How to Start a Construction Company in Florida | Essential Guide

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Florida Construction Company

Starting a construction company in Florida can be lucrative and rewarding for anyone with the right skills, resources, and determination. With a strong demand for quality construction services and a consistently growing population of 22,359,251 (2024 data), there is always room for new Limited Liability Companies to thrive in this industry. However, starting a construction company is a challenging task and requires careful planning, dedication, and hard work.

In this article, Webinarcare Editorial Team will discuss the necessary steps to Start a Construction Company in Florida and provide valuable tips for ensuring your success in this competitive industry.

How to Start a Construction Company in Florida

What is a Construction Company?

A construction company in Florida is a business that specializes in the planning, design, and execution of construction projects. These projects can range from residential homes to commercial buildings and infrastructure projects such as roads, bridges, and utility systems. Florida construction companies must adhere to local building codes, regulations, and licensing requirements to ensure their projects are safe, efficient, and compliant with state standards.

Florida construction companies often offer various services, including general contracting, design-build, and specialized construction services. They collaborate with various stakeholders, such as architects, engineers, developers, and property owners, to bring projects to life. By employing skilled tradespeople, project managers, and other professionals, construction companies in Florida work to deliver high-quality, durable structures that meet their client’s needs and contribute to their community’s development and growth.

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It is suggested that you speak with a legal professional before you begin setting up a construction company. They’ll understand what’s best for you and your future company. To safeguard your personal assets from business debts, you can always start an LLC in Florida.

– WEBINARCARE EDITORIAL TEAM

How to Start a Construction Company in Florida

To launch a construction business, you must follow the guidelines that include researching the construction industry, developing a business plan, registering your business, securing funding, purchasing equipment and material, hiring a skilled team, and marketing your construction company.

Step 1: Research the Construction Industry

Before diving into starting your construction company, it’s essential to understand the local construction industry in Florida. Research your area’s market trends, major players, and potential competition. This will help you identify gaps in the market that your company can fill and allow you to make informed decisions about the types of services you want to offer.

Some key areas to research include:

  • Types of construction projects in demand (residential, commercial, etc.)
  • The average cost of construction projects in your area
  • Local building codes and regulations
  • Key stakeholders in the industry (architects, developers, etc.)
  • Licensing and certification requirements for contractors in Florida

Step 2: Develop a Business Plan

A well-thought-out business plan is crucial for the success of any new business, including a construction company. Your business plan will act as a roadmap for your company’s growth and development, helping you make informed decisions and keep your business on track.

Some key elements to include in your construction company business plan are:

  • Company Overview: Describe your company’s mission, vision, and goals. Include the legal structure of your business (LLC, corporation, sole proprietorship, etc.) and your company’s name and location.
  • Market Analysis: Summarize your research on the local construction industry, including the target market, competition, and growth opportunities.
  • Services Offered: Clearly define the types of construction services your company will offer, such as general contracting, design-build, or specialized construction services.
  • Marketing and Sales Strategy: Outline how to attract and retain clients and your strategies for generating leads and closing sales.
  • Management and Organization: Detail the roles and responsibilities of your management team and any key personnel you plan to hire.
  • Financial Projections: Provide a realistic estimate of your company’s financial performance over the next few years, including projected income, expenses, and profits.

Step 3: Choose a Business Name

Selecting a name for your Florida construction company is essential to forming. Your business name should be unique, memorable, and reflective of your products or services. There is a complete guide on Florida Business Name Search for you to have a proper Florida construction business name. 

In Florida, if you do not wish to file your construction business company right away but want to hold the name that you have decided on, then you can reserve your Florida construction business name for 120 days. You must file a name reservation application with the Florida Secretary of State to keep the name. 

You can register your business under a different legal name if your preferred name isn’t available. Once you have chosen a name, you can submit an application for Florida DBA (doing business as). In this manner, you can choose any name you desire for your business. A DBA allows a company to operate under the name of the person or entity who owns it. If you have decided to file for a DBA, you can file it in three methods, online, by mail, and in person filing..

However, before filing a DBA, you should know that you need to renew your DBA every five years, which costs $50 Processing Fee, $10 Certificate of Status, $30 Certified Copy.

You can check the availability of your desired business name by searching the Florida Department of State Division of Corporations‘s website.

