How to Start a Construction Company in Kansas | Essential Guide

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Kansas Construction Company

Starting a construction company in Kansas 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 2,963,308 (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 Kansas and provide valuable tips for ensuring your success in this competitive industry.

How to Start a Construction Company in Kansas

What is a Construction Company?

A construction company in Kansas 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. Kansas construction companies must adhere to local building codes, regulations, and licensing requirements to ensure their projects are safe, efficient, and compliant with state standards.

Kansas 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 Kansas 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 Kansas.

– WEBINARCARE EDITORIAL TEAM

How to Start a Construction Company in Kansas

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 Kansas. 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 Kansas

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 Kansas 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 Kansas Business Name Search for you to have a proper Kansas construction business name. 

In Kansas, 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 Kansas construction business name for 120 days. You must file a name reservation application with the Kansas 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 Kansas 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.

You can check the availability of your desired business name by searching the Kansas Secretary of State Business Entity‘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 Kansas 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 Kansas.
  • 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 Kansas requirements and deadlines for the company, such as Annual Reports and Kansas 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 Kansas Registered Agent Services.

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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 Kansas Articles of Organization, which costs $165. However, you must file the Articles of Incorporation if you form Kansas Corporation for your construction company. The Articles of Incorporation filing fee costs $90 for filing online 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: Create an account/Log in to the SOS site, get the online form, fill it, and submit online 
  • Offline Filing: Send the form by mail to Kansas Office of the Secretary of State, Memorial Hall, 1st Floor, 120 S.W. 10th Avenue, Topeka, KS 66612

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

The application of an EIN in Kansas 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 Kansas 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 Kansas Business License. The business license fee in Kansas 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 Kansas 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.
  • Kansas Sales Tax Permit: A sales tax permit from the Kansas Department of Revenue allows you to collect sales tax. Currently, the Kansas sales tax rate is 6.50%.
  • 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 Kansas 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 Kansas Small Business Loans.

Step 7: Purchase Equipment and Materials

Once you have secured funding for your Kansas 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 Kansas 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 Kansas 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 Kansas construction company and showcasing your expertise and quality work, you can build a strong reputation in the Kansas 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 Kansas 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 Kansas 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 Kansas construction companies, allowing them to focus on their core business operations.

Credibility

Forming an LLC can provide the Kansas 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

