business plan. Building a construction company is hard work, but you don’t reach success on hard work alone. You also need strategic planning, an in-depth understanding of the competition, and a way to finance your business. These are all things that construction business plans address. In this post, we take a deep dive into how to write a business plan for a construction company. Read on to learn everything you need to know.

Why Do You Need a Business Plan for Your Construction Company?

Before you get too deep into “how” to write a home-building business plan, it’s helpful to understand “why” you should write one. There are three main considerations here: competition, growth, and financing.

Competition

The 50 U.S. construction companies with the highest annual revenue all made more than $1.5 billion in 2020 , with the highest-grossing company topping $14.4 billion. This is the level thousands of construction companies in the U.S. and around the world are trying to reach, and the fight to get there is fierce. With that in mind, you need to understand your competition. This is a primary purpose of a construction company business plan. You probably already know who your competitors are, but you need to do market research and write it all down. A construction or general contractor business plan will force you to do that.

Like it or not, if you’re not growing, you’re more than likely dying in the construction industry. And your financial backers will want to see that you intend to grow. That means you need to have a plan for growth — how to achieve it and how to manage it when it happens.

How are you going to fund the expansion of your business? How will you get the initial capital to buy equipment? There are plenty of questions related to finances when you’re building a construction company. And any large or small construction company business plan will answer them and help you get the financing you need in the process.

Two Types of Information to Include in a Construction Business Plan

The information you include in your commercial or residential construction business plan will fall into two categories: industry information and general business information. Both are important to your business for different reasons. Perhaps the most important reason to include thorough information in your business plan is that it demonstrates your knowledge of the industry and business in general to the investors and banks who will read the plan when considering you for a loan. See below to learn more.

Industry information:

What do you know about the construction industry that others don’t? In other words, what makes your approach to your construction business different from the rest? This is what investors in your business will want to know as they try to gauge your chance of success. Don’t rely on empty buzzwords here — words like friendly, service, reliable, and the like. These are fine words, but you need to be more specific. How does what you know about the construction industry make you capable of running a successful construction business? Make sure those points are clear in your construction company business plan.

General business information:

In addition to your expertise in home building, you need to demonstrate some knowledge of general business practices. That means construction business plans need to have detailed information on the basic running of the business, the plan to get construction jobs, cash flow, corporate taxes, and similar items.

How to write a construction business plan

A business plan for a construction company is not a single page of text. It’s a complex, multi-part document that requires a lot of information. While not all construction company business plans are the same, most of them have a similar format. They include 12 key sections, which we explore in more detail below.

Executive Summary

Your executive summary is your introduction. It needs to summarize the rest of the document but not go into too much detail. Try to limit the executive summary section to a single page if at all possible, and cover topics like the following:

• The reason you are starting a construction company
• Your goals for the business
• Where you plan to operate and offer residential construction services
• Your estimated business expenses and profits
• How your home building business will fit into the existing market

Again, don’t go into too much detail here. The details will come later in the business plan. Just hit the high points.

Company Description

The second part of your construction business plan will echo some of the points you raised in the executive summary, but it will go into deeper detail. In the company description section, the takeaway point for a reader should be why you think your business will be successful. To that end, you need to describe any specialties you or your business partners have, any special positioning you can achieve within the market, and any revenue streams or reduced expenses that can make you more competitive. You will also need to describe the existing competition here. Who are your competitors, how successful are they and why do you expect to outperform them? These are all questions your company description should answer.

Operational Plan

You will get into even more detail in this section. But instead of focusing on who you are and what your business will be, you will use the operational plan section to describe how your business is going to run day in and day out. You’ll need to cover a few key areas: Technology: List and describe the pieces of technology and equipment you will use in the operation of your construction business. This can include initial construction equipment purchases and office technology like computers, programs, and even home design software .

Bidding processes: How do you plan to bid on residential construction jobs? This is an important part of generating revenue for your construction company, so it needs to be described in detail in your business plan.

Production schedules: When you get a home-building job, you are instantaneously on a tight schedule. As you know, it takes a lot to take a home from paper to real life, and the logistics behind that process are complex and unforgiving. So, make sure your business plan demonstrates your knowledge of production schedules and, more specifically, how you plan to structure your company’s production schedules.

Inventory partners: Being willing to build homes is one thing, but having the right partnerships in place to get the job done is entirely another. Which vendors and suppliers will you work with? Why? Do you have any existing relationships that could prove beneficial to your business? Answer these and any related questions in your operational plan.

Market and Competition

You’re probably not going to be the first construction company in town. Who else is already established in your intended service area? How successful are they? Your construction company’s business plan needs to contain an in-depth analysis of the competition you’re going to face, as well as the market for residential construction services in the place you plan to operate. The reason why is simple. You need to know who your competitors are so you can see what they’re doing and look for ways to grab some market share from them. And you need to know whether people want the service you are going to provide. This section will cover all of that — for both your knowledge and that of your financial backers.

Construction is a service, but it contains within it multiple related services that you can choose to offer or not offer to your customers. This is going to be an important part of your business plan — starting a construction business without a list of services you will provide is like opening a store without knowing what you’re going to sell inside it. So, make a list. Here are some of the construction-related services you may want to consider:

• Residential construction
• Commercial construction
• Home design
• Landscape work

Sales & Marketing

You may not be a marketer at heart, but you’re going to have to have a plan to market your construction business and bring in home-building jobs. The sales and marketing plan you write in your business plan should be as detailed as possible. Include information on the following subtopics:

• Your marketing budget
• Your company’s marketing assets, such as a website
• Advertising plans (such as billboards, newspaper ads, and search engine advertising)
• Whether and how you plan to leverage social media
• Loss leader plans, such as offering free home design consultations
• How you will measure the success of your marketing efforts

In addition to marketing, this section of your construction company business plan will need detailed information on your sales processes. Will you have dedicated salespeople? How will your sales team get leads? Will salespeople be paid on commission? Answer these questions and more.

Managers can make or break a construction business. These are the leaders of your company — the ones who will define the path your business follows and bear the responsibility for the successes and failures you have along the way. That’s why this is an essential part of your home-building business plan. Management may shift over time, but at the start, you need to have a good idea of who’s going to be in charge of what. You will also need to include an explanation of why you have chosen these people, who they answer to, and what you are planning to pay them.

For financial backers, this is going to be one of the most important sections of your business plan. They want to know how you plan to manage the money they may give you so they have an idea of whether this is a sound investment. Give them as much detail as possible. Cover everything from your revenue projections and operational costs to employee wages and the price of your services. Wherever possible, you need to include exact figures based on hard data and research instead of soft estimates based on your own beliefs. Remember — lenders and investors have a head for numbers, so they will immediately notice if you’ve left something important out.

The funding section of a business plan for a construction company is an extension of the finance section, but it’s not the same thing. This is where you describe how you plan to obtain the money you need to start, run, and expand the business. The audience reading your business plan will hopefully play a part in the funding — that’s the whole idea, anyway — but you need to convince them that you will be able to use their funds wisely to generate revenue. Be specific about how much startup funding you’re going to need and why. Go into detail about how you will repay a loan or generate returns for investors. Describe how initial funding will be used in your business — to buy equipment, hire talented employees, market your business, and so on. With these bases covered, you will set yourself up to receive the funding you need to get this business off the ground.

Financial Projections

You’re hoping for a bright future for your new construction company. That’s a given. But you need to show that bright future with the financial projections in your business plan. Include projections for revenue, expenses, and profits for five years out from your starting date. Don’t just say you plan to bring in $100 million by the fourth quarter of year three — show the numbers behind how you’ll get there. You will be able to reference the information from the other sections of your business plan to support your projections.

Funding Request

If you need investments or a loan to start your construction business, you need to include in your business plan a specific funding request. This is where you ask for the money you need. Here again, you need to provide some detail:

• How much money do you currently have for the business?
• How much are you contributing alongside the investment or loan you are seeking?
• What assets do you already own, and what assets do you still need to acquire?

Many of the facts and claims you have made in other sections of your construction company business plan will have supporting information or related documents that won’t quite fit. The appendix is where you include those references. Any extra information that could help financial backers understand your proposed business should be included here. And don’t worry — this section will not likely be read in its entirety, so you can include everything. In general, more information in a business plan is better than less.

Final Thoughts

Writing a construction company business plan is a big task, but if you break it down into small steps, you can get it done. From the executive summary to the appendix, your business plan needs to demonstrate your ability to achieve success in the residential construction industry. With your business plan written and your company started, you’ll need to get home-building jobs and please your clients. Cedreo can help with that. Our home building software can help you quickly create 3D home designs to help clients visualize the project and make them much more likely to close the deal with you. Interested? Learn more about our home building software here, or contact us for more information.

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How to write a business plan for a construction company?

Putting together a business plan for a construction company can be daunting - especially if you're creating a business for the first time - but with this comprehensive guide, you'll have the necessary tools to do it confidently.

We will explore why writing one is so important in both starting up and growing an existing construction company, as well as what should go into making an effective plan - from its structure to content - and what tools can be used to streamline the process and avoid errors.

Without further ado, let us begin!

In this guide:

Why write a business plan for a construction company?

• What information is needed to create a business plan for a construction company?
• How do I build a financial forecast for a construction company?

The written part of a construction company business plan

• What tool should I use to write my construction company business plan?

Having a clear understanding of why you want to write a business plan for your construction company will make it simpler for you to grasp the rationale behind its structure and content. So before delving into the plan's actual details, let's take a moment to remind ourselves of the primary reasons why you'd want to create a construction company business plan.

To have a clear roadmap to grow the business

Small businesses rarely experience a constant and predictable environment. Economic cycles go up and down, while the business landscape is mutating constantly with new regulations, technologies, competitors, and consumer behaviours emerging when we least expect it.

In this dynamic context, it's essential to have a clear roadmap for your construction company. Otherwise, you are navigating in the dark which is dangerous given that - as a business owner - your capital is at risk.

That's why crafting a well-thought-out business plan is crucial to ensure the long-term success and sustainability of your venture.

To create an effective business plan, you'll need to take a step-by-step approach. First, you'll have to assess your current position (if you're already in business), and then identify where you'd like your construction company to be in the next three to five years.

Once you have a clear destination for your construction company, you'll focus on three key areas:

• Resources: you'll determine the human, equipment, and capital resources needed to reach your goals successfully.
• Speed: you'll establish the optimal pace at which your business needs to grow if it is to meet its objectives within the desired timeframe.
• Risks: you'll identify and address potential risks you might encounter along the way.

By going through this process regularly, you'll be able to make informed decisions about resource allocation, paving the way for the long-term success of your business.

To anticipate future cash flows

Regularly comparing your actual financial performance to the projections in the financial forecast of your construction company's business plan gives you the ability to monitor your business's financial health and make necessary adjustments as needed.

This practice allows you to detect potential financial issues, such as unexpected cash shortfalls before they escalate into major problems. Giving you time to find additional financing or put in place corrective measures.

Additionally, it helps you identify growth opportunities, like excess cash flow that could be allocated to launch new products and services or expand into new markets.

Staying on track with these regular comparisons enables you to make well-informed decisions about the amount of financing your business might require, or the excess cash flow you can expect to generate from your main business activities.

To secure financing

Whether you are a startup or an existing business, writing a detailed construction company business plan is essential when seeking financing from banks or investors.

This makes sense given what we've just seen: financiers want to ensure you have a clear roadmap and visibility on your future cash flows.

Banks will use the information included in the plan to assess your borrowing capacity (how much debt your business can support) and your ability to repay the loan before deciding whether they will extend credit to your business and on what terms.

Similarly, investors will review your plan carefully to assess if their investment can generate an attractive return on investment.

To do so, they will be looking for evidence that your construction company has the potential for healthy growth, profitability, and cash flow generation over time.

Now that you understand why it is important to create a business plan for a construction company, let's take a look at what information is needed to create one.

Need a convincing business plan?

The Business Plan Shop makes it easy to create a financial forecast to assess the potential profitability of your projects, and write a business plan that’ll wow investors.

Information needed to create a business plan for a construction company

You need the right data in order to project sales, investments and costs accurately in the financial forecast of your construction company business plan.

Below, we'll cover three key pieces of information you should gather before drafting your business plan.

Carrying out market research for a construction company

Carrying out market research before writing a business plan for a construction company is essential to ensure that the financial projections are accurate and realistic.

Market research helps you gain insight into your target customer base, competitors, pricing strategies and other key factors which can have an impact on the commercial success of your business.

In particular, it is useful in forecasting revenue as it provides valuable data regarding potential customers’ spending habits and preferences.

For example, your construction company could find that there may be an increasing demand for eco-friendly construction materials.

This information can then be used to create more accurate financial projections which will help investors make informed decisions about investing in your construction company.

Developing the marketing plan for a construction company

Before delving into your construction company business plan, it's imperative to budget for sales and marketing expenses.

To achieve this, a comprehensive sales and marketing plan is essential. This plan should provide an accurate projection of the necessary actions to acquire and retain customers.

Additionally, it will outline the required workforce to carry out these initiatives and the corresponding budget for promotions, advertising, and other marketing endeavours.

By budgeting accordingly, you can ensure that the right resources are allocated to these vital activities, aligning them with the sales and growth objectives outlined in your business plan.

The staffing and equipment needs of a construction company

Whether you are at the beginning stages of your construction company or expanding its horizons, having a clear plan for recruitment and capital expenditures (investment in equipment and real estate) is vital to ensure your business's success.

To achieve this, both the recruitment and investment plans must align coherently with the projected timing and level of growth in your forecast. It is essential to secure appropriate funding for these plans.

A construction company might incur staffing costs for laborers, supervisors, and managers. They might also need to buy supplies and equipment, such as power tools, scaffolding, ladders, safety equipment, and vehicles. Additionally, they may need to hire subcontractors to do specialized tasks, such as plumbing, electrical work, or roofing.