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Step 4: Register Your Construction Company

Register your business with the appropriate government agencies before officially starting your construction company in Florida and obtain any necessary licenses and permits. 

Hire a Registered Agent

A Registered Agent is a person or entity responsible for receiving legal documents and official notices for your construction business. The qualifications of a Registered Agent vary depending on the jurisdiction, but generally, they must meet the following criteria:

  • Age: The Registered Agent must be at least 18 years old.
  • Residency: The Registered Agent must reside where the company is registered or authorized to do business in that state. In some jurisdictions, a domestic corporation or limited liability company (LLC) can act as its Registered Agent if it has a physical address in Florida.
  • Physical Address: The Registered Agent must have a physical street address, not just a post office box, where the company is registered. This is where they will receive official correspondence and legal documents on behalf of the company.
  • Availability: The Registered Agent must be available during normal business hours (9 a.m. to 5 p.m., Monday through Friday) to receive and sign official correspondence and legal documents.
  • Good Standing: If the Registered Agent is a business entity, it must be in good standing with the state and not be in default, suspended, or revoked.
  • Compliance: The Registered Agent should know Florida requirements and deadlines for the company, such as Annual Reports and Florida franchise tax filings, and ensure that the company stays compliant. 

You can serve as your Registered Agent, appoint a friend or family member, or hire a Professional Florida Registered Agent Services.

Recommended: Professional services will ensure your business gets legal notices and critical mail. With LegalZoom’s Registered Agent Services, they offer peace of mind and expert support for businesses, ensuring compliance and seamless communication with state authorities. That’s why we recommend using –

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File For Articles of Organization or Articles of Incorporation

If you form an LLC for your construction company, you must file the Florida Articles of Organization, which costs $100. However, you must file the Articles of Incorporation if you form Florida Corporation for your construction company. The Articles of Incorporation filing fee costs $35 for filing in-person and by mail. It is crucial to provide accurate and complete information on this document, as errors or omissions may result in delays or rejection of your filing.

  • Online Filing: Get the online form from Secretary of State, fill it up, and submit. Don’t refresh the page during the process. It will erase everything.  
  • Offline Filing: Send the form by mail to New Filing Section, Division of Corporations, P.O. Box 6327, Tallahassee, FL 32314

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Create an Operating Agreement

Operating Agreement is a document that contains all of your company’s organizational details. Drafting an operating agreement in Florida is optional. Yet, having one as an internal document is strongly advised. 

Recommended: Creating an Operating Agreement is like having a personal legal guide at hand; it’s efficient, thorough, and ensures the smooth and compliant operation of your business. With LegalZoom’s operating agreement, it will protect your rights as an owner, keeping misunderstandings at bay and your business on the path to success. That’s why we recommend using –

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Obtain an Employer Identification Number

You must first obtain Florida Employer identification number (EIN) from the IRS if you will open a bank account or hire an employee for your Florida construction company. 

The application of an EIN in Florida can be through the following:

  • Apply Online- The online EIN application is the preferred method for customers to apply for and obtain an EIN.
  • Apply by Fax- Taxpayers can fax the completed Form SS-4 application to the appropriate fax number), after ensuring that the Form SS-4 contains all of the required information.
  • Apply by Mail- The EIN application Form SS-4 can be filed via mail. The processing time frame to receive the mail is four weeks.
  • Apply by Telephone-International Applicants – International applicants may call 267-941-1099 (not a toll-free number) from 6 a.m. to 11 p.m. (Eastern Time) Monday through Friday to obtain their EIN.

Recommended: Professional services have the EIN included in their LLC formation package. We recommend using –

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Step 5: Obtain the Necessary Licenses and Permits

Starting a construction company in Florida requires several licenses and permits. Some of the most common licenses and permits you’ll need include the following:

