Are you tired of working for contractors when you could be your own boss? Starting a fencing business allows you to set your schedule and run the company your way. While embarking on any entrepreneurial venture comes with many challenges, it can also be incredibly rewarding.
This detailed guide will help you learn about the fencing industry in the United States, the costs of starting a fence business, and the steps to follow in setting up your company.
The United States Fencing Market: Facts and Figures!
According to Grand View Research, the United States fencing market stood at $8.20 billion in 2021, and the industry is set to expand at an annual growth rate of 5% till 2030. Wooden fences are popular among homes near forests, while wire fences have become a favorite in the industrial sector.
The key driver behind the rising trend in the fencing market is the considerable growth in the construction industry over the past few years. Recent data suggests that spending in this sector jumped more than 41%, reaching $1.2 trillion in 2024.
The Experience and Qualifications Required to Become a Fencing Contractor
To set up a fencing business, you must know how to build sturdy, durable, and attractive fences. Working under another contractor for a while can help develop the skills you need to run a successful fence company. It'll teach you how to:
Accurately measure distance and area
Estimate time, labor, and fencing materials for each project
Properly operate equipment and use the tools to install fences
Interact with customers and ensure their satisfaction by providing top-notch fencing services
You can also strive to achieve a professional certification from the American Fence Association, adding another layer of credibility to your business and helping close more clients while building trust with your potential customers.
The Cost of Starting a Fencing Business
Unlike many other businesses, setting up a fencing company doesn't cost much if you plan properly. You can expect to spend between $3,260 and $6,050 or more, and this amount would cover the following:
Business license and registration
Contractor's license and certification exam
Business insurance
Fence contractor software
Branded uniform and necessary accessories
Fence installation tools and equipment
Business cards
A website to market your fence installation business
If you need a van to transport your equipment and crew to and from the work site, expect to spend up to $30,000 more.
How Much Does a Fencing Contractor Make?
Before starting a fencing business, you need to know how much fence installers make while working for a contractor. This information should help you with many things, including pricing your products, hiring qualified professionals at market-competitive salaries, and determining the number of projects you need to cover wages, including yours.
The hourly rate of fence installers in the United States is $21.05 per hour, which translates to an average of $43,780 annually. Since this is just the mean figure, entry-level fencing professionals may earn much less than that. Experienced contractors can expect to make $61,710 or more.
How to Start a Fencing Business: 15 Steps to Building a Successful Fence Installation Company
From creating a plan to set up your fence company to securing financing, opening up a business bank account, and more, here are the steps to starting your very own fencing business:
1. Focus on Market Research
While you already know that the fencing industry in the United States is gradually growing, you still need to conduct market research.
Start by considering where you plan to provide services and conduct a thorough investigation into your competitors. Find out what they're offering, how they're attracting clients, and what they're charging. This information will give you a head start with your business. For a digital marketing presence, consider web design for fence companies.
If there are a lot of competitors in the area you wish to open your fencing company, choose a niche. You can specialize in providing a particular type of fencing solution or offering services to a certain group, such as commercial or residential.
By choosing a niche, you'll stay focused on one area, allowing you to dedicate all your time and energy to it. While offering everything under one roof may seem lucrative, it can be a real challenge to manage, especially for those who are just starting their businesses.
2. Determine Your Approach
Now that you've taken the first step to starting a fencing installation company, you should think about the approach. You could either buy a franchise or set up a new business from scratch. Both of these have their advantages and drawbacks.
Many fencing businesses would be ecstatic to sell their franchising rights to aspiring individuals. It's a great way to profit from someone else's hard work, as you'll gain access to training and mentorship and a brand name that people may already know, making it easier to attract new clients.
However, setting up a franchise fence business can be expensive. Depending on the fencing business brand, you'll need to cover an initial cost, which can be pretty high. In addition to that, you will have to pay royalties according to the agreed terms and conditions.
On the other hand, starting your own fence company is much cheaper than buying a franchise. That said, you'll have to do a lot of hard work to set up the business, and this involves purchasing fencing supplies, complying with the licensing and permit laws, and marketing your services to get started.
3. Create a Business Plan
If you've decided to start a fence company from scratch, it's a good time to write up a business plan. This document outlines a company's goals, strategies, and financial projections. It creates a roadmap that you can use when starting and managing operations, and it helps secure investor financing.