To create a financial forecast that accurately represents your business's outlook, remember to factor in other day-to-day operating expenses.

Now that you have all the necessary information, it's time to dive in and start creating your business plan and developing the financial forecast for your construction company.

What goes into your construction company's financial forecast?

The financial forecast of your construction company will enable you to assess the profitability potential of your business in the coming years and how much capital is required to fund the actions planned in the business plan.

The four key outputs of a financial forecast for a construction company are:

• The profit and loss (P&L) statement ,
• The projected balance sheet ,
• The cash flow forecast ,
• And the sources and uses table .

Let's take a closer look at each of these.

The projected P&L statement

The projected P&L statement for a construction company shows how much revenue and profits your business is expected to generate in the future.

Ideally, your construction company's P&L statement should show:

• Healthy growth - above inflation level
• Improving or stable profit margins
• Positive net profit

Expectations will vary based on the stage of your business. A startup will be expected to grow faster than an established construction company. And similarly, an established company should showcase a higher level of profitability than a new venture.

The forecasted balance sheet of your construction company

The projected balance sheet of your construction company will enable the reader of your business plan to assess the overall financial health of your business.

It shows three elements: assets, liabilities and equity:

• Assets: are productive resources owned by the business, such as equipment, cash, and accounts receivable (money owed by clients).
• Liabilities: are debts owed to creditors, lenders, and other entities, such as accounts payable (money owed to suppliers).
• Equity: includes the sums invested by the shareholders or business owners and the profits and losses accumulated by the business to date (which are called retained earnings). It is a proxy for the value of the owner's stake in the business.

Analysing your construction company projected balance sheet provides an understanding of your construction company's working capital structure, investment and financing policies.

In particular, the readers of your plan can compare the level of financial debt on the balance sheet to the equity value to measure the level of financial risk (equity doesn't need to be reimbursed, while financial debt must be repaid, making it riskier).

They can also use your balance sheet to assess your construction company's liquidity and solvency:

• A liquidity analysis: focuses on whether or not your business has sufficient cash and short-term assets to cover its liabilities due in the next 12 months.
• A solvency analysis: takes and longer view to assess whether or not your business has the capacity to repay its debts over the medium-term.

The cash flow forecast

As we've seen earlier in this guide, monitoring future cash flows is the key to success and the only way of ensuring that your construction company has enough cash to operate.

As you can expect showing future cash flows is the main role of the cash flow forecast in your construction company business plan.

It is best practice to organise the cash flow statement by nature in order to show the cash impact of the following areas:

• Cash flow generated from operations: the operating cash flow shows how much cash is generated or consumed by the business's commercial activities
• Cash flow from investing activities: the investing cash flow shows how much cash is being invested in capital expenditure (equipment, real estate, etc.) either to maintain the business's equipment or to expand its capabilities
• Cash flow from financing activities: the financing cash flow shows how much cash is raised or distributed to financiers

Looking at the cash flow forecast helps you to make sure that your business has enough cash to keep running, and can help you anticipate potential cash shortfalls.

Your construction company business plan will normally include both yearly and monthly cash flow forecasts so that the readers can view the impact of seasonality on your business cash position and generation.

The initial financing plan

The initial financing plan, also known as a sources and uses table, is a valuable resource to have in your business plan when starting your construction company as it reveals the origins of the money needed to establish the business (sources) and how it will be allocated (uses).

Having this table helps show what costs are involved in setting up your construction company, how risks are shared between founders, investors and lenders, and what the starting cash position will be. This cash position needs to be sufficient to sustain operations until the business reaches a break-even point.

Now that you have a clear understanding of what goes into the financial forecast of your construction company business plan, let's shift our focus to the written part of the plan.

Need inspiration for your business plan?

The Business Plan Shop has dozens of business plan templates that you can use to get a clear idea of what a complete business plan looks like.

The written part of a construction company business plan plays a key role: it lays out the plan of action you intend to execute to seize the commercial opportunity you've identified on the market and provides the context needed for the reader to decide if they believe your plan to be achievable and your financial forecast to be realistic.

The written part of a construction company business plan is composed of 7 main sections:

• The executive summary
• The presentation of the company
• The products and services
• The market analysis
• The strategy
• The operations
• The financial plan

Let's go through the content of each section in more detail!

1. The executive summary

The first section of your construction company's business plan is the executive summary which provides, as its name suggests, an enticing summary of your plan which should hook the reader and make them want to know more about your business.

When writing the executive summary, it is important to provide an overview of the business, the market, the key financials, and what you are asking from the reader.

Start with a brief introduction of the business, its name, concept, location, how long it has been in operation, and what makes it unique. Mention any services or products you plan to offer and who you sell to.

Then you should follow with an overview of the addressable market for your construction company, current trends, and potential growth opportunities.

You should then include a summary of your key financial figures such as projected revenues, profits, and cash flows.

Finally, you should detail any funding requirements in the ask section.

2. The presentation of the company

The second section in your construction company's business plan should focus on the structure and ownership, location, and management team of the company.

The structure and ownership part provides an overview of the legal structure of the business, who the owners are and how much each has invested and owns. If you are seeking financing it is important that the reader gets a clear picture of which legal entity is receiving the funds, and who controls the business.

The location part should give an overview of the premises from which the company is operating, and why that location is of particular interest (catchment area, accessibility, amenities nearby, etc.).

When describing the location of your construction company, you could emphasize the potential for growth in the area. You might mention that the area has a growing population, access to important resources, and a wide range of potential customers. You could also focus on the proximity to major transportation routes, as well as potential sources of new business or customers. Finally, you could emphasize the fact that the area is rapidly developing, making it an attractive location for any business.

Finally, you should introduce the management team. Explain each member's role, background, and experience.

It is also important to emphasize any past successes that the members of the management team have achieved, and how long they've been working together, as this will help potential lenders or investors understand why they should trust in their leadership.

3. The products and services section

The products and services section of your business plan should include a detailed description of what your company offers, who are the target customers, and what distribution channels are part of your go-to-market. 

For example, your construction company could offer a variety of services such as design and layout, carpentry, masonry, roofing, plumbing, and electrical work. It could also provide products such as lumber, tile, shingles, and other materials needed for construction projects. Additionally, your company could offer project management services to ensure that the job is completed properly and on time. These products and services would allow customers to take advantage of the expertise and resources of your construction company to complete their projects efficiently, safely, and cost-effectively.

4. The market analysis

When presenting your market analysis in your construction company business plan, you should detail the customers' demographics and segmentation, target market, competition, barriers to entry, and any regulations that may apply.

The goal of this section is to help the reader understand how big and attractive your market is, and demonstrate that you have a solid understanding of the industry.

You should start with the demographics and segmentation subsection, which gives an overview of the addressable market for your construction company, the main trends in the marketplace, and introduces the different customer segments and their preferences in terms of purchasing habits and budgets.

The target market section should follow and zoom on the customer segments your construction company is targeting, and explain how your products and services meet the specific needs of these customers.

For example, your target market might include residential homeowners looking to remodel or upgrade their homes. They might be seeking out services such as kitchen or bathroom remodels, new decks, or even a complete home renovation. These customers typically have the financial means and are willing to invest in the services a construction company provides.

Then comes the competition subsection, where you should introduce your main competitors and explain what differentiates you from them.

Finally, you should finish your market analysis by giving an overview of the main regulations applicable to your construction company.

5. The strategy section

When you write the strategy section of your construction company business plan, remember to cover key elements such as your competitive edge, pricing strategy, sales & marketing plan, milestones, and risks and mitigants.

In the competitive edge subsection, elaborate on what makes your company stand out from competitors. This becomes especially important if you're a startup, aiming to carve a place for yourself amidst established players in the marketplace.

The pricing strategy subsection should demonstrate how you plan to maintain profitability while offering competitive prices to attract customers.

Outline your sales & marketing plan, detailing how you'll reach out to new customers and retain existing ones through loyalty programs or special offers.

For the milestones subsection, outline your company's achievements to date and your main objectives for the future, complete with specific dates to set clear expectations for progress.

Lastly, the risks and mitigants subsection should address the main risks that could affect your plan's execution. Explain the measures you've put in place to minimize these risks, assuring potential investors or lenders.

Your construction company faces many risks. It could be exposed to the risk of property damage due to natural disasters such as floods or storms. It may also face the risk of litigation if employees or contractors are injured on the job. In addition, there could be potential financial losses due to missed deadlines or cost overruns.

6. The operations section

The operations of your construction company must be presented in detail in your business plan.

The first thing you should cover in this section is your staffing team, the main roles, and the overall recruitment plan to support the growth expected in your business plan. You should also outline the qualifications and experience necessary to fulfil each role, and how you intend to recruit (using job boards, referrals, or headhunters).

You should then state the operating hours of your construction company - so that the reader can check the adequacy of your staffing levels - and any plans for varying opening times during peak season. Additionally, the plan should include details on how you will handle customer queries outside of normal operating hours.

The next part of this section should focus on the key assets and IP required to operate your business. If you depend on any licenses or trademarks, physical structures (equipment or property) or lease agreements, these should all go in there.

You could have key assets such as construction equipment and building materials. These may be considered your key assets because they are necessary to complete any construction projects. Additionally, the construction company might have intellectual property such as blueprints or designs. These could be valuable to the company and could be used to distinguish themselves from competitors.

Finally, you should include a list of suppliers that you plan to work with and a breakdown of their services and main commercial terms (price, payment terms, contract duration, etc.). Investors are always keen to know if there is a particular reason why you have chosen to work with a specific supplier (higher-quality products or past relationships for example).

7. The presentation of the financial plan

The financial plan section is where we will present the financial forecast we talked about earlier in this guide.

Now that you have a clear idea of what goes in your construction company business plan, let's look at the solutions you can use to draft yours.

What tool should I use to write my construction company's business plan?

There are two main ways of creating your construction company business plan:

• Using specialized business planning software,
• Hiring a business plan writer.

Using an online business plan software for your construction company's business plan

The modern and most efficient way to write a construction company business plan is to use business plan software .

There are several advantages to using specialized software:

• You can easily create your financial forecast by letting the software take care of the financial calculations for you without errors
• You are guided through the writing process by detailed instructions and examples for each part of the plan
• You can access a library of dozens of complete business plan samples and templates for inspiration
• You get a professional business plan, formatted and ready to be sent to your bank or investors
• You can easily track your actual financial performance against your financial forecast
• You can create scenarios to stress test your forecast's main assumptions
• You can easily update your forecast as time goes by to maintain visibility on future cash flows
• You have a friendly support team on standby to assist you when you are stuck

If you're interested in using this type of solution, you can try The Business Plan Shop for free by signing up here .

Need a solid financial forecast?

The Business Plan Shop does the maths for you. Simply enter your revenues, costs and investments. Click save and our online tool builds a three-way forecast for you instantly.

Hiring a business plan writer to write your construction company's business plan

Outsourcing your construction company business plan to a business plan writer can also be a viable option.

Business plan writers are experienced in writing business plans and adept at creating financial forecasts without errors. Furthermore, hiring a consultant can save you time and allow you to focus on the day-to-day operations of your business.

However, hiring business plan writers is expensive as you are paying for the software used by the consultant, plus their time, and their profit margin of course.

From experience, you need to budget at least £1.5k ($2.0k) excluding tax for a complete business plan, more if you need to make changes after the initial version (which happens frequently after the initial meetings with lenders or investors).

You also need to be careful when seeking investment. Investors want their money to be used to grow the business, not spent on consulting fees. Therefore, the amount you spend on business plan writing services (and other consulting services such as legal services) needs to be negligible relative to the amount raised.

The other drawback is that you usually don't own the business plan itself: you just get the output, while the actual document is saved in the consultant's business plan software - which makes it difficult to maintain the document up to date without hiring the consultant on a retainer.

For these reasons, outsourcing the construction company business plan to a business plan writer should be considered carefully, weighing both the advantages and disadvantages of hiring outside help.

Ultimately, it may be the right decision for some businesses, while others may find it beneficial to write their business plan using online software.

Why not create your construction company's business plan using Word or Excel?

I must advise against using Microsoft Excel and Word (or their Google, Apple, or open-source equivalents) to write your construction company business plan. Let me explain why.

Firstly, creating an accurate and error-free financial forecast on Excel (or any spreadsheet) is highly technical and requires a strong grasp of accounting principles and financial modelling skills. It is, therefore, unlikely that anyone will fully trust your numbers unless you have both a degree in finance and accounting and significant financial modelling experience, like us at The Business Plan Shop.

Secondly, relying on spreadsheets is inefficient. While it may have been the only option in the past, technology has advanced significantly, and software can now perform these tasks much faster and with greater accuracy. With the rise of AI, software can even help us detect mistakes in forecasts and analyze the numbers for better decision-making.

And with the rise of AI, software is also becoming smarter at helping us detect mistakes in our forecasts and helping us analyse the numbers to make better decisions.

Moreover, software makes it easier to compare actuals versus forecasts and maintain up-to-date forecasts to keep visibility on future cash flows, as we discussed earlier in this guide. This task is cumbersome when using spreadsheets.

Now, let's talk about the written part of your construction company business plan. While it may be less error-prone, using software can bring tremendous gains in productivity. Word processors, for example, lack instructions and examples for each part of your business plan. They also won't automatically update your numbers when changes occur in your forecast, and they don't handle formatting for you.

Overall, while Word or Excel may seem viable for some entrepreneurs to create a business plan, it's by far becoming an antiquated way of doing things.

• A business plan has 2 complementary parts: a financial forecast showcasing the expected growth, profits and cash flows of the business; and a written part which provides the context needed to judge if the forecast is realistic and relevant.
• Having an up-to-date business plan is the only way to keep visibility on your construction company's future cash flows.
• Using business plan software is the modern way of writing and maintaining business plans.

We hope that this practical guide gave you insights on how to write the business plan for your construction company. Do not hesitate to get in touch with our team if you still have questions.

