7 Excellent Construction Business Ideas to Start with Limited Investment in 2020

Construction is a booming business.  Because of high profit margins and a booming economy, it’s one of the best businesses to get into.

The contracts are higher than average, and there is always construction going on.  Here’s the thing, not everyone wants to be laboring and working hard in the field.

Luckily, the most successful people in the construction industry are in the office, not in the field.  Most people don’t know that more than half of the work in a construction project is administrative in nature. 

I’ve gathered 7 simple startup ideas in the construction world to give you some inspiration and I’m even going to give you some over-the-shoulder instructions on how you can get started in each of them.

Let’s dive in.

1. Online Bookkeeping for Construction

In case you haven’t noticed, everything you’ve ever known is going digital, and that includes bookkeeping.  Being a bookkeeper doesn’t mean you need to be a licensed CPA.

Many construction companies have in-house employees that manage their Quickbooks, invoices, shipping receipts, payments, payments to suppliers and employees, etc.  There are companies popping up offering accounting-related services to contractors.

Why is this successful?  Because contractors are busy people.  And they don’t have the knowledge or expertise to do their own paperwork sometimes.

Every business has finances and tedious tasks to manage, so your number of potential clients is enormous.

This is mainly for people with accounting experience who want to start their own company and generate some potentially serious revenue. Your task would be like any other bookkeeper, keeping track of transactions, setting up appointments, that sort of thing.

The best part? There is some amazing accounting software out there to help you systemize your work so you don’t need books piling all over your home office, and so you can even outsource much of the work required.

No matter how good the accounting software is, there is a need for humans to personally interpret the data and help the client make data-driven decisions for their business.

Startup costs would be around $1,500, and that includes certification, the website, business licenses, etc.

The ICB's certification on bookkeeping should get you up to speed on most of what you need to know, so all that's left is to form the business model and find construction companies in need of your services.

2. Account Manager/Salesperson for Construction Companies

Most construction companies struggle with lead generation and relationship-building.  It’s not due to lack of ability, it’s mostly due to lack of time of the owner.

As construction companies grow, it becomes necessary to hire sales people and give them territories to manage.  It’s a low overhead because sales people can be paid on commission.  A good sales person loves the idea of commission because the harder they work, the more money they make.  It’s a great motivator.

You can even be an independent contractor and sell for multiple companies.  The trick is for the different companies to be in different sectors and not be competitors.

Most companies will have their sales department that gets leads, build relationships, and them submits those projects to their estimating department to calculate those costs.  Savvy construction companies will use a combination of in-house estimators, along with companies that provide estimation services to help with the overflow.

Construction projects are won in the follow-up.  Most contractors submit their pricing and bids and then forget about the project.  Having a dedicated account manager to follow up and review is invaluable for a company looking to grow.

The exact strategy to obtain leads varies, you can cold call contractors and ask to get on their bid lists, you can set up their paid ads, it’s all up to you.

Tons of contractors would pay hundreds, even thousands of dollars a month to have a service like this giving them business.

So how would you even get this business model off the ground?

Allow me to draw a map for you.

Firstly, you need to get better at sales, a lot better.

Chances are if you’re reading this article, you’re already motivated to start something and that’s perfect, but you will need to improve your sales skills as the priority.

Why is it so important? Let me explain.

The underlying goal of any marketing campaign is to create a relationship between the seller and the buyer, so if you’re going to be doing that consistently and successfully you need to be a great communicator not just with the leads you’re getting, but with your clients themselves.

After you’ve built up your sales skills it’s time to start taking action.

You should treat yourself like your first client because if you think about it, you’re just like your future clients. You need leads for your business.

There’s a whole list of ways you can start getting leads so I’ll give you a few.

-       Cold call people and offer services

-       Social Media Ads

-       Go to construction company offices and give sales pitch to decision makers

If you already have some valuable connections you have a head start but if you don’t, you’re going to have to be a go-getter and hunt for your first clients.

Once you get your clients all that’s left is to complete your service and manage your business.

3. Construction Manager/Owner’s Representative

Construction is a surprisingly complex industry, with so much to it that it's actually impressive to meet someone who understands a lot about the systems and whatnot.

