The general contractor launch plan
Every step from deciding to opening, in the order it happens, shaped to your situation, with your own numbers beside it. About 46 steps in 8 phases, 22 of them specific to a general contractor. Free to read; ticking steps off and putting in your own numbers come with membership.
The plan46 steps
- 01Not started0/6Fold
Decide with the numbersa week or two
Before a dollar is spent. Most expensive mistakes happen here, and this phase costs nothing.
A general contractor sells projects, estimated one bid at a time.
Typical for one unit is $1,000,000 to $10,000,000 a year; the owner keeps 10 to 20% of it before paying themselves. If that band does not cover what you need, that is the signal to pause and look again.
~50% survive 5 years. Roughly half of all new U.S. employer businesses are still operating after five years.
Twelve questions about your money, time, experience and temperament, scored. Then the 5 questions this business asks of its owner, about the hours and the work. Answer both before you spend a dollar.
Rule of thumb: buy an established firm with a real backlog, retainable crews, and proven sub relationships when you want cash flow and lower risk; build from one crew when capital is tight and you... Answer it in your situation above and the plan reshapes.
Customers, prices, rent, staff pay, what it costs to open. We filled in typical numbers; change what you know and everything on this page follows.
- 02Not started0/5Open
Plan the moneya week
What it costs to open, where the money comes from, and the cushion that keeps you alive until the business pays for itself.
A general contractor is light on equipment and heavy on cash: there is no storefront to build, so the money goes into crew trucks and trailers, saws and layout tools, the license, bond and...
The itemized cost to open8 lines
- Crew trucks (lease down payments) & trailers: $17,300 to $21,100Two pickups and a trailer per crew; buying both trucks new costs about $92,000 to $114,000 instead of the lease down payments
- Saws, nailers, laser, scaffolding & generator: $7,200 to $26,100Jobsite table and miter saws, cordless kits, a rotary laser and a demolition hammer for each crew
- Safety gear, uniforms & office setup: $3,500 to $10,700
- Tablets, logo, website & truck graphics: $2,500 to $24,700Door signs at the low end, full truck wraps at the high end
- Licensing, bonding & setup fees: $600 to $5,000State or local license, contractor bond, entity, contract and lien-waiver setup
- Insurance (liability, builder’s risk, auto, workers’ comp & tools): $5,900 to $14,700First premiums and deposits; certificates are required to license, pull permits and bid
- Launch marketing: $2,500 to $15,000Yard signs, door hangers, a builder and architect mailer and the first 60 days of local ads
- Initial working capital: $40,000 to $120,000Payroll, materials and sub payments carried ahead of progress draws for the first 3 to 6 months; your plan computes your own figure
Costs start on day one; customers take months. Map the first twelve months of cash so the business does not run out of money while it is getting going.
The business has to earn your pay like any other bill. Set it in your numbers and watch the month it move.
How deals in this business are financed5 lines
- SBA 7(a) loan (Up to $5M · 10 yr (25 with real estate) · 85% guaranteed up to $150k, 75% above)The workhorse for buying an existing general contractor or funding a startup’s trucks, tools and working capital.
- Working-capital line of credit (Revolving · secured by contracts & receivables)A revolving line from your bank (the SBA’s 7(a) CAPLines program includes lines for contract work) that carries payroll and materials until a draw comes in, then pays down.
- SBA surety bond guarantee (80-90% guarantee to the surety · 0.6% of the contract price)Bonding capacity, not demand, caps how big a job a young contractor can take.
- Seller financing (Often 5-20% of price · 3-7 yr)Common when buying a contractor.
- Equipment & fleet financing (Secured by the trucks & equipment)Lease or finance the trucks, trailers and bigger tools, secured by the equipment itself, so cash stays free for payroll and materials.
Most new shops pair an with 10 to 20% of your own cash. Know the monthly payment before you look at a single space.
Before you shop. A lender tells you what they would fund, what they need from you (credit, your cash in, a plan with numbers), and a pre-qualification letter makes a landlord or a seller take you seriously.
- 03Not started0/4Open
Set up the companya day or two
A day of paperwork, and it has to come before the space: a lease, a loan application and every permit are in the company’s name.
Your state’s business name search, the trademark register, and the domain, before the name is on a sign, a van, or a lease.
