26 Aug Guest Blog: 7 Things a Trade Business Can Do to Improve and Grow
As an experienced business coach who has worked with trade businesses for decades, I know what it takes to run your trade business well. Here are seven simple but effective steps you can implement today which I know WILL make a positive difference.
- Know your figures
Whether figures are ‘your thing’ or not every business owner must have a basic understanding of their financials. You don’t have to be a university graduate of accounting to have a solid grasp of the fundamentals. Firstly, ensure you view your profit and loss figures and Balance Sheet which should be generated out of your accounting software no less than monthly. If you look at items on those reports and you don’t know what they mean, ask your bookkeeper, accountant or business advisor. These people should be able to explain things in clear to understand language. Do you know your overhead costs? That’s another valuable figure to know and understand, especially when quoting. Do you know what an employee’s true cost is to the business? You might be paying $40 per hour, but if they accrue leave, get super and there is Workers Comp, then the cost is far more than $40.
- Shop around for best prices
Yes, I know many tradies are flat out and just don’t have the time to shop around. You suddenly need something and it’s just quick and easy to drop into the chain hardware store that’s in almost every suburb. Problem is that their pricing is usually exceedingly high. Sometimes it’s worth buying products in bulk and from a specialist supplier who will give you the best rates. You only know by investigation and whilst that might take a little time now, the difference could really mount in dollars.
- Don’t ignore variations
I’ve worked in the building and construction year for more than 30 years now and I’ve worked with many who say the variations don’t add up; the ups and downs are like swings and roundabouts. A number of years ago I convinced a medium-sized builder to track his variations for just one job. I think he agreed more so to finally shut me up, but he promised he’d do it and do it completely. Well – he was absolutely shocked at how much he’d been giving away. Once he started tracking the variations, he realised that they really did mount up and equated to a tonne of lost money for his business. The trick is to have a variation book (Master Builders or HIA have them) and have it completed at time of request so that they are approved as you go. Then be sure to invoice them as you go, not within the last invoice; as this is when disputes tend to arise.
- Be professional
I’m not talking about wearing a tie and jacket but being professional within your industry. This might mean turning up to quote in a polo shirt, versus mud and sweat soaked work shirt that is very much on the nose. It also means being reliable and doing what you promised you would do. It might mean your business doesn’t operate from a Hotmail free email account.
- Communicate well
Part of being professional and running a good business is great communication. That starts with contact at the very first moment. How do you answer your phone? If someone is wanting to book in a quote, do you stop for a moment and get their details, or instead keep working, run the power tool and then ask them to text you their address and details. Sadly the latter is relatively common amongst tradies. Your customer is not your wife or secretary – if you’re going to pick up the call, then do it properly. If you say you’ll be there at 2pm and you do get caught up, then at the very least text or ring the person and alert them you’ll be xx minutes late.
- Follow up on quotes
Tradies spend a lot of time quoting. You drive to the job, check out what’s required, talk to the prospective customer and then spend time preparing the quote. Often it’s then emailed and you think – well, my job is done. It’s not! You don’t even know if your quote ended up in a spam folder. Ensure the quote is received (texting as soon as you send is excellent) and then be sure to follow up a few days later to see if the person has questions or wants to book it in.
- Spend time working on your business – not just in it
I get it, you work like crazy from dawn to dusk and when you get home, you just want to have some time away from the business. However, all businesses spend some time in the business – and I’m not talking here about the bookwork or quoting. You should be working on the marketing, ideas for growth, implementing improved systems, strategising on growth opportunities and more. When I’m working with my business coaching clients, first we start with setting some goals. Then during coaching they get ‘homework’ and that is usually something that they need to do in order to improve their business. In every business it’s different but the idea is that it’s an action, activity or task which will make the business better.
As a business coach, my passion is around business success and improvement. The above are just some of the hundreds of tips that I share with my business coaching trade clients. May I suggest if there were any items in this article that you would like to implement in your tradie business, then print out this blog or make a note of that action. The next step is to set some time aside and begin working on that task. If you’re stuck on the how … feel free to reach out to me at Stone Business Coaching as I offer a range of packages and don’t lock clients into long term contracts. Make contact today at www.donna-stone.com.au or 0411 622 666. My passion is your potential.