Can I start a construction company in Kansas with no experience?
Yes, you can start a construction company in Kansas regardless of your experience.
Is it mandatory to have a home office address in Kansas to start a construction company?
Yes, you need to have a home office address in Kansas to start a construction company in the state.
What kind of license do I need to start a construction company in Kansas?
You need to obtain the appropriate contractor’s license to start a construction company in Kansas.
How can I get a contractor’s license for starting a construction company in Kansas?
You can apply for a contractor’s license with the Kansas Attorney General’s office to start a construction company in Kansas.
Do I need to have general liability insurance to start a construction company in Kansas?
Yes, you need to have general liability insurance to start a construction company in Kansas.
How much does it cost to get a contractor’s license to start a construction company in Kansas?
The cost of a contractor’s license varies depending on the type of license you need to start a construction company in Kansas.
Can I obtain a contractor’s license online for starting a construction company in Kansas?
No, you cannot obtain a contractor’s license online for starting a construction company in Kansas.
Do I need to have a bond to start a construction company in Kansas?
Yes, you need to have a bond to start a construction company in Kansas.
What are the major legal requirements I need to fulfill to start a construction company in Kansas?
The major legal requirements you need to fulfill to start a construction company in Kansas include obtaining a contractor’s license, insurance, and a bond.
Can I start a construction company solo in Kansas?
Yes, you can start and run a construction company solo in Kansas.
Do I need to have a registered agent for starting a construction company in Kansas?
Yes, you need to have a registered agent for starting a construction company in Kansas.
How can I register my construction company for taxes in Kansas?
You can register your construction company for taxes with the Kansas Department of Revenue.
What kind of tax liabilities do I have as the owner of a construction company in Kansas?
You have income tax, property tax, sales tax, and payroll tax liabilities as the owner of a construction company in Kansas.
Do I need to collect sales tax for my construction company in Kansas?
Yes, you need to collect sales tax for your construction company in Kansas.
Can I get a tax deduction for startups when starting a construction company in Kansas?
Depending on the expenses you incur, you may be able to get a tax deduction for startups when starting a construction company in Kansas.
What is the minimum wage rate for construction workers in Kansas?
The minimum wage rate for construction workers in Kansas is $7.25 per hour.
Do I need to have a proper business plan to start a construction company in Kansas?
Yes, it’s a good idea to have a proper business plan to start a construction company in Kansas.
How can I find potential clients for my construction company in Kansas?
You can use various strategies such as networking, word-of-mouth marketing, social media marketing, advertising, and cold-calling to find potential clients for your construction company in Kansas.
Can I form a limited liability company (LLC) for my construction company in Kansas?
Yes, you can form an LLC for your construction company in Kansas.
Should I hire an attorney to start a construction company in Kansas?
It’s not mandatory to hire an attorney, but it’s a good idea to hire one to help you with legal aspects of starting a construction company in Kansas.
How can I finance my construction company in Kansas?
You can finance your construction company in Kansas through various options such as savings, personal lines of credit, small business loans, crowdfunding, and venture capital.
Can I get grants for starting a construction company in Kansas?
Yes, you can apply for various public and private grants for starting a construction company in Kansas.
Do I need to have construction specific insurance coverage for my construction company in Kansas?
Yes, you need to have construction specific insurance coverage for your construction company in Kansas.
How can I handle my taxes if my construction company operates in multiple states including Kansas?
You need to file tax returns in all states where you operate your construction company including Kansas.
Do I need specific permits to start a construction company in Kansas?
Yes, you need various permits such as zoning, building, safety permits based on your construction company’s nature in Kansas.
What are the most needed construction safety measures when starting a construction company in Kansas?
The most-needed construction safety measures include work site clean-up and clutter prevention, fall protection measures, emergency response planning, and proper signage of safety hazards when starting a construction company in Kansas.
Can I operate a construction company in Kansas without any employees?
Yes, you can operate a construction company in Kansas without any employees.
Is it important to monitor my construction company’s budget regularly in Kansas?
Yes, it’s important to monitor your construction company’s budget regularly to keep track of expenses, bills paid, income collected and profits or loss reports in Kansas.
What are the essential construction tools and equipment for starting a construction company in Kansas?
Depending on your construction company’s nature, the essential construction tools and equipment include safety laser, surveying equipment, leveling tools, ladders, hardhats, gloves, and harness when starting a construction company in Kansas.
What are the steps I need to follow to set up my construction company in Kansas?
The first step is to register your company with the Kansas Secretary of State, obtain a tax ID number, and secure any necessary licenses and permits.
Can I start my construction company without a license in Kansas?
No, you need a license to operate a construction company in Kansas, which is issued by the Kansas Corporation Commission.
What kind of license do I need for my construction company?
This will depend on the type of projects you’ll undertake, i.e., general contractor, electrical, plumbing, or mechanical contractor.
How do I apply for a license in Kansas?
You will need to submit an application to the Kansas Corporation Commission, along with supporting documents like licenses, insurance, and a bond.
Can I apply for more than one license type if I plan to take up diverse Constructor projects?