So, if it takes contractors years of experience and hard work to get a feel for their work, how could you expect a rookie homeowner to know exactly what's going on at all times?

You can't.

Some homeowners unfortunately know all too well how frustrating it can be to work with contractors who are taking too long or don't do something correctly.

And some contractors know how difficult it is to manage their clients when they have a million other things on their minds at all times.

This dilemma is why the concept of the construction manager exists.

The job of the construction broker is to be the middleman between the business owner and the contractor, representing the clients’ interests to the contractor and the same vice versa.

This role on residential jobs has a huge effect on the efficiency of the project, and that reflects itself on the commissions you would make as the construction broker on projects.

To get started here you definitely either need to set up a system of leads to acquire clients in the early stages of preconstruction.  This could be before they purchase a property.  You can develop relationships with Commercial and Residential Realtors so they can provide you with those leads. 

Of course, if you offer a finder’s fee, they will be much more motivated to recommend you over someone else.

4. Painting Contractor

Painting contractors are very common for the simple reason that it’s such an “easy” trade to master. So, there’s a ton of competition out there.

But if you have a good business strategy you will find success here.

Fortunately, we already have a strategy that’s been years in the making, and it’s what we teach our clients every day.

Create system of leads to fuel business

This is the part where you’re going to have to be a go-getter.

This is also the part where you’d hire a lead generator. (see Lead Generator above)

But here you’re going to pay the big guys (iSqFt, BlueBook) and get access to projects happening right now in your city and then visit potential clients in person to start building up those relationships.

For more info be sure to click the link above and check out the section we have on this.

Bid at lightning speed and bid more jobs

Winning bids comes down to 2 things:

-   The owner’s financials

-    Your perceived value in relation to your competition.

So, the goal here is to align those in your future company, and it starts with picking the best leads in a huge crowd of “timewasters”. We have the full list of people to avoid and people to go after in the link above.

Once you have the details on financials of good leads, it’s time to estimate them quickly and start bidding.

Supercharge your closing rates and get lifetime clients

The idea here is to build on the relationships already formed in steps 1-2 and follow up consistently.

This network of connections leads you to referrals, and repeat business.

Summing it up, if you apply this strategy to your painting contracting business you will see success.

5. Equipment Rental Agency

Have you ever wondered how often construction companies use equipment?

Probably not, but just know, it’s a lot of time.

Who’s giving them the vehicles and resources they need to do their work?

If construction companies were to rent out your 80 hp bulldozer for example, you would get an estimated $600 per rental period (4 hours).

This is an example of how much a bulldozer would cost so if my math is correct, it would take you about 56 rental periods until you start seeing profit.

You can do this with other equipment as well like concrete saws, scaffolding, even hard hats.

This a great potential business to start and is relatively more passive than the others on this list.

6. Local Business Consulting

This is mainly for people who already have a lot of construction experience under their belt.

Let’s be honest, most construction companies are hustling and thinking about tomorrow or next week, instead of next year.

There’s a huge lack of business strategy in the construction industry, and that’s where you would come in.

As a local business consultant your job is to help construction companies make their strategies and give them a direction to work towards. That’s it.

You’re the undercover CEO.

Of course, no one is going to pay hundreds of dollars an hour for someone who isn’t going to give them results almost guaranteed.

So that’s why this is only for people with a lot of construction expertise and are willing to share to people who want to grow their companies.

7. Property Manager

Real estate investing is one of the most well-known and effective business ideas, but there are businesses within that huge industry.

When rental properties have issues, the tenant usually calls the landlord for assistance and then he/she has to go through the trouble of dealing with leaky toilets, broken doors, or whatever the issue might be.

OR, the real estate investor can hire a property manager to take it off their hands.

When dealing with lots of properties, real estate moguls need to outsource the workload of managing them, so this business idea has a lot of potential.

Just one or two clients with decent portfolios to manage can get this business started.

Conclusion 

There is an almost ridiculous amount of abundance in the market right now.

I hope this article gave you some inspiration and great ideas to start running with and be sure to reach out to us if you want to outsource your estimating and start growing your construction company.