5 Tips for Start Up Tradesmen
A big mistake that a lot of Tradesmen make is trying to get too big too quickly and thus spending unnecessarily. Follow these 5 tips to help ensure you stay on track so you can spend your money where it really matters; on developing your business.
Tip 1 - Stay digitally ahead
It is fair to say that almost everything is digital these days. A lot of people in the construction industry are unaware of the benefits of incorporating IT into their company. There are many websites and apps out there that can tremendously help start ups and growing construction companies. Job management apps such as workflowmax, service m8 and imanageapp can cut back considerably on admin time. They can manage and schedule jobs, monitor staff, generate quotes and invoices and much more. Accounting apps such as sage and xero can also be tremendously beneficial especially in avoiding having to pay bookkeepers and accountants on a weekly basis. Similarly, TradesConnect.ie offers an excellent platform to link you to service seekers seeking Tradesmen, helping you receive quality job leads. These websites and apps are user friendly and easy to use.
Tip 2 - Cash flow forecasts
It is all well for a construction company to have lots of jobs on the horizon but it is no use on having these jobs if you cannot take them on. It is advised to sit down on a weekly basis and plan a cash flow forecast for the coming months. Take into account all income and expenditure and the dates that these will be spent and received. With a good cash flow forecast you can plan ahead and see if and when you can take these jobs on. Failte Ireland provide a good, editable cash flow template and can be found here Cash Flow Template - Failte Ireland
Tip 3 - Start on a moderate salary
A common problem faced with start up entrepreneurs in construction is what salary to pay themselves. For start ups especially, it is recommended to pay yourself the bare minimum you need to get by. Remember, you are focusing on building a strong, long-lasting business. Cash flow is vital. Start on a small salary, grow your company and hopefully in time you can increase your income. Avoid taking lump sums from your business. For example, if you profit 10k on a job, leave it in the bank. At the end of the year, sit down with your accountant and assess. You may then take a dividend if you so wish or re-invest into your company.
Tip 4 - Avoid Credit where necessary
As we know, expenses can build up quickly when it comes to start ups and growing construction companies and when someone offers you credit it can be very tempting to take advantage. Try to avoid taking credit where necessary. Although, a 5k materials credit may seem advantageous at the time, take note that you are increasing your companies debt at the same time. Think twice before taking such credit.
Tip 5 - Networking
Networking is vital in getting you and your business name out there. Carry business cards (vistaprint offer excellent free templates and cheap rates), set up a modern, mobile compatible website. Set up social media sites, such as Facebook and Google+ to showcase your work and build customer reviews. Keep an eye out for tradeshows in your industry. You never know who you may meet or get connected with. BMAP is an excellent yearly exhibition worth attending and info can be found on that here http://bmapexpo.ie. Furthermore, brand your company with matching uniforms and shirts for your employees. See the the Trades Connect shop here, where you can purchase workwear clothing with optional logo print.
This article was written by Andy Boland, Managing Director of TradesConnect.ie