5 Tradie Business Mistakes to Avoid

Building a tradie business requires hard work, focus and care. As a business owner, you have a very different mindset to an employee -  you are focused on management and business growth, rather than on completion of tasks you’ve been given. There can be challenges enough without adding to them with avoidable mistakes. 

Here’s our list of common tradie business mistakes to be aware of! 

 

1. Trying to do it all yourself

As a business owner, it’s your job to delegate to people who have the skills that you lack, rather than thinking you must take everything on yourself. Even if you do have the skills, you might not have the time to juggle it all. 

If you don’t want to hire employees (or not yet anyway), there are other options such as outsourcing. For example, you could outsource administration to a virtual assistant and/or financial tasks to a bookkeeping firm. 

The important thing here is to concentrate on your strengths, shift your focus towards growing your business, and delegate where you need to! 

 

2. Avoiding the digital world

If you’re trying to do everything the old-fashioned manual way, you might be doing yourself a disservice.

For example, almost everyone these days uses search engines to seek services they need. If you don’t have an online presence, you will likely miss out on work. So it’s important to at least have a website and a social media account or two. Getting listed on online business directories can also be a good move.  

There are plenty of digital tools designed to make running a tradie business easier and more efficient. These include job management programs such as Tradify and Workbuddy. You can use these platforms for everything from managing subcontractors and safety issues to job scheduling, project management and more. 

Small business owners need good accounting systems as well. There are plenty of these available, including XERO and MYOB. Tradie job management platforms often integrate with these types of accounting apps as well, which saves time on data entry. 

 

3. Overcapitalising on assets

Naturally you will need to invest in tools for everyday use. But if you only need to use bigger and more expensive pieces of equipment from time to time, or even on a more regular basis, it might not be worth spending a substantial part of your capital on purchasing them. It depends on the situation, but you could be better off hiring equipment as you go. 

The benefits of hiring equipment include:

• Use equipment only as and when you need it. 
• No need to worry about additional costs, such as registration and insurance.
• Maintenance is taken care of by the hiring firm. 
• You get the use of up-to-date equipment. 
• The costs of hiring may be tax deductible in the current year (although you would need to discuss this with your accountant).
• It can help with management of your cash flow. 

A reputable equipment hiring company should be able to provide you with advice on the types of equipment you will need for a particular task as well – making it easier for you to ensure you have the right tools for the job. 

 

4. Ignoring your finances

Even if you hand over or outsource your financial tasks, it’s important not to drop the ball altogether. You should at least have a general idea of your financial position at any time, and a basic understanding of how business finance works. 

As such, you should communicate with your bookkeeper regularly and let them know what information you need. This might include outstanding client payments, cash flow position, bank account balances, what liabilities are due, and so on.

Knowing your financial position helps you with important decision-making – such as how much cash you have available to invest in business growth. 

 

5. Lack of goals and vision

As mentioned, running a business requires a very different mindset from that of being a worker. As a business owner, you should have a long-term vision, a business plan, and a set of goals to guide you. 

Trying to run a business without goals or a plan could be a bit like driving around without a destination or map! So make it a priority to determine what you want to achieve in your business for the years ahead, and to create a map for getting there. And if you are not sure where to start with this, you could consider hiring a reputable mentor or business coach to help you!