Yes, you can apply for multiple types of licenses in the state of Kansas if the projects you want to undertake require different types of licenses.
Do I need to pass any exams to get a license?
Yes, you will be required to pass a test to qualify for a contractor’s license in Kansas.
Apart from the testing fee, what are the other costs that I need to consider?
There are fees associated with filing a license application, procuring workman coverages, carrying liability insurance.
Do I need to register my construction company with the Kansas Workers’ Compensation Board as well?
Yes, all construction companies are obligated to register with the Kansas Workers’ Compensation Board and carry workers’ compensation insurance for their employees.
How expensive is workers’ compensation rate in Kansas?
Workers’ compensation rates are usually based on the type of work and risk level involved in your business.
Are there any restrictions on the bids that I place from outside Kansas?
No, there are no restrictions placed on contractors coming from other states.
Are building permit fees significant in Kansas?
Permit fees always depend on the type and cost of the work being conducted. Additionally, several Kansas agencies issue permits based on specific regulations they developed.
What capacity should my Kansas registered engineer have to supervise my construction projects when it lasts?
The engineer must have the necessary Kansas license.
Are there any restrictions about subcontractors’ used in Constructor projects?
There are no restrictions related to the use of subcontractors in constructor projects. However, anything contracted out will incorporate Kansas-approved building codes, permits, and insurance.
Can I start a construction company in Kansas with no business history?
It’s possible to begin a construction company without business history as long as you can work with a cosigner that will be actioned by collaborating with your liability insurance supplier.
Do Kansas construction contractors need legal policies added to their contractual terms?
Yes, it’s necessary to have legally binding standards and policies put in place while contracting with customers. These standards and policies vary depending on the back-and-forth developments on what each project requires.
How much liability insurance do I need for my Kansas construction company?
There are no set limits, but this will depend on the jobs and your plans immensed for the contracted projects already mapped out.
Once work on my construction project begins, can I change its timeline or features?
Changes after starting the construction work may call for retrospective modifications. Alterations, timelines, or new feature changes should be done on cue to ensure state-permitted building codes are not exceeded.
Can I face consequences for conducting illegal contracting conducted in Kansas?
Any person acting as a general, electrical, plumbing, or mechanical contractor without appropriate licensure may encounture charges for incidents generated there, including possible administrative penalties and delay charges that might hamper the project or even superseding applicable contractors’ agreement charges that might cripple the project completions.
Are there any industry trade shows where Kansas construction contractors remain up-to-date?
There are some Kansas-specific construction trade shows annually, which feature new industry developments, projects, regulations, and educational opportunities for Members in-country and from bordering areas to show development across skills, materials and finishes.
What financing options to consider when beginning my construction business?
Consider working with nearby angels, community banks, traditional banks loan advances, construction financing loans, and connecting with the Kansas Small Business Development Center for training and access to funding
Should first-time entrepreneurs think of owning Office space at early stages of the business development?
Unless obtaining an Office outside your home may not run unnecessary financial and HR expenses needlessly, its always wise to start modeling revenue procedure before committing to enduring time-consuming office-space contracts or even hiring employees.
Are there any notable infrastructural developments in Kansas work considers grasping professionally?
Transportation Infrastructure development is feasable but the southeastern quadrant is undergoing significant transformation and will have the required opportunities needed for developing commercial contracting highly engrained amongst targeted initiatives underway soon.
What possibilities exist to create marketing prospects as a Kansas business?
Word-of-mouth, listings (both social and non-infrastructure-dependent online directories, engaging on social media to enhance workforce skills amplifying through social options online posting/print media placement, giveaways/twitter banner ads to innovatively connect your newly former business with new customers.
What company tax regulation gets positioned rightly?
All Kansas approved companies attract particular taxes at a single-density rate- but only Kansas monthly withhold other professional services, social security and Medicare that are reimbursed to broaden Federal projects with consistent regularity.
What gross sales level that requires customers increasing targe in sales funnel process inline within a year?
Usually, there is no expressed gross-sales threshold, several opportunities continuously shed off over the span of the advert marketing different structuring capacities throughout the initial st.ages until they conclude with tender acceptance or offerings you exclusively deem suited.
How reliant are B2B Markets as core Kansas companies they engage with?
There no credible flow of data and material about core businesses of Kansas being particularly suited B2B business endeavors either through offline (transparency decisions speaking on who they have singledly bought contracts from) or otherwise online trade placed within reporting commuirevices.
As its holiday services nearing its final quarter, are there ranges of services construtor companies should focus designing domestic (residential) services round?
Seasonal festivity end-of-the-year a great deal of experts to conversational consultants, architects, engineers, designers required to developing facility installations from domiciled-services and creating personalized home-activity spaces due to quarantine-friendly lifestyle shift still aligned with daily business concepts principles regimes.

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Conclusion

Starting a construction company in Kansas 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 Kansas market.

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