Also on The Business Plan Shop

• In-depth business plan structure
• Key steps to write a business plan?
• Free business plan template

Know someone who owns or wants to start a construction company? Share this article with them!

Founder & CEO at The Business Plan Shop Ltd

Guillaume Le Brouster is a seasoned entrepreneur and financier.

Guillaume has been an entrepreneur for more than a decade and has first-hand experience of starting, running, and growing a successful business.

Prior to being a business owner, Guillaume worked in investment banking and private equity, where he spent most of his time creating complex financial forecasts, writing business plans, and analysing financial statements to make financing and investment decisions.

Guillaume holds a Master's Degree in Finance from ESCP Business School and a Bachelor of Science in Business & Management from Paris Dauphine University.

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Business Plan Template for Construction Company

• Great for beginners
• Ready-to-use, fully customizable Subcategory
• Get started in seconds

Starting a construction company requires careful planning and strategic thinking. With so many moving parts, it's crucial to have a solid business plan in place to guide your every move. That's where ClickUp's Business Plan Template for Construction Company comes in handy!

This comprehensive template is specifically designed to help construction companies like yours:

• Outline clear objectives and goals for your business
• Conduct detailed market analysis to identify opportunities and target customers
• Develop effective marketing strategies to attract clients and stand out from the competition
• Create financial projections and budgets to secure funding and ensure profitability
• Plan and execute operational strategies for smooth project management and delivery

Don't let the complexities of starting and running a construction company overwhelm you. Use ClickUp's Business Plan Template to streamline your planning process and set your company up for success. Get started today and build the foundation for a thriving construction business!

Business Plan Template for Construction Company Benefits

A well-crafted business plan template for a construction company can provide numerous benefits, including:

• Creating a comprehensive roadmap for success, outlining the company's objectives, strategies, and milestones
• Attracting potential investors by showcasing the company's financial projections and market analysis
• Helping the company differentiate itself in the competitive construction industry by highlighting its unique value proposition
• Providing a clear framework for operational plans, including project management, procurement, and risk management
• Guiding the company's marketing strategies and helping to identify target markets and customer segments
• Enabling the company to adapt and pivot as needed by regularly reviewing and updating the business plan template

Main Elements of Construction Company Business Plan Template

When it comes to creating a comprehensive business plan for your construction company, look no further than ClickUp's Business Plan Template. This template includes:

• Custom Statuses: Track the progress of each section of your business plan with statuses like Complete, In Progress, Needs Revision, and To Do, ensuring that every aspect of your plan is accounted for.
• Custom Fields: Utilize custom fields such as Reference, Approved, and Section to add important details and organize your business plan effectively.
• Custom Views: Access different views like Topics, Status, Timeline, Business Plan, and Getting Started Guide to gain insights, track the status of your plan, and visualize your roadmap for success.

With ClickUp's Business Plan Template, you can streamline the process of creating a professional and impactful business plan for your construction company, helping you secure funding and stand out in the competitive construction industry.

How To Use Business Plan Template for Construction Company

Are you ready to take your construction company to the next level? Follow these 6 steps to effectively use the Business Plan Template in ClickUp:

1. Define your vision and mission

Start by clearly defining your construction company's vision and mission. What sets your business apart? What do you want to achieve in the long term? Having a strong vision and mission will guide your decision-making and help you stay focused on your goals.

Use a Doc in ClickUp to outline your vision and mission statement.

2. Analyze the market and competition

Take a deep dive into the construction industry and analyze the market and competition. Identify your target audience, understand their needs, and assess the competitive landscape. This will help you identify opportunities and challenges, and develop strategies to differentiate yourself from the competition.

Use the Gantt chart in ClickUp to create a timeline for your market analysis and competition research.

3. Define your services and target market

Clearly define the services your construction company offers and identify your target market. Are you focused on residential, commercial, or industrial projects? Determine the specific needs and preferences of your target market and tailor your services to meet those needs.

Use the Board view in ClickUp to create lists for different services and target markets.

4. Develop a marketing and sales strategy

Craft a comprehensive marketing and sales strategy to promote your construction company and attract clients. Identify the most effective channels for reaching your target market, such as online advertising, networking, or partnering with other businesses. Develop a sales strategy that highlights your unique value proposition and sets you apart from the competition.

Use recurring tasks in ClickUp to create a marketing and sales plan with specific actions and timelines.

5. Create a financial plan

Develop a detailed financial plan for your construction company. This includes estimating start-up costs, projecting revenue and expenses, and determining profitability. Consider factors such as labor costs, material costs, overhead expenses, and pricing strategies. A solid financial plan is crucial for securing funding and ensuring the financial health of your business.

Use custom fields in ClickUp to track financial data, such as projected revenue, expenses, and profitability.

6. Monitor progress and make adjustments

Regularly monitor the progress of your business plan and make adjustments as necessary. Track key performance indicators (KPIs) to assess the success of your strategies and make data-driven decisions. Continuously evaluate market trends, customer feedback, and industry developments to stay ahead of the competition and adapt your business plan accordingly.

Use Dashboards in ClickUp to visualize and track your KPIs, and set recurring tasks to review and adjust your business plan regularly.

By following these steps and utilizing the Business Plan Template in ClickUp, you'll be well on your way to building a successful construction company. Good luck!

Get Started with ClickUp’s Business Plan Template for Construction Company

Construction companies can use this Business Plan Template to create a comprehensive roadmap for success and attract potential investors.

First, hit “Add Template” to sign up for ClickUp and add the template to your Workspace. Make sure you designate which Space or location in your Workspace you’d like this template applied.

Next, invite relevant members or guests to your Workspace to start collaborating.

Now you can take advantage of the full potential of this template to create a solid business plan:

• Use the Topics View to outline and organize the different sections of your business plan
• The Status View will help you track the progress of each section, with statuses like Complete, In Progress, Needs Revision, and To Do
• The Timeline View will allow you to set deadlines and milestones for each section of your business plan
• Use the Business Plan View to have a comprehensive overview of your entire plan, including objectives, financial projections, market analysis, marketing strategies, and operational plans
• The Getting Started Guide View will provide step-by-step instructions on how to use the template effectively
• Customize the template by adding custom fields like Reference, Approved, and Section to provide additional context and information
• Update statuses and custom fields as you make progress and receive feedback from stakeholders
• Monitor and analyze your business plan to ensure it aligns with your goals and attracts potential investors.
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Construction Company Business Plan Template

AUG.30, 2013

Construction Company Business Plan for Starting Your Own Building Firm

The construction industry is immensely profitable and a large number of people are trying their hand at it. However, merely entering the business plan of a construction company and starting a company is not enough. You have to create a formidable business plan of a construction company in order to have direction and a proper plan. Not doing so could lead to unfavorable circumstances, resulting in massive losses.

Are you looking to start your very own construction company? If the answer is yes, continue reading this article, as it discusses everything you need to know about creating a well thought out construction company business plan.

Executive Summary

Quite a lot of people ask “how to start a construction business?” Well, starting with a detailed construction company startup plan would be the best idea. The first thing to include in your plan should be the executive summary. For those who don’t know, the executive summary provides a concise look at your intent behind starting a business plan of a construction company (in this case, a construction company.)

This portion will essentially show potential investors what they can expect from your proposal, ensuring they become acquainted with the business plan of a construction company overall material. Use the executive summary to discuss how you plan to manage your upcoming construction company, your potential customers, and your target. It is an excellent way to show readers that you did your research and are motivated to get your business plan of a construction company up and running the right way.

Company Summary

Whenever someone shows you an example of a business plan for a construction company, it will include a detailed company summary after the executive summary. This portion of your proposal will highlight your brand and how you plan to market and promote it. You should also consider discussing how you plan to improve your construction business’s web presence, making sure you show potential investors that you are serious about generating profits.

The company summary section should also provide answers to important questions like why you started a company, who the owner is, and how they started the business plan of a construction company .

Owning your own construction company is a big deal and every investor wants to know about the services you offer. Therefore, you should pay special attention to this portion, as it could make or break your construction company business plan. Fortunately, this part will be quite straightforward as construction companies quite limited when it comes to the range of services they offer. Nevertheless, you should still mention the services provide, convincing investors that you know what you are doing.

Marketing Analysis of Construction Company

When jotting down construction business concepts in your proposal, you should create a separate section for marketing analysis. This portion of your business plan of a construction company will provide readers a detailed layout about the construction industry’s market trends and segmentation. You should also mention your target market and explain the reasons behind targeting specific audiences.

What’s more, the marketing analysis must include a well thought out pricing strategy as investors want to know how much you plan to charge for your services or products. Consider studying your target market and analyzing prices to make sure you have enough data to justify your prices, increasing your chances of getting adequate funding to start your construction company.

Marketing Strategy

As mentioned earlier, running a successful business plan of a construction company is not as easy as most people think. There are a lot of complications involved in it, which could lead to losses and may even cause you to close shop. Therefore, it is essential to show your potential investors why you are competent enough to run a construction company that generates excellent profits.

The best way to prove that you are worthy of getting investments is by creating a detailed marketing strategy containing stats and data to support your claims. If you take a close look at any marketing plan for business plan of a construction company , you will notice they discus monthly and yearly sales, profit forecasts, and competitive analysis.

Some proposals also have diagrams, charts, and tables to indicate your construction businesses expected trajectory, showing people that you have a clear strategy to make money.

Personnel Plan

Investors, especially if they have years of experience, are quite vigilant when it comes to helping out up-and-coming businessmen. Letting them know who will work in your construction company and what their roles will be could make them more relaxed. You can do this by creating a section named “Personnel Plan”.  It is an important section when writing a plan of a business for a construction company as it highlights your company’s staff and the average salary of your potential employees.

This portion should also mention the roles of your company’s staff members and their overall contribution. It would be best if you make a thorough, detailed personnel plan and provide an estimate of your workers’ annual salaries. Once again, you should do a fair amount of research to make sure you get the correct facts and figures as your investment for business depends on it.

Financial Plan

Many people create a business plan for a construction company, but very few succeed. Why? Because the ones who fail often provide a lackluster financial plan and in some cases, people don’t even bother mentioning it.  The financial plan is arguably the most important part of your construction company business plan.  It should be stat heavy and discuss how you intend to manage your business’s finances.

Every successful business plan of a construction company proposal includes a brake-even analysis, monthly and yearly profit business plan of a construction company , business ratios, projected profits and losses, and other critical elements. Remember, business proposals without financial plans are a deal breaker for most investors and will significantly reduce your chances of getting funded.

The appendix will be the last section of your construction company’s business plan and will contain detailed information regarding its essential talking points. Adding some extra documents, charts, and tables, pertinent to your upcoming business is a great way to get people’s attention, showing that you are serious about starting a construction company.

Download Construction Company Business Plan Template in pdf`

Professional writers OGS capital specialized also on the theme architecture firm business plan , engineering consulting business plan , HVAC business plan , interior design business plan and etc.

OGSCapital’s team has assisted thousands of entrepreneurs with top-rate business plan development, consultancy and analysis. They’ve helped thousands of SME owners secure more than $1.5 billion in funding, and they can do the same for you.

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Construction Business Plan Template [Updated 2024]

Construction Business Plan

If you want to start a new construction company or expand your established business, you need a business plan.

The following construction business plan template gives you the key elements to include in an effective business plan. It can be used to create a commercial construction business plan, a general contractor business plan or business plans for residential construction, building construction or industrial construction.

You can download the Construction business plan template (including a full, customizable financial model) to your computer here.

Sample Business Plan For a Residential Construction Company

Below are links to each of the key sections of a construction company business plan example:

• Executive Summary – The executive summary provides an overview of your business opportunity and summarizes the business plan.
• Company Overview – The company analysis includes information about your business idea, the full service design and construction services you offer, and the business structure.
• Industry Analysis – The industry analysis includes market research that supports your business and provides insights into market trends and the construction industry.
• Customer Analysis – The customer analysis provides an overview of your target market and the demographics and purchasing habits of these target customers.
• Competitive Analysis – The competitive analysis should identify your direct and indirect competitors and highlight your competitive advantage.
• Marketing Plan – The marketing plan includes your overall marketing strategy, pricing strategy and what marketing techniques you will try to attract potential customers (i.e., email marketing, paid advertising, etc.).
• Operations Plan – The Operations Plan includes information on your construction company’s day to day operations, expected operating costs and the bidding process for new construction jobs.
• Management Team – The management team section includes a profile of the business owner and management team including the officer manager and project managers, their experience and responsibilities.
• Financial Plan – The financial plan includes financial projections, including cash flow statements, income statements, and balance sheets for the next 5 years.

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Business Plan Template Construction

How To Write A Construction Business Plan

Create your small construction company business plan using our free construction business plan template. We guide you through the steps of taking your business idea from dream to reality.

Construction Business Plan (Free PDF)

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Business Plan Template: What You Get

• Create a construction business plan step by step
• Receive support for the creation of all chapters in the business plan
• Outline the objectives of your business, goals set for future growth and profitability as well as strategic planning

This Business Plan Template is Suitable For:

Applicable for founders, freelancers & small business owners

Your Benefits:

• Free of cost: Download the business plan template for free!
• Time-saving: Save time and open your business faster!
• Correct data: Avoid unnecessary mistakes!

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How to Start a Construction Company

Anthony St. Clair

12 min. read

Updated April 22, 2024

Free Download:  Sample Construction Business Plan Templates

Whether you want to be your area’s next big general contractor, or you believe you can build a successful small construction company in a specific niche, getting into the construction business is a process.

But fear not. Yes, there are licenses to apply for, equipment to buy, and maybe even training you’ll need to complete. But once you have a solid construction company business plan and know the direction you want to take, you can start your own construction business.

As Forbes and the U.S. Small Business Administration (SBA) have pointed out, construction is a high-growth industry right now and is expected to remain strong for years to come. In fact, many fast-growing small businesses are connected to construction, such as finishing contractors (e.g., drywall, flooring, and painting), utility systems construction (e.g., water, sewer, oil, gas, and electricity), and structural construction (e.g., concrete, roofing, and siding).

