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Construction Company Business Plan

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construction company business plan

The construction industry is broad and includes large and small projects. The types of jobs include building new residential and commercial structures, and doing various repairs and alterations to existing buildings. The construction company business plan will need to make it clear in the Executive Summary what type of construction business startup or expansion is involved. Many construction companies specialize, and that influences the type of vehicles and equipment needed. For example, a construction company working on high rise buildings needs very different equipment from one that does small remodels, interior and exterior painting, cabinets and so on. A company that installs and replaces windows needs specially fitted trucks for carrying panes of glass, while a cabinet builder needs a box van to carry cabinet units or sections. All of these issues, plus ones like the following, have to be fully explained in the business plan.

  • Geographic area that will be targeted, i.e. city, county, state or multi-state coverage

  • Licensing, bonding and insurance requirements

  • Customers targeted, i.e. residential, commercial, government projects, or any combination of the three

  • Legal form, i.e. limited liability, C corporation, sole proprietor, partnership, etc.

  • Assets needed, including vehicles, specialized construction equipment, tools

  • Specific services offered, i.e. carpentry, painting, cement, brick and stone work, plumbing, electrical, etc.

  • The design or architectural services included, and the people qualified to handle the services delivery

  • Employees, i.e. general construction workers, electricians, plumbers, sheetrockers, painters, etc.

  • Work that will be subcontracted and subcontractor agreements already in place

  • Market analysis and need for the business services

  • Reliable and affordable materials and supplies sources

  • Market segmentation and analysis by type of potential customers, i.e. office buildings, restaurants, houses, apartment buildings, etc.

  • Sales strategies


Requirements to the Construction Company Business Plan

In most states, general contractors must be licensed and bonded. The construction company business plan needs to explain the experience and credentials of the business owners, who are almost sure to be the general contractors. Some construction companies start with residential work and move into commercial projects once economies of scale are reached. Commercial projects often have a higher profit margin. Entering the commercial market might be a long-term goal of a new construction company or the initial target market. Since market entry for small contractors is fairly simple, the construction company business plan will have to differentiate itself from the competition. For example, perhaps the business will specialize in “green” construction projects that address environmental sustainability, or the contractor may be a certified LEED or Green Globes professional.

OGS Capital works with different types of construction companies requiring business plans. Consultants consult closely with the business owners to fully develop each section of the plan in a way that attracts desired investors. These sections include the Executive Summary, Company Description, Management, Marketing and Sales, Operational Plan and Financial Plan. The process begins by completing the online contact form.
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