The new financial year is the perfect time for tradie businesses to review the past year and use that information to set new goals and a budget. Consider what is making you money and what tasks could be streamlined with technology or outsourced to save you time moving forwards.
Tips for preparing for the new financial year [0:01:16s]
Preparing for the new financial year involves looking at the previous year’s performance, setting goals, creating a budget, and streamlining accounting processes with cloud software.
Keryn recommends you start by looking at the previous year’s profit and loss statement and balance sheet to make any necessary adjustments going forward.
Next step is to set some SMART goals (specific, measurable, achievable, relevant, timely). These will set the framework of your new financial year plan. Then create a budget based on the previous year’s performance and your goals for the upcoming year. Don’t forget to look into how cloud software could help streamline your processes further.
The Importance of Setting goals [0:04:10s]
Setting goals and creating a budget are essential for giving direction to your tradie business and will help business owners achieve success. Many business owners just keep doing the same thing day in and day out without direction or purpose. Setting goals helps by providing a plan on where you’re headed over the next 90 days or 12 months.
creating a budget [0:05:03S]
Creating a budget is important for businesses to grow and succeed. Look ahead and set targets and budgets within your business to help it grow.
Help Goal setting and budgeting [0:05:37s]
Goal setting and budgeting is important for achieving good returns. Accounts All Sorted provide a holistic approach for their clients with tailored solutions to meet their needs. They can help you work out a realistic budget and set goals to start the new financial year on the right foot.
We like to set smart goals so we look at being specific, are they specific for the business, are they measurable, achievable and are they relevant and timely.
use of technology in business [0:7:37s]
Over the last five years, there has been an increase in the use of technology by tradie businesses which is revolutionising the way they operate. Technology and cloud software can give businesses more data and visibility over their operations which helps them to understand the general health of their business and set goals and budgets for the future.
It’s important to choose the right system for your business needs, there are a large variety of different software available and it helps to get expert advice from a company such as TradiePad when choosing and implementing technology solutions into your tradie business. Often businesses start with some basic technology like calendars or Hubdoc before moving on to more advanced systems.
TradiePad work with different software products but tailor solutions based on what is best for each client’s business needs. If you are already using software but not sure if it is right for your business, or if you are using it correctly, TradiePad offers Discovery sessions to ensure that clients are using their chosen system to its full potential.
importance of proper integration and training [0:11:17S]
Commonly tradie businesses will start with accounting software such as Xero, Quickbooks or MYOB. This is just one piece of the puzzle, job management and project management software completes the big picture.
Proper training on any software program you implement is critical to ensure that everybody is familiar with how to use them and that they’re integrated correctly.
Both Clinton and Keryn have seen many issues with integration when people try to set cloud software up themselves, resulted in missing or duplicated information. The beauty of cloud software is that it is designed to work together and provide a seamless flow of data between systems. When software is integrated correctly the visibility and reports you can access on your business is amazing, providing a whole new perspective on your business.
You've got to have your tech stack in order and what does that look like? A lot of clients say to us Oh we do it this way because that's the way we've always done it but they don't realise they could use Dext, EzzyBills or Hubdoc or something like that to actually get the information to us quicker rather than dropping to my front door in a plastic bag
Software can help businesses grow by providing more visibility into your day-to-day operations. Tradies can use software to automate tasks and streamline processes, allowing you time to focus on other aspects of their business.
Reports from the software can help businesses understand their cash flow and adjust their mix accordingly. Keryn discusses how they analyze client reports to help tradies discover which jobs are most profitable and plan out a balance of work to ensure steady cashflow for the business.
leveraging technology and outsourcing for business success [0:16:57S]
Investing in technology is necessary in today’s business environment. Technology can help tradie businesses to identify activities that do not generate income. Outsourcing these tasks will improve your operations and increase income.
Take bookkeeping for example, it is necessary for every business but is it the best use of your time? Accurate bookkeeping is important for a business’s performance and ATO compliance but staying on top of all the legislative changes could be completely overwhelming for tradies and their partners who already have enough on their plate.
Businesses should consider outsourcing tasks like bookkeeping and appointment confirmation to save time. Outsourcing simple tasks can have many benefits, including reducing the chance of no-shows and improving customer service and saving your sanity.
support for clients doing their best [0:21:58S]
It’s common for clients to feel deflated when they don’t know how to do something. Keryn has witnessed many tradie partners falling into the role of bookkeeper to help the family business, even if they don’t enjoy it.
Accounts All Sorted helps tradie businesses by providing support with various levels of service. They can do all the bookkeeping for you or offer shared services which allow clients to do most of the work themselves while still receiving support from a professional bookkeeper.
The thing I find about our tradie clients is they always come to us feeling a little bit deflated because they don't understand the financials. I always say to them whilst they have to have an understanding of how their business is performing we can help them with that and I couldn't be a plumber or I couldn't be an electrician so if we all do what we do best and then tap into trusted partners then I think there's no reason why our business can't succeed.
financial tips for tradies [0:22:41S]
Here are Keryn’s top 3 tips for tradie businesses to avoid common financial issues.
1. STAYING ON TOP OF INVOICING
Staying on top of invoicing is crucial to avoid running out of money. Chasing up overdue invoices is the best way to stay on top of invoicing.
2. REVIEWING SUPPLIER TERMS
Reviewing supplier terms can help businesses get better discounts and save money. Accounting software can help businesses see how much they are spending with suppliers.
3. SAVING FOR ATO DEBT
Moving money out at the end of each week into a different savings bucket can help businesses save for ATO debt. Payday super is an excellent strategy that helps with cash flow and avoids unpaid super penalties.
I think chasing up on on invoices is probably the best thing for them because the longer they get out of date overdue, the harder it is to chase.
lodgement penalty amnesty program [0:25:02S]
It has been a tough couple of years for some tradie businesses. The ATO is getting stricter, but if your businesses is struggling Keryn says that communication with the ATO is crucial to avoid any penalties and interest for your business.
Recently the Australian Government announced the lodgement penalty amnesty program which is an initiative by the government to waive late lodgement penalties. The program applies to any BAS, income tax, or fringe benefits tax due from December 2019 to February 2022. Previously, the ATO required payment before remitting any penalties. With the new amnesty program, penalties will be waived if lodged between June and December 2021.
MEET THE SPEAKERS
Keryn Stack - Accounts All Sorted
Keryn is passionate about empowering small businesses. She helps tradies understand their financials and how to be compliant, to achieve their financial and business goals.
Clinton is driven by a passion to help the construction and field services industries evolve through the use of technology and education.
