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Working as a builder is an extremely popular trade in New Zealand, and for good reason – the job offers independence, satisfying work and the security of a valuable skill set. Starting your own business in the industry can help maximise all of these advantages. You have a range of options when starting a building business, and it can be overwhelming to work out what you need to do and where to begin. This article takes you through some of the most critical steps in the early stages of forming a building business. These include getting your basic qualification as a builder, thinking about business structures, and beginning to build up a base of clients and customers.

Obtaining the Industry Experience That You Need

There are no specific requirements to launch your own building business in New Zealand. However, it is essential to ensure that you have the experience and credibility you need to succeed. This can come from a few different places depending on your experience in the industry and more broadly. For instance, if you have completed an apprenticeship, you may be able to get the New Zealand Certificate in Carpentry which will help certify you as a competent builder. 

Otherwise, if you have other experience or have worked for another building business in the past, your focus may be building up a customer and client base. Try making a list of the possible connections and future work you can think of, and be proactive in offering the services of yourself and your new business. Also, when thinking about promoting your business, make sure to emphasise your years of experience in the industry. Your experience will be highly relevant to a prospective client who is looking to engage your services.

Choosing a Business Structure

There are multiple ways of structuring your business depending on what kind of building business you would like to run. 

The first and most common way is as a sole trader. In this structure, you are entirely in control of your business and take responsibility for all the profits and liabilities. Operating as a sole trader may be ideal for your business since it is an efficient and quick way to structure your business and manage your affairs. This structure is perfect if you are looking to start a business independently and do not necessarily want to involve other people in the early stages. Most builders in New Zealand operating on their own are sole traders. 

You can also consider operating your building business with other people in a partnership. You and the other builders can share the business’ load and split profits and liabilities. How you divide profits and losses should be following your partnership agreement. You and your partners should draft this agreement when you start the business. Ultimately, a partnership structure is an excellent option if there are a few like-minded builders with who you want to go into business with.

Finally, a company is the best option if you want to quickly grow your building business and possibly become a major player in the industry. Doing so will require investment and more employees, both of which a company structure can cater to and support. However, it is more expensive and time-consuming to set up a company and then operate as one. These costs can be outweighed by the benefits of the company structure that better suit your long-term growth goals. 

Key Takeaways

There are some important choices to make when you consider whether to start your own building business in New Zealand. These include thinking about whether you have the experience and certifications to be successful. The industry is highly competitive. Accordingly, you will need to demonstrate you have the skills and expertise for clients to be confident in your business. You should also think about what business structure best meets your needs as you begin planning your business.  If you want to know more about starting a new business in the building industry, contact LegalVision’s business lawyers on 0800 005 570 or complete the form on this page.

Frequently Asked Questions

Do you need a specific certificate to start your own building business in New Zealand?

No. However, it can be advantageous to have a New Zealand Certificate in Carpentry or a similar degree. Having a relevant qualification provides a solid base of skills for a building company. If you have plenty of industry experience and know customers and potential clients, you may be able to qualify for this certificate without going through an apprenticeship.

How much experience do you need in the building and construction industry to start your own building business?

There is no set minimum on the experience you should have before going into business on your own. The more experience you have, the better. However, you can also build up your base of knowledge and customers simultaneously if you start reasonably soon after finishing an apprenticeship.

What business structure is best for builders?

It depends on what the builder in question wants from their business. Many builders are happy to practice as sole traders, which maximises flexibility and simplicity. On the other hand, a company can suit if you have willing investors or want a more comprehensive and layered business structure to advance your long-term business goals. 

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