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We want nothing for the best for everyone in our industry. We invite you to learn more about becoming a contractor, how to get started, and what it means to excel in the industry. If you're a contractor working with historic homes, we'd love to work with you. We offer discounts priority service, and custom services packages. If you are a service professional interested in becoming a trade partner, please reach out and we'd be happy to talk!
If you are able to apply yourself to learning and apply dedication to picking up the tools of the industry, commercial contracting and construction may be for you. The life of a contractor can be tremendously rewarding, but it comes with great responsibility. Even if the project is a simple installation, maintenance job, repair, or service, the responsibility all falls on the contractor’s shoulders. While it's not necessarily easy to become a general contractor, the rewards are huge and the upside is that you become your own boss and can make a lucrative life for yourself.
These are the minimum requirements for becoming a contractor:
- Pass the contractor license exam
- Legally work in the United States
- Clean work record
- GED or high school diploma
- 4 years experience as a journeyman or higher in the last 10 years
General contractor licenses offer many opportunities. However, you need to have prior experience and knowledge. General contractors in the commercial sector have many years of industry experience, relevant licenses and certifications. Some also earn Bachelor's or Master's degrees to keep up with current industry knowledge.
Owners of plumbing, HVAC and electrical specialty contractors may want to start their own general contractor businesses. However, they must be aware of what it takes to grow a general contractor business.
You will want to find out if your state requires you to have a contractor's license. These rules will help you understand the requirements for your state's license. The work you are interested in doing can affect the type of contractor license that you need.
Contractor license exams require knowledge of construction law and business management. Be aware that exam topics can vary from one state to the next. Most contractor licensing exams cover everything from general engineering and building to more specialized topics such as electrical, fire protection and water conditioning.
Noting that licensing requirements may differ between the local and state levels is important. While the state may not require a license for certain activities, cities and municipalities may require one. It's possible to work with no contractors license—however, it is not recommended. Companies may not be willing to work with you if you don't have a valid license.
Modern construction projects can be large and complex. They require extensive planning. Project scope and direction can be affected by changes to engineering and architectural plans, financial adjustments, or legal requirements. The changes that are made and their impact on revenue and budgets must be understood by the contractor.
It is your job to keep up-to-date with the latest trends and information in the construction industry. You will be able to adapt and pivot to help your business survive. Business insight can also be gained by learning functional skills in engineering, project management, and accounting.
As a GC, you must be able to manage a business, as the day-to-day management of the business is done by the owner. This includes but is not limited to overseeing:
- Personal in the office
- Field technicians
- Relationships between client and customer
- Compliance with federal and local regulations
- Monitor financials
And, there is another set of skills that you will need:
- Compliance with building regulations
- Bidding for projects
- Budgets and financial management
- Management of high-value client relationships
- Management of subcontractor
These skills can be acquired on the job, but you will also need to have business management knowledge in order to create strategies for growing and scaling your business.
You will need to prepare your business plan before you can start your general contractor company. Your business plan is your roadmap and guideline for your business. How to structure your business is the first step.
First, it is important to ask which type of business entity you want:
- S Corporation
- C Corporation
- Limited Liability Company (LLC)
Next, you’ll want to determine which type of contracts are you willing to accept, such as:
Finally, you’ll want to start brainstorming where you will find customers. Some ideas are:
- Social media
The costs of your business plan should also be considered. These include expected revenue, initial start-up costs, and balancing costs. Your business plan can be used by the bank to determine your eligibility for a loan. While you’re at it, consider technology that can help you optimize your day-to-day operations. For example, cloud-based software, project management software, or databases. A good idea is also safety checklists as well as digital task management. Invest early in a cloud-based project management platform and field service management platform. It will centralize your business and make it easier to digitize. Your techs will also be able accept more payment options through a mobile app connected to the internet.
You will require business insurance to protect yourself, your employees and any subcontractors once you have obtained the license and certificates. You may also need worker's compensation depending on where you live. Workers' compensation protects employees and subcontractors who are injured while on the job. Business insurance covers you against claims, damages and lawsuits.
You will require surety bonds (also known as contractor license bonds). These bonds are similar to insurance and can be given to clients to prove that you have completed the job according to plan or to get their money back. In most states, general contractor license bonds are required.
To ensure a safe work environment, it is important to follow all safety regulations of the Occupational Safety and Health Administration. As an employer, you must comply with all OSHA standards. You should establish business-level safety standards that all employees follow, regardless of any local or federal regulations. Use a safety checklist if you are going to offer HVAC service.
Once you have completed all licensing and insurance requirements, you are ready to start looking for clients. You shouldn't expect to bid for large industrial or government contracts. This is because you don't have the experience or reputation for these projects.
You will need to grow your customer base, complete jobs and establish a positive reputation as a general contractor. Begin with smaller jobs and reach out to existing relationships and networks.
For those looking for jobs or projects early on, old colleagues, former employers and friends are great resources. These projects can improve your company's reputation, and help you get more referrals and recommendations.
You may want to eventually hire more staff to support your growing business. Your office staff will play an important role in tracking jobs, technicians, finances, and other details. Because they can help you take on more work, field technicians are key to your growth.
Although general contracting is a highly lucrative career, you may not be looking to manage multiple departments or deal with all levels of construction and service.
For those looking for flexibility and freedom while still being able to own their business, subcontracting is an excellent option. Subcontractors will be skilled in sub-industry services like mechanical, plumbing, and HVAC.
A general contractor might hire subcontractors to help with projects that are more time-consuming than the general contractor, or require additional skills. A subcontractor may form a partnership with the general contractor over time.
Subcontractors will still need to set rates, build their own businesses, but they can now focus on scaling. Software will be needed to organize dispatch technicians, customers, quotes, and invoices. It is important to adopt a field service management software platform as soon as possible in order to improve workflows throughout the company and optimize:
- Customer management
- Management of projects and jobs
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