  • Business License: Your local city or county government may require Florida Business License. The business license fee in Florida ranges from $50 – $300.
  • Contractor’s License: A contractor’s license is required in most states for construction businesses that perform specific types of work, such as general contracting, electrical, plumbing, HVAC, or other specialized trades. Requirements for obtaining a contractor’s license may include passing an exam, providing proof of experience, and obtaining bonding and insurance.
  • Building Permits: Construction projects typically require permits issued by the Florida building department. Building permits ensure the construction project complies with local building codes and regulations.
  • Occupational Licenses: Some states may require occupational licenses for specific types of work, such as asbestos abatement, lead paint removal, or the installation of fire protection systems. Check with your state’s licensing board to determine if any special licenses are required for the work your construction company will perform.
  • Florida Sales Tax Permit: A sales tax permit from the Florida Department of Revenue allows you to collect sales tax. Currently, the Florida sales tax rate is 6.00%.
  • Environmental Permits: Depending on the nature of your construction projects, you may need to obtain environmental permits, such as stormwater discharge or air quality permits.

Step 6: Secure Funding

Starting a construction company requires significant capital to cover equipment, materials, and labor costs. To secure funding for your Florida business, you must explore various financing options and determine the best fit for your needs.

When seeking funding, be prepared to present your business plan and financial projections to potential lenders or investors. This will demonstrate your commitment to your company’s success and help build their confidence in your ability to repay the loan or generate a return on their investment.

However, consider applying for your construction company’s Florida Small Business Loans.

Step 7: Purchase Equipment and Materials

Once you have secured funding for your Florida construction company, you must purchase the necessary equipment and materials to begin operations. This may include items such as:

  • Construction vehicles (trucks, excavators, etc.)
  • Power tools and hand tools
  • Safety equipment (hard hats, safety goggles, etc.)
  • Building materials (lumber, concrete, etc.)
  • Office equipment and supplies (computers, printers, etc.)

Invest in high-quality equipment and materials, as this will help you deliver exceptional results to your clients and build a strong reputation in the industry. Consider purchasing insurance for your equipment, as this can help protect your investment in the case of theft, damage, or accidents.

Step 8: Hire a Skilled Team

Your Florida construction company’s success will largely depend on your team’s skills and expertise. Hire individuals with experience and knowledge in the construction industry to build a strong workforce. This may include:

  • Project managers
  • Construction laborers
  • Skilled tradespeople (electricians, plumbers, etc.)
  • Architects or engineers
  • Administrative staff (accountants, receptionists, etc.)

In addition to hiring qualified employees, invest in ongoing training and development programs to help your team stay current on industry trends, technologies, and best practices. This will improve the quality of your services and help you attract and retain top talent in the competitive construction industry.

Step 9: Market Your Construction Company

You must develop a comprehensive marketing strategy to attract clients and grow your Florida construction company. This may include building a professional website that showcases your services, portfolio, and testimonials from satisfied clients; creating and distributing print materials, such as brochures, business cards, and direct mail advertisements; networking with industry professionals, such as architects, developers, and real estate agents, to generate leads and referrals, and utilizing social media and digital marketing strategies to reach a wider audience and drive traffic to your website.

By consistently promoting your Florida construction company and showcasing your expertise and quality work, you can build a strong reputation in the Florida construction industry and attract a steady stream of new clients.

Benefits of Forming a Construction Company

Forming a Construction LLC is best for a start-up company since it offers the following advantages.

Limited Liability Protection

LLC provides limited liability protection to its owners, also known as members. This means that the personal assets of the LLC members are separate from the company’s debts and liabilities. In the construction industry, where accidents, property damage, and contractual disputes occur, limited liability protection is crucial to protect business owners’ assets.

Pass-through Taxation

An LLC typically offers pass-through taxation, meaning the company’s profits and losses are reported on the owner’s tax returns. This avoids the double taxation corporations may face, where the company and its shareholders are taxed separately. Pass-through taxation can lead to potential tax savings for the Florida construction company’s owners.

Flexibility in Management

LLCs have a more flexible management structure than corporations. They do not require a board of directors, and the owners can choose how to manage the company through member or manager management. This flexibility allows Florida construction companies to adapt their management structure as needed.

Simpler Record-Keeping and Compliance

LLCs still require formalities; they typically have fewer record-keeping and reporting requirements than corporations. This can save time and resources for Florida construction companies, allowing them to focus on their core business operations.

Credibility

Forming an LLC can provide the Florida construction company with increased credibility and professionalism in the eyes of clients, vendors, and financial institutions. This can be beneficial in securing contracts and building a positive reputation in the industry.

