On the face of it, construction companies seem like extremely easy-to-run enterprises. After all, you will see dozens of local construction companies in your area, all of which never seem to struggle to find work. People and businesses need construction work done at all times; it’s a service that will never ever go out of fashion. 

 

Not only that, but running the company is a simple case of managing some employees and building stuff. It’s fairly straightforward, and there’s not a great deal of difficulty to it…right? 

 

Wrong. Running a construction business is harder than you think, so don’t do it as an ‘easy’ business idea. Often, some of the biggest concerns and drawbacks are hidden, so let’s reveal them in this post!

 

Marketing

 

Marketing a construction business is tough because you’re running a business that blends the B2B and B2C markets. You will do work for businesses, but you’ll also do work for regular people and their properties. As such, you have to develop separate marketing strategies that attract both types of customers. It can be hard to market a construction business in the first place, seeing as you’re quite a niche business. There’s also the worry that you do a good job of generating one type of client, but not the other. As a result, your marketing strategy can often go over budget without generating good enough returns. 

 

Bids & Bonds

 

Unless you’ve been in the construction industry before, you will be surprised to learn how many companies earn contracts – particularly for certain projects. There’s a whole process that involves bidding for contracts and securing performance bonds. It can all take absolutely ages, and there’s never a guarantee that you’ll win the contract. So, you can waste time and money bidding on projects without getting anything to show for it. Granted, there are programs like FastBond that try to speed everything up and increase your chances of success. However, it’s still something that stresses out a lot of construction companies. As a result, many stick to residential projects, but this means they miss out on big projects where all the money lies. 

 

Equipment Costs

 

Lastly, running a manufacturing company can come with so many costs and expenses. You have to use a lot of equipment, and this doesn’t come cheap. It leaves you in the tricky situation of a) finding affordable and good equipment, and b) deciding whether to rent or buy the stuff. Renting equipment makes sense when it’s something you’re unlikely to use all the time. Buying equipment is a good idea if it’s something you are bound to use again and again. For example, all of the general power tools you might use on every project. Still, trying to decide when to rent and when to buy – combined with keeping the overall equipment costs as low as possible – can be a juggling act that many find incredibly difficult. 

 

This post isn’t meant as a way of dissuading you from starting a business. More accurately, it’s designed to shine a light on some of the drawbacks and issues you might face when running a construction company. As a result, you won’t start this business thinking that everything is simple, and you’ll be more prepared for what’s to come.