7 facts about becoming a licensed contractor guide, Tips, Online Advice
7 Facts You Need To Know About Becoming A Licensed Contractor
25 Feb 2021
Becoming a licensed contractor can be a lengthy process. It requires lots of time, commitment, and experience. Before you begin the journey, let’s discuss the seven facts you need to know.
7 Facts About Becoming Licensed Contractor
- You’ll Be Responsible
Projects you might work on as a licensed contractor include:
- Building new residential homes.
- Remodeling or renovating residential homes.
- Doing commercial projects.
As the contractor, you’ll be responsible for planning and overseeing these projects from start to finish.
- Testing Is (Mostly) Mandatory
Almost all states require you to be licensed in order to work as a contractor. In order to become licensed, you must pass the general contractor’s test. The test covers questions about the business, legal, and practical side of the trade. You can do your contractor’s license exam prep through RocketCert to get ready for testing day.
- The Test Isn’t All You Need
It isn’t enough to simply pass the test, you need to have skills and experience. There are two paths you can take to become a contractor.
- Start off working as a crew member to gain experience and skills.
- Pursue a degree in civil engineering or construction management.
You can also choose a combination of the two. No matter which option you choose, there are a few key areas you’ll need to have educational or hands-on experience in. Those are:
- Bidding on jobs.
- Planning a budget.
- Scheduling other employees.
- Applying for and receiving permits.
- Working with clients.
- Complying with safety and building codes.
- Instructing and leading a team.
Knowing how to do all of the above is crucial for success as a contractor.
- Creating A Business Plan Is Important
You need to know what your financial, professional, and personal goals are, and how you’ll achieve them. Here are a few questions to ask yourself:
- How are you going to set yourself apart from other contractors?
- What can you offer a client that others can’t?
- What size projects do you want to take on?
- How much money do you have to invest up front for licensing, equipment, staff, and other expenses?
- How much money do you need to make in the first year?
Setting your goals and expectations up front helps you keep them in mind as you move forward. Check in with yourself regularly to make sure everything is on track.
- Marketing Is Everything
Competition in the industry is high, so you’ll need to get your name out there. When you’re ready to start marketing consider:
- Having social media pages for your business.
- Taking out online ads.
- Running radio ads.
- Posting print ads.
- Offering discounts to customers who refer you to someone else.
Keep in mind that marketing can get expensive, plan your budget upfront so you can decide which approach will be best for you.
- You Need A Network
Networking and marketing go hand in hand. Building a network is beneficial because:
- Attending networking events or joining online forums will help get your name out there in the community.
- Making connections with other contractors helps keep you up to date on changes in the industry.
- If other contractors know you, they might pass along jobs that they themselves can’t take.
Having friends and connections in the industry can really help get your business off the ground. Start building a network as soon as you can.
- It Pays Off
As of 2019, the Bureau of Labor Statistics reported that the average yearly pay for a general contractor (also referred to as a construction manager) was 95,260 per year. That works out to about $45.80 an hour. Rates can vary depending on what state you’re in, so check your local numbers.
Contracting can be a profitable profession, and it’s definitely worth looking into if you’re ready to begin a new chapter. Keep these seven facts in mind as you do your research and decide if becoming a licensed contractor is right for you.
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