It makes sense. Whether for a residence, commercial use, industry, or public works, someone has to build the buildings, roads, and systems we all use in our daily lives. In developed countries such as the U.S., Canada, and the U.K., the construction industry usually generates six to nine percent of gross domestic product (GDP). According to the U.S. Census Bureau, in 2014, the construction industry as a whole generated $960 billion in annual revenue, and according to the U.S. Bureau of Labor Statistics, employed an estimated 5.8 million in 2013—and the average firm had fewer than 10 employees.

Construction companies have their ups and downs (for example, the economic crisis of 2008 hit construction firms hard ), but it’s an industry that will always have demand—and where there’s demand, there’s opportunity.

• How will you start your construction company?

For starters, let’s break down what it means to be a construction company.

You can build a construction company that is as big and broad or as narrow and specialized as you want. Typically, the industry is considered to have three main sectors:

• Buildings:  residential and non-residential (including institutional and commercial)
• Infrastructure:  also known as heavy engineering, heavy/highway, or heavy civil, and usually encompasses large-scale public works projects, highways, roads, bridges, dams, utilities, and water/wastewater systems
• Industrial: typically includes mills, power generation, refineries, chemical plants, and manufacturing facilities

Factors to consider:

Here are factors you’ll need to consider when deciding the scope and niche of your construction company. Throughout this startup guide, we’ll discuss each in more detail.

• What are your skills, and what field do you want to go into?
• What is the current construction company landscape in your area? Who are the major players?
• Where are there opportunities for a new business to grow and succeed?
• Who are your customers? Who will you be marketing to, and who will be paying you for your services?
• How will you finance your company?
• What legal, trade, and regulatory requirements will you need to meet and adhere to?
• Where will you set up shop? How much space will you need for equipment, meetings, and office personnel?
• What vehicles, small equipment, and heavy equipment will you need to rent or buy? What tools or other materials will you need?
• What will you do yourself, and what tasks or site labor will your hire or subcontract for?
• What will you need in your business plan?

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Begin with a SWOT analysis, which looks at your strengths, weaknesses, opportunities, and threats. Assess where you are, where you want to go, and how you want to get there.

• What trades do you currently have skills, experience, and industry contacts in?
• If you need to learn a trade, what is that process? Can you work as an apprentice for a company? Are there classes available, such as through your area’s community college system?
• Talk to people in your trade or in a connected trade. Take them to lunch, let them know you’re looking at getting into the business, and would like to ask them questions. (Are you talking to a potential competitor? Possibly. But you are also talking to a valuable contact who may be someone you can work with later.)

Since there is always demand for construction companies, it is an industry where there can be lots of players. Some are established and can succeed, and some fizzle and fail.

Make sure you understand the local landscape by talking with your local municipal officials, the Chamber of Commerce, trade organizations, and people in the industry.

• What is your area’s population, and how are those demographics projected to grow, decline, or change over the next five to 10 years?
• How much demand has there been for your field? Are there big needs for new residences? Are new industries coming into the area? Is aging infrastructure getting updated? Conversely, where is there saturation, too little demand for a new player to get business, or a high number of firms that fail?
• What trade organizations should you be part of? (Trade organizations are great for networking and help you stay current on industry and regulatory changes.)
• Where are there opportunities for a new business to find a niche where it can grow and succeed?

As you set up your construction company, you will face an important decision about how general to make your operation, or if you want to really specialize in a particular niche. Different companies can make each strategy work. Sometimes a company can make it with an attitude of “no job too big or too small,” and take on any job that comes their way. There may be times, in the early stages of your business, where that’s what you have to do to pay the bills.

However, your construction company will have a greater chance of success if you identify a niche where you can specialize.

Could you build your firm to be another builder of new homes? Sure. However, there are other options. Your firm could focus solely on building additions, or in building separate small buildings on a residential property. You could be a general painter—or you could specialize in mid-century restorations.

Identifying your niche:

Here are some ideas to help you identify potential niches.

Remember to make sure that your niche isn’t just riding a trend—because if the trend goes away, your business could be left behind. Make sure you can pivot to new trends, or refocus on a different niche while also retaining some jobs or specialties outside of your core niche.

• Are there demographic trends driving construction needs in your area, such as aging populations, an influx of new families, or a drive to restore houses of a particular style or period?
• Is your area known for, or becoming known for, commercial or industrial sectors?
• Within your field, is there a particular service that you could specialize in? For example, if you are a flooring contractor, could you specialize in laminate floors? If you remodel kitchens, is there an aspect of the work that you could specialize in—such as cabinets or counters—and subcontract the other work? If you are an electrician, could you specialize in panel upgrades or electrical work for outdoor spaces?
• Who are your customers?

In other words, who will you be marketing to, and who will be paying you for your services?

The answer might surprise you. Your customers are not necessarily the end occupier or user of the finished work.

Think of it this way: You want to market your services to the people or organizations who will be writing checks to you.

Determining who your customers are:

• If you are working on a commercial space, your customer may be the development group or property owner.
• If you specialize in remodeling repossessed houses, your customer may be the bank or credit union that owns the property and wants to re-sell it.
• If you are specializing in utility systems or public works projects, your customer may be a municipality or other public entity.
• If you are a subcontractor, your customer may be a general contractor.

Make sure you understand who will be making the decision on whether to bring on your firm or a competitor. Be sure your marketing and networking efforts target that customer—because they are the ones who will be writing you checks and referring business to you.

A construction company is a capital-intensive business.

You may need to rent or buy heavy equipment, or purchase materials in bulk. A solid business plan can outline your assets, and make the case for your new construction company to access funding from investment sources, from private interests to SBA loans.

Construction overall is a highly regulated industry. Make sure you know the code, laws, Occupational Safety and Health Administration (OSHA) practices, insurance requirements, and regulations that you will have to comply with. Some requirements will vary industry to industry, state to state, or locality to locality.

Here is an overview of the legal requirements you should be aware of:

• Building codes used and enforced in your area, such as the International Building Code (IBC). Your local area may also use variants of the IBC that you will have to know.
• States have different classes of construction companies, and different regulations and limits apply to each class.
• Safety practices and personal protective equipment (PPE, often mandated by OSHA).
• Bonding, licensing, and insurance requirements, which vary by industry and state.
• Where will you set up shop?

How much space will you need for equipment, meetings, and office personnel?

Some small-scale construction companies can operate out of a pickup or modified box utility truck. Other firms may need large properties with shop space, office buildings, and parking areas for heavy equipment.

Identify the scale of headquarters and shop space you’ll need, while also consulting with other local contractors on properties (such as industrial parks) that may be a good fit for your business. Use your business plan to identify your initial and overall personnel needs, so that you can find the appropriate space to get you started and provide opportunities to grow and change as the business grows.

Just like with property and office or shop space, you’ll also need to know what tools, materials, and equipment you have, and what you will need to rent or purchase.

Also, use this as an opportunity to get to know the equipment and material suppliers in your area, as you’ll be relying on them to get you the tools and materials you need to fulfill your jobs.

Here are some questions to consider:

• What work will you be doing by yourself?
• What personnel will you need in the field, in management, and in the back office?
• Who will you hire, versus who will you subcontract work to?
• How will your personnel and labor needs change based on growth or specific job requirements, and how will your construction company meet those needs?

As you can see from what we’ve covered, there are lots of things you’ll need to figure out in advance of actually starting your business. That is where a solid, thorough business plan will be to your advantage. Here are some of the areas you’ll want to cover in your construction company business plan.

• Introduction: describes the organization’s goals and focus
• Products/Services: what problems you will be solving for your customers
• The Market: an analysis of your industry in your market
• Mission : a succinct, in-a-nutshell statement of why your business exists and what sets it apart in the market
• Your business name, entity, and where your base of operations is located
• Startup requirements, assets, liabilities, expenses, and investment amount sought
• Safety: Discuss known safety issues and how your organization will operate in a safe manner that complies with relevant laws and regulations
• Services:  a broader explanation of the work you will provide and what makes it better than the competition
• Applications:   typical target customers and users of your products and services
• Market Analysis Summary:  list statistics, data, and financial numbers that show your understanding of the industry on a local and national scale, and also demonstrate the market conditions that make your business a good investment with a promising future
• Market Segmentation: Show the recent history of your target market and state where in the market you believe you can stand out and succeed
• Strategy and Implementation Summary: State who your target customers are and how you will secure their business
• Sales Forecast: Show a projection of monthly sales estimates during the first 12 months of operation, and annual sales estimates for the first three years of operation
• Marketing Strategy: Outline your core marketing and networking strategies to acquire and retain customers
• Management Summary: Detail your core management team as well as guiding company principles
• Personnel Plan: Outline expected personnel numbers and costs, including employees, subcontracted labor, and other personnel or business services
• Projected Cash Flow for at least the first 12 months of operation
• Break-Even Analysis for at least the first 12 months of operation, to show progress of investors toward a break-even point
• Projected Profit and Loss that plans for potential loss periods, and how company will work toward profitability
• Projected Balance Sheet showing three years of assets, liabilities, and capital, to indicate projected net worth
• Business Ratios that show typical cost percentages for an organization in your industry
• Appendix detailing other information, tables, or data, such as sales forecasts, personnel numbers, interest rates, cost of sales, cash flow, and so on

Planning your construction business may not be an easy endeavor, but now that you understand the scope of the work involved, you are ready to figure out what you need to get started.

For additional guidance, check out our construction business plan example and free template .

See why 1.2 million entrepreneurs have written their business plans with LivePlan

Anthony St. Clair is a business copywriter, author of the Rucksack Universe travel fantasy series, and a craft beer writer specializing in Oregon. Learn more at anthonystclair.com.

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Construction Company Business Plan Template

Whether you're launching a new construction business or seeking investment for your existing company, having a well-structured Construction Company Business Plan is essential for outlining your vision, strategy, and financial projections. To access our Construction Company Business Plan Template, click the button below. This template is vital for creating a roadmap for success and securing funding or partnerships in the construction industry.

Save time, avoid headaches, and ensure compliance effortlessly with current version of Construction Company Business Plan Template. With our streamlined process, you'll have your form in hand within moments, giving you the peace of mind to focus on what truly matters – your business.

Understanding the Template

Are you tired of navigating through the complexities of the construction industry without a clear plan, tips and instructions for use, construction company business plan template instructions, frequently asked questions, what is a construction company business plan template.

A Construction Company Business Plan Template is a standardized document used to outline the goals, strategies, and financial forecasts of a construction business. It serves as a roadmap for guiding the business's growth, attracting investors, and securing financing.

Who Should Use a Construction Company Business Plan Template?

Entrepreneurs starting a new construction business, existing construction companies looking to expand or seek investment, and contractors seeking financing for specific projects should use a Construction Company Business Plan Template. It provides a structured framework for organizing business objectives, strategies, and financial projections.

Where Can I Get a Construction Company Business Plan Template?

You can download the Construction Company Business Plan Template for free from reputable sources like our website BlueNotary or from business planning resources.

How often should a Construction Company Business Plan be updated?

A Construction Company Business Plan should be updated annually to reflect changes in the market, financial projections, and strategic direction. Regular updates ensure the plan remains relevant and aligns with both short-term operational needs and long-term business goals.

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How to Start a Construction Company

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There’s a lot that goes into learning how to start a construction company, and not just on the financial side. You’ll have to come up with a great business plan, wade through local and state registration, find great staff, and come up with a marketing strategy that sets your business apart.

No matter how you start your construction company, there are a few basic financial and business tenets you’ll need to know if you want to be successful. Here’s what to focus on, and how to make sure you build your construction company on a solid foundation.

Draft a business plan

Every successful business has to begin with a solid business plan. Your business plan does more than just commit your company’s vision to paper—it helps you make sure that the fundamental ideas behind your company make sense, and can lead to real revenue. You’ll know exactly how, when, and why you’re starting your business, as well as the steps you intend to take to make it happen.

In this regard, how you start a construction company is the same as you would any other business venture. You create a plan, refine it, show it to other business leaders or mentors you trust, and make refinements along the way. Plus, you’ll need to have a business plan for loans, should you decide to take one out later down the line.

Drafting a business plan isn’t too challenging, even if you don’t consider yourself to be a writing whiz. Most business plans follow a specific template, which takes some of the guesswork out of the process. So long as you follow the steps for writing a business plan, your experience shouldn’t be too painful.

How much do you need?

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We’ll start with a brief questionnaire to better understand the unique needs of your business.

Once we uncover your personalized matches, our team will consult you on the process moving forward.

Register your business

Once you’ve completed a business plan you’re happy with, you’ll need to look into the rules, licenses, and registrations required within your business’ location. The construction industry’s requirements make starting a business a unique procedure. Your state, county, or town may have specific laws in place, which means you should make sure you’re fully aware of everything you need to do to get going. But here are a few overarching considerations to start with as a baseline.

Deciding on a business entity

Registering a business entity is the first real step toward making your company real. There are several ways to register your construction company, or any company for that matter. But the most common and straightforward option is often to form a limited liability corporation (LLC).

LLCs provide you with easy options for paying business taxes, while also covering your personal assets in case your business goes into debt or faces legal issues. There are a few different kinds of LLCs available to you as well—some are as small as a single-owner structure that lets you pay your business taxes straight from your personal filing, and others that create more structure and allow for several business partners to draw annual salaries.

Applying for licenses

It’s almost certain that your municipality requires construction companies to have specific licenses to work within their boundaries. Some may be as simple as being a recognized contractor within the town, county, or state.

Others may be more specific, such as licenses to install HVAC equipment or do other subcontracting work. You may also need licenses and permits to bid on government contracts, which vary based on where you operate.

Insure your business

Insuring your construction company is just as important as registering it. Construction is an inherently danger-prone business, given that you’re working with heavy machinery, electricity, and all sorts of other equipment that could do a fair bit of damage.

