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    7 Replies Latest reply on Oct 31, 2007 4:57 PM by Lighthouse24

    all in one construction company

    momthebuilder Newbie
      This is an idea my husband and I have been talking about. In the next 5 years or so (to aquire the various license/diplomas/etc) we would like to start an all around home building, remodel, repair company. He is an electrician but has experiance in every trade except masonry. We have friends who are more proficient in these other trades also so by employing them we would (in theory as of now) be able to build a house from the ground up. I think this would be a profitable idea due to the fact that when someone wants a custom house they have to go through many different contractors to get each area handled, we could take care of everything. Any thoughts on this idea?
        • Re: all in one construction company
          LUCKIEST Guide
          So you are looking for a 5 year plan. Tell us more. Where are you located?? Are they building
          and SELLING custom homes in your area??
          Now you are ready to put your ideas on paper and DEVELOP A BUSINESS AND MARKETING PLAN.
          You should also be working on CASH FLOW. Do you have the funds??
          Do you have an Accountant?? A Lawyer??
          Best of luck, LUCKIEST
          • Re: all in one construction company
            DomainDiva Ranger
            You will need to make sure that you have enough work to keep all of these people employed. Sounds great but is it workable? You would actually have to schedule home building in advance and would also have to be minful of how much work your people could handle at once...ie: what if you had 4 homes going at the same time?
            • Re: all in one construction company
              Lighthouse24 Ranger

              It can be a very profitable business. It isn't profitable for most of the people who get into it because they underestimate the overhead costs of running a business and having employees, and because their initial cash flow projections reflected a best case scenario (which never happens in construction).

              The individual, couple, or family who decides to build a custom home has to be one of the most difficult-to-please customers in the world. After all, it's probably the largest purchase they'll ever make, and they are going to live in it for years to come -- so their expectations are that everything be absolutely perfect. In home building, the gap between " absolutely perfect" and "accepted/passed/to code" is enormous, and a custom builder can spend a lot of money and time trying to close it.

              Custom homes usually mean at least some custom materials -- things you can't just pick up at Home Depot. What if the customer insists on facia stone from Italy, and the transport is delayed for six months? What if they want an innovative composite on the kitchen and bathroom counters that your crew has never worked with? Custom homes are often sited on unusual locations, where access, drainage, environmental impact, etc. are all far more complex than tract housing. What if the county requires you to tear out and redo all the landscaping, sidewalks, and driveways because of an unforeseen drainage problem -- and you can't close on the home (and get paid) until you do? What is someone steals all the mechanical equipment (A/C, furnace, water heater, etc.) from the job site?

              A custom builder in my area is dealing with all of the above on just one house (he bid the home for $880K, anticipating a $160K profit -- of which $144K has been eaten away by the problems above, and by closing the gap between "to code" and the buyer's idea of "perfect"). He is now five months behind and in danger of losing other jobs he had lined up.

              None of this is intended to discourage you from getting into the business. It is meant to encourage you to plan very carefully, especially since you have the time now to do so. Best of luck to you!
                • Re: all in one construction company
                  momthebuilder Newbie
                  that was the best answer so far, realistic and to the point
                    • Re: all in one construction company
                      Lighthouse24 Ranger

                      Glad I could help. To give you a more "upbeat" perspective, the best custom building and remodeling operation I've ever seen was a partnership between two brothers -- one was an excellent project manager and site boss, the other was an excellent sales person and overall communicator. One brother did a great job of educating customers and creating realistic expectations up-front -- and of keeping them informed and happy every step of the way. The other brother got things done. Perhaps you and your husband can plan for your success by dividing the challenges in this or some similar way. Again, best of luck to you!