How do I start a subcontracting business?

by Josh Hogan Commercial Builder

So you are thinking of starting a business as a construction contractor…

The construction industry is responsible for 8% of Australia's entire GDP and so there is plenty to go around.

As a trade contractor in the commercial sector you will have many responsibilities as a person conducting a business or undertaking (PCBU). You should have a satisfactory understanding of; cashflow management, workplace heath and safety, insurances, contract law, human resource systems & management (particularly the relative award that your employees should be under), an accounting system (many use Xero), the right tools, the right team of professional advisors and ultimately a 'can do' attitude.

What is important from a Commercial builder's perspective:

Competitive pricing and clear inclusions in your quotations.
Clearly communicate your plans and stick to them.
Submit the required paperwork before you commence i.e. Insurances and WMS.
Order the correct materials, on time.
Send your employees to the project site induction at the same time.
Rectify any mistakes.
Under promise and over deliver.

How to find work:

It's important to have an online and social media presence. Initially your time is going to be best spent speaking with commercial builder's and asking to be put on tender lists.

If you're concerned about the rates you are charging you can always invest in the most recent Rawlinson's to compare your rates with the market.

Before you jump in to it make sure you have achieved a headspace where you can bring perseverance and maintain your moral compass in daily operations. Once you have commenced with great foundational business building blocks you're going to be faced with the opportunity to cut corners, make more money from the situations you are presented and more. This line of thinking is short term and it wont allow you to grow.

If you can maintain your moral compass and take opportunities to build a relationship over make more money this will ironically make you far more money in the long run. Some of the greatest value that we can offer clients in our business is proposing subcontractors that we know are trustworthy, don't over commit themselves and consistently do quality work. By virtue of this relationship with subcontractors our clients have a smooth and enjoyable experience and give us repeat work which we pass back onto those subcontractors.

Build your business from solid foundations and correct processes, stay true to your moral compass, build relationships and good luck.

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Co-authored by Josh Hogan (B BldgConstrMgt) and Sean Hague (B BldgConstrMgt)