Starting a concrete business can be very profitable. With proper planning, execution and hard work, you can enjoy great success. Below you will learn the keys to launching a successful concrete business.
Importantly, a critical step in starting a concrete business is to complete your business plan. To help you out, you should download Growthink’s Ultimate Business Plan Template here.
14 Steps To Start a Concrete Business:
- Choose the Name for Your Concrete Business
- Develop Your Concrete Business Plan
- Choose the Legal Structure for Your Concrete Business
- Secure Startup Funding for Your Concrete Business (If Needed)
- Secure a Location for Your Business
- Register Your Concrete Business with the IRS
- Open a Business Bank Account
- Get a Business Credit Card
- Get the Required Business Licenses and Permits
- Get Business Insurance for Your Concrete Business
- Buy or Lease the Right Concrete Business Equipment
- Develop Your Concrete Business Marketing Materials
- Purchase and Setup the Software Needed to Run Your Concrete Business
- Open for Business
1. Choose the Name for Your Concrete Business
The first step to starting a concrete business is to choose your business’ name.
This is a very important choice since your company name is your brand and will last for the lifetime of your business. Ideally you choose a name that is meaningful and memorable. Here are some tips for choosing a name for your own concrete business:
- Make sure the name is available. Check your desired name against trademark databases and your state’s list of registered business names to see if it’s available. Also check to see if a suitable domain name is available.
- Keep it simple. The best names are usually ones that are easy to remember, pronounce and spell.
- Think about marketing. Come up with a name that reflects the desired brand and/or focus of your concrete business.
2. Develop Your Concrete Business Plan
One of the most important steps in starting a concrete company is to develop your business plan. The process of creating your plan ensures that you fully understand your market and your business strategy. The plan also provides you with a roadmap to follow and if needed, to present to funding sources to raise capital for your business.
Your business plan should include the following sections:
- Executive Summary – this section should summarize your entire business plan so readers can quickly understand the key details of your concrete business.
- Company Overview – this section tells the reader about the history of your concrete business and what type of concrete business you operate. For example, are you a concrete pumping, concrete cutting, concrete grinding, shotcrete, or a precast concrete business?
- Industry Analysis – here you will document key information about the concrete industry. Conduct market research and document how big the industry is and what trends are affecting it.
- Customer Analysis – in this section, you will document who your ideal or target market are and their demographics. For example, how old are they? Where do they live? What do they find important when purchasing products or services like the ones you will offer?
- Competitive Analysis – here you will document the key direct and indirect competitors you will face and how you will build competitive advantage.
- Marketing Plan – your marketing plan should address the 4Ps: Product, Price, Promotions and Place.
- Product: Determine and document what products/services you will offer
- Prices: Document the prices of your products/services
- Place: Where will your business be located and how will that location help you increase sales?
- Promotions: What promotional methods will you use to attract customers to your concrete business? For example, you might decide to use pay-per-click advertising, public relations, search engine optimization and/or social media marketing.
- Operations Plan – here you will determine the key processes you will need to run your day-to-day operations. You will also determine your staffing needs. Finally, in this section of your plan, you will create a projected growth timeline showing the milestones you hope to achieve in the coming years.
- Management Team – this section details the background of your company’s management team.
- Financial Plan – finally, the financial plan answers questions including the following:
- What start-up costs will you incur?
- How will your concrete business make money?
- What are your projected sales and expenses for the next five years?
- Do you need to raise funding to launch your business?
3. Choose the Legal Structure for Your Concrete Business
Next you need to choose a legal business structure for your new concrete business and register it and your business name with the Secretary of State in each state where you operate your business.
Below are the five most common legal structures:
1) Sole proprietorship
A sole proprietorship is a business entity in which the new business owner and the business are the same legal person. The owner of a sole proprietorship is responsible for all debts and obligations of the business. There are no formalities required to establish a sole proprietorship, and it is easy to set up and operate. The main advantage of a sole proprietorship is that it is simple and inexpensive to establish. The main disadvantage is that the owner is liable for all debts and obligations of the business.
A partnership is a legal structure that is popular among small businesses. It is an agreement between two or more people who want to start a concrete business together. The partners share in the profits and losses of the business.
The advantages of a partnership are that it is easy to set up, and the partners share in the profits and losses of the business. The disadvantages of a partnership are that the partners are jointly liable for the debts of the business, and disagreements between partners can be difficult to resolve.