FAQs

What kind of licenses do I need to start a construction company in Florida?
You will need a construction license from the Florida Construction Industry Licensing Board.
How do I apply for a construction license in Florida?
You can apply online through the Florida Department of Business and Professional Regulation.
What are the fees associated with getting a construction license in Florida?
The application fee is $249, and there is an additional fee for the examination.
Do I need to have insurance to start a construction company in Florida?
Yes, you need to have general liability insurance to protect yourself from lawsuits.
What are the insurance requirements for a construction company in Florida?
You need to have at least $300,000 in liability insurance and $50,000 in per occurrence coverage.
What kind of taxes do I need to pay if I start a construction company in Florida?
You will need to pay sales tax and unemployment taxes in Florida.
How do I register my construction company with the state of Florida?
You can register your business with the Florida Division of Corporations.
Do I need to have a business plan to start a construction company in Florida?
A business plan is not required, but it can help you to secure financing and plan for the future.
What is a DBA and do I need one to start a construction company in Florida?
A DBA is a “doing business as” name, and it is not required in Florida.
What is the process for obtaining a building permit in Florida?
The process for obtaining a building permit varies by city and county.
How much does a building permit cost in Florida?
The cost of a building permit will vary depending on the project’s scope and the location.
What are the requirements for a building permit in Florida?
The requirements for a building permit will vary depending on the project’s scope and the city/county regulations.
Do I need to have a builder’s risk insurance policy in Florida?
Builder’s risk insurance is not required by law in Florida but is highly recommended.
What is the average cost of a builder’s risk insurance policy in Florida?
The cost of a builder’s risk insurance policy will depend on the scope of the construction project.
Do I need a bonding company for my construction company in Florida?
Yes, you need to be bonded in Florida to do any construction work.
How do I get bonded in Florida?
You can work with a bonding company to obtain a surety bond for your construction company.
What are the bonding requirements for a construction company in Florida?
You will need to be bonded for an amount of at least $20,000.
Do I need to have a company name before registering my construction company in Florida?
You will need to have a company name to complete the registration process.
Can I start a construction company in Florida if I am an out-of-state resident?
Yes, you can start a construction company in Florida as an out-of-state resident.
What is the difference between an LLC and a sole proprietorship in Florida?
An LLC is a separate legal entity from its owners, while a sole proprietorship is not a separate legal entity.
Which type of business entity is best for a construction company in Florida?
An LLC is usually the best option for a construction company in Florida.
How do I register my business name in Florida?
You can register your business name with the Florida Department of State, Division of Corporations.
Does Florida require a state tax ID number for construction companies?
No, you only need a federal tax ID number to start a construction company in Florida.
What is the difference between a contractor and a builder in Florida?
In Florida, a contractor is someone who performs contracting services, while a builder is someone who constructs buildings.
Do I need to have a permit to build a shed in Florida?
Yes, you will need a building permit to construct a shed in Florida.
Can a homeowner act as their contractor on a construction project in Florida?
Yes, a homeowner can act as their contractor on construction projects in Florida as long as they live in the property for 12 months or more.
Do I need to file my taxes in Florida if I start a construction company there?
Yes, if you have established Florida as your company state, your business is probably taxed in Florida.
How many employees do I need to have to start a construction company in Florida?
One person can start a construction company in Florida and it could gradually increase.
What should I include in my construction company’s contract in Florida?
You should include the scope of the work, timeline for completion, materials, terms of payment, and any warranties or guarantees.
What are the licensing requirements for starting a construction company in Florida?
In Florida, contractors are required to obtain a state license from the Florida Department of Business and Professional Regulation.
What kind of insurance does a new construction company need in Florida?
New construction companies in Florida typically need general liability insurance, workers’ compensation insurance, and builder’s risk insurance.
How can I get bonded to start a construction company in Florida?
To obtain a Florida contractor’s license, applicants must provide proof of a surety bond between $5,000 and $20,000, depending on the type of license.
Are there any training requirements to become a licensed contractor in Florida?
Yes, in Florida, all applicants for a contractor’s license must complete a state-approved licensing course and pass a qualifying exam.
Can I do construction work in Florida without a license?
No, in Florida, anyone engaging in construction work that exceeds $500 must be licensed as a contractor.
How do I apply for a contractor’s license in Florida?
