To maintain reliable compliance, construction firms must keep continuous licensing and stay in good standing with the secretary of state in each jurisdiction where they operate. For multi-state firms, this entails a cycle of corporate filings and license renewals arising continually throughout the year.

A construction company’s approach to these regulatory tasks has a strong influence on profitability and performance. The dramatic effects are easy to recognize: one firm wins a prime project, while another never gets a chance to bid because the company couldn’t obtain a license in time. One firm uses its record of consistent licensing compliance as a selling point in proposals; the next is battling reputation damage from a project that was disrupted by a lapsed subcontractor license. Companies with strong compliance programs can respond quicker to opportunities, ensure reliable performance, enhance their brands, and improve administrative efficiency.

Creating a well-oiled compliance machine is not without its challenges. When it comes to contractor licensing, no two states are alike, and even a small difference can lead to a massive administrative headache. Something as simple as leaving LLC off the end of your name on an insurance policy can get an application rejected, eating up precious staff hours needed to resubmit, and delaying your ability to get out and bid.

The following are areas that pose particular challenges for multi-state contractors. In addition, numerous resources for managing licensing and corporate lifecycle filings effectively are linked at the end of this article.