Strategic Planning for Residential Construction Business Startups


Steven Hunt

Faculty Mentor(s)

Hongtao Dang (Construction Management)


With over 70% of all construction startups in the U.S. failing within the first ten years, there are clear headwinds that new business owners face that are not being considered. This paper provides research into the link between strategic planning and successful construction startups, with a primary focus on the residential construction industry in the United States. The goal of this study is oriented around the considerations and planning that should be made prior to executing a startup business, and their importance in seeing success in the industry. The strategic planning considerations include market entry timing, market research, budgeting, financial forecasting, production forecasting, and business design. By analyzing nationwide survey data and researching successful construction startup owners means, methods, and considerations before beginning their work, strong differences can be found between those who succeed and those that struggle to find a footing in the industry. The key findings derived from the research show that those who see success considered all the strategic planning variables listed above, and not only had a strong understanding of the work, but how the industry was changing and innovating. Those that attempted to enter the industry without the necessary considerations either failed or did not see substantial growth for their business. With over two-thirds of startup businesses in the construction industry failing within the first ten years, this research helps shed a light on the strategic planning required to see success in the industry.

Keywords: Construction, Startup, Business, Residential, Strategic Planning


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