The carpentry business requires a highly skilled trade, and it is best to spend some time learning from some experienced peers to perfect your craft. However, after a few years of working for someone else, you may feel the pull to start your own business and go at it alone. Taking the plunge involves a lot of work and planning, but being a small business owner can be incredibly rewarding.
As other tradespeople, you will be no stranger to hard work. The skill and expertise you have gained from working as a carpenter will provide you with the solid foundation needed to be a skilled professional. Still, you will need to learn some new skills to be a business owner. This article aims to provide you with a basic guide to starting your own carpentry business.
Write a Carpentry Business Plan
The first essential step to starting any business is writing a business plan. This task can be time-consuming, but it will help provide a solid foundation for business success. The business plan will need to contain your business goals and your plan to achieve them — along with more practical factors such as financing and marketing.
Although not everything will go as you may have wished, having a business plan in place will help you navigate problems when they crop up.
Finance Your Carpentry Business
One of the primary hurdles of starting a carpentry business is getting the money together so you can start trading. The amount of money you need will depend on your business structure. Are you going to be a self-employed contractor or a registered business? Have you set up goals in your business plan that involve a fully-fledged workshop or a commercial property?
You may be in a place where you have saved enough money to start your own company. However, for the majority, aspiring business owners will need to look into funding. Here are a couple of options that are popular with carpenters going into business if you do need to borrow money:
- Small Business Loan – Although it is possible to get a small business loan, you will need to do some serious research into these loans. It is probable in all borrowing routes that you will need to prove how you plan for your business to succeed. You will need to provide:
– A break-even analysis (how your business plans to break even before making a profit);
– A cash-flow forecast (how much money is moving in and out of business, and when); and
– A sales forecast (estimate of future revenue by estimating weekly, monthly, or yearly sales).
- Government Loan Scheme – The UK government often runs financial schemes to help new businesses. You will be able to check online to check if your business is eligible — it can be a good way to access funding. There are also some instances where it will not need repayment back. For example, the UK Start-Up Loan offers £500 to £25,000 to eligible applicants to start or grow their businesses.
- Private Investor – Another option is to approach an investor to fund the start-up costs. This could be a family, friend, or a private investment company. Be warned that mixing friends and family with business is stressful if there are any disagreements regarding the running of the company or debt repayments.
Purchase Equipment and Tools
Once you have the funding available, ensure you have the tools required to do the job. Owning your own tools might be one of the highest up-front costs when starting a carpentry business, but consider it an investment. You will need to make sure the tools you purchase are high quality and well looked after, so they last you for many years to come.
You will most likely need a work vehicle. too. This does not mean you have to run out and get the latest model with all bells and whistles. Instead, a modest, reliable vehicle is enough to start with — you just need to store your tools securely while on the move.
One of the good parts about purchasing your business-related tools and equipment is that you claim the tax back (including the vehicle).
Consider These Carpentry Business Responsibilities
Owning a carpentry business comes with many responsibilities. You are to do a good job, look after your employees, and stay on top of your financial obligations. There is also the need to comply with the regulations surrounding the carpentry and building industry. If you ignore the rules, you face fines and discontinuation of trading.
As a business owner, consider:
- What you must do to comply with health and safety regulations;
- How your business impacts the environment and how you plan to deal with it; and
- What the local laws around operating a business and employment laws are for any hired staff.
Government documents are complex and time-consuming to decipher what is relevant to your business or not. It is worth joining a professional trade association for carpenters and builders to help you become and remain compliant with the law.
Manage Your Carpentry Business
Once you have your business up and running, there is then the challenge of making a success of going at it alone. The day-to-day management of your company will take more than your carpentry skill and experience, as you need some business acumen too.
It may feel like there is too much to take on alone, so see if there are areas you can outsource. Then focus on what you are good at and enjoy doing. For example, one area is business accounting. An accountant completes your tax returns correctly and timely, ensures payment to employees via a payroll system, and keeps an eye on the books.
The Takeaway
For most tradespeople, the ambitions to start their own companies are the result of wanting more control and better lives. As the business owner, you choose which jobs you take on, how much to charge, and what hours to work. Then, with hard work and patience, you have a positive work-life balance and a lifestyle you strive to achieve.
