How to Start a Construction Company in Missouri | Essential Guide

by
Missouri Construction Company

Starting a construction company in Missouri 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 6,204,710 (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 Missouri and provide valuable tips for ensuring your success in this competitive industry.

How to Start a Construction Company in Missouri

What is a Construction Company?

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

Missouri 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 Missouri work to deliver high-quality, durable structures that meet their client’s needs and contribute to their community’s development and growth.

If you plan to start an LLC for your construction company, hire the Best LLC Services in Missouri. They offer the top features and prices for you to check out.

LLC Service

Rating & Pricing

Top Features

Learn More

#1 Recommendation

$0 + State fee

  • Free LLC Formation

  • Legal Support

  • Highly Reputed Company

Learn More

$299 + State fee

  • Single LLC formation package

  • Flat price for all services

  • Legal consultation

Learn More

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 Missouri.

– WEBINARCARE EDITORIAL TEAM

How to Start a Construction Company in Missouri

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 Missouri. 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 Missouri

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

In Missouri, 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 Missouri construction business name for 60 days. You must file a name reservation application with the Missouri 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 Missouri 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 $7.

You can check the availability of your desired business name by searching the Missouri Secretary of State Business Services‘s website.

Recommended: Embark on your entrepreneurial journey confidently and affordably with LegalZoom’s DBA service, the beacon that guides businesses to credible branding and comprehensive compliance. Discover how effortless success can truly be!

– LegalZoom – ($99 + Filling Fees)

Step 4: Register Your Construction Company

Register your business with the appropriate government agencies before officially starting your construction company in Missouri 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 Missouri.
  • 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 Missouri requirements and deadlines for the company, such as Annual Reports and Missouri 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 Missouri 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 –

LegalZoom – $249/year

File For Articles of Organization or Articles of Incorporation

If you form an LLC for your construction company, you must file the Missouri Articles of Organization, which costs $105. However, you must file the Articles of Incorporation if you form Missouri Corporation for your construction company. The Articles of Incorporation filing fee costs $50 fo filing online, $105 for filing 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 or drop it off in person to Corporations Unit, James C. Kirkpatrick State Information Center, P.O. Box 778, Jefferson City, MO 65102

Recommended: Filing the Articles of Organization and the Articles of Incorporation is easy and hassle-free if you hire a professional service. We recommend using –

LegalZoom – ($0 + State Fee)

Create an Operating Agreement

Operating Agreement is a document that contains all of your company’s organizational details. Drafting an operating agreement in Missouri 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 –

LegalZoom – Starts at $99

Obtain an Employer Identification Number

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

The application of an EIN in Missouri 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 –

LegalZoom – ($0 + State Fee for LLC formation)

Step 5: Obtain the Necessary Licenses and Permits

Starting a construction company in Missouri 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 Missouri Business License. The business license fee in Missouri 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 Missouri 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.
  • Missouri Sales Tax Permit: A sales tax permit from the Missouri Department of Revenue allows you to collect sales tax. Currently, the Missouri sales tax rate is 4.225%.
  • 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 Missouri 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 Missouri Small Business Loans.

