Starting a Building & Carpentry Business

[AmyT]

Hi,

My husband & I are looking to start a building & carpentry business. He is currently a qualified carpenter and is enrolled to start his building course this year. I am basically after any information regarding business set up... Mainly the following:

- Where can we go for business set up support/mentoring. This is all very new to us and whilst he will learn many aspects in his course I want to undertake some training so that I can better understand the legalities, insurances, employee/subcontractor information etc etc

- Can we set up the business name now... Ie, Jack's carpentry & building & start taking on carpentry work under this name until he is a qualified builder. He is currently in a carpentry partnership but we want to go out on our own now so that he doesn't have to split the earnings with the other partner as he is currently doing. I'm just unsure about advertising as a builder when he's not qualified but surely this would be ok if we only take on the carpentry stuff for now and say that we have a builder who would subcontract to us if a building job came up

- Any other general advice would be much appreciated.

Thanks

[Picasso Media]

Hi Amy

It is very exciting you are thinking about going out on your own.

In terms of training I would speak to your local Business Enterprise Centre. Most of them have mentoring/support options which could come in handy.
They also have a lot of different events/training that could work for you.

I am sure you could set up your business name, depending on what you need to have legally to ensure the business name is approved.

I know quite a few builders up here advertise they do bricklaying etc, but they dont actually do the bricklaying themselves but have their subcontractors (that are licenced) to do it. However I wouldn't know if this is legally correct.

I hope this helps.

Cheers
Nicole

[FS Concierge]

Hi Amy,

Congratulations on taking the first step towards building your own business.

There are plenty of people around here who'll be able to offer advice, so please feel free to continue to post your questions.

Looking forward to learning more about the new venture as things progress.

Jayne

[Just Launch]

Hi Amy,

As others have advised the government offers support and learning for small business's in each state.

You are certainly allowed to register a business name and begin trading in carpentry now. whether it be as a sole trader or through a different business structure. No matter how you trade you will need a new ABN though.

If you assistance with business structures don't hesitate to drop me a PM.

John Whale CA

[Divert To Mobile]

Hi Amy,

I think you could register the business name including the word building for now and just accept the carpentry jobs.

Steve

[estim8]

Rules vary from state to state, in Victoria to get a full building license either commercial or residential you need to meet the criteria of the Building Control Commission.

There's no problem working as a subbie for a builder (no limit-they carry the license risk) or a private householder up to a certain dollar value (was 12K I think), beyond that the BCC can stick it's nose in.

The main restriction of not having a license is you can't take out a permit to build in your own right (or meet the requirements for insurance and housing guarantee funds), as it's possible to take out a permit as an owner builder, it's common practise for an unlicensed builder to get the client to take out the permit, something the BCC is keen to crush, so be a bit careful if you go down this track.

Above all of that, go see your accountant the tax man is far more dangerous than the BCC.

Good luck with it.

[The Hobbit]

Originally Posted by AmyT

- Where can we go for business set up support/mentoring.

Amy, this is one of the best places to come to for advice. Ask specific questions in separate posts, there's always plenty of willing helpers. Giving real world, experience based advice.

[Corey]

Amy which state are you in?

Cheers
Corey

[AGMBris]

Hi

Congratulations and good luck.

There is a lot information on www.ato.gov.au or www,asic.gov.au as well as alot of knowledgeable people here on FS of course.

IMO, take the time to consider as much as you can now re naming, branding, domain names, Trademark etc, not mention business plan to create strategy.

[MH08]

Fanastic, always good to see another competitor (if your in NSW), I'm currently in a partnership in a building company (I don't do any of the work I'm the numbers guy) thats local to Sydney, also my family own a building supply yard, so there a few things you should know when taking the leap into a building company, please remember this is as honest as possible, so take on what you read now and see how you can change it and make your business stand out.

I only know how it works in Sydney, it may be different in your own state.

• What 'estim8' stated is correct.
• Mentoring on a business won't help you set it up the same way as others, most of the builders that do well haven't done well for 5 to 10+ years until the big break comes along.
• Highly competitive industry with the minorities in your area.
• Your husband will be taught to go by the rules in business, you wont win all the jobs like that. Though I'm not saying to break the law but everybody bends them here.
• Advertising can be a complete waste if there isn't proof of what your husband has constructed.
• Be friends with everybody in the industry, everybody knows each other, once the business is tarnished, move on to something else.
• Very difficult to recieve funds from clients, even your solicitors would have trouble.
• Clients wont care about how good you are, they want to know how 'cheap' you are, not how much.
• Costs of products to purchase at the start, try to sub-contract them all.

But please don't take this into context start the business up and enjoy it, I always like to see the disaster side to things first so I can weigh everything up.

But the rewards are grand, I know of one builder in particular that has been building over 20 years, he just got his break winning awards just recently for best luxury homes design and now only focuses on building luxury homes, he also takes a sweet earning of $12M a year, from just 5 years ago at $2.5M.

Maybe even be a specialist in a certain area, we know of alot of builders that are evolving there business into this structure to keep a competitive advantage.

One development we looked at quoting had a about 15 builders walk in and quote it, we were second cheapest to the winning builder and mind you he was cheaper by $200k, how can they afford it? The contingency for the build was negative 25% when he took it? I mean if prices of materials swung the other way he would be out of pocket, different if he over quoted the job.

Best of luck, you may have a niche in the market know one has tried yet, but I'll give you a secret for starting up, Granny Flats are huge right now, there is a order of over 100,000 to be built in the beaches area of Sydney (if you here that is), not many people know about this and there fetching profits of about $25K each, and they take 3 weeks to build, I actually know the only agent that is exclusive in selling these flats out.