Top tips on how installers can improve their business

Considering that around two-thirds of businesses fail in the first year, it’s apparent that there’s a lot of potential benefit to be gained by improving efficiency. Benjamin Dyer looks at how managing time and cashflow, and embracing technology can have a positive effect on efficiency. 
Anyone who runs a small business knows that there is rarely enough time in the day to cope with the variety of tasks that need attention. The result of this is that admin tends to come last, which can lead to major problems.
Power admin webKeeping the cash flowing
Cashflow is all about balance – at the very least, having enough funds coming into the business to meet the demands of the cash going out. One of the key ways to help is to ensure that invoices are raised as soon as possible.
It also has the benefit that a customer is more likely to pay up quickly, while the job is fresh in their mind. Leaving things too long means that the invoice will be less likely to get paid.
It is also crucial that any paperwork is accurate and legal. For tax reasons, the word ‘invoice’ must be clearly displayed along with a unique identification number, company name, address and contact information plus the same for the customer’s details.
The invoice needs to provide a clear description of the job done, and the total amount owed. If the company is VAT registered, the tax being charged and the VAT number should be shown as well.
The payment terms must also be clearly stated, and it’s best to make invoices ‘payable immediately’. Within the UK, the usual payment period is a maximum of 30 days, and this is more appropriate (and necessary) when dealing with large jobs or bigger organisations.
Late payment legislation means it is possible to claim 8% over base rate and levy a charge. It is fairly easy to register to make a legal claim online, but of course the downside is that the relationship with the customer may be damaged.
If accepting bank cheques, it is important to pay them in quickly, but ideally use a payment method that’s more efficient and where the chance of a bouncing cheque is eliminated. Better methods are cash, bank transfer online or payment by card. However, in the latter case, a means of processing such payments is needed, but it is easy enough to set up a PayPal account.
For larger projects with residential customers, consider requesting a deposit in advance and planning staged payments. Another option is to agree that the customer will pay for materials as they are purchased.
Both of these approaches help with cashflow as well as reducing risk. Arranging an account with a builders’ merchant can also give access to credit and discounts off list prices.
Time is money
The simplest way to avoid wasting time is by making sure the right materials are available at the right time. Obviously, a good working relationship with suppliers will help, but the biggest challenge is to reduce time spent on multiple visits to pick up the materials. It’s amazing how much time can be wasted (even when the supplier is nearby) due to interrupting workflow, parking, walking the aisles and paying.
Technology talks
Technology can also help to both avoid wasted time and improve cashflow, as well as making a variety of tasks easier. There are new systems specifically designed for tradespeople working in the field which work entirely on smart mobile devices. Using such technology can help make a business much more efficient.
For installers who have the desire and capability to plan their own cashflow, Google Docs offers cashflow templates as does SCORE – a non-profit company that provides help and assistance for small businesses.
Quickbooks from Intuit is a well-known PC-based tool that provides a cashflow forecast report as part of its general small business financial and accounting software. The app can also generate estimates once reports have been generated, merely by clicking a few links.
Plumbers and heating engineers can benefit from a range of apps especially suited to their business. There are several, such as iCertifi, that enables certificates to be generated on site, and InvoiceASAP is a software package that provides a basic – if somewhat restricted – level of invoicing.
Opportunity knocks
Very few people are the best at everything that they do, and many installers didn’t go into business to do paperwork. It’s always worth reviewing how a business is run to see if there are any processes that can be improved. The onward march of technology means that even for the older dogs there are new tricks worth learning.
Power up
Powered Now – available for iPhones and iPads – is specifically designed for plumbers and other trade companies. It records customer requirements and contacts, enables easy invoicing, quotes and worksheet creation, and sets appointments and reminders.
It can capture photos, notes and pricing, and help put together estimates/quotes. The app can also help reduce driving time through an integrated Google map and street view.
Importantly, the app aids cashflow as it allows customers to pay by credit or debit card, or PayPal on the spot. For peace of mind and security, it synchronises information between multiple devices while backing everything up to ‘the cloud’ – it even works when no signal is available.
[author image=”” ]Benjamin Dyer is co-founder and CEO of Powered Now, the mobile admin app that takes the pain out of paperwork and payment for tradesmen and field trade companies.[/author]