How to Start a Home Renovation Business in 8 Steps

Launching a home renovation business (or any business whatsoever) is an uphill battle. However, at the top of this climb lies an opportunity as the remodeling industry size has swollen to over $110 billion in the US alone.

But, at this point, we understand that uncertainty may have set in, making you anxious about where to start and then what.

Such fears while starting a new business are normal. However, with a path laid out for you to follow, you will feel much more confident in taking the required steps.

This is why we have come up with this step-by-step guide on how to start a home renovation business. So let's start our journey.

Table of Content

1. Research the Market and the Competition
2. Develop a Business Plan
3. Establish a Legal Structure
4. Obtain the Necessary Licenses and Permits
5. Obtain Insurance
6. Purchase the Necessary Equipment
7. Open a Business Bank Account
8. Develop a Marketing Strategy
9. Avoid These Mistakes as a Home Remodeling Business Owner
10. FAQs
11. Conclusion

Step 1: Research the Market and the Competition

Who are you up against? What circumstances will your new venture face? The answers to these questions are crucial to find before you start your own home renovation business. Why?

Because then you will be able to identify the cracks in the market as well as the services of your competitors. And it is via these cracks, you will make your place in the market.

To do market research well, understand that a market consists of three things:

• Businesses
• Potential customers
• Marketplace

So let's look at each of those.

1. Find your competitors

It is easy to find your competitors these days. Just search "home renovation businesses in " in any search engine.

Found them? Now make a list of all regional, national, and international players in the home remodeling market industry that you will be competing against.

Take each of them separately to know what all its home renovation services are and who its target audience is.

2. Understand the customer behavior

Not clearly understanding the target customers is one of the biggest mistakes any business makes. But thankfully, you are here and we won't let you repeat those.

So, identify their needs.

• What do they want from a remodeling business like yours?
• What is their average project size?
• What is their motivation(s) to make a purchase?

Knowing the audience well demands you to go into a lot of depth. But an overview will do for now as you will get to know them better as you start running your new business.

3. Understand the marketplace

A marketplace is a medium that connects businesses to potential customers. For example, you can take a mall as a marketplace. Even Amazon is one of these.

The point of doing this is to know what are the ways your competitors use to reach their prospects. You can then pick a set of those pathways for your business to do the same.

This will give you a lot of insights that may later turn into advantages for your business to thrive.

Step 2: Develop a Business Plan

"What is a business plan?", you may be wondering. Hubspot has explained it simply:

"A business plan is a documented strategy for a business that highlights its goals and its plans for achieving them."

In other words, it is your guiding light that your company follows to get where you want it to be from where it is. A solid business plan for your home renovating business may include information about:

• Company name and address
• Company logo
• Contact information
• Goals
• Market analysis
• Team
• Company's services
• Target market
• Competition
• Marketing and sales strategies (step 9)

You may have noticed that you have already completed a part of it with step 1. But you are now done with it yet. To help you with this, ask yourself these questions:

Step 3: Establish a Legal Structure

Defining the legal business structures is a must.

A legal business structure is a form that your business takes. It determines how your business is organized, managed, and taxed. A legal business entity can take any form such as:

• Sole proprietorship
• Partnership
• Limited Liability Company (LLC)
• Corporation

Each structure has its pros and cons. So only choose one after weighing both sides because it affects your liability, tax obligations, and management structure. Here is a guide to help you do that.

Step 4: Obtain the Necessary Licenses and Permits

As a home improvement business, you are likely to do many things. Out of those, some require you to obtain a contractor's license first. Here we have classified those, as per Investopedia:

Step 5: Obtain Insurance

Running construction businesses is not everyone's cup of tea. You will run into many problems now and then, especially if you are just starting.

Thus, getting your business insured will help you overcome many of these challenges, if you do face them, by protecting yourself and your assets from potential risks.

Usually, businesses in the home renovation industry pick insurance coverage with these insurances:

Step 6: Purchase the Necessary Equipment

With your business formally set up, you still have some necessary purchases to make so you can run it.

1. Purchase your hardware

To keep your cost to the minimum, start with the essentials such as a computer and printer. This will help you manage your business and connect with your clients.

2. Invest in quality tools and equipment

Now it's time to purchase your weapons with which you will serve your clients. So we suggest you invest in high-quality tools that are durable and reliable.

As a home renovation business, you will need specialized tools and equipment such as:

3. Get the required software

In addition to hardware, you will also need to install software to help you run your business efficiently. This includes:

• Designing software
• Invoicing software

Step 7: Open a Business Bank Account

Instead, will your business account do? Not if you are concerned about protecting your assets.

When you use a single bank account for all your purposes, you run the risk of getting it all wiped out if your business is sued. However, if you have a separate business account, only this will be jeopardized in such cases.

You can also look to issue a business credit card as well as it will finance you in the name of your business, instead of your name.

So contact any trusted bank in your region and apply for both.

Step 8: Develop a Marketing Strategy

If you did the first 2 steps mentioned here correctly, then developing a marketing strategy will be much easier. A marketing strategy is a plan to help you promote and brand your business to your target audience. Here is how you do it:

1. Define your unique selling proposition (USP)

As suggested earlier, have you found any cracks in the market and the services of your competitors? This will help you take advantage of this gap to make your business stand out in the home improvement industry.

So ask yourself, "What makes your home renovation business unique?" This could be the quickness or quality of your services, your exceptional customer service, etc.

2. Establish your brand

How your target audience perceives your business is what your brand is. To START establishing your brand, reflect your USP on all your business properties such as:

• Business name
• Logo
• Website
• Social media profiles
• (And most importantly) Your services

3. Build Your online presence

This is probably the most rewarding thing you do for the marketing of your business. In today's digital age, having a strong online presence is a must if you are looking to make it big. For this, there are at least 2 things you have to do:

1. Build a website that showcases your work, services, and contact information.

2. Create social media profiles on platforms to connect with your audience by posting on them regularly.

4. Utilize SEO with content

SEO (Search Engine Optimization) is how your website comes higher on search engines for relevant search queries.

For example, if someone is searching for, let's say, "best home renovation business", is your website coming up for it?

This is a very vast subject, But you can start by placing keywords at right place such as:

• Meta title and description
• Content

You can also showcase your expertise by consistently posting your website blog. This will help you with SEO as well as branding your business as an authority.

5. Optimize for local SEO

This will help the prospects in your region find you easily. And it is very easy to set up as well. Just get yourself registered for free on:

• Google My Business
• Bing Places
• Yahoo Local

The better you set up your profile, the better are your chances to be placed higher than your competitors.

Avoid These Mistakes as a Home Remodeling Business Owner

Given that you are starting a new venture, as a home renovation business owner you are bound to make some mistakes no matter how much you try to perfect your overall business model. To save you from that, let's identify them:

Conclusion

So these were the 8 steps you needed to take to launch your own home renovation company. Following them, you are all set for a great start to your venture.

It may look daunting at first, but the key is to take one step at a time while avoiding the common but costly mistakes we just shared. All the best.