Starting a company with no experience is not always advisable but it’s not impossible. One industry that you can enter with little to no experience is the construction industry. The construction industry is a labour-heavy industry, and a lot of current professionals learned from mentors and working experience so you can too. Establishing a construction company with no experience is possible.
A construction company is a business that oversees the construction of buildings, bridges and other types of buildings. In other cases, construction companies manage each stage of the new building.
If you want to start a construction company but you don’t have experience, you can do it easily. It will take a lot of hard work but by the end of the journey, you will be a fully-fledged experienced construction company owner.
In this article, we look at what you can do to start a construction without any experience.
Step 1: Register Your Business
This is the most important step for anyone starting a new business. All businesses by law have to register through the Companies and Intellectual Property Commission (CIPC).
When registering with the CIPC, you need to register your construction company as a Pty company. A Pty company would mean that you and your company have different taxation and legal responsibility.
The next thing is that you have to register for income tax through the South African Revenue Services (SARS). When registering you might also have to register for a skills development levy (SDL) and unemployment insurance fund (UIF).
Lastly, you need to get your B-BBEE certification. As your company will still be new and considered an exempted micro-enterprise by the Department of Trade and Industry, you will automatically obtain a B-BBEE status of level four.
Note: Documentation for the B-BBEE certification can be obtained through a verification professional who is accredited with the South Africa National Accreditation Systems (SANAS).
Step 2: Getting Your Construction Documents
As with any industry, there are certain documents, laws and regulations that solely apply to that industry. In the construction industry, you need certain documents in order to be compliant.
Note: You will need to hire qualified builders and engineers for the technical side of the business.
CIDB Register for Contracts
The Construction Industry Development Board (CIDB) is compulsory for all within the industry. Under the Construction Industry Development Board Act 38 of 2000, the CIDB is an integrated strategy for the reconstruction, growth and development of the industry. The CIDB is there to ensure that all construction companies uphold national standards and a Code of Conduct.
Registration with the CIDB is vital for you if you want to apply for contracts and government tenders. Those who are home builders with no interest in tenders or public sector contracts and those supplying labour and supplies to construction companies, do not need to apply for CIDB registration.
You can find the CIDB application forms here.
NHBRC Registration
The National Home Builders Registration Commission (NHBRC) is a regulatory body that is responsible for keeping a database of registered builders. You need to register with the NHBRC because some clients will check with the organisation to see if you are registered.
In some cases, registration with the NHBRC is a requirement for contracts and tenders. You can register with the NHBRC by clicking on this link.
MBSA Registration
The Master Builders South Africa (MBSA) organisation is not necessary for your construction company, however, it’s a great group to join. The representative body has over 4000 contractors and employers in the industry.
The company represents its members on national bodies and lobbies the national government on legislative and policy issues. The company is regulated by the Labour Relations Act 66 of 1995.
You can join the body by registering with the MBSA within your province.
Now that you have registered with the correct regulatory bodies, you can begin gaining your experience.
Step 3: Find a Mentor and Gain Experience
Because you do not have experience within the construction industry, the best way to get it is to find a mentor. Your mentor should be someone with a lot of knowledge and skill within the industry and can help you navigate the day-to-day work of owning a construction company.
Mentors are also valuable for helping you gain practical experience. This means that whatever your mentor teaches you or shows you, should be directly applicable to your company and the work you will be doing.
Getting a mentor will be easier for you as the owner of the company because you also need to learn about working with employees, how to be a leader, how to apply for tenders and contracts correctly and lastly, which laws and regulations to follow.
Step 4: Funding for Your Construction Company
Funding is an important step in the ‘construction’ of your company. You will need funding for tenders, equipment and sometimes to be able to pay your employees.
Funding platforms for construction companies:
iMbewu Fund
Part of the National Empowerment Fund (NEF), the iMbewu Fund provides funding for those looking to fulfil tenders and contracts.
Tirisano Construction Fund
This fund is part of the Industrial Development Corporation (IDC) and provides financing for renewable energy and energy-efficient projects that are of a smaller scale.
Indigo Kulani Group
This venture capital platform provides financing, and technical advisory services to the construction industry.
Lulalend (Lula)
Lula provides business loans and alternative funding which can be used to fulfil tenders and contracts.
These are just a few examples of places where you can get funding for your newly formed construction company. There are also government funding agencies which can help you get funding.
Remember, with all of these resources you still need to put in a lot of hard work to gain the experience you want. However, it’s not impossible and because you want this to work it will work.
