It’s critical to maintain track of your trades firm’s ‘health’ at all times, whether you’ve been in business for years or are just getting started as a new small business in QLD. No matter what area of business you’re in, it’s easy to get caught up in day-to-day craziness. But especially when the economic climate is changing, or you need to make big adjustments, you should take time to halt and analyse the status of your organisation.
After all, it’s common knowledge that you should measure twice and cut once. When it comes to running your business, the same is true.
Beyond the basic principles of whether or not you generate more money than you spend, there are numerous elements to consider when assessing the health of your organisation.
Here are five crucial aspects to consider if you truly want to be sure your company is fighting fit and prepared for whatever 2022 has to fling at small businesses in Queensland.
1. Do you get paid in a timely manner?
Ask yourself how frequently you are paid on time and in full during a business health check.
Receiving timely payments from consumers is critical for cash flow and the life of your organisation.
Are too many customers are extending payment terms or failing to reply to bills at all? It’s possible that your company will face difficulties.
Take action to better your circumstances if you’re having trouble being paid.
Make sure the due date and payment choices are prominently shown on your invoices. You don’t want someone to have to hunt for information on their own.
Also, send out regular reminders to your clients if they haven’t paid by the due date after you’ve finished a project.
Don’t do any additional work or purchase materials for large clients until their invoices are paid in full; additionally, if you deal with a lot of large companies, such as builders and developers, who take a long time to pay, consider diversifying your customer base to include a better mix of small and large customers to improve cash flow.
2. How are the members of your team faring?
If you have a team assisting you, such as other craftsmen, apprentices, or in-house administrative personnel, observe how pleased they appear.
Do they look to be overworked, stressed out, and making errors, or do they appear to be busy yet productive? Are they continually calling in ill or requesting too many vacation days?
You want to give your employees enough work to keep them engaged, challenged, and inspired, but not so much that their physical and mental health suffers.
A successful trades firm has a strong team that can be counted on and works effectively together.
Check in on your workers or contractors on a frequent basis to check how they’re doing and to make sure everyone is on the same page.
It’s also beneficial to set quantifiable goals for them to aim for.
3. How big is your profit margin?
You must create an adequate profit margin in your work for your trading enterprise to remain chugging along smoothly.
It can be difficult to achieve this aim at times, particularly during the present era of COVID-19 and potential worldwide war. But that is exactly why you must keep on top of financial statistics.
To attract new consumers, be mindful of decreasing your pricing too low, as there’s no purpose in working if you’re not going to make enough money.
Look for ways to reduce your overheads as well, such as identifying more cost-effective suppliers or focusing your marketing efforts just on those that provide a positive return on investment.
4. Do you receive a lot of customer recommendations and testimonials?
Receiving continuous referrals from delighted clients who brag about you to their friends, family members, and co-workers is a sure indicator that your business is in good shape.
Most individuals who need employment seek their friends and family for referrals, so this may be a wonderful approach to attract new clients.
It doesn’t cost you anything and can result in a flood of high-quality clients.
You also want customers to be so satisfied with your outcomes that they leave reviews and publish images of the job on social media sites like Twitter, Facebook, Instagram, and Google.
However, don’t forget that asking for references and testimonials is perfectly acceptable.
When you’ve completed a piece of work, be sure to say how much you like collecting feedback from clients and how much you’d want to hear what they have to say.
Encourage consumers to submit reviews on their own social media accounts or on sites like Google and Yelp by sending them a link to your company’s Facebook page.
When you come across these shout-outs, share them with your social media followers and embed them on your website to gain more exposure.
5. Is your company compliant, and is your administration up to date?
On the documentation front, a healthy business is compliant and up to date.
Think about where you are right now in your life. Do you need to apply for a licence or membership, or renew one? Are you overdue on your payroll or superannuation payments for your employees?
How about the BAS and taxes? Are you being pursued by your accountant for information?
Isn’t it past time you learned about marketing, finished that certification you began, or scheduled some training for a staff member?
If you said yes to any of these questions, make a commitment to cross them off your to-do list during the next several months.
Remember that you may outsource certain tasks and make use of useful software packages.
MYOB’s payroll technologies, for example, make this business process faster and easier for you, as well as keeping your staff happier.
It takes time, work, and energy to build a healthy business (and it seldom occurs quickly), but if you focus on the five areas outlined above, you’ll soon feel more in charge of the future of your trades firm.
Before you go…
No matter how cautious you are, risks are an inherent part of life, and the dangers you encounter may grow if you’re in business. If your company offers goods or services for sale and interacts with customers, suppliers, or the general public, you might be held accountable for any harm caused to them as a consequence of your operations. Fortunately, Public Liability insurance QLD is available to assist you safeguard your company against the dangers that come with day-to-day operations.
