How to Start a Construction Company in Wisconsin | Essential Guide


Steve Bennett
Steve Bennett
Business Formation Expert
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Wisconsin Construction Company

Starting a construction company in Wisconsin 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 5,955,737 (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 Wisconsin and provide valuable tips for ensuring your success in this competitive industry.

What is a Construction Company?

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

Wisconsin 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 Wisconsin 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 Wisconsin.

WEBINARCARE EDITORIAL TEAM

How to Start a Construction Company in Wisconsin

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 Wisconsin. 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 Wisconsin

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

In Wisconsin, 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 Wisconsin construction business name for 120 days. You must file a name reservation application with the Wisconsin 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 Wisconsin 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 two methods, by mail and in person.

However, before filing a DBA, you should know that you need to renew your DBA every ten years, which costs $15.

You can check the availability of your desired business name by searching the Wisconsin Department of Financial Institutions‘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 Wisconsin 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 Wisconsin.
  • 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 Wisconsin requirements and deadlines for the company, such as Annual Reports and Wisconsin 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 Wisconsin 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 Wisconsin Articles of Organization, which costs $130. However, you must file the Articles of Incorporation if you form Wisconsin Corporation for your construction company. The Articles of Incorporation filing fee costs $100 for online and by mail filing. 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 e-form, fill it, and submit online. Or get the online PDF, fill it up and upload it back on the site.  
  • Offline Filing: Send the form by mail to State of WI – Dept. of Financial Institutions, P.O. Box 93348, Milwaukee, WI 53293

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 –

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

The application of an EIN in Wisconsin 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 Wisconsin 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 Wisconsin Business License. The business license fee in Wisconsin 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 Wisconsin 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.
  • Wisconsin Sales Tax Permit: A sales tax permit from the Wisconsin Department of Revenue allows you to collect sales tax. Currently, the Wisconsin sales tax rate is 5.00%.
  • 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 Wisconsin 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 Wisconsin Small Business Loans.

Step 7: Purchase Equipment and Materials

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

Credibility

Forming an LLC can provide the Wisconsin 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

