How to Start a Fence Company

Start a fence company by following these 10 steps:

1. Plan your Fence Company
2. Form your Fence Company into a Legal Entity
3. Register your Fence Company for Taxes
4. Open a Business Bank Account & Credit Card
5. Set up Accounting for your Fence Company
6. Get the Necessary Permits & Licenses for your Fence Company
7. Get Fence Company Insurance
8. Define your Fence Company Brand
9. Create your Fence Company Website
10. Set up your Business Phone System

We have put together this simple guide to starting your fence company. These steps will ensure that your new business is well planned out, registered properly and legally compliant.

Exploring your options? Check out other small business ideas.

STEP 1: Plan your business

A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:

• What will you name your business?
• What are the startup and ongoing costs?
• Who is your target market?
• How much can you charge customers?

Luckily we have done a lot of this research for you.

What will you name your business?

Choosing the right name is important and challenging. If you don’t already have a name in mind, visit our How to Name a Business guide or get help brainstorming a name with our Fence Company Name Generator

If you operate a sole proprietorship, you might want to operate under a business name other than your own name. Visit our DBA guide to learn more.

When registering a business name, we recommend researching your business name by checking:

• Your state's business records
• Federal and state trademark records
• Social media platforms
• Web domain availability.

It's very important to secure your domain name before someone else does.

What are the costs involved in opening a fence company?

Opening expenses include a business and tax license, a contractor’s license, and liability insurance. Insurance is necessary to protect your business in the event of an accident or injury. Purchasing a surety bond is also a good idea. Many come in amounts from between $6000 to $12000, but coverage for up to $50,000 can be purchased for large projects. The cost of yearly premiums for a small business averages between $500 and $900. At minimum, you’ll need a full size truck with an extended bed for delivering materials. A forklift can also be useful in loading fencing materials quickly and easily. The necessary equipment required for building fences includes post drivers, fence stretchers, saws, drills, air compressors, hydraulic augers, and a concrete mixer. Purchasing that equipment new will require a minimum investment of approximately $10,000. Finally, you’ll need a place to store all of that equipment as well as office space for storing files and contracts. Fortunately, depending on your local zoning laws, your home may be able to serve those multiple purposes.

What are the ongoing expenses for a fence company?

Ongoing expenses for a fence installation business may include:

• Vehicle and equipment maintenance
• Fencing materials
• Storage costs
• Shipping fees
• Credit card processing fees
• Website maintenance and office supplies
• Employee payroll

Who is the target market?

Preferred customers are homeowners, business owners, real estate developers, farmers, ranchers, and government agencies.

How does a fence company make money?

A fence installation business makes money by purchasing fencing supplies at wholesale prices and charging for the labor and expertise necessary to design and install fences.

How much can you charge customers?

It is estimated that the average cost of a fence is $2,620. In many places, building permits are required. The average building permit costs about $800. If the area to be fenced is sloped or contains obstructions that need to be removed, the cost can be significantly higher. For a simple wooden fence, the industry standard for materials is currently from between $7 and $19 per linear foot. The charge for a vinyl fence can be as high as $33 per linear foot. Other materials, such as decorative wrought iron, can be priced as high as $300 per linear foot when installation costs are included. Labor costs per linear foot vary from $7 to $12, depending on the type of materials used.

How much profit can a fence company make?

Depending on the level of training and experience, the annual salary for a fence installation worker ranges from between $21,160 and $51,800 with an average of $32,450. A large, well- established fence installation business can create as much as 1.4 million in annual revenue.

How can you make your business more profitable?

One way to make your business more profitable is by creating a display showcasing all the different types of fencing your company offers for potential customers. Erecting a number of small sections of each type, using different materials, including decorative elements, provides your customers with a visual representation of the finished product. Another important step you can take to make your business more profitable is teaming up with other fencing contractors who specialize in different types of fences than those your company normally builds. Cooperation as well as competition between industry professionals benefits everyone involved. It can both increase your company’s name recognition and result in a greater number of satisfied customers.

STEP 2: Form a legal entity

The most common business structure types are the sole proprietorship, partnership, limited liability company (LLC), and corporation.

Establishing a legal business entity such as an LLC or corporation protects you from being held personally liable if your fence company is sued.

You can form an LLC yourself and pay only the minimal state LLC costs or hire one of the Best LLC Services for a small, additional fee.

STEP 3: Register for taxes

You will need to register for a variety of state and federal taxes before you can open for business.

In order to register for taxes you will need to apply for an EIN. It's really easy and free!

There are specific state taxes that might apply to your business. Learn more about state sales tax and franchise taxes in our state sales tax guides.

STEP 4: Open a business bank account & credit card

Using dedicated business banking and credit accounts is essential for personal asset protection.

When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.

Open a business bank account

Besides being a requirement when applying for business loans, opening a business bank account:

• Separates your personal assets from your company's assets, which is necessary for personal asset protection.
• Makes accounting and tax filing easier.

Get a business credit card

Getting a business credit card helps you:

• Separate personal and business expenses by putting your business' expenses all in one place.
• Build your company's credit history, which can be useful to raise money later on.

STEP 5: Set up business accounting

Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.

Make LLC accounting easy with our LLC Expenses Cheat Sheet.

STEP 6: Obtain necessary permits and licenses

Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.

State & Local Business Licensing Requirements

Certain state permits and licenses may be needed to operate a fence company. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.

Services Contract (e.g. MSA)

Fence companies should require clients to sign a services agreement before starting a new project. This agreement should clarify client expectations and minimize risk of legal disputes by setting out payment terms and conditions and service level expectations. Here is an example of one such services agreement.

Recommended: Rocket Lawyer makes it easy to create a professional service agreement for your fencing business when you sign up for their premium membership. For $39.95 per month, members receive access to hundreds of legal agreements and on call attorneys to get complimentary legal advice.

STEP 7: Get business insurance

Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.

There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance. This is the most common coverage that small businesses need, so it’s a great place to start for your business.

Another notable insurance policy that many businesses need is Workers’ Compensation Insurance. If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.

Is this Business Right For You?

This business is ideal for people who enjoy working outdoors and helping people increase the security, beauty and functionality of their property.

What happens during a typical day at a fence company?

Daily activities can include:

• Meeting with potential clients
• Surveying and measuring areas to be fenced
• Performing safety checks on utilities
• Obtaining building permits
• Preparing bids and estimates
• Negotiating prices and purchasing supplies
• Using tools and equipment such as augers and spades
• Erecting and repairing fences
• Interviewing, hiring and training support staff
• Marketing

What are some skills and experiences that will help you build a successful fence company?

Some of the skills necessary in this business include:

• Physical strength and dexterity
• Knowledge of building and construction
• Ability to understand clients’ needs and give clear and logical presentations
• Ability to accurately estimate costs, time and materials needed to complete jobs
• Knowledge of tools and materials needed
• Time management skills
• Experience in repairing tools and machinery
• Math skills for measuring distance, area and ensuring structural integrity

Certification in fence and gate design is highly desirable. In addition to formal education courses, there are also a number of helpful books available.

What is the growth potential for a fence company?

This industry is expected to exceed $9 billion dollars in sales by the year 2018. Many fencing companies have grown large enough to offer franchise opportunities for those wishing to gain knowledge and experience from seasoned professionals.