Many deck builders are happy working for another person, but others want to branch out and be their own bosses.
The first step is having the skill and knowledge to build decks. Then, one has to figure out how to open a new business in a niche where countless others are doing the same thing.
Learning how to start a deck-building business is fairly simple, and this guide walks everyone through the 10 steps required. However, it will take perseverance and hard work to gain trust in the neighborhood and attract new clientele.
10 Steps to Starting a Deck Business
This complete guide was designed for deck builders who want to branch out and start a business of their own.
The steps below will ensure that the deck-building business is legally compliant, registered correctly, well-planned, and marketed properly. Let's get started.
1. Plan the Business
A clear business plan is crucial to be a successful entrepreneur. Deck builders must map out the specifics of the company and consider these topics:
Naming the Business
Choosing a name is challenging, but it's the most important aspect. If one doesn't already have a logo in mind, they can use an online generator tool to get ideas.
While many deck builders use their own names for the business, it might be wise to operate under a different one, especially if they choose the sole proprietorship route.
When registering the business name, it's important to research it by checking:
Web domain availability
Social media platforms
The business records of the state the deck builder will be operating in
Costs Involved in Starting a Deck-building Business
Starting a deck-building business often requires significant amounts of working capital. The professional will need to gather their equipment, tools, and materials. These can include:
Circular saws
Chop saws
Screw guns
Pneumatic nail guns
Air compressors
Routers
Hammers
Chisels
Planers
Jigsaws
Nails
Metal hardware
Screws
Apart from those items, the builder may also want to invest in:
A flatbed trailer to haul supplies and equipment
A work van or truck
A contractor's license
Insurance for the workers and the company
A warehouse to store supplies and equipment
Signage for the warehouse and vehicles
Work cellphones
Internet and phone service
A website
Ongoing Expenses to Consider
Most of the expenses will fall into the equipment and materials categories because tools and wood are required for every job. However, if the builder rents the office building, they must make payments, consider insurance and maintenance for vehicles, and more.
It's important to factor the ongoing expenses into the business plan. Generally, this makes it easier for the builder to meet the break-even point and earn a profit.
Target Market
While builders can target any market they wish, they'll likely focus on upper- and middle-class clients who want to add more living space or appeal to their homes.
Still, builders can also attract clients to the decking business when the customer wants to put up their house for sale, or rent it to tenants. This home improvement project is often inexpensive and can significantly increase the home's value.
How Much to Charge Customers
Deck builders often charge anywhere from $100 to $150 per square foot. That will include their labor, transportation, materials, and everything else.
Likewise, customers might have special requests, which means the materials might cost more per square foot. In this case, builders might charge higher amounts. However, it's important to research price points in specific neighborhoods to stay competitive in the market.
Profits and Making the Business More Profitable
Depending on the size of the deck business and the types of clients it sees, one can expect to make about $80,000 to $120,000 annually.
It's possible to be more profitable as time goes on. Consider the extras that customers often ask about when estimating the cost of the job. One might decide to add a department to the company for maintenance, add-ons, and remodeling. Likewise, the builder can offer other services, such as pergolas, sun shades, and partial enclosures.
Always listen to the customers and create additional services that can easily be added to the website. They will indicate what they want or need.
2. Form an LLC (Legal Entity)
Establishing a solid foundation is the most important aspect when starting a deck-building business. While partnerships and sole proprietorships are common entity options for small companies, LLCs might be more advantageous and stable.
Unincorporated business structures, such as sole proprietorships and partnerships will expose the owner to personal liability for any legal actions and debts related to the company. However, an LLC protects the builder by keeping their assets separate from the brand's cash.
Ultimately, if the deck-building business faced a lawsuit or incurred debts, the owner's home, savings accounts, and other personal assets could not be used to cover those costs because of the LLC in place. Likewise, customers often believe that a limited liability company appears more trustworthy and legitimate.
3. Register to Pay Taxes
Generally, a deck builder must register for federal and state taxes before they open their business. The IRS allows them to apply for an EIN, which is free and easy to do.
However, every state is different, so it's wise to check out the taxes that might apply to the business.
4. Get a Business Bank Account and Credit Card
It's crucial to use a business account for credit and banking. If one mixes personal and professional finances, their own assets (house, valuables, and car) are at risk if the company gets sued.
Opening a business bank account will:
Make tax filing and accounting easier.
Separate personal assets from company ones.
Likewise, getting a business credit card can:
Build the company's credit history to make it easier to get a loan in the future.
Separate business and personal expenses.
5. Set Up the Accounting Process (Hire an Accountant)
Recording the various sources of income and expenses is crucial to understanding the financial performance of the deck business. There should be detailed and accurate reports. Some choose to hire an accountant, while others tackle this aspect themselves. Regardless, it needs to be free of errors.