Is it necessary to have a license to start a construction company in Wisconsin?
Yes, Wisconsin requires construction businesses to have a license before they start operating.
What is the minimum age requirement for obtaining a contractor’s license in Wisconsin?
The minimum age requirement to obtain a contractor’s license in Wisconsin is 18 years old.
Is there a difference between a contractor and a subcontractor in Wisconsin?
Yes, there is a distinction between a contractor and subcontractor in Wisconsin. Subcontractors work under a contractor on a specific part of the project.
What is a surety bond, and is it required for construction companies in Wisconsin?
Surety bonds are an agreement between three parties that ensure proper project completion. They are required for certain types of construction projects in Wisconsin.
How much does it cost to obtain a construction license in Wisconsin?
The cost of obtaining a construction license in Wisconsin varies depending on the type of license you are applying for.
What are the different types of construction licenses available in Wisconsin?
The different types of construction licenses available in Wisconsin include general contractor, master plumber, journeyman plumber, master electrician, and more.
What are the requirements for obtaining a journeyman plumber license in Wisconsin?
The requirements for obtaining a journeyman plumber license include an apprenticeship, proof of experience, and passing an exam.
Do construction companies in Wisconsin have to provide workers’ compensation insurance?
Yes, construction companies in Wisconsin are required to provide workers’ compensation insurance to their employees.
How many continuing education hours are required for construction licenses in Wisconsin?
Construction license holders in Wisconsin are required to complete 12 hours of continuing education every two years.
Can a corporation own a construction company in Wisconsin?
Yes, a corporation can own a construction company in Wisconsin.
What is the process to renew a construction license in Wisconsin?
The process to renew a construction license in Wisconsin includes completing continuing education requirements and submitting the required paperwork.
What is the maximum fee to earn for a small works general contractor in Wisconsin?
A small works general contractor in Wisconsin can earn up to $25,000 per project.
Does Wisconsin offer reciprocity for construction licenses obtained in other states?
Yes, Wisconsin offers reciprocity for construction licenses obtained in some other states.
How do I register my business in Wisconsin?
To register your construction business in Wisconsin, you need to complete the Wisconsin Department of Financial Institutions form.
What are the different types of insurance required for construction businesses in Wisconsin?
The different types of insurance required for construction businesses in Wisconsin include liability, workers’ compensation, and automobile insurance.
What is the cost of general liability insurance for a construction company in Wisconsin?
The cost of general liability insurance for a construction company in Wisconsin depends on the amount of coverage needed.
How long does it take to complete the Wisconsin contractor’s exam?
The length of time it takes to complete the Wisconsin contractor’s exam depends on the person, but usually takes a full day.
Does Wisconsin require contractors to establish a surety bond or obtain a certificate of insurance?
Yes, Wisconsin requires contractors to establish a surety bond or obtain a certificate of insurance.
How can I find jobs for my construction company in Wisconsin?
Construction companies can network with contractors’ associations, attend events, search websites and job boards, and advertise their services online and offline.
Are there any restrictions on advertising a construction business in Wisconsin?
Yes, Wisconsin law requires construction businesses to advertise a specific class of the license within the advertisement.
Does Wisconsin require construction businesses to have standard contracts with customers?
No, Wisconsin does not require construction companies to use a specific contract. However, a contract between construction companies and customers in Wisconsin is highly recommended.
Is it possible to access construction plans and permits through the government’s online portal in Wisconsin?
Yes, construction companies can access construction permits and plans online at the Wisconsin Department of Safety and Professional Services website.
Do companies need a builder’s license to construct homes in Wisconsin?
Yes, construction companies need to have a builder’s license to construct homes in Wisconsin.
Can I operate an unlicensed construction business in Wisconsin?
No, unlicensed construction businesses cannot operate in Wisconsin.
Is there a specific procedure to obtain a master electrician license in Wisconsin?
Yes, obtaining a master electrician license in Wisconsin requires certain levels of experience and an examination, with testimony required from your sponsoring organization.
Are there specific building codes and regulations for construction businesses to follow in Wisconsin?
Yes, Wisconsin has adopted particular building codes and regulations for construction businesses to follow.
Do I need a permit to build a deck in Wisconsin?
Yes, a permit is required for outdoor deck building in Wisconsin.
Is a zoning permit required for building a commercial property in Wisconsin?
Yes, construction companies need a zoning permit to plan commercial construction projects in Wisconsin.
What are the permits or licenses required for HVAC contractors in Wisconsin?
In Wisconsin, HVAC contractors require a state license and a permit to work.
What entity type should I choose for my construction company in Wisconsin?
Wisconsin allows you to choose from several entity types, including LLCs, corporations, partnerships, and sole proprietorships.
What kind of business licenses do I need for a construction company in Wisconsin?
In Wisconsin, you will need a contractor’s license from the Department of Safety and Professional Services (DSPS).
How do I obtain a contractor’s license in Wisconsin?