3) Limited Liability Company (LLC)
A limited liability company, or LLC, is a type of business entity that provides limited liability to its owners. This means that the owners of an LLC are not personally responsible for the debts and liabilities of the business. The advantages of an LLC for a concrete business include flexibility in management, pass-through taxation (avoids double taxation as explained below), and limited personal liability. The disadvantages of an LLC include lack of availability in some states and self-employment taxes.
4) C Corporation
A C Corporation is a business entity that is separate from its owners. It has its own tax ID and can have shareholders. The main advantage of a C Corporation for a concrete business is that it offers limited liability to its owners. This means that the owners are not personally responsible for the debts and liabilities of the business. The disadvantage is that C Corporations are subject to double taxation. This means that the corporation pays taxes on its profits, and the shareholders also pay taxes on their dividends.
5) S Corporation
An S Corporation is a type of corporation that provides its owners with limited liability protection and allows them to pass their business income through to their personal income tax returns, thus avoiding double taxation. There are several limitations on S Corporations including the number of shareholders they can have among others.
Once you register your concrete business, your state will send you your official “Articles of Incorporation.” You will need this among other documentation when establishing your banking account (see below). We recommend that you consult an attorney in determining which legal structure is best suited for your company.
4. Secure Startup Funding for Your Concrete Business (If Needed)
In developing your concrete business plan, you might have determined that you need to raise funding to launch your new business.
If so, the main sources of funding for a concrete business to consider are personal savings, family and friends, credit card financing, bank loans, crowdfunding and angel investors. Angel investors are individuals who provide capital to early-stage businesses. Angel investors typically will invest in a concrete business that they believe has high potential for growth.
5. Secure a Location for Your Business
When choosing a location for your concrete business, you’ll want to consider a few things. First, you’ll need to find a place with enough room to store supplies and equipment. You’ll also want to choose a location that is close to your customers, so that you can easily deliver concrete products. Finally, you’ll need to find a place that is affordable with good infrastructure.
6. Register Your Concrete Business with the IRS
Next, you need to register your business with the Internal Revenue Service (IRS) which will result in the IRS issuing you an Employer Identification Number (EIN).
Most banks will require you to have an EIN in order to open up an account. In addition, in order to hire employees, you will need an EIN since that is how the IRS tracks your payroll tax payments.
Note that if you are a sole proprietor without employees, you generally do not need to get an EIN. Rather, you would use your social security number (instead of your EIN) as your taxpayer identification number.
7. Open a Business Bank Account
It is important to establish a bank account in your concrete business’ name. This process is fairly simple and involves the following steps:
- Identify and contact the bank you want to use
- Gather and present the required documents (generally include your company’s Articles of Incorporation, driver’s license or passport, and proof of address)
- Complete the bank’s application form and provide all relevant information
- Meet with a banker to discuss your business needs and establish a relationship with them
8. Get a Business Credit Card
You should get a business credit card for your concrete business to help you separate personal and business expenses.
You can either apply for a business credit card through your bank or apply for one through a credit card company.
When you’re applying for a business credit card, you’ll need to provide some information about your business. This includes the name of your business, the address of your business, and the type of business you’re running. You’ll also need to provide some information about yourself, including your name, Social Security number, and date of birth.
Once you’ve been approved for a business credit card, you’ll be able to use it to make purchases for your business. You can also use it to build your credit history which could be very important in securing loans and getting credit lines for your business in the future.
9. Get the Required Business Licenses and Permits
To start a concrete business, you will need a business license and a permit to operate. You will also need to meet any other requirements that your state or municipality may have. For more information, contact your local licensing or permitting agency.
10. Get Business Insurance for Your Concrete Business
The type of insurance you need to operate a concrete will depend on the type of business.
Some business insurance policies you should consider for your concrete business include:
- General liability insurance: This covers accidents and injuries that occur on your property. It also covers damages caused by your employees or products.
- Auto insurance: If a vehicle is used in your business, this type of insurance will cover if a vehicle is damaged or stolen.
- Workers’ compensation insurance: If you have employees, this type of policy works with your general liability policy to protect against workplace injuries and accidents. It also covers medical expenses and lost wages.
- Commercial property insurance: This covers damage to your property caused by fire, theft, or vandalism.
- Business interruption insurance: This covers lost income and expenses if your business is forced to close due to a covered event.
- Professional liability insurance: This protects your business against claims of professional negligence.
Find an insurance agent, tell them about your business and its needs, and they will recommend policies that fit those needs.
