Many people are remodeling their current homes to meet their new needs and wants instead of moving to a larger home. Remodeling is often the less costly option, and alleviates the need to go through the long process of applying for credit, searching for a new home and moving. Additionally, older homes frequently need remodeling to upgrade older plumbing or electrical issues, fix deteriorating walls and floors or upgrade windows and decor. If you are looking to start a remodeling business, work is available for a variety of project sizes.
Here are 3 things to know before you get started.
Understand the Numbers
The most common error made by remodeling companies is that they do not mark up their cost properly to make a profit. Remodelers should use a minimal markup over cost of 50 percent, and over labor, 100 percent. Costing a job includes labor, fringe benefits, materials, sales tax and deliver, plans, permit and cleanup. Jobs need to pay for company overhead, typically about 30 percent.
Marketing, Selling and Hiring
Part of being in business is letting people know that you are available to do work through marketing, selling jobs to customers and hiring contractors and employees. These tasks take time and money away from actual work. Whether all of the work is kept inside your family or you hire people to work with you, you will have to delegate much of the administrative work at the very least to someone else while you do the production work yourself. A typical schedule is marketing and selling in the evenings while running production during the daytime.
Taking Advantage of Opportunity
The opportunity is out there, but you will most likely need to work about 60 hours per week the first couple of years to get your business going. Niche remodelers are in demand, and with foreplanning and hard work, your business will thrive.