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We know owning a business isn’t for everyone. Many people prefer working for others and enjoying a steady income, a stable routine, paid vacations, and other perks. For others, though, entrepreneurship is irresistible, and you might be one of them. If you started your own contractor business, you’d be your own boss, employ a talented team, and help your community to prosper.
Of course, running any business is a great challenge. Here’s some advice to increase your odds of success and longevity.
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1. Arrange Financing
To begin, get your financing lined up. You’ll need enough money to cover several months of living expenses. After all, it could be a while before clients start paying you.
You’ll also need equipment and other materials. Plus, you might want enough cash to hire a few employees, obtain an office and storage facilities, and to advertise your new business.
Thus, compile a list of your contractor business’s first-year expenses. Next, figure out how much you have saved. Also, how much collateral could you offer a financial institution? With the right assets, you could secure business loans.
Alternatively, you might find investors. You could attend local networking events. You could utilize online fundraising websites. And you might even ask your friends, relatives, and colleagues for investments.
Attracting investors often requires a business plan. You can find templates online. In this detailed document, you’ll describe your services, assets, financial requirements, expansion proposals, and more.
2. Rely on Marketing Plans
Your first few contractor clients may come from your personal network of family and friends. If you’ve worked in contracting before, some of your past customers might also hire you.
However, to keep growing, it helps to rely on a marketing plan. This document will give you a timetable for your social media ads, radio and TV commercials, and website strategies.
Always have new marketing goals in mind. For example, within six months, you might want to boost your customer base or your website views by 25%. Then, once you reach that goal, immediately set a new one. And keep adjusting your marketing plans to meet your new objectives.
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3. Make It Legal
With your plans in place, you can make your company official.
At this point, it’s wise to consult with an attorney. That person could help you decide between making your business a sole proprietorship or incorporating it.
Incorporating means separating your personal assets from your company’s assets. Incorporated companies are typically eligible for more tax breaks, while sole proprietorships are generally easier to manage.
From there, you can finalize your company’s name and register it.
Your lawyer can also let you know what types of insurance you need. Take those policies out right away.
With those formalities out of the way, you can finally launch your business.
After you have completed all legal requirements, you can go to your state’s franchise tax board or state comptroller to apply for a business license and follow your state’s contractor license requirements. This is a different license than your contractor’s, but you will need to enter your general contractor license number when you register in your state.
4. Strike a Work-Life Balance
As an independent contractor, it’s vital to find a middle ground between multitasking and overextending yourself.
On one hand, you should expect to wear multiple professional hats. For example, you’ll probably be handling your hiring and marketing yourself. And, most likely, you’ll be doing some of the labor as well.
Furthermore, accountants can be expensive. But, with a software program like FreshBooks, you could do your own invoicing and financial recordkeeping. You might even prepare your own tax returns, too.
On the other hand, don’t take on too many responsibilities. You could easily overwork yourself. In that case, your family time and social life would suffer. And the quality of your work could decline.
Therefore, look for business tasks that you could outsource to freelancers — web design, to name one.
5. Focus on Customer Satisfaction
For as long as you own a business, you should make impressing your customers your top priority.
Always be patient, polite, and friendly on the job. Answer all of your clients’ questions fully and thoughtfully. Dress professionally, and watch your language. Naturally, for every assignment, you and your team members should show up on time, take minimal breaks, and work hard, effectively, and efficiently.
In addition, respond promptly to all of your phone calls, texts, social media messages, and emails. Yes, answering inquiries often feels like a full-time job in itself.
Will you meet with clients and potential clients in person? If so, your contractor office — even if it’s a home office — should be clean, tidy, quiet, comfortable, and professional in its decor.
Always be honest. If you or your employees make errors, own up to them, apologize for them, and compensate your customers for them.
Never take on more projects than you know you can manage. And don’t overpromise. Instead, make your timelines and price quotes as accurate as you can.
Especially important, grow your staff slowly. Only hire people with excellent resumes and references. Conduct exhaustive background checks, and make sure that all of your employees have the right training, skills, and knowledge. Your business is only as good as your hires.
Are you positive you can handle the heavy workload, the hectic schedule, and the occasional uncertainty of entrepreneurship? If so, the pride, joy, and adventure of creating a contracting company could soon be yours.
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