Step 7: Purchase Equipment and Materials

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

Credibility

Forming an LLC can provide the Missouri 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 are the steps to start a construction company in Missouri?
The steps to start a construction company in Missouri include creating a business plan, registering the business, obtaining any required licenses and permits, and having adequate insurance.
Does Missouri require a construction company to be licensed?
Yes, Missouri requires construction companies to be licensed with the Missouri Department of Revenue.
What are the insurance requirements for a construction company in Missouri?
Construction companies in Missouri are required to have general liability insurance and workers’ compensation insurance.
How long does it take to obtain a construction license in Missouri?
The time it takes to obtain a construction license in Missouri varies depending on the type of license and the complexity of the application.
Is there a fee for obtaining a license for a construction company in Missouri?
Yes, there is a fee for obtaining a license for a construction company in Missouri. The amount varies depending on the type of license.
Can an out-of-state construction company operate in Missouri?
Yes, an out-of-state construction company can operate in Missouri, but they must register with the Missouri Secretary of State.
What are the business registration requirements for a construction company in Missouri?
Construction companies in Missouri must register their business with the Missouri Secretary of State and obtain a tax identification number from the Missouri Department of Revenue.
Does Missouri have any special regulations for construction companies?
Missouri has several regulations specific to the construction industry, including licensing requirements, workers’ compensation insurance, and safety training.
Are there any specific licenses required for general contractors in Missouri?
Yes, general contractors in Missouri are required to obtain a contractor’s license from the Missouri Division of Professional Registration.
What are the requirements for commercial construction projects in Missouri?
Commercial construction projects in Missouri generally require permits and inspections from the local building department.
Can a construction company specialize in specific types of work in Missouri?
Yes, a construction company in Missouri can specialize in specific types of work, such as electrical or plumbing.
How can a construction company find job opportunities in Missouri?
Construction companies in Missouri can find job opportunities through networking, government contracts, and private projects.
What are the safety regulations for construction companies in Missouri?
Safety regulations for construction companies in Missouri include providing safety equipment, safety training, and following OSHA standards.
Are there any tax incentives for construction companies in Missouri?
Missouri offers tax incentives for certain types of businesses, but they vary by location and project.
Can a construction company apply for bonding in Missouri?
Yes, construction companies in Missouri can apply for bonding, which provides assurance to clients that the project will be completed as agreed upon.
What are the bid requirements for construction companies in Missouri?
Construction companies in Missouri must follow specific bid requirements when submitting proposals for government projects.
What is the prevailing wage in Missouri for construction projects?
The prevailing wage in Missouri for construction projects varies depending on the project location and type of work being performed.
How can a construction company obtain funding in Missouri?
Construction companies in Missouri can obtain funding through loans or grants from government programs or private lenders.
Are there any specific certifications or qualifications required for construction workers in Missouri?
Missouri has various requirements for specific trades, such as electricians and plumbers, but not for general construction workers.
Are there any environmental regulations that a construction company should be aware of when working in Missouri?
Yes, construction companies in Missouri must comply with state and federal environmental regulations, such as those relating to air and water quality.
Can a construction company hire subcontractors in Missouri?
Yes, construction companies in Missouri can hire subcontractors, but they are responsible for ensuring that the subcontractors are licensed and insured.
How can a construction company verify the licenses of other contractors and subcontractors in Missouri?
Construction companies can verify licenses of contractors and subcontractors by contacting the Missouri Division of Professional Registration.
What are the penalties for not having the proper licensing or insurance in Missouri as a construction company?
The penalties for not having the proper licensing or insurance in Missouri as a construction company can include fines, loss of the license, or restricted ability to get jobs.
Are there any size or revenue requirements for a construction company operating in Missouri?
No, there are no size or revenue requirements for a construction company in Missouri.
Can a construction company choose not to bid on a project in Missouri?
Yes, a construction company can choose not to bid on a project in Missouri, but they may miss out on potential job opportunities.
How can a construction company resolve a dispute with a client in Missouri?
Construction companies in Missouri can resolve disputes with clients through mediation or litigation, depending on the severity of the issue.
How does the weather in Missouri affect construction companies?
The weather in Missouri can affect construction companies, especially during severe weather conditions such as tornadoes or heavy snowfall.
Can a construction company use cost-plus contracts in Missouri?