While there are many templates you can find online, a business plan typically includes the following:
Cover page
Executive summary
Company description or business overview
List of fencing services you plan to offer
Pricing strategy
Target market analysis
Competitive analysis
Marketing plan
Employee planning
Financial projections
4. Secure Financing to Start Your Fencing Company
One of the major barriers to setting up a fence installation company is capital. You'll need money to purchase fencing supplies and equipment, rent an office or warehouse, and market your business.
Take time to think about the costs. Make a list of everything you need to start your fencing company and do a quick online search for pricing. Once you've calculated the costs, it's time to determine your source of financing.
Many experts believe that a successful fence company is one that you start with your own money. While you can take loans later to grow the business, spending your savings can help avoid interest payments on debt financing.
However, if you don't have the funds to start a fencing company, you can always turn to friends and family for a loan. Unlike banks, they won't pressure you as much, and your parents or relatives might see this as a business opportunity and consider investing.
Remember the business plan we talked about earlier? It is a fantastic document that you can use to attract angel investors, so fire up your computer and start networking with such individuals on LinkedIn. You can reach out to them, discuss more about your venture, and convince them to invest in your ideas.
Grants are another source of finance. Local governments and non-profit organizations in the United States offer a wide range of funding to aspiring individuals with a solid business plan. Generally, you would not need to pay this money back, but some might have repayment conditions.
5. Choose a Business Structure
Have you figured out the source of funding? Good, now it's time to select a business structure, as the next step will require you to set up your fencing company.
The type of business structure you choose will have an impact on your entire business, from day-to-day operations to management to taxes. You must think about this step carefully.
Typically, there are four different types of business structures, and these are as follows:
Sole Proprietorship
This is the simplest type of business to set up, as there are very few legal formalities that you need to complete.
A sole trader or proprietorship removes all of the distinctions between the owner and the business, which means that the law will treat the two as the same. All of your profits are yours, and so are the debts and liabilities.
This structure offers complete control, easy taxes, and a quick setup process, making it a fantastic option for those looking to embark on a solo business venture.
Partnership
If you're planning on starting a fencing business with a friend or colleague, you may want to consider a partnership.
You can choose between a general partnership, where everything is equally shared, or a limited liability partnership, where at least one partner has limited liability.
A partnership can be a great option because there are multiple people involved in setting up a company. It provides access to more sources of finance and greater knowledge, allowing you to easily overcome the challenges in the fencing industry.
However, one of the major drawbacks of a partnership is the disagreements and conflicts between partners. If you and your friend or colleague share different mindsets or ideas, you can expect to have clashes down the road, which could be detrimental to the fencing business.
Limited Liability Company (LLC)
A limited liability company or an LLC offers a unique mix of characteristics that you'll find across sole proprietorship, partnership, and corporation. The owners are separate from the business, meaning that they will not be held liable in case of bankruptcy or any other unfortunate event.
An LLC can be a great option to consider, as it comes with flexible taxes and profit-sharing rules. However, there is a lot of administrative paperwork involved, and the fees are higher than what you would have to pay if you wish to set up a sole proprietorship or partnership.
Corporation
This is a complex business structure that's considered a separate legal entity similar to an LLC. It offers the greatest protection from personal liability.
That said, a corporation is quite expensive to set up, and there are a lot of legal formalities to complete. It comes with increased reporting requirements, stringent regulations, and, in some cases, double taxation.
6. Name Your Fencing Business
A business name is the cornerstone of a brand. It is the first thing people notice, so choosing a strong, appealing name is crucial.
The right business name can convince potential customers to consider you over your competitors. It makes it easier for your target audience to reach out to you or recommend your fencing company to others.
Coming up with a business name can be challenging, which is why we've provided some tips below to help you with brainstorming:
There are many online business name generators that you can use. They require some descriptive terms before giving you several suggestions to choose from. This can help you save time and effort.
Consider combining two different words and creating a fun fencing business name. For example, Groupon is a combination of group and coupons.
While your business name doesn't have to convey a specific meaning, it should generate interest or evoke a particular memory for your audience. Whole Foods, for example, is often associated with health and wellness by its customer base.
