Monthly ArchiveJune 2020

construction bonds

Reinforcing Your Construction Business with Bonds

Individuals purchase insurance to cover losses and damages. Similarly, business entities procure insurance to protect their interests. As a contractor, you need to purchase a special type of work-related insurance known as a construction bond. Many owners require contractors to carry construction bonds that protect their projects from disruptions or financial losses that prevent completion of the project or construction according to project requirements. Here are a look at common types of construction bonds available and how they work.

What Are Some Common Types of Construction Bonds?

The most common construction bonds include the following:

  • Contractor License. These are usually required by government owners before you can work on the project. It’s a guarantee that you follow all applicable laws and regulations.
  • These bonds guarantee that you will contract with the owner for the bid amount if awarded a project.
  • These bonds are often required for contracts over $100,000, covering your subcontractor’s and suppliers’ invoices in the event that you can’t pay them for their work.
  • This guarantee that you deliver a project according to contractual terms, including scope, schedule and quality.
  • These bonds are used to reimburse a purchaser for the loss if you fail to obtain supplies or materials.

What Other Bond Types are Available?

Other bonds include maintenance bonds, subdivision bonds and site improvement bonds, which may be required of contractors that specialize in maintenance work, municipal projects and renovation jobs. Consult an insurance agent that is an expert in coverage for construction work for the right plan for you.

legal cannabis and hemp industries

What Are the Risks Involved in Starting a Cannabis or Hemp Business?

The proliferation of cannabis and hemp businesses across the nation continues to skyrocket with the nation-wide legalization of hemp and the increasing number of states legalizing cannabis. While the potential for profit is high, there are risk factors involved that those who would like to get in on these new niches should be aware of.

Potential Risk Considerations

Starting a business always involves risks. This is true regardless of industry. Hemp and cannabis are both agricultural crops. As such, they are subject to issues inherent in agriculture. Though hemp is a hardy plant, the weather is still a concern. For instance, too much water too early can ruin the crop.

While the market is thriving for hemp and cannabis products, there are still concerns about competition. Other market factors have become apparent in the time of COVID-19, which has resulted in an overall boon for the industries, though those with physical shops either had to close their doors or shift their delivery methods.

Special Considerations

In addition to the risks involved in starting any business, there are some special considerations for the legal cannabis and hemp industries, including:

  • Marketing claims that could lead to legal issues.
  • Inadvertent production of crops with THC levels higher than the legal limit.
  • Difficulty finding adequate insurance.

The growth curve for these industries is predicted to continue on an upward trajectory, and many entrepreneurs are taking advantage of the trend to start a new business. For those taking the leap, it is important to consider and plan for the potential risks.