Yes, construction companies in Missouri can use cost-plus contracts, which involve the client paying for the actual costs of the project plus a percentage for profit.
How do I start a construction company in Missouri?
To start a construction company in Missouri, you should follow the state registration process and obtain any required licenses and permits.
Who can start a construction company in Missouri?
Anyone can start a construction company in Missouri as long as they meet the state’s legal and regulatory requirements.
Do I need a construction permit to start a company in Missouri?
You don’t need a construction permit to start a company in Missouri, but you will need permits and licenses to start accepting contracts and performing construction work.
What licenses do I need to start a construction company in Missouri?
You will need a contractor license, building permit, and other permits relevant to your type of construction work in Missouri.
How much does it cost to start a construction company in Missouri?
The cost of starting a construction company in Missouri varies, but you should expect to spend between $500 and $3000 on initial registration, licensing, and other setup costs.
Can I conduct business statewide in Missouri with one license?
Yes, you can use a single contractor’s license to conduct business statewide in Missouri.
How long does it take to get a contractor’s license in Missouri?
The time required to obtain a contractor’s license in Missouri varies depending on your qualifications and the license you need, but it typically takes between one and six months.
Can I work as a contractor in Missouri without a license?
No, it is illegal to work as a contractor in Missouri without a valid contractor’s license.
How do I apply for a contractor’s license in Missouri?
To apply for a contractor’s license in Missouri, you will need to provide proof of insurance, experience, education, and financial stability.
Can I get a temporary permit to work on a project in Missouri?
Yes, Missouri allows temporary permits for contractors working on a specific project or temporary basis, but you must still meet the state’s licensing and insurance requirements.
Can an out-of-state contractor work in Missouri?
Out-of-state contractors can work in Missouri, but they need to obtain a Missouri contractor’s license.
What are the bonding requirements for construction companies in Missouri?
The bonding requirements for construction companies in Missouri vary depending on the type of construction work you plan to do, but they typically involve surety bonds or insurance policies.
What types of general liability insurance are required for construction companies in Missouri?
Construction companies in Missouri require general liability insurance to cover potential accidents or damage that may occur on the job site.
Do I need a business plan to start a construction company in Missouri?
It is not required, but a business plan can be helpful in outlining your goals and financial projections for your construction business.
Can I obtain insurance quotes on my own or should I go through a broker?
You can obtain insurance quotes on your own, but brokers can be helpful in finding the best policies and pricing for your specific business needs.
Is a construction company listing in the Missouri Department of Revenue required?
Yes, all construction companies in Missouri must be listed with the Department of Revenue.
What taxes will my Missouri construction company have to pay?
Missouri-based construction companies will have to pay state and federal income, unemployment, and workers’ compensation taxes.
How can I find construction contracts in Missouri?
You can find construction contracts in Missouri through online portals, networking, and relationships with related industries.
Do I need a specific type of corporate structure to start a construction company in Missouri?
No, Missouri does not require a specific corporate structure for a construction company, although some structures may be more advantageous than others depending on your business goals.
How can I find the prime contractors in Missouri?
You can find prime contractors in Missouri by attending networking events, reaching out to industry associations, or through public bids posted by government agencies.
What is the limitation period for construction-related claims in Missouri?
Under Missouri law, construction-related claims must be brought within ten years of the date of the initial work.
Can I bid on public construction projects in Missouri?
Yes, Missouri offers public construction bidding opportunities to qualified and certified contractors.
What are some challenges I may face in starting a construction company in Missouri?
Some of the main challenges you may face in starting a construction company in Missouri include licensing requirements, insurance coverage, and uncertainty of demand.
Do I need a contractor’s license to provide general contractor services in Missouri?
Yes, you need a contractor’s license to provide general contractor services in Missouri.
Can I get financial assistance to start a construction company in Missouri?
Yes, Missouri offers financial assistance programs for entrepreneurs through the Missouri Small Business Development Center and other resources.
How long does it take to get a building permit in Missouri?
The time required to get a building permit in Missouri varies depending on the city and county, but it can take up to several weeks.
What is the Missouri Mechanics’ Lien Law?
The Missouri Mechanics’ Lien Law provides protections for contractors and subcontractors to secure payment for work done on a property.
Can non-residents start a construction company in Missouri?
Yes, non-residents can start a construction company in Missouri, but they must obtain a Missouri contractor’s license and meet the state’s legal and regulatory requirements.

Also Read

Conclusion

Starting a construction company in Missouri 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 Missouri market.

Leave a Comment