June 16, 2024

How Much Does It Cost to Start a Construction Company on Average?

Fifty-five percent of adults in the U.S. have started at least one business in their lifetime.

Starting a construction business can be one of the most rewarding and exciting things you’ll ever do. You can create a business that changes people’s lives while also building your own.

But how much does it cost to start a construction company?

The cost depends on many factors, including size, location, construction supplies, and more. It can range from $50k – $500k, depending on your goals.

If you are wondering what it costs to start a construction business, this short and simple guide is for you.


The first step to starting a construction company is getting your license.

Depending on the state you live in, this can be a very simple process, or it can take several months. You’ll need to complete an application, pay a fee, and submit any required documentation.

This includes things like proof of insurance and business formation documents.


Getting employees on board will be one of the most significant expenses when starting a construction business.

You’ll need to hire an office manager, project managers, estimators, and subcontractors. The cost of these positions can vary wildly based on location, experience level, and more.

You’ll also need to pay for any benefits that you offer your employees, such as health insurance and retirement plans.

Office Space

Depending on the size of your business, you may or may not need an office.

If you do, it’s important to find a location that is easy for clients to access and has plenty of parking. You’ll also need to make sure the space meets any local zoning requirements.

You can find an office on your own, or you can hire an agent to help you.


Construction equipment is probably the most expensive piece of the puzzle.

You’ll need to buy a variety of machines, including a tractor and trailer, backhoe, excavator, or used skid steers for sale. If you don’t have the cash on hand to buy the equipment you need, you can lease it instead.

However, keep in mind that leasing is usually more expensive than buying outright.


Insurance is one of the most important expenses you’ll face when starting a construction business.

You’ll need to buy liability, worker’s compensation, and auto insurance for your equipment. You can also purchase equipment insurance to cover the cost of replacing damaged machines.

The exact type of insurance coverage you need will vary based on the state in which you operate.

How Much Does It Cost to Start a Construction Company? Know What to Expect

How much does it cost to start a construction company? It might seem like you could start a construction company with just a few tools and your bare hands.

However, there’s a lot more to it than that.

You need the right equipment, insurance, and licenses before you can get started. You also need to know what costs you’ll have to cover in the long run.

For more on starting a business, check out the latest articles on our blog.

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