A home renovation business works with existing properties to repurpose or redesign their structure, architecture, function, or design. There are many types of renovations, from single rooms to entire homes. Like other construction ventures, home renovation is in high demand, particularly with real estate investors and new homeowners. Home renovation isn’t easy work; it requires a lot of manual labor, planning, permits, and teamwork. You’ll need to follow the proper procedures to ensure your prospective renovation business can get off the ground successfully.
1. Start a Business Plan
A business plan solidifies your company’s goals, purpose, ideas, and operation policies. If you haven’t figured out how your renovation business will operate, now is the time. A business plan will identify your company size in terms of employee count and locations, your financial goals, who your ideal client base is, and the types of renovations you’ll get. As the business’s owner, what is your role in the company? Will you also be renovating, or will you oversee all operations without fieldwork? It’s up to you, but consulting with business partners, investors, and financial advisors can help create a solid and successful vision. Marketing plans, executive summaries, lists of services, and market analyses are all part of an ideal, thorough business plan.
2. Plan Your Budget
Starting your home renovation business will cost a lot of money. You’ll need equipment, employees, marketing, a physical location or office, utilities, internet service, tools, and more. These costs will be in addition to your expenses, as your business won’t be profitable yet. Starting a budget is a great way to calculate finances for your business. Subtract your potential costs from your total income. You can see how much money you’ll need to start your business and how much will come from external sources such as loans, grants, or investors. Before taking out loans, look into business startup grants from your local government or investment funds from friends, family, or potential business partners.
3. Create an Online Presence
It’s tough for any business, including renovation, to be successful without adapting to the modern world. Creating an online presence allows more people to locate, research, and review your business. Create social media profiles for your business where applicable. Renovation businesses can provide home renovation tips and videos on social media platforms like Instagram, X (Twitter), TikTok, and YouTube. More importantly, creating a website for your business so potential customers can find out more about you and submit inquiries is ideal. Your website should be simple but attractive. Creating a Google Business Profile will allow people to see your website, physical location, phone number, photos, reviews, and more. These factors contribute to a thorough online presence that can grow your client base.
4. Register Your Business
To legitimize and file taxes with your business, you must register it with your local and federal government. You will choose a name and a business structure (LLC, corporation, sole proprietorship, etc.) You’ll also need to receive an employer identification number (EIN) for financial purposes. You will provide documentation about the owner, address, and business plan to register it. You will need business registration information to obtain essential credentials like licenses, so keep all copies of paperwork for multiple purposes (including for yourself and other partners).
5. Obtain Licenses
You need a business license in most states to operate a commercial venture. You also may need building permits depending on the type of renovation you cover. Additionally, since renovation is a part of the construction industry, you or any relevant employees will need a general contractor license. Plumbers, electricians, and HVAC technicians will need additional licensing if applicable. Securing a license is a relatively straightforward process, and it typically involves providing business registration documentation, proof of insurance, passing an exam, and paying licensing fees. However, where you live will significantly determine licensing laws and requirements. Below are some examples of state policies for contracting licenses. Here is related information on 3 key states, for example.
Oregon
In Oregon, you must hold a general contractor license to perform any type of commercial construction on a property, and this can include renovations. Oregon contractor license requirements involve a mandatory pre-licensing course and state exam, so preparation and studying are essential.
Florida
In Florida, contractor license eligibility relies on credit checks in addition to passing an exam. You’ll also need fingerprinting, proof of liability insurance, and worker’s compensation. Once you obtain a general contractor license, you can get specialty licenses, such as plumbing or electric.
California
You need proof of four years of work experience in California to obtain a contractor license. You’ll also need to pass a two-part state exam. Many applicants will utilize pre-licensing training and exam preparation courses to ensure they only have to take this lengthy exam once. You can get your license after paying licensing fees and submitting the proper paperwork.
Conclusion
There are many steps and factors to starting a home renovation business. These companies are in high demand but require hard work and determination for success. Before opening your doors, you will need to create a business plan, register your business, get licensed, and budget for your startup. Creating an online presence can also boost your brand identity and improve your chances of success.
