Sample Demolition Company Business Plan

Here is how to write a demolition company business plan.

Are you a contractor interested in starting your own demolition company? Apart from the skills you possess, you’ll need all the help you can get to structure your business.

In other words, a lot of planning is necessary to actualize your goal.

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This demolition company business plan guide seeks to offer as much help as possible to simplify the planning process. We’ll be highlighting important aspects that require further expanding on.

Before we proceed, it’s important to briefly explain the basic services offered by a demolition company. As the name suggests, a demolition company is involved in the take-down of buildings or structures.

This is either done manually or with hydraulic press machinery.

To start your own demolition company, you’ll need to figure out what needs to be done, the equipment required as well as the cost implications among other things.

The Business Plan

One of the primary needs of your demolition company is a business plan.

This plan essentially lays down the groundwork for how the business will be launched and operated. Effective demolition company business plans have medium and long-term goals regarding how the business will unfold.

Your demolition company business plans should contain the following vital sections; the executive summary, company description, services offered, as well as market analysis. Others include your strategies & implementation, organization & management team as well as the financial plan & projections.

A breakdown of these sections should clarify specific actions to take in launching your operations as well as details on how to achieve sustainable growth.

Demolition Company Startup Costs

What will it cost (in terms of funding) to start your demolition company? This is an important question that needs to be asked and the right answers were given. It’s not realistic to answer right off the bat without first working the estimates.

Now, such estimates will have to take into consideration every possible detail of the cost incurred in running your business operations. Now, there are lots of equipment to be purchased when it comes to a demolition company.

However, startup costs depend on the scale of your operations. Apart from the need to purchase demolition equipment, other costs to be incurred include your wage bill, cost of incorporation, ongoing costs, as well as marketing or advert costs among others.

  1. Aspects of Influencing Startup Costs

In working your startup cost estimates, every cost-contributing factor will need to be taken into consideration.

As mentioned earlier, these range from the scale of operation as well as getting some used equipment.

Others include renting demolition machinery and also finding a ready source for spare parts.

  • Scale of Operations

Your scale of operations as a demolition company depends on the type of demolition jobs you’ll be handling. Now, there are small as well as large demolition jobs. The equipment needed for each varies and determines your eventual startup costs.

Small demolition companies will handle mostly small demolition jobs. These types of jobs do not require heavy equipment as large demolition jobs. As such, you’ll need to get basic demolition equipment like grinders, cutting torches, jackhammers, wire strippers, sled hammers, and concrete cutters.

Others include protective gear (including safety glasses and ear pads) as well as wheelbarrows among others. The costs for these aren’t significant and won’t affect increase your startup costs significantly.

Large demolition jobs on the other hand will need more expensive and heavy equipment. These are much different from the basic ones and include crushers, excavators, bulldozers, and scaffolding among others.

Not everyone can effectively operate this heavy equipment. Licensed operators will need to be hired for this purpose.

  • Purchasing Used Equipment

Not all equipment used for demolition jobs must be purchased new. This is even truer when you’re working on a tight budget. We recommend going for used equipment only when you can’t afford new ones and when these have no moving parts to wear out.

Most demolition equipment having no moving parts are basic, yet reliable tools for small-scale demolition work. These range from wire strippers, sled hammers, etc. All of such equipment will need to be identified and the cost worked out.

  • Consider the Rent Option

One of the most effective ways to cut down on expenses is by renting your equipment as well as operators. Here, no outright purchase is necessary. This drops your startup costs considerably. Following this route requires a lot of planning.

You want to plan your operations in such a way that equipment is readily available when needed.  However, this option is only temporary for most demolition companies. As such businesses grow they purchase their equipment.

  • Have a Ready Source for Spare Parts

Demolition businesses operate much differently than a lot of other construction-related businesses. The main factor involved here has to do with frequent wear and tear. This happens a lot in the field of construction.

As such, you’ll need to find a ready source for spare part replacements. Without this, efficient operation is affected.

Becoming Bonded

The demolition industry requires that demolition companies become bonded. Such a surety bond is a guarantee that the job will be completed within the stipulated time and under the contract terms. The need for getting bonded as a demolition company is simply to give your clients the needed confidence to patronize.

Obtaining Licenses and Permits

Part of the planning procedures for starting a demolition company involves getting the necessary licensing and permits. Now, the requirements for obtaining such aren’t uniform across all locations.

In other words, different states, counties, or local municipalities have their unique requirements for demolition companies to obtain licensing. Make inquiries about demolition contractor licensing requirements for your location and do the needful.

Get Insurance and EIN

An Employer Identification Number (EIN), as well as insurance, must be obtained. These serve as requirements for doing business for all demolition companies. The EIN is issued by the Internal Revenue Service (IRS) and is meant mainly for business having employees.

Demolition companies are mostly involved in delicate operations that require some form of protection in the form of insurance coverage. This includes worker’s compensation benefits among other things.

This demolition company business plan guide has highlighted important areas or sections every business plan should have. Demolition business is a serious business and should be taken as such.

With proper planning, your chances of success are significant.

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