Staying ahead of the curve for trade companies is notoriously tricky. The number of moving pieces involved in carrying out a job means that from the initial job request through to invoicing there are thousands of points where a job can go south.
The sheer scale of staying across every single facet of two or three jobs, let alone 20 or 30, is a task that nobody can or should be expected to complete flawlessly. In a lot of cases, there’s a sense that trade businesses are too much trouble past a certain point.
Over the past five years, however, we’ve seen trade companies start to emerge from piles of paperwork and mountains of debt by automating repetitive tasks and adopting smarter organisational tactics.
To spread the good word and help our tradie mates out, we’ve put together a list of tactics we’ve seen take trade companies from ditches to riches.
1. Accounting software
In the early days of running a trades business, there can be a tendency to want to learn how to do everything yourself. It, however, often a much better use of your time to hire a bookkeeper to look after your accounts for you.
To support this, it’s invariably in your best interests to move your books onto accounting software like Xero. Xero is a simple way of staying across all of your financials in a straightforward interface that both you and your bookkeeper can access remotely. Among other smarts, Xero can read photos of all your rogue receipts and turn them into expenses in your dashboard, easily create financial reports, and track inventory.
2. Online Price Books
Flicking through 20kg supplier price books all day is enough exercise to cripple the heftiest of footy players let alone a wee office manager. So put down the deep heat and pick up a job management software solution that does the heavy lifting for you with online price books. Online price books are the new kid on the trade block: they allow you to significantly reduce time spent on manual data entry by saving supplier price book files and auto-populating materials with their respective costs when you’re building quotes and estimates.
3. Just in time stock control
It’s often the little expenses that eat away at trade and service business profits, so it’s pivotal to make sure as little falls through the cracks as possible. Just in time stock control is a framework employed by some of the world’s most successful manufacturers to help with loss mitigation and cash forecasting. This is a methodology for managing materials costs. It requires you only to buy the materials that you need when you need them so that you’re never left with expenses that won’t ultimately be covered by the customer. Here’s how to do it:
- Quote exclusively what you purchase: Quote with surgical precision and make sure that all the materials you’ll need will be accounted for.
- Order what you quote: Only purchase the materials required to complete a job.
- Charge what you buy: If you’ve purchased materials for a job that you know you need to complete the job, make sure you charge them to the job.
- Control what you buy: Be disciplined in buying (or instructing your team to buy) the correct amounts of materials that have been included in quotes. An easy way to do this is to use the quote as a shopping list.
For many companies, it’s not as easy as going to the supplier a few times a day for materials specific to a job (and moreover, that would be inefficient). If you’re miles away from the nearest supplier, plan and buy all the materials you need for several jobs at once.
4. Digital job card apps
If you run a trade business and you’re just hearing about job card apps now, it’d pay to take a seat as you might get a little light headed when you realise how much time, money and stress you could save by adopting this system. Within job card apps office managers, project managers and tradespeople alike can make real-time updates to job briefs. Whether you’re rescheduling a job, adding hazards, changing an address, scheduling a second job or adding photos/notes – the job card is your oyster. The benefits here speak for themselves; it’s a game changer.
All things considered
Trade and service businesses aren’t an easy game, and things will always go wrong, but it’s on business owners to create a business structure that eases the pressures on their employees and minimises room for error and ultimately grows their margin. There are plenty of ways to do this, but they won’t come knocking at your door, so it’s best to think creatively and be resourceful to find solutions to suit your business.