Starting a business is bloody terrifying.
Whilst it's every tradies dream to start their own business, work for themselves, then retire comfortably — few have the bravery to try. And what you'll learn is it's not the best tradies who are successful, it's the best business people.
So, ask yourself, are you just a tradie, or are you a businessman too?
G'day, my name is Andy Smith, owner of Dr.DRiP Plumbing and co-founder of Lifestyle Tradie. I've been on the journey of building my own trade business, and let me tell you it hasn't always been easy.
I ended up $188,000 in debt, facing burnout, a marriage breakup, and bankruptcy. The entire business lived in my head; I had no strategy, financial overview, or systems — an utter mess!
My biggest takeaways from how to start your own business are;
Know the rules & qualifications
When I started Dr. DRiP back in the day, things were a lot different and simpler. Nowadays, there are so many boxes you need to check before starting your own business it can be hard to know where to start.
Firstly, you need the necessary qualifications for your trade. For example; you can become a Plumber by completing a 4-year apprenticeship. You have to be in an apprenticeship arrangement to complete the Certificate III in Plumbing (CPC32413), which is a nationally accredited qualification in Australia.
I got my accreditation back in the '90s - feels like a lifetime ago!
Now, you need to decide if you are a sole proprietor. This is how many start off their trade businesses when they're just a one-man-band, because they can work directly under their tax file number.
You also need to secure your business Domain name and ABN. This is what your business will legally operate under, so it's an important step. For me, a mate’s girlfriend over a few drinks suggested Dr. DRiP and it stuck! It made my friends laugh, and it's memorable.
Now, I'm no expert, so if you want to check you've met all the Australian Government requirements before you hit the pavement, check out the 'Legal Essentials Page' here.
Getting a leg up
Starting up your trade business is hugely expensive. Forking out for a truck, tools, signage, supplies, basic marketing, domain, and website purchasing — can easily set you back 100k or more depending on your trade. Plus, you need some additional capital in case your clients can’t pay you straight away or want a standard 30-60 day invoice.
So any help you can get, you should take! Depending on your trade, and what state you live in — there are heaps of different small business grants you can apply for. If you qualify, it can be a massive help to your business, because every dollar counts!
Check out your state's grant schemes and see if you're eligible and apply.
Get the right technology and know your numbers.
I'd recommend using a good cloud accounting program [I use Xero] paired with great job management software. This will allow you to capture your finances and be able to see everything at a glance.
Having these programs run in unison is a game changer! Make it work hard for you, so you don't have to.
You also need an accountant you can trust and who can share your detailed figures and stats with you weekly. Having both an accountant and a cloud accounting program is a must-do.
Now it's time to introduce systems into your business.
Time to systemise!
Systems are a one-off investment of time and money for long-term business sustainability. Introducing systems was a lifesaver for me.
Systems essentially make your life easier by getting the day-to-day operations out of your head and onto a page. This will provide amazing consistency within your business. And most importantly, it gives you a business you can sell.
If your company operates systematically and generates profit regardless of who owns it — this is a very big selling point for a potential buyer. The hard work is done for them!
My biggest tip for setting up your business is to plug any knowledge gaps before you end up between a rock and a hard place.
A mentor is the "gap filler" that allows you to know all the right moves to ensure your success. They can help guide you through, and keep you on track for success.
It would be best to find a mentor who's "been there, done that", somebody who owns and still runs their own trade business. I've been mentoring tradies just like you since 2009, helping them create better, stronger trade businesses.
I understand the road ahead is tough, I've done it myself and know the struggles, but nothing worth doing is ever easy — and that certainly rings true with starting your own trade business.
But trust me, if you get it right, you'll be laughing!
This guest blog is written by Andy Smith
Andy Smith is a fellow trade business owner and co-founder of Lifestyle Tradie, a membership and community for tradies in business.