Choose a scalable business name over a highly specific one. While you don't know where your business will be in the next 10 years, you should avoid choosing a name that would limit your fence company's growth.
Make sure you choose a business name that flows well. If it's too difficult to pronounce, your target market may go to your competitors for fencing services instead.
Once you've narrowed down a few names, test it with your family and friends. See how they respond and think about what needs improvement. This feedback will help you come up with a name that's snappy and memorable.
Check whether your chosen name has an available domain, as it is much cheaper to set up an online presence.
7. Register for Taxes
Now that you've registered your business with a name of your liking, it's time to think about taxes. If you plan on hiring employees or working with a partner, you must apply for an Employer Identification Number to file taxes with the Internal Revenue Service.
You must remember here that certain states have additional taxes you need to pay. Go over your state's taxation laws or work with a financial advisor to ensure compliance with the guidelines.
8. Open a Business Bank Account
Keeping your business and personal transactions separate is crucial to avoid confusion and simplify taxation. It's also a great way to show potential investors that you know the basics of maintaining your company's financial health.
Head over to a couple of banks near you and discuss opening a business bank account. The manager will guide you on their available products, making it easier to compare the offerings from all financial institutions to make an informed decision.
9. Understand the Licensing and Permit Requirements
Licensing and permit requirements may vary depending on where you plan to set up your fence company. Visit the relevant government office, Chamber of Commerce, or Small Business Administration near you for more information on the types of licenses and permits needed to operate legally in your state.
Also, brush up on the local regulations. Some states or municipalities have strict requirements pertaining to zoning and erected heights for fencing contractors to follow.
For example, California requires companies to register with the Contractors State License Board if the fence installation jobs are worth over $500. Knowing the local laws will help you avoid legal trouble when you take on projects.
10. Get Insurance for Your Fence Business
Whether you have considerable field experience or the desirable skills, it's essential to understand that anything can go wrong at the job site. When that happens, you need liability insurance to protect you financially from lawsuits.
If you plan on hiring employees, you should check your state's requirements for workers' compensation, as almost all states require you to maintain this type of policy to safeguard your staff and fence company.
Besides these two crucial insurances, you may also require additional coverage, such as property insurance to cover your office or auto insurance for the transportation vans.
11. Buy Fencing Tools and Equipment
Word of mouth spreads far and wide, and the best way to ensure customer satisfaction with every project is to use quality tools and equipment. It will help you maintain a high standard of workmanship with each job you undertake.
You can either rent the tools and equipment or buy them. Do a quick calculation to determine how much money you have to buy fencing supplies to start your company. Prioritize purchases according to the allocated budget and lease out the rest.
Some of the tools and equipment that you should buy or rent from a fencing hardware store may include the following:
Fence stretcher
Post popper
Tamper
Sledgehammer
Cable grip
Nail gun
Circular saw
Crimping tool
String line
Cement mixer
Bolt and pipe cutters
Tape measure
Safety glasses and work gloves
12. Build a Skilled Team
While you can consider taking on fencing projects on your own to save money on labor, there is always strength in numbers. Think about building a team if you can, as it'll make it easier to take on multiple jobs to ensure a continuous stream of revenue.
Post an advertisement and shortlist the applications according to your company's requirements. Conduct interviews to choose the right professionals and train them so that they can carry out the projects without much supervision.
A key thing to remember is that training shouldn't end after the recruitment process. You must train your team every now and then, as the quality of its work will have a direct impact on your brand's image and reputation.
Regular training will keep your team up to date with the latest techniques, regulations, laws, best practices, and safety protocols.
If you don't know much about hiring, here are the steps that you should follow:
Decide whether you want to hire an employee or partner with a contractor.
Create a job description with an overview of the position, roles and responsibilities, location, salary, and working hours.
Join the many free job boards available and share your posting on them. You can also use LinkedIn and similar platforms to connect with aspiring fence installers in your area.
Gather all of the applications and shortlist favorable candidates according to your company's hiring requirements. Schedule interviews and make sure to ask thoughtful questions.
Make an offer to the selected candidate to bring them on board and train them once they accept the employee agreement.
Finding the right professional for your fencing company can be time-consuming. It may take days or even months before you interview an applicant who is the best fit for your business. Don't rush this process; you don't want employees who could cause trouble for you or your clients.
