What is the first thing you should consider if you want to start your own civil engineering business?
“You will need an idea for a business before you do anything else,” says Doug Buchanan, P.E., M.ASCE, principal engineer at Buchanan Engineering, Civil and Structural, PLLC, in Indian Trail, North Carolina. “To be successful, you are going to need to develop a business idea [that] no one else in your area currently provides or which you can provide better than anyone else. And this should be something you are really passionate about, since your new business will consume a great deal of your time and money.”
Buchanan should know a thing or two about starting a business because he started his own this past January.
“The other thing that you need to think about is a contingency plan,” he says, “because if the business doesn’t work, what are you going to do? You have to realize that, hey, you are not going to be making a million dollars the first month. It is going to take time to establish yourself in the community and build up a pool of clients.”
Buchanan, along with Katy Ringeman, an insurance/investment advisor with Ringeman Insurance; Louis A. Trosch, an attorney with Conrad Trosch & Kemmy, P.A.; Ann Craven, an accountant with Rowell, Craven & Short, P.A.; and Martha Rea Calkins, president of the FROG Company, a marketing and sales firm, presented a preconference Short Course at ASCE’s 143rd Annual Civil Engineering Conference in Charlotte, North Carolina, entitled Engineering Business Startup.
Among the things they advised attendees to consider when thinking about becoming your own boss are (a) be sure your business idea is both plausible and unique, (b) determine your potential market, and (c) determine the cost of your operation.
“The best business plan is to start your own business debt free,” stressed Buchanan, “which means determining impediments. You will need to plan ahead for all of the problems which can get in the way of running a business.”
Buchanan and the rest of the presenters advised determining a budget, including wages for yourself and your employees, costs for professional services, the time and money you are going to spend on marketing, the cost and time of starting a website, and a realistic assessment of revenues.
“Word of mouth – which is good PR – can be the best way to attract new customers,” he says. “If you get bad reviews or negative feedback, respond positively and fix the problem. People will be much less judgmental about mistakes if you’re willing to fix them.
“Also, go to conferences, charity galas, meetings with complementary businesses and anywhere […] your customers are likely to be highly concentrated. In other words, get out in public and interact with people.”
Trosch explained the differences between a Limited Liability Company, an LLC Partnership, a Limited Partnership, and a business corporation, and the advantages and disadvantages of each. Ringerman talked to the attendees about the importance of liability insurance and the pros and cons of investment.
“New business owners need to know what a business expense is and the difference between what is considered a gross profit and a gross net profit when you pay your taxes,” explained Buchanan.
Develop a Marketing and Sales Plan
To help prospective business owners in the area of sales and marketing, Calkins told attendees that developing a marketing plan “is nothing more than setting goals and making a to-do list that will get you there.”
“It’s really not much different than planning a party,” she said. “You’re basically creating a plan for inviting more people you love to give you money and then tell other people why they should give you their money.”
Calkins says this means that it’s absolutely vital to develop a comprehensive, realistic, and step-by-step sales process, with a clear outline of what you are to do. It’s only when such an outline is in place that a business owner can measure success and monitor his or her sales progress and results.
The Good Life
“I went through all this myself,” says Buchanan. “And actually started all the paperwork in the summer of 2012 and it was not a lot of fun. But there are a number of reasons why you want to be your own boss: you want to set your own destiny, you want to be involved in the kind of projects that you want to be involved with, and you want to have the possibility of financial freedom.
“So following the outline of this plan, I feel like my business is very successful, I have good clients, I am in the black, and I am doing some networking to improve business. Take it from me, if you manage it and plan it right, being your own boss can be a pretty good life, to be honest with you.”