Even with the COVID-19 pandemic, the construction industry seems to be emerging strong. According to data released in June by the U.S. Bureau of Labor Statistics, based on analysis from the Associated Builders and Constructors, the industry recorded 464,000 new construction jobs in May this year. It is said to be the largest monthly increase in labor since 1939. It also comes after April, which recorded the highest rate of month-on-month job loss in the industry.
The industry is getting back on its feet after a slight setback at the start of the pandemic. The home construction segment is also reawakening from a half-asleep state in the past decade, following the 2008 recession. If you’re planning to start a support business in this industry, now would be the perfect time to do it. One good idea is a forklift service or construction equipment rental business.
Starting a Forklift Service or Construction Equipment Rental
As most business owners know, the performance of a business will not be the same in two different locations. The reason is they have two different markets that have two different buying priorities and behaviors.
- Study your market before you make your business plan, so you can be sure that you’re addressing their specific needs. The best way to learn it is by surveying them. Talk to construction companies, contractors, and small local developers. For instance, ask them about the brands they prefer, the type of equipment they use, and how much they’re willing to pay for it. In the process, you might learn what other pieces of equipment they require.
- Buy only the brands and machines they use or the kind you can use if you’re offering services. If you go ahead and buy a forklift or other construction equipment before asking your target market, you might end up with idle inventory that won’t bring you profit. Start with just a few pieces, too, then expand your inventory as you grow your business.
- Find the best deals on your equipment purchase. There’s no need to go all out on buying the latest model of backhoe loaders, excavators, and bulldozers. Chances are they’re expensive. As a startup business, you’d want to build your inventory without blowing your budget. Your equipment doesn’t have to be brand new. Quality preowned tractors and forklifts on sale are good purchases as long as they are well-maintained and still useful to your customers. On the other hand, research about market rates and how you can offer the best prices to your customers.
- Promote your business where possible. Most construction companies are likely traditional and may look for the materials and equipment they need through conventional channels. But many now understand the power of online marketing. Reach out to them with a professional-looking website and a gallery of the things they need. Make choosing pieces of equipment easy and the rental or booking process convenient. Make your company easy to find on social media and forums as well.
- The construction industry is not like retail, where you have constant competition and you need to do promotions all the time to be top-of-mind. In construction, most companies work with tried-and-tested suppliers. Proving your capability to contractor customers can land you long-term partnerships with contractors. Having partners, especially ones with a busy project calendar, will ensure ROI.
- Don’t forget to maintain your equipment. While waiting for new customers and contracts, or in between projects, make sure you have your construction equipment checked, fixed, cleaned, and maintained. Find potential problems, fix issues that may worsen over time, and make your machinery look new—even if they’re not.
Starting a business isn’t easy, particularly if you plan to cater to a high-investment market segment. But no one says it’s impossible. These tips can help you with the infancy stage of your company, but the rest will be up to you. Find what makes your construction market tick and fulfill their needs.