13. Define Your Fencing Services
Think about the services your fence company will offer. Since you're just starting your business, you may not have all the tools and equipment, which means that you might only be able to perform certain tasks. There's nothing wrong with that, as you can upgrade your offerings later on.
Here is a list of fencing services that you can start providing as soon as you set up your business:
Custom fence design
New fence installation
Handling local building permits
Existing fence repair or removal
Fence maintenance
When deciding on your offerings, you should keep in mind that some customers with limited budgets may want to do most of the project themselves. Capitalize on this target audience by selling materials and labor for extra money.
14. Price Your Fencing Services
Deciding the services you wish to offer is much easier than pricing your offerings. This requires a bit of research into what your competitors are charging.
You shouldn't cut your rates, as that could create a perception of low-quality craftsmanship, but make sure they're competitive in the local market.
Here are a few steps that you can follow to help you price a particular fencing project:
Figure out the material costs: If you're building a wooden fence, consider all the materials you'll need for the project. This may include nails, stains, boards, and cement, among other items. If your costs are $4,000, add a 5% buffer to this, which brings the total to $4,200.
Estimate labor costs: Figure out the number of hours it will take to complete the project. If you and your team need 16 hours to finish the job, multiply that by the hourly rate ($18 per hour). It should cost you $288 in labor for a fence installation.
Calculate hourly expenses: Consider your daily operations and monthly expenses, including utility bills, and add them up. If your overhead is around $1,000 per month and you work 160 hours, that amounts to $6.25 per hour. For a 16-hour wooden fence installation, this totals $100.
Consider profit margins:Â Let's be real: you're putting all your time and energy into building a successful fencing business. It's important to factor in the profit margin, which refers to the money a company makes on its products or services after deducting all expenses. If you decide on a 25% profit margin, your profit for a wooden fence installation will be $1,147.
Incorporate taxes:Â You should factor in the state and local taxes into your pricing, as otherwise, you'll have to pay them from your profits, which can leave you with very little money behind. In this example, we'll assume a tax rate of 11%, which comes up to $630.85.
When you add all of the abovementioned costs, you will be able to price your wooden fence installation service fairly. In the above example, your contractor rate should be $6,365.85 for that particular job.
15. Market Your Fencing Company
Now that you have the right team ready and have finalized the pricing for your fencing services, it's time to market your fence installation business properly. Securing the first client is often challenging, but reaching out to potential customers may seem like a breeze once you get the ball rolling.
Before advertising your fence company, you must create a solid marketing plan. It should include the following strategies to help you grow your fencing business:
Word of mouth: This is the most effective marketing strategy, as it costs very little money to implement. Reach out to your friends and family members for fencing services and offer a discount on the job if they can successfully refer your company to others in their social circle.
Focus on branding: Print business cards, wrap your vehicle with decals, and invest in branded uniforms. These strategies will make it easier for potential customers to reach out to you and recognize your brand.
Invest in a website: Build a website to create an online presence. Publish your contact details, picture portfolio, list of services, and more information about your fence company on the site to ensure credibility and authority. When you make posts or create pages, make sure you incorporate search engine optimization (SEO) strategies to rank on the first page of the SERPs.
Stay active on social media:Â The current generation likes to spend time on their mobile phones, with social media platforms receiving the most attention. Create a business account on Facebook, Instagram, and others to interact with your target audience and build a brand around your fence installation business.
Create business listings: There are many online directories, including Google Business, Yelp, and Bing Places, where you can list your fence business. These listings are great and cost-effective in helping generate leads.
Let Blue Collar Websites Create an Online Presence for Your Fence Building Business Today!
To remain relevant in today's digital world, most fencing companies have set up websites and focus on SEO tactics to build a strong online brand, attract new clients, and establish authority in the industry. While you can do all of this yourself, learning the ropes may take a lot of time. Blue Collar Websites can provide that help as well as advise on how to start a deck building business.
Focus on growing your business and managing day-to-day operations while Blue Collar Websites handles your online presence. Call us at (740) 729-1010 to get started.
Our experienced professionals will create and maintain an SEO-optimized site for you, allowing you to focus on what matters most: scaling your company and improving client relationships!
Comments