5 Ways to Cut Costs in Your Trades Business
Today, Rhino Trade Insurance is here to help with tips and tricks on saving your business money. Sounds lovely, right? What could we spend that extra cash on... perhaps a new van, more beer or treat the apprentice to a new toolset.
Whether you are a seasoned professional in the trade or just starting up, planning your finances and cash flow is an important part of staying liquid. As a self-employed tradesman or woman, you handle a variety of tasks, so let's show you some quick and effective ways to structure your finances.
Shop around for your materials.
Our saving tips start with a basic one, but one of the best. It often surprises us how many people in the trades happily go to the first place they know for materials without shopping around. Cutting your business costs helps with your bottom line. Consider national builders merchants; they will mark up the materials costs, which you could save by going to your local building wholesalers.
On top of this, consider your workflow/ your booked jobs in the pipeline and plan to buy the materials in bulk. This is an excellent way to lower your costs because the more you buy, the lower the unit price will be.
Remember, when buying in bulk, you must store these materials correctly to save from corrosion and wastage. Also, remember that wholesale prices don't just have to lay at the door of materials. You can purchase tools, plant, machinery and equipment and save more money.
Be efficient on-site and erase waste.
Our second point is to combine improving efficiency and reducing wastage on-site. Improving efficiency can include hiring or buying the right machinery for the job. Consider a digger instead of shovelling the mud yourself if laying the foundations for an extension. Even though the cost of such devices is a more considerable outlay at first, your costs will soon be returned because you can complete work quicker.
From a management standpoint, if you have staff on-site, be sure to keep them busy. As plenty of tradespeople say, "there is always something to do on-site". Whether that's keeping the area clean (saving you time at the end of the day) or utilising their skills on different parts of the job if there's a bottleneck in another area, being aware of these two points will improve your business's efficiency tenfold.
Likewise, being aware of the materials on-site, what's being used and what's left over can help save you money. Instead of throwing offcuts in the skip, consider using them for smaller parts of the job. Wastage is a money pit in the trade industry, and cutting down on it can save you a fair amount of money in the long run.
Invest in quality tooling
Where would you be without your tools? More to the point, if you don't look after your tools, they may drain your business's finances. Deciding to invest in top-quality tooling can save you in the long run. A robust, durable and well-made tool will last longer than a cheaper alternative. On top of this, buying a better quality tool will likely involve a higher specification. This, in turn, will assist you in working faster and more efficiently. Some tools even have features that help to avoid injury, thus saving you time from being off from an accident.
Of course, these tools aren't cheap, but you have to weigh up the cost-benefit in the longer term. If your tools are quicker, they may improve your time on the job. If they are more robust, there's less chance of them breaking down, and you won't need to replace them anytime soon.
Is it time to upgrade your equipment?
Automate your expenses and processes.
According to data compiled by SAGE UK, the average small to medium-sized business in the UK wastes close to three months a year on admin. That is an astounding stat and something that can easily be reduced using newer admin technologies.
Long gone are the days of paperwork and writing out individual invoices; save yourself time and money by considering investing in some of these tools to help make your admin life more straightforward.
- Trade job management software: Tradify
- Find new trade jobs: Book a Builder
- Accounting software for your business: Xero
- Payroll, invoicing, accounting and more: SAGE
Shop around for your insurance.
Many tradespeople are happy to sign up for the cheapest insurance they find and let it renew annually (out of sight, out of mind mentality). As a business owner, it's best to stay on top of your insurance for a variety of reasons:
- It helps you to make sure your business is fully covered
- It makes you aware of any price changes and can save you more money
- It lets you stay in control of your own destiny
The team at Rhino offer a variety of insurance products, all of which can cover a trade business from almost every angle. If you need Public Liability Insurance, Tool protection, Legal Assistance and cover for your Gadgets, we have all that and more.
Our policy experts ensure you get the best level of protection at a cost-effective price. Our team also publishes consistent articles that help you with insurance, showing you ways to save money, take out the right cover and more.
Why choose Rhino Trade Insurance?
And that brings an end to our tips for saving money in your trade business. We hope you can take some valuable information away from this post and implement it. With the prices increasing and demand for your work exploding, taking care of your finances and making your business more efficient can help the health of your business.
If you would like to find out more hints and tips, have a read of the latest posts on our blog today. Alternatively, if you are seeking a new insurance policy, why not get in touch with our team today? The lads and lasses at Rhino can give you a bespoke policy to fit the needs of your business. Just ring us on 0116 243 7904 or check out our website here.