6. Obtain Permits and Licenses
If the decking business doesn't get the proper permits and licenses, the owner could be hit with significant fines. In some cases, the company is shut down. Here is more information on this:
Certificate of Occupancy
Usually, a deck-building business is run from a warehouse or something similar. Whenever the company has a physical location, they need a Certificate of Occupancy (CO). This confirms that all government regulations are met.
When one chooses to lease a location, they must:
Have the landlord obtain a CO.
Confirm that the landlord can obtain or already has a CO suitable for the deck-building business.
Obtain a new CO after a major renovation. If the place is remodeled before the company opens, it's best to include language in the lease agreement stating that no payments will start until there is a valid Certificate of Occupancy.
If one chooses to build or purchase a location, they must:
Obtain a valid CO from the local government authority.
Review zoning laws and building codes for that location to ensure the company is in compliance and can obtain the CO.
State/Local Business Licensing Requirements
The deck-building business might require specific state licenses and permits to operate.
Most businesses must collect sales tax for any services or goods provided.
Labor Safety Requirements
Because deck building requires the use of power tools and other dangerous equipment, the professional must understand the state's labor safety rules. This information can be found online.
Service Contracts
Deck-building businesses may want to have clients sign a service agreement before beginning a new project. That will map out payment conditions and terms, as well as other expectations, which can reduce the risk of legal disputes and clarify customer preferences.
7. Acquire Business Insurance for Deck Builders
A deck-building business must have insurance to operate lawfully and safely. The coverage will protect the company's financial well-being after a covered loss.
There are many types of insurance available for different businesses. Therefore, it's wise to speak to a reputable insurer. Initially, one may only require general liability protection, which is the most common for small brands.
However, workers' compensation insurance is also important if the company has employees. The business may also require more coverage, depending on its needs.
8. Define the Brand
Overall, the deck-building business has to create a brand image, which is what the company stands for and indicates how the public will perceive it.
It's wise to think about a logo that matches the brand and tone of the company. This will help the builder stand apart from the competition.
Promoting and Marketing as a Deck Builder
Marketing and promoting the business is also important. While recommendations and word of mouth will be an important part of the strategy, there are other forms of advertising to consider.
For example, flyers can be helpful when starting out. It might be wise to join a contractor's association and advertise through home and garden shows, homeowners' associations, and builder associations.
Plus, it's also possible to advertise online through Instagram and Facebook. Building a website (learn more about this in the next step) can also help with local searches. Overall, the professional can create a deck business listing on Yelp and other directories. Pair those efforts with Google Ads to keep track of campaigns, and see what's working.
Customer Retention Tactics
Ultimately, the goal for the deck-building company is to attract customers. This requires the expert to maintain a professional look, be respectful, and focus on client satisfaction. Likewise, they must produce quality work because it will speak for itself.
9. Create a Business Website
After defining the brand and creating a logo, it's time to build a website for the business.
Most people have no website-building experience, so they think they can't obtain a beautiful-looking site. However, that's just not true.
Though it's possible to use a website builder that walks people through the process, it often looks bland. Instead, it's better to work with a company that offers web design services. Blue Collar Websites takes all the guesswork out of the job. Plus, it can help with Google Ads setup and much more such as explaining how to start a drywall business.
Overall, one needs a business website and should start working on it as soon as possible. Here are the reasons why:
Every legitimate company has a website, regardless of its industry or size.
Social media accounts can't replace a business website, but they can be paired to make advertising easier.
An experienced web designer for deck builders from Blue Collar Websites does all the work, giving the deck builder more time to focus on the company.
10. Choose a Business Phone System
Setting up a phone for the deck business is a great way to keep personal and company needs separate. While many people start by using their smartphones, upgrading is something they should consider as they grow and expand.
Generally, a business phone number will make the company more automated. It also builds trust and shows that the brand is legitimate. Potential clients can also easily make contact to start a new project.
A business cellphone can indeed keep everyone connected while on the job. However, most stationary systems are technologically advanced enough to forward calls as needed.
Allow Blue Collar Websites to Create a Site for You
Learning how to start a deck-building business seems complicated, but this guide broke everything down into easily manageable steps. We can also share insight into how to start a fencing business.
While there are many things to do before the deck business starts making money, one of the most crucial aspects is creating a website. At Blue Collar Websites, we recommend doing this once you have your company name in mind.
Our team will handle everything for you. Though you're in control of the design elements, we do the work, ensuring you can focus on other aspects. Once you're ready to promote your brand, your site is already up and running! Call (740) 729-1010 to schedule a meeting today.
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