You can obtain a contractor’s license in Wisconsin by applying through the DSPS and meeting certain qualifications, such as having a certain level of experience and passing an exam.
Do I need to obtain any special insurance as a construction company in Wisconsin?
Yes, you will need to obtain general liability insurance, worker’s compensation insurance, and potentially other types of insurance to protect your business from liability claims.
Can I bid on public projects as a construction company in Wisconsin?
Yes, you can bid on public projects in Wisconsin, but you will need to be registered with the Wisconsin Department of Administration.
What is the prevailing wage in Wisconsin for construction work?
The prevailing wage in Wisconsin varies by county and by trade, and is set by the Wisconsin Department of Workforce Development.
How can I find construction projects to bid on in Wisconsin?
You can look for construction projects to bid on in Wisconsin through the DSPS website, local newspapers, and online construction directories.
What are some common financing options for starting a construction company in Wisconsin?
You might consider seeking financing from banks, credit unions, or the Small Business Administration.
How do I hire employees for my construction company in Wisconsin?
You will need to follow Wisconsin’s hiring process, which involves verifying employees’ work eligibility, completing tax and benefit paperwork, and withholding taxes from employees’ paychecks.
What qualifications do I need to become a construction contractor in Wisconsin?
You will need to meet certain experience and education requirements set by the DSPS in order to become a registered contractor in Wisconsin.
How long does it take for my contractor’s license application to be processed in Wisconsin?
The processing time for contractor’s license applications in Wisconsin can vary depending on the completeness of your application and the workload of the DSPS.
Can my construction company work outside of Wisconsin?
Yes, you can work outside of Wisconsin, but you will need to follow the licensing requirements and regulations of the state or states you are working in.
What is the difference between being a general contractor and a subcontractor in Wisconsin?
A general contractor is responsible for overseeing an entire construction project, while a subcontractor performs a specific task or job as part of the overall project.
Can I get a construction loan for my Wisconsin business if I have bad credit?
It may be more difficult to get a construction loan with bad credit, but there are lenders who sometimes work with borrowers with less-than-stellar credit histories.
Do I need a business plan to start a construction company in Wisconsin?
While it is not required, having a business plan is recommended to help you identify your goals, strategies, and potential risks.
What kind of construction projects require a building permit in Wisconsin?
Constructing, enlarging, altering, repairing, moving, or demolishing any structural building element in the state of Wisconsin may require a building permit.
Can I start a construction company if I have no prior experience in construction work?
While it is technically possible, having experience in construction work can be very helpful in running a successful construction business.
Do I need to carry workers’ compensation insurance in Wisconsin if I am the only employee of my business?
Even if you are the only employee of your business, you may still need to carry workers’ compensation insurance in Wisconsin depending on your industry and the type of work you perform.
Should I incorporate my construction company in Wisconsin or Delaware?
Incorporating your construction company in Wisconsin can be a good option if you plan to do business only in the state, but incorporating in Delaware can provide some benefits as well, such as more favorable tax laws.
Can I bid on federal construction projects as a Wisconsin-based construction company?
Yes, you can bid on federal construction projects as a Wisconsin-based construction company, but you will need to follow federal regulations and obtain certain certifications.
What kind of equipment do I need to start a construction company in Wisconsin?
The equipment you will need depends on the type of construction work you plan to do, but common types of equipment might include excavators, bulldozers, backhoes, and skid steers.
What is the average salary for construction workers in Wisconsin?
According to the Bureau of Labor Statistics, the average wage for construction workers in Wisconsin is around $25 per hour.
How much does it cost to obtain a contractor’s license in Wisconsin?
The fees for obtaining a contractor’s license in Wisconsin vary depending on the type of license and level of experience required.
Do I need to obtain a certificate of insurance in Wisconsin?
Yes, you should obtain a certificate of insurance from your insurance provider to prove that you have the necessary insurance coverage for your business.
Can I file for bankruptcy if my construction company is struggling in Wisconsin?
Yes, you can file for bankruptcy if your construction company is struggling in Wisconsin, but there may be consequences such as losing assets and future credit opportunities.
How do I obtain government contracts for my Wisconsin construction company?
You can register with the Wisconsin Department of Administration and search for available government contracts through their website or other government contracting directories.
Can I deduct equipment purchases on my Wisconsin state taxes?
Yes, if the equipment is being used for business purposes, you can generally deduct the cost of purchasing and leasing equipment on your Wisconsin state taxes.
How long does it take to form a construction company in Wisconsin?
The time it takes to form a construction company in Wisconsin depends on how quickly you can gather and file the necessary paperwork, but it typically takes several weeks to several months.

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Conclusion

Starting a construction company in Wisconsin 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 Wisconsin market.

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