How To Become A General Contractor Who Makes Money

With more and more people looking to bail on their corporate careers in favor of more entrepreneurial undertakings, the idea of learning how to become a general contractor has become a popular one of late. I think there tends to be this perception that general contractors make a lot of money while answering only to themselves, but this isn’t always the case. In fact, I know of many GC’s who are just barely getting by right now.

Now this may fly in the face of what you thought you knew about earning potential for a self-employed contractor, but it’s the real, unvarnished truth. I don’t care what you saw on a reality television show or what you heard at the local pub, the harsh truth is that making a ton of money in the field of home improvement is anything but easy. I don’t mean to crush the dreams of any young guy or gal out there who is intent on learning how to become a general contractor, but I just hope that you’ll go into it with your eyes wide open to challenges that lay ahead.  Your chances of landing a six-figure remodel or a new home construction right out of the gates are pretty slim.  You would be better served by aiming low in the beginning and then shooting for higher targets as your business grows and matures.

For one thing, there are a few things you need to avoid like the plague if you want to have any hope of staying above water. I would stay away from expensive tool or equipment purchases until later on. In the meantime you can find almost anything at Home Depot’s rental center. I would also hold off on purchasing or renting an expensive office or industrial space until revenue justifies it. Yes, this means operating out of your home for awhile but the savings will be absolutely enormous. I think it’s also a good idea to keep staff to a minimum if at all possible. You might need an office assistant who answers the phone but try to sub out as much of the labor as possible. Whenever you have to hire laborers and pay them consistent salaries it can be a real drain on your wallet when times are slow.  Finally, only pay yourself the absolute minimum in the beginning, investing the rest of the profits back into the business so that you can grow more quickly.  This will hurt initially but the eventual payoff will be bigger and will come faster.

Now, for the things you can do to give yourself a better shot at making a good living.  First off, don’t be afraid to spend some good coin on marketing efforts.  This is so very important in the beginning stages of any business for the simple reason that nobody has ever heard of you before!  As the months and years go on you can start to cut back on ad spending because customer referrals will start to kick in, but in the beginning it’s absolutely crucial that you open up your wallet for advertising purposes.  I recommend that you target wealthier suburbs and areas because these are the kinds of customers that are willing to pay what is necessary to have the job done right, and because they would rather hire home improvement work out to someone else.  I also recommend that you make customer service a top priority.  If there’s one thing that can make or break your business it’s the word-of-mouth testimonials that spread about you and your business.  Leave your customers happy with the work you’ve done and you’ll be surprised how much this will drive your company’s growth for years to come.

It is possible to make a lot of money as a general contractor, but you better have a plan and you better know what you’re doing.  If you lack manners or don’t think that quality is a big deal then this isn’t the field for you because I guarantee you’ll be out of business in no time flat.  On the other hand, if you’re business-savvy, courteous, and hard working you might just be in for a very fruitful future.