Business insurance

Most construction companies need at least one kind of business insurance to stay on the right side of the law. General liability insurance for contractors is a must, as this protects you against worksite injuries, accidents, and other mishaps that could otherwise leave you with hefty bills (or even legal liability issues, depending on your circumstances).

You’ll also want to look into vehicle and property insurance policies to make sure your company’s machinery and equipment are covered in case of an unforeseen issue.

Employee-related insurance

If you plan to hire workers directly as part of your construction company, you’re going to need three major forms of insurance: workers compensation , unemployment, and state disability insurance.

Workers compensation helps your employees cover bills and expenses if they’re hurt on the job, and provides them with coverage for medical costs and lost wages. Unemployment insurance helps cover employees who lose their jobs due to reasons beyond their control—such as layoffs or the disbandment of a company. And state disability insurance provides employees with coverage in case they are no longer able to work but still need assistance paying bills and cost of living expenses.

Access small business loans and financing

Aside from asking how to start a construction company, you’ll likely want to know how to finance one, as well. After all, construction is an inherently costly endeavor in terms of overhead. You have to buy supplies, rent or purchase equipment, maintain your tools, and keep a fleet of vehicles running. And that’s only the beginning.

Thankfully there are several business construction loans out there that could come in handy as you start your construction company. Some offer tons of flexibility, such as a business line of credit . Others are designed to provide you with a bigger sum of cash at once, like Small Business Administration (SBA) loans. No matter your need, there’s a business loan out there that’ll help you fulfill it.

SBA loans are a great option for small businesses: they come with low interest rates, generous terms, and a wide range of loan amounts. Banks partner with the SBA to lend small businesses cash, while the SBA provides a guarantee of up to 85% of the loan’s total value. This guarantee means that the SBA will pay the bank up to 85% of what the borrower owes in the event that the company can’t pay.

These great terms come with a catch, however. SBA loans are notoriously hard to get: You’ll need to have a long personal credit history (and a good score), a ton of patience, and the diligence to wade through a heap of paperwork. But the cost savings make it all worth it if you’re approved. Here are a few of the most common SBA loans for construction companies.

1. The SBA 7(a) loan program

SBA 7(a) loans are one of the more popular options for most businesses. They offer up to $5 million and can be used for a variety of purposes. You can use an SBA 7(a) loan to increase your working capital, to refinance existing debts, or to renovate your offices. Plus, these loans come with interest rates that are far below what a conventional small business loan would cost you (and significantly less than a short-term loan).

2. The SBA microloan program

SBA microloans are great for entrepreneurs who may not need a massive amount of cash but still need access to capital. SBA microloans are made for small and new businesses seeking less than $50,000, and are designed to help these companies build out their budding enterprises. Microloan terms are fairly generous as well, as they allow the borrower to pay off the loan over the course of up to six years.

3. The SBA CDC/504 loan program

These loans are a bit different than the other two, insofar as they’re designed to help small businesses purchase major fixed assets (i.e. large equipment and commercial real estate). CDC loans provide up to $5.5 million to borrowers, and come with repayment terms of 10 or 20 years. This loan could be particularly helpful if you need help purchasing heavy machinery for your construction company.

Equipment financing

SBA loans aren’t the only options for small business owners to finance their company. In fact, there are plenty of loans out there that come with less stringent credit history requirements. Equipment financing is a particularly useful option for borrowers without a spotless or long-standing credit history. Equipment loans are designed to help business owners purchase machinery for their company. The loan amount is tied specifically to the cost of the equipment being purchased, and must only go to that purchase itself.

But in exchange for these terms, you’ll give up the collateral requirement that comes with most other loan types. The equipment’s value serves as collateral instead, which means the lender will repossess your machinery if you can’t make payments. This is a great option for businesses that are tight on cash but have a specific purchasing need.

Start Your Dream Business

Business term loans

Term loans might be right for you if you don’t qualify for an SBA loan, or you need cash faster than the SBA loan process allows for. Term loans provide a lump sum to borrowers, which they can use for any of business purposes they deem fit. So long as you’ve been in business for a while, have a good personal credit score (and a business credit score), you’re likely to be a decent candidate.

These loans vary in interest rate, repayment terms, and the amount of money provided. You can work out these details with your lender and shop around offers to get the best value.

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How To Start A Construction Company: A Beginner’s Guide

Key Takeaways

How to start a construction company | Researching the industry | Building a business plan | Registering yourbusiness | Legality, permits, and insurance | Acquiring funding

The thought of starting a construction company may simultaneously elicit fear and overwhelming excitement. The prospect of becoming an entrepreneur within the construction industry may open several new doors for savvy business owners, but the task that lies ahead is anything but easy. Therefore, prospective entrepreneurs will need to learn how to start a construction company the right way. Starting a construction company is not unlike any other type of investment in your portfolio: due diligence, education, and preparation will be met with a higher likelihood of success. As a result, anyone interested in starting their own construction company should heed the following advice.

How To Start A Construction Company In 5 Steps

Understanding how to start a construction business requires the unique convergence of several fundamental factors. Everything from developing an in-depth knowledge of the industry to understanding the demand and competition will be needed to build a solid foundation. The sheer volume of prerequisites can get overwhelming rather quickly. Fortunately, the process can be broken down into five, easy-to-digest steps:

Research The Construction Industry

Build A Business Plan

Register Your Business

Get Licenses, Certifications, Permits & Insurance

Acquire Funding

1. Research The Construction Industry

Conducting the appropriate research on the construction industry is anything but optional; it’s necessary for any aspiring business owners. In fact, before taking any actionable steps, prospective business owners need to research the construction industry—all of it. Research will not only tell business owners how to conduct themselves moving forward, but it will also serve as an important indicator as to whether or not the impending endeavor is a good idea.

Research should begin on a broad level and include everything from national trends and laws to tax implications and legal requirements. The amount of information new construction company owners will be inundated with will be overwhelming, but here’s a list of resources to get started:

U.S. Small Business Administration (SBA): The SBA’s website is a good place to start looking to acquire basic business knowledge. While it may not contain information specifically relegated to the construction industry, it will give future owners the foundational knowledge they need to start a business. The site will provide information for every stage of growth and point you in the direction of helpful business tools.

U.S. Bureau Of Labor Statistics (BLS): As its name suggests, the Bureau of Labor Statistics will provide information about existing construction companies and their current status concerning employment. The site will reference specific labor indicators like employment, job openings, new hires, earnings, hours worked, and more. These indicators can give aspiring owners an idea of what to expect from their own labor force.

Construction Industry Publications & Statistics: Valuable market insights may be gleaned from one of many construction industry publications. The Fails Management Institute, the Construction Marketing Association, and Data USA all contain valuable information business owners in the construction industry covet.

Local Industry Publications: For extra credit, future business owners may want to dig into local publications to learn more about their area on a more microeconomic level. Local publications will provide specific insight reserved for a particular area, which can oftentimes prove more valuable than national publications.

The Securities & Exchange Commission (SEC): The SEC contains the financial information of public companies. It can even give insight into what proper bookkeeping looks like (or even poor bookkeeping). Either way, new business owners will have something to aim for if they can see the financials of companies that have already been where they want to be.

These resources are not meant to serve as a comprehensive list of today’s most valuable insights. In fact, they only represent a fraction of the information people will need to know when learning how to start a construction company. Instead, these resources should serve as a starting point and will hopefully lead to additional insights elsewhere.

2. Build A Business Plan

Success in the construction industry won’t be realized overnight; it’ll take countless hours of preparation and an inherent degree of determination. Of the countless hours spent devising a strategy, many should be dedicated to building a business plan. If for nothing else, a good business plan will serve as a compass for the duration of the entire company’s existence. More importantly, a truly great business plan will serve as an essential road map for carrying out a successful construction business. With that in mind, let’s take a look at how aspiring entrepreneurs can make their own business plans.

Executive Summary

The first step when drafting any good business plan is to include an executive summary. As its name suggests, this portion of the business plan will provide a ” 1,000-foot view” of the business as a whole. More specifically, this part of the business plan is dedicated to providing a brief “snapshot” of the respective company. In doing so, the executive summary will contain the mission statement, company description, growth data, products and services, financial strategy, and future aspirations. On a more subjective level, it’s here where business owners will want to include their own reasoning for why they want to break into the construction industry.

Company Overview

Otherwise known as the company description, the company overview will detail the various aspects of the business, including its goals and how they intend to be reached. At this point in the business plan, prospective owners will want to describe the nature of their business, starting with what it does, the needs it meets, and who it serves. Go in-depth on the products and services the business will provide to meet the market’s needs. Additionally, the overview will address specific customers, organizations, or businesses the company will serve. To be clear, it’s not enough to define a target audience; owners will need to define the competitive advantage they bring to the table to secure said audience.

Market Analysis

Learning how to start a construction company won’t do business owners any good if they aren’t equipped with a proper market analysis. Including a comprehensive market analysis in the business plan is of the utmost importance, which begs the question: What’s included in the market analysis? Not surprisingly, a comprehensive market analysis will start with information regarding the specific market the business will operate in. Indicators to add to a market analysis include but are not limited to distinguishing characteristics, size, market shares, and pricing and gross margin targets. Include a SWOT analysis, which breaks down individual strengths, weaknesses, opportunities, and threats related to business competition.

Business Structure

Include a detailed outline of the company’s projected business structure and clearly define organizational roles and management. In other words, it’s in this section which individual roles will be defined and who will carry them out. It is important to be as specific and granular as possible to avoid any future discrepancies. The business structure will clearly define the rank and file and solidify the chain of command. This section should include your company’s organizational structure, details of the ownership, profiles on the management team, and qualifications. 

Product & Services

It is impossible to describe a business without detailing the goods and services it provides. Therefore, no business plan is complete without an entire section devoted to the service or product the business owner intends to provide. As an aspiring construction company owner, what is it you intend to provide your customer base? Take the time to outline your specific service and how it’s different from your competitors. Do not hesitate to get as detailed as possible. This section should offer no less than a description of what you offer, details on its duration for the customer, information on intellectual property, as well as research and development. This is where you’ll make a case for why your services are better than the competitions’.

Marketing & Sales

Marketing and sales strategies are instrumental in running a sound construction company, and a respective business plan needs to reflect as much. Take the time to put every marketing strategy on paper, and devise a comprehensive approach to reaching your target audience. This section should include, but isn’t limited to, a market penetration strategy, a plan for future growth, distribution channels, and a comprehensive communication strategy. Additional points to consider:

Why your target audience needs the service and how it represents a value

How you intend to find and reach out to prospective customers

The advertising medium you feel will generate the most responses

How you plan on converting customers into brand advocates

Financial Plan

The aptly described financial plan will identify the current state of your finances, and where you plan to be in the future. Some of the most important documents include:

Income Statements

Cash Flow Statements

Balance Sheets

Debt Obligations

Funding From Private Investors

The financial plan serves a very specific purpose: it identifies your current financial state and where you hope to be in the future. With the proper budgeting and adherence to the plan, a financial plan can keep new business on track to realize profits sooner rather than later.

The more detailed a business plan is, the better. Therefore, prospective business owners should do their best to include every bit of information that will help them down the road. That said, not all information fits cleanly in the previously mentioned sections; that’s where the appendix comes in. Include an appendix so that you may add additional information without convoluting every other section. While the appendix is reserved for necessary information, some things you’ll want to add include:

Visual components like charts and graphs

More detailed information on your particular market

Information on previous projects you completed

Necessary permits and licenses

Proof of insurance

Detailed information on the company’s organization

Notable news coverage

3. Register Your Business

With everything in place, it is time to register the construction company as a business. Fortunately, the actual registration process is straightforward, and can be taken care of in a few simple steps:

Come up with a name: Prior to registering, the construction company should already have a name. If not, come up with a simple name that answers more questions than it asks. A company name should be easy to understand, and free of any controversy.

Choose a business entity: Determine whether you want to register your construction company as a LLC or a corporation.

Obtain an Employer Identification Number (EIN): Otherwise known as a federal tax ID, the EIN is what the business will use to identify itself when it pays taxes, hires employees, opens bank accounts, and applies for licenses. You can get your EIN by applying on the IRS website.

Those filing as an S-Corp will need to file Form 2553 with the IRS: Corporations need to file at the federal level, unlike LLCs who do it at the state level.

Register with the state agencies you intend to work in: Aspiring construction companies will need to register in each state they intend to do business in.

Register with local agencies: Businesses will need to register through local governments in each state.

4. Get Licenses, Certifications, Permits & Insurance

Understanding how to start a construction company requires many steps, but none may be more important than obtaining the proper credentials, of which there are a lot. For a construction company to even operate, it needs the appropriate licenses, certifications, permits, and insurance for each state it operates in. Let’s take a closer look at what credentials today’s construction companies need to operate below.

State & Federal Licenses

Again, each state will differ, but there are generally three licenses required to run a construction company:

General Contractors’ License: Most states require a construction company (and its workers) to have a general contractors’ license to conduct work. Licenses prove competency when completing construction projects and ensure customers their contractors can get the job done.

Specialty Contractors’ License: Some states require more in-depth licensing procedures. Specialty contractors (those who specialize in a particular field), for example, may be required to get a particular license for their industry. Contractors who specialize in carpentry, painting, electrical, roofing, and HVAC units may need a specific license to identify their competency in a given field.

There is, of course, one exception: Contractors who want to work with government contracts will need to register as a government contractor.

In addition to the proper licenses, construction companies will also need to make sure they have the insurance coverage they need to operate in each state. While insurance will vary from location to location, here are the six types of insurance no construction company can do without:

General Liability Insurance

Property Insurance

Vehicle Insurance

Workers Compensation Insurance

Unemployment Insurance

Disability Insurance

5. Acquire Funding

Unless you are fortunate enough to be able to fund the entire endeavor yourself, there’s a good chance you’ll need funding to get operations up and running. If for nothing else, understanding how to start a construction company will reveal just how expensive the process can be. Business owners will need money for everything from operations and payroll to supplies and insurance. That said, there are a number of ways to fund a construction company, not the least of which include:

Small Business Loans

Working Capital Loans

Purchase Order Financing

Vendor Financing

Equipment Loans

How Much Money Do You Make Owning A Construction Company?

