Lots of tradesmen consider building their own businesses. And creating a company and your own success can be an incredibly rewarding and fulfilling experience.
However, in our experience we have seen that there is a difference between being a good tradie and a good businessperson.
Being self employed as a tradie is just like being in any small business. If you want any chance of being successful, there are some simple rules to follow. A key element should be aiming to have a good balance between the business and your lifestyle.
Here are some quick tips on what you need to do:
1.Identify your market
Create an understanding of who your target customers are and what they need. Are you targeting domestic work? Commercial? Industrial? Would you like to work in a partnership with other tradies, or focus on your own work? Over time these factors may change, but when you start out it’s good to have a clear image of what you see yourself doing on a daily basis. This gives you a good goal to work towards and keeps you on track.
2.Set up your business properly.
When you start right, you avoid wasting time ironing out big issues later down the track. Having the right licenses and insurances for your industry is crucial. It may seem like a lot of money to spend in the beginning stages, but never skimp on insurance. The day you don’t have it will likely be the day you need it most. Additionally, engage the services of a good accountant. That is, if you don’t already have one. This accountant should also refer you to a solicitor.
3.Create a business plan and cash flow forecast.
These are extremely important. You need an idea of what your proposed income and expenditure will likely be. Your accountant will help you with this, but it’s important that you do take this step.
Take your time and ensure you’ve set realistic goals. You don’t want to find yourself in financial difficulty.
4.Decide on your marketing methods.
Social media is a great way to market, but ensure that you know how to use it correctly. When you set up a website, consider engaging a professional who will not only set it up, but also train you on how to use it so you can keep your content fresh.
Reviews are also important to keep an eye on. Good work brings recommendations, and this is the best referral you can get. It takes years to establish a good reputation, but very little time to destroy it.
5.Avoid spending unnecessary money whilst setting up.
It’s always tempting to have the latest vehicle, the best tools and other business equipment, but it’s much better to get established before spending up big.
6.Review your business regularly.
Review your business monthly at first, in order to monitor your progress. Glancing at the bank balance is not enough, as this provides a false sense of security. There could be outstanding bills or taxation liabilities you’ve overlooked.
7.Monitor your debtors closely.
Setting up facilities for instant payment is easy nowadays with the use of smartphones. Never give credit unless the debtor has provided references and signed an agreement. And remember to always provide written quotations that set out payment details and, whenever possible, have your clients sign contracts.
Just doing the trade work is a lot of fun, but the paper-pushing is what enables you to do more of it. Bookwork is essential and these days there are programs that will link to your accountant and the ATO. Keep your bookwork up to date for smooth sailing.
Remember to have goals – short term, medium term, and long term. Remember to review your progress, too! You don’t want to slog away at work and discover that ten years have passed, and you don’t have quality of life and that your income isn’t any better that if you were on a wage.
Work and life balance are essential to your wellbeing and longevity. When you are taking care of yourself, you are able to enjoy work even more.
Has this blog fed fuel to your fire of wanting to start a business?
Get in touch with us today to learn how we can help you turn your dream into reality.