To apply for a Florida contractor’s license, go to the Florida Department of Business and Professional Regulation website and complete an application.
What are the fees associated with obtaining a contractor’s license in Florida?
Fees for a contractor’s license in Florida include application fees, licensing fees, and insurance requirements, which vary depending on the type of license.
Is there a difference between a general contractor license and a construction contractor license in Florida?
Yes, a general contractor has broader contracting privileges than a construction contractor, and an additional exam is required to obtain a general contractor’s license.
How long does it take to obtain a contractor’s license in Florida?
The length of time to obtain a Florida contractor’s license can range from several months to over a year, depending on the type of license and the applicant’s experience.
Can an out-of-state contractor work in Florida?
Yes, out-of-state contractors can work in Florida as long as they are properly licensed and insured in Florida.
What are the requirements to renew a contractor’s license in Florida?
To renew a Florida contractor’s license, the applicant must complete the required education requirements and submit the renewal application along with any required fees and insurance information.
Are there any continuing education requirements for licensed contractors in Florida?
Yes, licensed contractors in Florida are required to complete minimum continuing education requirements to refresh their knowledge and skills and stay updated on industry changes.
How do I verify a contractor’s license in Florida?
To verify a Florida contractor’s license, go to the Florida Department of Business and Professional Regulation website and search for the contractor in the license database.
Can a person hold multiple contractor’s licenses in Florida?
Yes, a person can hold multiple contractor’s licenses in Florida, as long as they meet the requirements for each license type.
Is there a minimum age requirement to become a licensed contractor in Florida?
Yes, an applicant for a Florida contractor’s license must be at least 18 years old.
What are the different types of contractor’s licenses available in Florida?
The different types of contractor’s licenses in Florida include general contractor, roofing contractor, electrical contractor, plumbing contractor, and residential contractor.
Can a contractor’s license be transferred from another state to Florida?
Florida does not have reciprocity agreements with other states, but an applicant can use their certification from another state as equivalent work experience to apply for a Florida license.
Are there any financial requirements to obtain a Florida contractor’s license?
Yes, an applicant must have a net worth of at least $2,500 to obtain a Florida contractor’s license.
What are the experience requirements to obtain a Florida contractor’s license?
The experience requirements for obtaining a Florida contractor’s license vary depending on the type of license and range from two to four years of documented experience.
Can a contractor subcontract work to other companies in Florida?
Yes, a contractor can subcontract work to other companies in Florida as long as they meet the licensing and insurance requirements.
Can a homeowner apply for a contractor’s license in Florida to work on their own home?
No, a homeowner cannot apply for a contractor’s license in Florida to work on their own home unless they plan to complete all of the work personally without hiring subcontractors.
How does a new construction company find clients in Florida?
New construction companies in Florida can find clients through referrals, online advertising, and participating in local networking events.
What are the penalties for working without a license in Florida?
Violating the state’s licensing requirements can result in fines, suspensions, or revocation of a contractor’s license. Repeat offenders can face criminal charges.
Does a contractor in Florida need to have a construction contract in writing?
Yes, contracts for construction work in Florida that exceed $2,500 must be in writing and should outline the scope of work, payment terms, and any other terms and conditions.
What should I include in my proposal for a construction project in Florida?
Proposals for construction projects in Florida should include a detailed description of the project, a breakdown of costs, a timeline for completion, and any special terms and conditions.
Are there any special requirements for choosing a business name for a construction company in Florida?
Florida has regulations for business names that prohibit certain words and require certain designations such as LLC, Inc., and LLP.
How can I ensure that my construction company is compliant with OSHA regulations in Florida?
The Occupational Safety and Health Administration has specific regulations that contractors in Florida must follow to ensure a safe work environment. Familiarize yourself with these regulations and make sure your company is fully compliant.
Do I need to register my construction company with the state of Florida?
Yes, new construction companies in Florida need to register their business with the state and obtain any necessary permits to conduct business.

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Conclusion

Starting a construction company in Florida can be challenging yet rewarding for those prepared to invest the time, effort, and resources necessary for success. By following the steps outlined in this article and dedicating yourself to providing exceptional service and quality work, you can create a thriving construction business that stands out in the competitive Florida market.

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