According to ZipRecruiter , the average annual pay for a construction company owner in the United States is $80,700 a year. For those of you keeping track, that salary translates to about $38.80 an hour (the equivalent of $1,552/week or $6,725/month). It is worth noting, however, that this is an average. ZipRecruiter also identified salaries as low as $20,000 a year and as high as $284,000 a year. The difference is substantial and the result of a diversified industry. Government contractors, for example, tend to land higher-paying jobs with more profit potential. On the other hand, smaller companies may struggle to make ends meet, especially in a market that was recently stagnated by the Coronavirus.

In learning how to start a construction company , prospective business owners will quickly find out the process can be difficult and complicated. However, a truly great contractor’s profit potential is relative to their skill and business acumen. Fortunately, both skill and business acumen can be honed and improved over time. With the right foundation, there’s no reason you can’t build a successful construction company from the ground up, and this guide should help get you started.

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Construction Company Business Plan [Sample Template]

By: Author Tony Martins Ajaero

Home » Business ideas » Construction & Engineering Industry » Construction Business

Are you about starting a construction company ? If YES, here’s a complete sample construction business plan template & feasibility report you can use for FREE .

Okay, so we have considered all the requirements for starting a construction business. We also took it further by analyzing and drafting a sample construction marketing plan template backed up by actionable guerrilla marketing ideas for construction businesses. So let’s proceed to the business planning section.

A Sample Construction Company Business Plan Template

1. industry overview.

The construction industry can comfortably boast to be responsible for the infrastructural development of the world. As such, the development of any country or city can be said to be the handiwork of construction companies and other stakeholders.

In other words, all the edifices, bridges, dams, roads, estates, campuses, shopping malls, office complexes, skyscrapers and massive structures that you see around are all products of the construction industry. Starting a construction business is capital intensive simply because of the type of heavy duty equipment that is required to carry out a construction project and also the cost of managing a large workforce.

Despite the fact that the construction industry requires huge start – up capital, the industry is highly profitable, especially if you have the expertise and capacity to deliver quality jobs. The major clients for construction companies are governments and the private sector.

Construction giants all over the world head towards developing countries, because they know that they are going to get juicy construction contracts there. Unlike in advanced economy, in developing countries and undeveloped world, there are loads of construction works to be done.

The fact that they have infrastructure deficit means that the government must be up and doing in terms of road constructions, bridge construction, public facility construction (hospitals, schools, office facilities and estates et al) and dams constructions.

After a war, the construction industry is one of the major stakeholders that contribute in the rebuilding of a country. In so doing, they work with governments in ensuring that basic infrastructures are restored and of course it will always ends up a win – win situation for both parties.

The government gets what they want and the construction company and contractors get good returns for delivering the projects.

Over and above, the success of a construction company to a larger extent depends on their relationship with the biggest clients in the industry; the government of any country. No doubt there is always enough construction contracts to go round as long as a construction company is competent and well positioned. They won’t lack construction contracts from both the government and the private sector.

2. Executive Summary

Shannon Berg Construction Company is an international construction company that has its headquarters in Grand Rapids, Michigan – USA. The fact that we are based in the united states does not in any way restrict our scope of operations to the United States of America.

We are an international construction company and we work for our clients (governments and private sectors) in any part of the world.

Shannon Berg Construction Company will be specialized in the constructions of skyscrapers, bridges, stadiums, roads, dams, Office complex, shopping malls, schools, campuses and estates et al. As a matter of fact, we are going to be known for delivering world class structures all over the globe.

Creativity, excellence and timely completion of construction projects will be our signature. We intend starting our construction business on a small scale in Grand Rapids, Michigan, but we have a bigger picture – to have our presence in any part of the world that our clients wants us to work.  We hope to achieve this feat within the first 10 years of launching the company.

As part of our plans to make our highly esteemed customers our number one priority and to become a global construction brand, we have perfected plans and strategies that will enable us work with our clients in delivering projects that can favorably compete with the best in the industry at an affordable and reasonable price within the stipulated completion date barring any unforeseen circumstance.

Shannon Berg Construction Company is fully aware that starting a construction business requires huge capital base, which is why we have perfected plans for steady flow of cash from private investors who are interested in working with us.

We can confidently say that we have a robust financial standing and we are ready to take on any construction project that comes our way, as long as the project is duly commissioned by the required authority.

Shannon Berg Construction Company will be owned by the principal partner; Engr. Shannon Berg and other partners (Nani David, Lois Scotland and Christopher Parkston). They also have plans in the pipeline to sell the shares of the company in the nearest future to interested investors who would want to be part owners of the company.

Shannon Berg who is the principal partner has well over 25 years of experience in the construction industry. Before starting his own construction company, he was a senior project manager and consultant with one of the world’s largest construction company based in Germany.

Engr. Shannon Berg, Nani David, Lois Scotland and Christopher Parkston will be the major financier of the company. Nonetheless, we have made a concerted decision not to limit the number of investors with similar investment ideology that may want to invest in the business.

This is necessary in order for us to be able to retain financial flexibility. Ideally, our plan is that no investment will be less than $1,000,000, which would purchase a 1 percent equity position. It is our desire that all equity partners be limited partners.

3. Our Products and Services

Shannon Berg Construction Company is a construction company that is set to undertake both small construction projects and massive construction projects for governments, private sectors and for individuals which is why we do not intend to place limitations of the scope of the projects we handle and what we do.

We know that if we are good at what we do, it will make it easier for our brand to grow beyond Grand Rapids, Michigan to other parts of the United States of America and the rest of the world. Our business offering are listed below;

• Road Construction
• Bridge Construction
• Dam construction
• Airports and Helipads Construction
• Seaports Construction
• Skyscrapers construction
• Estate construction
• Public facility construction (hospitals, schools, shopping malls, office complexes and industrial facilities et al)
• Construction of residential facilities
• Property Makeover Services
• Construction Consultancy and Advisory Services

4. Our Mission and Vision Statement

• Our vision is to build a first class construction company that will have active presence in North America, South America, Africa and Asia.
• At Shannon Berg Construction Company, our mission and values are to help governments, the private sector and individuals in the United States of America and throughout the world realize their dreams of building a world class structure that can compete on a global stage with the best in the construction industry.

Our Business Structure

Shannon Berg Construction Company intend starting small from Grand Rapids, Michigan, but with a vision of growing the business to becoming a global construction brand with presence in all the continents of the world. In order to achieve this vision, we just have to position our company for growth and ensure that we hire dedicated and highly competent employees at all levels.

Shannon Berg Construction Company will ensure that we build a team that will work together towards achieving the company’s vision. We will build a business that has the right structures and process in place that can support growth; a business that runs on autopilot.

In view of the above, we have made provisions for the following position in our organization based on the size of the company we intend starting but as the business grows, we will create senior level positions and also create a structure that will support the business growth at every growth and expansion stage;

• Chief Executive Officer (President)

Project Manager

Civil Engineer

• Structural Engineer
• Quantity Surveyor

Land Surveyor

Company’s Lawyer/Secretary

Admin and HR Manager

Business Developer

• Front Desk Officer

5. Job Roles and Responsibilities

Chief Executive Officer – CEO:

• Responsible for providing direction for the business
• Creates, communicates, and implements the organization’s vision, mission, and overall direction – i.e. leading the development and implementation of the overall organization’s strategy.
• Responsible for the day to day running of the business
• Responsible for handling high profile clients and deals
• Responsible for fixing prices and signing business deals
• Responsible for signing checks and documents on behalf of the company
• Evaluates the success of the organization
• Reports to the board
• Responsible for the planning, management and coordinating all projects on behalf of the company
• Supervises projects
• Ensures compliance during project executions
• Provides advice on the management of projects
• Responsible for carrying out risk assessment
• Using IT systems and software to keep track of people and progress of ongoing projects
• Responsible for overseeing the accounting, costing and billing of every project
• Represents the organization’s interest at various stakeholders meetings
• Ensures that project desired result is achieved, the most efficient resources are utilized and different interests involved are satisfied.
• Responsible for preparing bids for tenders, and reporting to clients, public agencies and planning bodies
• Ensures that sites meet legal guidelines, and health and safety requirements
• Assesses the environment impact and risks connected to projects
• Responsible for judging whether projects are workable by assessing materials, costs and time requirements
• Draws up blueprints, using Computer Aided Design (CAD) packages
• Discussing requirements with the client and other professionals (e.g. architects and project managers et al)
• Responsible for managing, directing and monitoring progress during each phase of a project
• Responsible for creating building designs and highly detailed drawings both by using the hands and by using specialist computer – aided design (CAD) software
• Works around constraining factors such as town planning legislation, environmental impact and project budget
• Writes and presents reports, proposals, applications and contracts
• Adapting plans according to circumstances and resolving any problems that may arise during construction
• Works with project team and management to achieve a common goal
• Responsible for applying for planning permission and advice from governmental new building and legal department.
• Responsible for undertaking land surveys/measurements using a variety of specialist technical equipment such as theodolites, laser alignment devices and satellite positioning systems et al.
• Responsible for presenting data to clients
• Responsible for producing and advising about construction plans and drawings
• Responsible for advising about technical matters and whether the construction plans are viable
• Responsible for drawing up contracts and other legal documents for the company
• Consult and handle all corporate legal processes (e.g. intellectual property, mergers & acquisitions, financial/ securities offerings, compliance issues, transactions, agreements, lawsuits and patents et al)
• Develops company policy and position on legal issues
• Researches, anticipate and guard company against legal risks
• Represents company in legal proceedings (administrative boards, court trials et al)
• Plays a part in business deals negotiation and take minutes of meetings
• Responsible for analyzing legal documents on behalf of the company
• Prepares annual reports for the company
• Responsible for overseeing the smooth running of HR and administrative tasks for the organization
• Defines job positions for recruitment and managing interviewing process
• Carries out staff induction for new team members
• Responsible for training, evaluation and assessment of employees
• Responsible for arranging travel, meetings and appointments
• Oversees the smooth running of the daily office activities.
• Identifies, prioritize, and reach out to new partners, and business opportunities et al
• Responsible for supervising implementation, advocate for the customer’s needs, and communicate with clients
• Develops, executes and evaluates new plans for expanding increase sales
• Documents all customer contact and information (manage the company’s CRM system)
• Represents the company in strategic meetings with government agencies, private sectors and contractors
• Helps increase sales and growth for the company
• Responsible for preparing financial reports, budgets, and financial statements for the organization
• Responsible for financial forecasting and risks analysis.
• Responsible for developing and managing financial systems and policies
• Responsible for administering payrolls
• Ensures compliance with taxation legislation
• Handles all financial transactions for the company
• Serves as internal auditor for the company

Front Desk/Customer’s Service Officer

• Receives Visitors/clients on behalf of the organization
• Receives parcels/documents for the company
• Handles enquiries via e-mail and phone calls for the organization
• Distributes mails in the organization
• Handles any other duties as assigned the line manager

6. SWOT Analysis

Surviving in the business world as a construction company requires more than knowing how to deliver standard projects but also how to network with key people that matter; decision makers that can decide who a project is given to and all that.

We know that it will be a bit difficult to compete with already established construction companies in the United States especially because we are new in the industry.

In order to properly position our company for growth and to favorably compete in the construction industry, we engaged the services of a Dr. Joe Whyte, a renowned HR and business consultants in the United States of America to help us run a SWOT analysis.

It is important that we know our strength, our weaknesses, and the opportunities that we can leverage on in the industry and the threats that we are likely going to be confronted with.

With that, we will be able to map out strategies that will not only help us to survive in the industry but also to build a global construction brand. Here is a summary from the result of the SWOT analysis that was conducted on behalf of Shannon Berg Construction Company;

Shannon Berg Construction Company can confidently boast of having a competent and highly experienced management team who are regarded as some of the best hands in Michigan.

Although we are a new construction company, but our president and board of trustee are respectable people in the United States of America who have served the US government in various capacity; we are a construction company that has the right network that is suitable for the kind of business we are into.

Well the fact that we are a new construction company could count as a weakness. It is normal for clients to think twice before awarding construction contracts to newbies in the industry.

Another weakness that can count against us in the industry is the fact that we may not have the financial muscles to drive the business the way we ought to drive it. We require huge financial base to be able to acquire some of the latest heavy duty construction equipment.

• Opportunities:

Our business concept, our mission and vision puts us at an advantage in the industry. We will start small to build trust within Grand Rapids, Michigan and there are loads of opportunities for us there simply because we are well positioned to work with both the state government and the highly organized private sector.

Generally in the construction industry, both the already established construction companies and start – up construction companies are subject to threat from government policies, global economic downturn and unforeseen natural disasters (disasters that may cause setback).

These are the threats that we are likely going to face as a newbie construction company in Grand Rapids, Michigan. Another threat that we are likely going to face is the arrival of a big construction company in the location where our business has strong presence.

7. MARKET ANALYSIS

• Market Trends

The trend in the construction industry is that construction companies are always coming out with processes that will help them achieve more within a short period; construction jobs can be time consuming especially the construction of massive infrastructures.

Most players in the construction industry are fully aware that the government of any country or state is the biggest clients they can get and they do all the lobbying and horse trading to ensure that they get government contracts.

No doubt there are loads of big time investors that have stakes in the construction industry, but one thing is certain, there is room big enough to accommodate both the big construction companies and the small construction companies.

What smaller construction companies need to do to survive in the industry is to concentrate on developing estates, schools, hospitals and hotels et al before bidding for big construction contracts like road construction, bridge construction, dam construction and skyscrapers et al.