A , an , and the S-corporation election each change what you keep and what you are exposed to. Compare them with the numbers, confirm with a CPA and an attorney, then file with your state.
After:The is free from the IRS in minutes once the company exists. The bank account needs both. Keep business money separate from day one.
After:Pick the accounting software and connect the bank account now, so every cost of opening is captured and the numbers you later are real.
- 04Not started0/4Open
The territory and the vehiclea week or two
A general contractor's "location" is its service territory and the building activity within it.
What decides it for this business: population & construction growth, deep pool of reliable subcontractors, older or high-value housing stock, homeowner, middle-to-high income base, reasonable permitting and inspection climate.
Mobile businesses still answer to city rules: where the vehicle can be kept overnight, whether you can run the business from home, and what the state licenses.
The van or truck is the shop. Price it, outfit it, insure it, and brand it before the first job. The quotes go into the loan application.
Commercial auto for the vehicle, for the work. Customers and any lender will ask for the certificate.
- 05Not started0/2Open
Get the loanfour to eight weeks
Four to eight weeks with an SBA lender, longer if the file is incomplete. Everything else waits on this, so send a complete file.
Your plan with numbers (download it as a PDF from this page), the company’s papers, the vehicle and equipment quotes, your personal financial statement, and proof of the cash you put in.
The lender funds against the quotes and the insurance; the money goes to the vendors and the build.
After:
- 06Not started0/9Open
Permits and the vehicletwo to four weeks
General contracting is licensed by most states, many cities, or both, and every project runs through permits and inspections.
Bind the policies you had quoted before a contractor, a vehicle or a customer is in play. Keep the certificates; the landlord, the lender and the city will ask.
After:With the money in hand: the vehicle, the , the branding, and the state inspection most cities require before it can work.
After:Register your or corporation and obtain a city or county operating license.
With your state, before the first taxable sale. Usually free and online; check your state.
Many states license general contractors after years of experience plus trade and business exams.
If you do not hold the license yourself, most licensing states let a licensed employee or partner qualify the company.
Many states and cities require a license bond (California asks for $25,000, Denver $50,000) and proof of to license a contractor or pull permits.
Builder’s risk covers the work in progress against fire, theft and storm; commercial auto covers every truck and trailer.
Public and many commercial jobs require bonds sized to the contract; your surety sets how much you can bond from your financial statements and track record.
- 07Not started0/10Open
Set up to runduring the build
During the build, so the business runs from day one: the systems, the prices, the people and the routine.
Estimating, scheduling, job costing, and change-order tracking are the operational core: they protect the you bid and keep jobs on time.
Referrals, reviews, and local presence are the bid pipeline; managing cost per won project is a core profit lever.
Progress draws, deposits, and financing on big jobs keep cash flowing and lift close rates on larger projects.
Crew pay, prevailing-wage jobs, and sub payments get complex; you need this the moment you have a crew.
Per-job visibility and clean books are essential for managing , bonding, and financing growth.
, workers' comp, surety bonding, and builders-risk coverage are non-negotiable for a licensed GC.
See the price the the business needs implies, then check it against what the market pays.
Daily: Walk and estimate jobs, coordinate subs and deliveries, check... Weekly: Review the bid pipeline and win rate, job costs vs the estimate,... Monthly: Review estimated-vs-actual by job, bonding capacity and cash,...
Opening, closing, the sale, the complaint, the cash. One page each. This is the manual a franchise would have sold you.
Free, and it is how most people will find you. Address, hours, photos and the menu or price list, live before opening day; then the sign, the soft opening and the first regulars.
- 08Not started0/6Open
Open and measurethe first ninety days
You own it. Now run it on the numbers.
Friends, neighbors and a short menu or list. Find the problems while the room is forgiving.
Enter the real numbers and see every cost line against the for this business.
Underbidding and overruns; Materials and subs at ~50% of every job; Bid efficiency and weak change-order discipline.
Wages are the start: , insurance, training time and the hours you stop billing. Register as an employer and carry workers’ comp before the first payday.
Growth consumes cash before it produces it. Find the rate your own cash funds before you push.
General contractors sell to owner-operators, SBA buyers and larger builders who want a backlog, crews or a new market.