How to Start Hardware and Construction Supply Business

In this article, we’ll discuss how to start a construction supply store, what the market looks like for this type of business, and some pointers on how you can get started.

Construction Supply in The USA

Construction supply are a big market in the United States. U.S. consumers spent over $45 billion on construction supply in 2016 according to IBIS World, with home improvement stores accounting for a significant chunk of that revenue. There’s also plenty of upside potential; as the U.S. population grows, and the average age of homeowners rises, the demand for construction supply will only grow.

Construction supply stores can be found near highway exits or major metropolitan areas. They tend to stock a wide range of construction supply from roofing materials, to hand tools, and even construction equipment as needs change for various projects.

A typical construction supply store will be found in a strip mall or business park setting with other big box stores such as hardware stores or home improvement retailers nearby. They typically have a similar layout, with an entrance on one end, a large retail area in the middle, and two separate service areas at the back.


How to Start a Construction Supply Store

Now that you’ve learned what a construction supply store is, let’s look at how to start one.

The first step in starting a construction supply store is to assess what products you want to sell. If you already have a construction background, this should be easy, but if not, you may need to do some research. You’ll need to look at some industry trends, talk with suppliers and other business owners in the field, and of course, conduct your own survey of potential customers.

Next, you’ll need to determine the best location for your business. Look for a busy area with a large customer base that can support your products. You’ll also need to estimate how much parking area you will need and make sure it is available.

You’ll then need to get the construction permits and licenses required to operate your business including your general contractor license, home improvement contractor license, contractor’s license if applicable by state law (not all states require this), and a sales tax permit if applicable by state law. The latter process is simple but may involve a state and local tax office visit.

You’ll also need to acquire your tools, so don’t forget to factor this into your start-up expenses. This includes everything from hand tools to construction equipment. Depending on the type of business you want to run, you may need a forklift or other heavy equipment as well.


Once these preliminary tasks are taken care of, you’re ready to begin building your construction supply store. You can find wholesale suppliers online, but you will need to visit them in person for a credit check and to sign contracts. You will also need to visit local hardware stores for similar credit checks and sign contracts with suppliers as well.

You may also be required to pass a background check for your state license and/or select employees for theirs, as well as take some required classes. You should also make sure you’ve obtained your contractors insurance from a reputable insurer such as Nationwide Insurance.

You’ll need to choose your location and design your store. You will need to create a layout with all your products and service areas clearly marked and accessible. You may also want to create a mobile display unit to show off your product line and creative ideas.

In addition to your location and layout, you’ll also need to create a marketing plan. This includes developing a brand strategy and unique selling points for your store.

For example, you can highlight that you are an “eco friendly” supplier by selling bio-degradable materials such as mulch or construction paper. You can also develop a “DIY” (do it yourself) mindset by providing educational material in the form of magazines or classes. You may also want to emphasize your small business approach by offering financial assistance to customers who cannot afford the supplies you sell. This will help you establish a niche market and build your clientele.

You’ll need to set up your payment system including credit card processing and an internet payment system such as PayPal.

You can then begin to get your construction supply business off the ground. Remember that this is not going to be a fast process, and you will want to start small if you choose, with maybe one or two store spaces.

Finally, if you run a construction supply store and run into financial trouble, or find that the market has changed significantly since starting up, you may need to make some changes in your business plan.

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