Another obvious trend in the construction industry is subletting of contracts. It is now obvious that construction giants leverage on their brands to win contracts and in some cases after they have won the contract.

They will go ahead to sublet the contract to smaller construction company that they trust can deliver to execute the project at an agreed fee that will be good enough for both parties to make profits. Smaller construction companies position themselves to be able to leverage on such opportunities once it present itself.

8. Our Target Market

Our target market cuts across governments at all levels and countries, the organized private sector and people of different class and from all walks of life. We know that our selling points will be our excellent and timely delivery of construction projects using global best practices.

We will start with the local market, people, organizations and the government in Michigan, but we hope to spread our nets to clients from other states in the US and thereafter other countries of the world.

Shannon Berg Construction Company will be known for working with smaller clients (various individuals) as well as working for bigger clients (various governments and organized private sector). Below is a list of the people and organizations that we have specifically designed our services for;

• Organized private sector (Corporate organizations)
• Land Owners
• Businessmen and Businesswomen
• University Campuses
• Foreign investors who are interested in owning properties in the United States of America
• The government of the United States of America (Government contracts)
• The governments of other nations of the world

Our Competitive Advantage

We are quite aware that there are big – time investors and construction companies who are well recognized in the construction industry, and we maybe have to compete with them when it is time to bid for juicy government contracts.

It might be challenging competing as a newbie in the construction industry, especially in a highly organized market like that of the United States of America, which is why we were deliberate in choosing our board members. Our competitive advantage is not limited to the crop of highly experienced professions that are members of our management team but also our board members.

Our board members are highly respected professionals in the United States who have served the government of the United States at various capacities; people who are accomplished business gurus and people who have the right connections and experience to make things happen with little or no struggle. For us, it is indeed part of the competitive advantage that we are bringing to the market.

Another positive for Shannon Berg Construction Company is the fact that our Chief Executive Officer / President is a renowned Civil Engineer, he has robust experience in the construction industry and he has worked extensively as a senior project manager for one of the world’s leading construction companies.

He is sure going to bring is experience, expertise and network (connections) to make Shannon Berg Construction Company one of the leading construction brand in Grand Rapids, Michigan and also active player in the global construction market.

9. SALES AND MARKETING STRATEGY

• Sources of Income

Shannon Berg Construction Company was established with the aim of maximizing profits through delivering quality and standard construction works for our highly esteemed clients. We will ensure that we generate income from every available means within the construction industry. Below are the sources we intend exploring to generate income for Shannon Berg Construction Company;

• Construction of residential apartments

10. Sales Forecast

It is important to state that our sales forecast is based on the data gathered during our feasibility studies and also some of the assumptions readily available on the field.

We have relationship with major stakeholders in the real estate and construction industry in Grand Rapids, Michigan and also in order states in the US and we are sure of getting key construction contracts to kick start of business. Below are the projections that we were able to come up with for the first three years of Shannon Berg Construction Company;

• First Year-: $2,000,000
• Second Year-: $3,500,000
• Third Year-: $5,000,000

N.B : This projection is done based on what is obtainable in the industry and with the assumption that all things that will facilitate easy flow of construction contracts. From our calculations, we are likely going to make a minimum of 30 percent profits after task from executing key construction projects.

• Marketing Strategy and Sales Strategy

We have been able to clearly define our target market and have documented this in our construction marketing plan. We know how to get them to hire our services which is why we have decided to adopt some of the winning formula that construction giants utilize to win major construction contracts.

We know that it will take different marketing and sales strategies to win small clients and bigger clients. For example; there are requirements a construction company would hate to meet before they can be awarded a government contract. We have put all these factors in place before creating a workable marketing and sales strategy for Shannon Berg Construction Company.

Shannon Berg Construction Company is fully aware of the bureaucracy and horse trading that exists in bidding for construction contracts from the government and even the organized private sector, which is why we were able to put protocols in place to hire some of the best business developer to handle our sales and marketing.

No doubt, our sales and marketing team will be recruited based on their vast experience in the construction industry and their ability to fit into our Business model. We are going to pay more emphasis in the training of all our employees so as to give them all they would need to help the company achieve its aim and objectives.

Our goal is to become one of the leading construction companies in Grand Rapids, Michigan and we know we can achieve this by ensuring that our sales and marketing team are delivering on set targets. Shannon Berg Construction Company will adopt the following marketing and sales strategies;

• Introduce our business by sending introductory letters alongside our brochure to all the corporate organizations and government offices in Grand Rapids, Michigan and other States in the US.
• Promptness in bidding for contracts
• Advertise our business in real estate/properties magazines and websites
• List our business on yellow pages
• Promote our business on satellite TV stations and radio stations.
• Attend expos, seminars, and business fairs et al
• Create different packages for different category of clients in order to work with their budgets and still deliver quality housing/property to them
• Leverage on the internet (social media platforms and our official websites) to promote our business

11. Publicity and Advertising Strategy

We have been able to work with our consultants to help us map out publicity and advertising strategies that will help us walk our way into the heart of our target market. First and foremost, we want our brands to be visible and well communicated, which is why our publicity strategy have been well crafted to help us achieve our aims and business objectives.

All our publicity materials and jingles are done by some of the best hands in the industry. Below are the platforms we intend to leverage on to promote and advertise our property development business;

• Place adverts on both print and electronic media platforms
• Sponsor relevant TV shows
• Utilize our company’s website in promoting our business
• Leverage on the internet and social media platforms like; Instagram, Facebook ,Twitter, LinkedIn, Badoo, Google+ et al
• Install our Bill Boards on strategic locations

12. Our Pricing Strategy

Part of business strategy is to ensure that we work within the budget of our clients to deliver excellent and world class construction projects.

We are quite aware that there are major players in the construction industry in the United States of America who are not interested in small business deals and that is why we have positioned Shannon Berg Construction Company to take on such contracts.

Although our prices may not be outrageously lower than what is obtained in the industry, but we are hopefully that whatever price we bill our customer will be amongst the lowest they can get in the industry. The fact that we are going to be billing our clients lower than what is obtainable in the industry does not in any way going to affect the quality of our construction projects.

• Payment Options

Our payment policy in Shannon Berg Construction Company is all inclusive because we are quite aware that different people prefer different payment options as it suits them, but at the same time, we will not accept payment by cash because of the volume of cash that will be involved in most of our transactions. Here are the payment options that we will make available to our clients;

• Payment by via bank transfer
• Payment via online bank transfer
• Payment via check
• Payment via bank draft

In view of the above, we have chosen banking platforms that will help us achieve our plans without any itches.

13. Startup Expenditure (Budget)

• The Total Fee for incorporating the Business in New York: $750.
• The budget for Liability insurance, permits and license: $5,000
• The Amount needed to acquire a suitable Facility with enough space in Grand Rapids, Michigan (Re – Construction of the facility inclusive): $500,000.
• The Cost for equipping the office (computers, printers, fax machines, furniture, telephones, filing cabins, safety gadgets and electronics et al): $15,000
• The cost for acquiring heavy duty construction equipment: $2,000,000
• The Cost of Launching a Website: $600
• Additional Expenditure (Business cards, Signage, Adverts and Promotions et al): $5,000
• Working capital (investment fund): $3,000,000 (3 Million US Dollar)

Going by the report from our research and feasibility studies, we will need about $7,000,000 (7 US Million Dollars) to set up a construction company in Grand Rapids, Michigan. It is important to state that most of the heavy duty construction equipment that we will work with will be leased.

This necessary because some of these equipment are really expensive and it won’t be economical for us to acquire them from the start.

Generating Funding/Startup Capital for Shannon Berg Construction Company

• The Chief Executive Officer/President Engr. Shannon Berg will generate 20 percent of the start – up capital from his personal savings and sale of his stocks
• 30% of the capital will be generated from key partners (Nani David, Lois Scotland and Christopher Parkston)
• 50% of the capital will be sourced from banks

14. Sustainability and Expansion Strategy

Shannon Berg Construction Company was established with the aim of building a company that will outlive the founders and partners; a construction company that will have active presence in major cities in the world. Part of the vision of the company is to handover the baton of the company from one generation to generation; hence we have perfected our plans to put the right structures in place that will aid our succession plan.

In order to position of company for growth, we have been able to create strong partnerships with the government of the United States of America, organized private sector and construction giants. We are optimistic that we will continue to execute construction contracts for our clients.

Our marketing team will continue to get the needed support and encouragement that they need to be able to deliver on set goals and targets for the organization, and we will continue to improve our processes and structure to meet up with the changing trend in the construction industry.

Lastly, we will not relent in taking calculated business risks when it comes to bidding for bigger government contracts and taking on new business challenges and new business frontiers.

Check List/Milestone

• Business Name Availability Check: Completed
• Business Incorporation: Completed
• Opening of Corporate Bank Accounts various banks in the United States: Completed
• Opening Online Payment Platforms: Completed
• Application and Obtaining Tax Payer’s ID: In Progress
• Application for business license and permit: Completed
• Purchase of All form of Insurance for the Business: Completed
• Renting of Office Facility in New York City: Completed
• Conducting Feasibility Studies: Completed
• Generating capital from the CEO and Business Partners: Completed
• Applications for Loan from our Bankers: In Progress
• writing of business plan: Completed
• Drafting of Employee’s Handbook: Completed
• Drafting of Contract Documents (Tenancy Agreements et al), and other relevant Legal Documents: In Progress
• Design of The Company’s Logo: Completed
• Graphic Designs and Printing of Packaging Marketing / Promotional Materials: Completed
• Recruitment of employees: In Progress
• Purchase of the Needed furniture, office equipment, electronic appliances and facility facelift: In progress
• Acquiring of heavy duty construction equipment: In progress
• Creating Official Website for the Company: In Progress
• Creating Awareness for the business (Business PR): In Progress
• Health and Safety and Fire Safety Arrangement: In Progress
• Establishing business relationship with key players in the industry (networking and membership of relevant construction bodies): Completed.

Related Posts:

• 50 Best Construction Business ideas You Can Start Today
• Construction Company Marketing Plan [Sample Template]
• How to Get Big Federal Government Construction Contracts
• How to Effectively Handle and Store Construction Materials
• 20 Tips on Where and How to Recycle Construction Materials

Small Business Trends

How to start a construction company.

The construction industry is a significant contributor to the American economy . Learning how to start a construction company can position you to become one of the over 700,000 employers making an impact nationally. To successfully establish your footprint in this sector, it’s you can piece together your small business using the following comprehensive guide.

Starting a Construction Company in 19 Simple Steps

S tarting your own construction outfit requires planning and hard work. Following are the steps for a new construction company.

1. Research Nearby Construction Companies

Market research is necessary to get a handle on the competition. Local industry publications are good. Additionally, engaging in community events and local business meetups can provide valuable insights. Don’t forget to look to publications from the government and trade associations. Search engine results are great.

2. Stand Out from Your Competitors

Narrowing your focus to a specific target market is one way to be successful. Niche is important.

Narrowing your focus to a specific target market is one way to be successful. Niche is important. Identify unique services or specialties that set your company apart from others. Begin by choosing between commercial or residential work.

3. Create a Business Name and Brand

Every general contractor needs a brand. Be consistent. Your brand should strike a chord with your target audience, evoking trust and reliability. Your website and company vehicles should have the same logo. Engage prospects and customers on social media. Watch your enterprise grow.

4. Write a Construction Company Business Plan

A solid and comprehensive business plan is essential for success in construction services. It serves multiple purposes: Outlining your overall business strategy, allowing you to monitor progress against key milestones, and assisting in securing funding, including specifics for equipment loans.

Importantly, it should also include a detailed analysis of your potential market size, giving you a clearer understanding of your target audience.

Below is a template along with practical tips tailored for small business owners in the construction industry:

• For the financial section . Labor expenses are big. Include projections for salaried and subcontracted employees. Factor in potential cost increases. Try to add some labor statistics.
• For the industry analysis . Examine local construction trends and demands. Add in key stats like new home sales if you can.
• For the marketing plan . Plan digital marketing strategies, including social media. One area to highlight is networking with the likes of home improvement stores. And local real estate companies.

5. Choose a Location

Choosing a location is easy if you’re opting for a home-based shop for your own construction business. Otherwise, here are a few things to consider for your spot:

• Does the site need to be modified? Who will pay for that? Are there changes required to meet energy efficiency standards for equipment? Evaluate local zoning laws and potential restrictions for construction businesses.
• Make concessions for future growth. Scalability is crucial when you start a construction company.
• Are you renting? Investigate potential tax incentives and financial advantages available for construction startups.
• Finally, compile a comprehensive must-have list, encompassing both current and future needs, to ensure you stay within your budget while accommodating for growth.”

6. Form a Business Entity and Register

Any new enterprise needs to become a legal entity. There are several to choose from . Personal liability is one of the big concerns for a business owner.

• A sole proprietor can find issues with liability.
• Partnerships need to define everything in writing.
• Corporations offer good protection.

Find out if you even need to register your new business.

7. Open a Business Bank Account

You need an Employer Identification Number (EIN) and a copy of your general contractor’s license. The EIN acts as federal Tax ID.

8. Look into Small Business Loans

Small Business Administration (SBA loans) are a great place to look for funding.

Other options include:

• Traditional banks and credit unions. Look for the best interest rates.
• A business cash advance.
• A line of credit

Factoring is another way to purchase materials and have a cash flow. Sell invoices to third parties.

9. Purchase the Necessary Construction Equipment

The construction industry is reliant on heavy-duty equipment. While it is nice to own the following equipment, you don’t have to when you start out. You can start by renting and move to ownership.