11. Buy or Lease the Right Concrete Business Equipment
To start a concrete business, you’ll need a few essential pieces of equipment. A mixer is necessary to blend the cement, sand, and water together. You’ll also need a wheelbarrow or a concrete truck to pour the concrete mixture into molds. Finally, you’ll need a saw to cut the concrete products to size.
Additional equipment that can be helpful includes a trowel for smoothing the concrete, a broom for cleaning up, and a wet saw for cutting precise angles. With the right equipment, you’ll be able to produce high-quality concrete products for your customers.
12. Develop Your Concrete Business Marketing Materials
Marketing materials will be required to attract and retain customers to your concrete business.
The key marketing materials you will need are as follows:
- Logo: Spend some time developing a good logo for your concrete business. Your logo will be printed on company stationery, business cards, marketing materials and so forth. The right logo can increase customer trust and awareness of your brand.
- Website: Likewise, a professional concrete business website provides potential customers with information about the products and/or services you offer, your company’s history, and contact information. Importantly, remember that the look and feel of your website will affect how customers perceive you.
- Social Media Accounts: establish social media accounts in your company’s name. Accounts on Facebook, Twitter, LinkedIn and/or other social media networks will help customers and others find and interact with your concrete business.
13. Purchase and Setup the Software Needed to Run Your Concrete Business
You’ll need some essential software to run your concrete business. You may want to invest in some concrete estimating software to help you calculate your material and labor costs, as well as some construction project management software to help you keep track of your projects and customers. There are several software packages available for concrete businesses, so do some research on the different options to find the one that will suit your needs.
14. Open for Business
You are now ready to open your concrete business. If you followed the steps above, you should be in a great position to build a successful business and know everything you need about how to start a concrete company. Below are answers to frequently asked questions that might further help you.
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How to Start a Concrete Business FAQs
Is it hard to start a concrete business?
There is no one-size-fits-all answer to this question, as the ease or difficulty of starting a concrete business will vary depending on your skills, experience, and resources.
However, if you follow the steps above, you should be able to start your concrete business without too much difficulty.
How can I start a concrete business with no experience?
There are a few ways to start a concrete business with no experience. One way is to find a business partner familiar with the industry to help you. Another way is to attend workshops and seminars to learn about what's involved in starting your own concrete business. Finally, research online to find helpful information on starting a concrete company. Regardless of how you gain the knowledge, it is important that you are passionate about this type of business and have a clear vision for what you want to achieve.
What type of concrete business is most profitable?
The most profitable concrete businesses are those that provide ready-mix concrete and construction services. The demand for these concrete services is consistently high within the construction industry. Businesses that offer concrete pumping services are also profitable due to high demand from construction companies. Lastly, businesses that manufacture and sell concrete products such as blocks, bricks, and pavers are also quite profitable.
How much does it cost to start a concrete business?
Generally, starting a small concrete business will cost between $5,000 and $10,000. This includes purchasing equipment and materials, as well as setting up a workspace. However, the exact cost will vary depending on the size and scope of your business.
What are the ongoing expenses for a concrete business?
A concrete business will have many ongoing expenses, including the cost of the concrete, the cost of transportation, and the cost of labor. The concrete itself will be the largest expense, and the price of concrete can vary depending on the location. The cost of transportation will depend on how far the concrete needs to be transported, and the cost of labor will depend on how many people are needed to pour the concrete.
Other ongoing expenses for a concrete business include insurance, permits, and licenses, office supplies, and advertising.
How does a concrete business make money?
Concrete businesses make money by selling concrete products and services to customers. Concrete businesses can also make money by providing consulting services to other businesses or governments. Additionally, some concrete businesses generate income through the sale of concrete-related products and equipment. Finally, some businesses may earn revenue through the licensing of their concrete technologies or processes.
Is owning a concrete business profitable?
There are a couple of reasons owning a concrete business can be profitable. First, the demand for concrete is high and is expected to grow as the construction of new homes and commercial buildings increases. Second, concrete is a relatively cheap material to produce, so businesses can make a good profit margin on sales.
Why do concrete businesses fail?
One reason that concrete businesses may fail is because the market for concrete may be saturated in some areas, which can lead to decreased demand and failure for new businesses. Additionally, regulations governing the production and use of concrete may be stringent, and failing to comply with these regulations can result in hefty fines or even shutdowns. Finally, weather conditions can impact the ability to produce concrete, and extreme weather conditions can lead to a decrease in demand or even complete cessation of operations.