• Excavator Description: An excavator is a versatile heavy-duty machine used for digging, excavating, and lifting materials on construction sites. It comes with a bucket attached to a hydraulic arm for efficient earthmoving tasks.
• Backhoe Loader Description: A backhoe loader combines a loader (for loading materials) on the front and a backhoe (for digging) on the rear. It’s ideal for smaller projects and is commonly used for utility trenching and site preparation.
• Bulldozer Description: A bulldozer is a powerful machine equipped with a large, flat blade on the front, used for pushing and grading large quantities of soil, debris, and other materials on the construction site.
• Skid Steer Loader Description: A skid steer loader is a compact, maneuverable machine with a small turning radius. It’s used for various tasks, such as landscaping, material handling, and light demolition work.
• Crane Description: Cranes are essential for heavy lifting tasks, such as placing steel beams, concrete panels, and other materials at elevated heights on construction sites. Various types, like tower cranes and mobile cranes, are available.
• Concrete Mixer Description: A concrete mixer is used to combine cement, sand, water, and aggregates to produce concrete, which is crucial for building foundations, structures, and other components.
• Power Saw Description: Power saws, such as circular saws and reciprocating saws, are essential for cutting various materials, including wood, metal, and concrete, for construction and demolition tasks.
• Drill Machine Description: Drill machines are used for creating holes in different materials, such as wood, metal, and masonry. They are essential for fastening and joining components during construction.
• Jackhammer Description: Jackhammers, or demolition hammers, are powerful pneumatic tools used for breaking concrete, rock, and other hard surfaces during demolition and renovation work.
• Concrete Vibrator Description: Concrete vibrators are used to remove air bubbles and ensure proper compaction of freshly poured concrete, enhancing its strength and durability.
• Wheelbarrow Description: Wheelbarrows are simple but essential tools for transporting materials like soil, sand, and debris around the construction site, providing efficiency and convenience.
• Safety Gear Description: Safety gear, including hard hats, safety glasses, gloves, and high-visibility vests, is crucial to protect workers from potential hazards on the construction site.
• Measuring Tools (Tape Measure, Level) Description: Measuring tools like tape measures and levels are essential for ensuring accurate dimensions and alignment during construction and layout tasks.
• Hammer and Nails Description: Basic hand tools like hammers and nails are essential for various construction tasks, such as framing, carpentry, and general assembly work.
• Safety Barriers and Cones Description: Safety barriers and cones help to mark off hazardous areas, control traffic flow, and ensure the safety of workers and pedestrians on the construction site.

Having these essential tools and equipment will significantly enhance the efficiency and productivity of a new construction company and ensure smooth progress on various projects.

10. Create Your Own Construction Company Website

To start a construction outfit today, you need a website to attract potential customers. Many home inspection businesses provide good examples.

They include a separate page for each service. And testimonials.

11. Make Sure You Have the Licenses Required in Your State

State and local governments require different business licenses. Here are some general business license requirements by state. These cover specific licenses.

Each state is different. Insurance is important too and a reputable surety bond agent provides coverage for financial damages.

12. Get Your Taxes in Order

Paying business taxes is part of your new operation. Be mindful of federal and state payments and keep all documentation in order for tax purposes.A home inspector pays the following:

• Tax to the feds as independent business operators.
• That means a self-employment tax.

It’s important to keep all of your documentation because there are both federal and state payments.

13. Purchase Business Insurance

Insurance is crucial for construction companies. Here is a list of the insurance policies needed.

• General Liability Insurance. C overs claims for property and bodily injury.
• Vehicle Insurance: Prevent company closure. This covers vehicles used for work and employees who drive them.
• Workers Compensation Insurance. Occupational safety is important. These policies cover workers injured on the job. Mandatory in every state except Texas. Get more info on health administration here.
• State Disability Insurance: Another insurance that replaces lost wages. The contributions are tax-deductible.
• Unemployment Insurance. These programs are managed at the state level . There’s federal oversight.
• Property Insurance. Protects company property against theft and damage.

14. Sort Out Your Accounting Systems and Construction Software

Small business administration in construction needs to do several things. Accounting and software should work hand in hand. Look for billing reports, payroll and project budgets in one spot.

15. Hire Employees

If you plan to hire employees, ensure you have obtained an EIN. Post job openings in relevant places, such as social media, and consider offering apprenticeships to attract skilled workers. Stay updated on construction industry trends through industry publications.

Look in construction industry publications for advice on trends.

16. Market Your Business

A physical business card was the way to market years ago. Those still apply. But today’s marketing strategy for small businesses in construction needs to be digital too. The brand image needs to be the same on your website and social media accounts. The same logo applies to your trucks and front yard signs as well. Sharpen up your digital marketing skills with courses.

Develop a comprehensive marketing strategy that incorporates both traditional and digital methods. Maintain consistent branding across your website, social media accounts, and physical marketing materials like business cards.

Remember, whatever strategy you choose, keep your target customers in mind. Your business plan should have some details.

17. Network

Networking is vital in the construction industry. Take advantage of opportunities at trade shows, industry associations, and other events to connect with potential clients and industry peers. Building inspectors and construction owners need to network. There are good opportunities at trade shows and industry associations and companies such as ConstructReach .

The back of a business card is a good place to add some personal assets like updated contact info.

18. Bid for Contracts

Government contracts can be lucrative for construction startups. Prepare and submit well-structured documents covering project design and construction phases. Government contracts are golden for construction startups. Start here .

Submitting a document covering the design and construction phases is an early step.

19. Grow Your Construction Company

With the right approach and determination, your construction company can flourish. Focus on delivering quality work and making a positive impact on your community. Continuously evaluate your strategies and adapt to changing market demands.

How Much Does it Cost to Start a Construction Business?

The cost of starting a construction business depends on the size of the business, the type of construction work it does, and the location of the business. However, in general, it can cost anywhere from $5,000 to $100,000 or more to start a construction business. Most construction companies’ average startup costs  are $37, 390.

Here are some of the costs you can expect to incur when starting a construction business:

• Business licenses and permits:  You will need to obtain the necessary business licenses and permits from your local government. The cost of these licenses and permits can vary depending on the location of your business.
• Insurance:  You will need to purchase insurance to protect your business from liability claims. The cost of insurance can vary depending on the size of your business and the type of construction work you do.
• Equipment:  You will need to purchase equipment for your construction business. The cost of equipment can vary depending on the type of construction work you do.
• Vehicles:  If you plan on doing any traveling for your construction business, you will need to purchase vehicles. The cost of vehicles can vary depending on the size of your business and the type of vehicles you need.
• Marketing and advertising:  You will need to market and advertise your construction business to attract new clients. The cost of marketing and advertising can vary depending on the size of your business and the methods you use.
• Staffing:  If you plan on hiring employees, you will need to pay them wages and benefits. The cost of staffing can vary depending on the size of your business and the type of employees you need.

In addition to these costs, you will also need to factor in the cost of office space, office supplies, and other miscellaneous expenses. By carefully planning and budgeting, you can reduce the overall cost of starting your business.

More tips for lowering the cost of starting a construction business:

• Start small:  If you are just starting out, you may want to start small and grow your business gradually. This will help you to reduce your initial costs.
• Outsource:  If you can, you may want to outsource some of the tasks involved in starting a construction business. This can help you to save money on labor costs.
• Use your own equipment:  If you have any equipment that you can use for your construction business, you can save money on the cost of purchasing new equipment.
• Do your own marketing:  You can save money on marketing costs by doing your own marketing. This can be done by creating a website, using social media, and networking with other businesses in your industry.

How Profitable is a Construction Company?

The American construction industry was worth $1.36 trillion in 2020. The overall spending declined. But private construction grew. The profitability of a construction company depends on a number of factors, including the size of the company, the type of construction work it does, and the location of the company. However, in general, construction companies can be very profitable.

According to the Construction Industry Institute, the average profit margin for a construction company is 10%. However, some companies can achieve profit margins of up to 20% or more.

There are a number of factors that contribute to the profitability of a construction company. These include:

• The type of construction work:  Some types of construction work are more profitable than others. For example, commercial construction is typically more profitable than residential construction.
• The size of the company:  Larger construction companies typically have higher profit margins than smaller companies. This is because larger companies have more bargaining power with suppliers and can get better deals on materials and labor.
• The location of the company:  The location of a construction company can also affect its profitability. Companies that are located in areas with a high demand for construction work typically have higher profit margins.

Profitability can also be affected by a number of other factors, such as the company’s management team, its marketing strategy, and the overall economic climate. If you are considering starting a construction company, it is important to carefully consider all of these factors before making a decision.

Take a look at these tips to also increase the profitability of a construction company:

• Focus on high-margin projects:  As mentioned above, some types of construction work are more profitable than others. By focusing on high-margin projects, you can increase your overall profitability.
• Negotiate favorable contracts:  When negotiating contracts with clients, be sure to negotiate favorable terms. This includes getting the best possible price for your services and ensuring that you are not responsible for any unexpected costs.
• Manage your expenses carefully:  Construction companies can have high overhead costs. By carefully managing your expenses, you can reduce your costs and increase your profits.
• Build a strong reputation:  A strong reputation can help you attract new clients and increase your prices. Be sure to deliver high-quality work and provide excellent customer service.

By following these tips, you can increase the profitability of your construction company and build a successful business.

Remember that each step in starting a construction company requires careful consideration and planning. You can build a successful construction business by following these guidelines and staying dedicated to your goals.

FAQs about How to Start a Construction Company

What are the legal requirements to start a construction company.

To start a construction company, you’ll need to register your business, obtain necessary licenses and permits, and comply with local building regulations.

How do I secure funding for my construction business?

Funding options include personal savings, bank loans, investors, or partnerships. Prepare a comprehensive business plan to present to potential lenders or investors.

What types of insurance do I need for a construction company?

General liability insurance, workers’ compensation, and builder’s risk insurance are crucial to protect your business from potential risks and liabilities.

How do I build a strong team for my construction company?

Hire skilled workers, experienced project managers, and administrative staff. Focus on employee training, retention, and a positive work culture.

What equipment and tools do I need to start a construction company?

Essential equipment may include excavators, loaders, concrete mixers, power tools, safety gear, and vehicles for transportation.

How can I attract clients and win construction contracts?

Build a professional website, create a portfolio showcasing your past projects, network within the industry, and provide excellent customer service.

What safety measures should I implement on construction sites?

Develop and enforce safety protocols, conduct regular training, provide protective gear, and maintain a safe working environment.

Image: Depositphotos, Envato Elements

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CNH picks Iveco Group's Marx as new chief executive

(Reuters) -The holding company of Italy's Agnelli family has overseen a shakeup at the top of two of its major industrial groups, with Scott Wine quitting his post as CEO of farm and construction machinery group CNH to be replaced by Iveco boss Gerrit Marx.

The two companies said on Sunday Marx will replace Wine from July 1. Turin-based Iveco said it had appointed board member Olof Persson as its new CEO.

Iveco and CNH are both controlled by the Agnellis' Exor. Iveco Group's current market capitalisation amounts to around 3.4 billion euros ($3.6 billion), less than one fourth that of CNH.

A German national, Marx guided Iveco, the Italian bus and truck maker, through its spin-off from then parent CNH, which was finalised at the beginning of 2022, and through its first years as a stand-alone company.

Iveco shares doubled their value between November and the beginning of this month, before slightly correcting later in April.

By contrast, CNH shares lost more than 30% of their value since highs touched last year, when it cut its revenue forecast and announced a plan to reduce its workforce, citing softening demand for its farm machinery.

CNH said Wine was leaving the company to pursue other interests, and that the board had accepted his request to leave at the end of the current three-year business plan cycle.

Amid the Iveco spin-off, CNH has increasingly focused its business on precision agriculture, including with the acquisition of U.S. group Raven Industries in 2021.

CNH recently completed a plan to drop its New York and Milan double listing and focus on a U.S.-only listing set-up.

Marx had last month presented Iveco's new business plan targeting a 20% bump in revenue by 2028.

Persson, a 59 year old Swede, has covered in his career executive positions in several manufacturing companies, including CEO at Iveco's competitor Volvo Group.

He has been closely involved in the development of the group's recently presented business plan, Iveco said in its statement.

CNH also said its board had decided that its Investor Day scheduled for May 21 would be postponed to allow Marx to lead the company's planning and objectives for the next phase of its development

($1 = 0.9386 euros)

(Reporting by Akanksha Khushi in Bengaluru and Giulio Piovaccari in Milan; Editing by Frances Kerry and David Holmes)

CNH picks Iveco Group's Marx as new chief executive

• Medium Text

• Marx to take CNH position on July 1
• Olof Persson appointed as new Iveco CEO
• CNH postpones Investor Day scheduled on May 21
• Both companies controlled by Exor

The Reuters Daily Briefing newsletter provides all the news you need to start your day. Sign up here.

Reporting by Akanksha Khushi in Bengaluru and Giulio Piovaccari in Milan; Editing by Frances Kerry and David Holmes

Our Standards: The Thomson Reuters Trust Principles. New Tab , opens new tab

Super RTL, a children's television network belonging to Bertelsmann's RTL Group , has struck a deal to acquire Nickelodeon series in Germany, the group said in a statement on Tuesday.

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RTX beats estimates on military demand, aviation strength

Aerospace and defense major RTX on Tuesday beat first-quarter earnings estimates, helped by demand for missile defense systems and strength in the commercial aftermarket business.

Paintmaker Sherwin-Williams missed Wall Street estimates for first-quarter profit on Tuesday due to lower sales in North America, sending shares of the company nearly 5% lower in premarket trading.

Agnellis’ CNH Taps Iveco’s Gerrit Marx as New Chief Executive

By Shiyin Chen

CNH Industrial NV , the tractor and construction machinery maker controlled by Italy’s billionaire Agnelli family, appointed Gerrit Marx its new chief executive officer.

Marx is currently CEO of Iveco Group NV , which was spun off from CNH in 2022. He will rejoin CNH starting on July 1, according to statements from the companies. He replaces Scott Wine , who is stepping down at the end of the company’s current three-year business plan cycle to pursue other interests. Olof Persson, a current Iveco independent director, will become the company’s new CEO.

The departure of Marx from Iveco ...

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