Starting up in Business looking for some tips

[GQuigley67]

I can see the light at the end of the tunnel now, soon I will be GSR and will have my van and also getting a website made up then that should be me in business!! doing some jobs here and there at the moment to keep me going through this crappy Giro. I need some tips on pricing though, I'm doing QS at college the now and have a fair idea on how to price but don't know the going hourly rate at the moment I was thinking of £25 or £30 an hour, maybe £40 first hour...with 5% added on to materials for wastage and 8-12% added on to overall cost for Profit & Overheads...

My other thing that I need help with is how do you guys make up your invoices?

I am going to see a solicitor about getting gaurantees written up to give customers a 12 month gaurantee on all new installs and first service free on new boilers. Just wondering if anyone has some tips for me as I am a complete novice on the business side but I am getting alot of help from business advisors etc but no plumbers or tradesmen...

 

[oldplumber]

keep thingss simple, avoid spending when setting up you need to earn the money first, steer clear of solicitors they cost and if you install boilers correctly you van rely on the manufacturers to warranty the boiler, why do it yourself at cost to you. just ensure you build in an extra into your pricing to pay for any call backs in the first year, dont pay out of your own pocket. you have to be cheap to start to get the customers, then get a base and then increase your prices and stick anything from 10 - 25 percent on materials depending on what you think the customer will stand ie load it on a diveter diaphragm but not on copper pipe or the boiler

 

[princegoose]

expect more phone calls from people selling you stuff/advertising than customers.

I might be cynical but unless you pay silly money for advertising you wont get much work, then any work you do get end up paying for the adverts.

canvas your local area, knock on doors and give your business card, with a smile, offer discount rates for locals. its 50p per week to put an A4 advert up in my local post office window, advertise in local parish/village magazines £20 p year. (im yet to do either)

DONT get a loan, unless youre unemployed, you might be able to get a cheap Princes trust loan.

dont get a business bank account

dont pay an accountant or solicitor.

marry a woman who earns more money than you and can pay you to work for her when times are quiet.

 

[princegoose]

oh and be scared

 

[cr0ft]

1.) Don't waste money on advertising, if you have to do it then spend the money on local ad magazines (check with other tradesmen/women to find out which ones actually work in your area). Parish magazines etc can also be good.

2.) Get a website, it amazes me how many tradespeople don't have one. This is the number one way to gain new customers nowadays, if you don't have one you are missing sales and profit every year. They are very cheap to setup (free if you know how to make them, around £250 for a basic site if you don't) and will cost around £30 a year in running costs.

3.) Don't be suckered into buying ad space in any phone directories, free ads are fine thanks and will get you some work.

4.) Thumbs up to princegoose's points - don't pay for professionals unless you need too. Let Google be your friend and learn to do you own accounting. A good easy package is MYOB AccountEdge Plus, allows you to easily do all of your own book-keeping and invoices. You can even customise invoices/receipts and quotes with your company logo (you do have one right?).

5.) Be professional, when you visit a customer's house the first impression is vital. If you smoke, don't smell of smoke. Arrive fairly smart, offer to take off your shoes. Listen to them, try to offer them tips that will save them money. Basically, get them onside and then you should get the quote (if your pricing is right).

6.) Where in the country do you live? This will have a huge effect on what you can charge. It is very difficult to raise your prices later on and keep customers so I don't necessarily agree that it's best to start off cheap. I started off quite expensive (compared to other plumbers) and 2 years on things are going very well. People will pay more if you are professional, turn up on time and offer a good service. While others are focussing on price, focus on being the best you can be.

Sorry if any of that sounds cheesy, but it's advice all borne from my experience of setting up. I had no plumbing experience prior to starting and am 'fast tracked' but attitude and the willingness to learn is FAR more important than experience. This said, in the first year, work with a more experienced plumber and if you aren't comfortable taking on a job pass it to them and watch them do it..

 

[GQuigley67]

im getting a website and logo made up from a friend of a friend with a .co.uk web address, i'm concentrating on van, website and business cards for advertising. I'm going to get uniforms made up also with logo etc etc


wherer would i get this accountant program?

 

[Centralheatking]

Hiya, good luck with your venture. I started 30 years ago and a lot of whatyou are doing was not possible then. I think if your ok with it then spending some money on a company image might work and a website is good - were on one now.

A van image really does work. You can get van packs from major boiler manufacturers still I think - worked well for us.

BUT remember winning a customer is the hard part - they have to trust YOU. The second bit if you are good IS TO KEEP THAT CUSTOMER - who then might recommend you - FREE ADVERTISING and the trust bit is a liitle easier to gain.

centralheatking

 

[GQuigley67]

ive already got customers at the moment that seem to trust me, got a quote for van signage at roughly £200, getting the logo and website and hosting for £85 although i did get quotes off a graphics designer for £600 !!! I was brought up with manners so that seems to help win people over, also I am good at my job so hope that helps haha just going to be honest with my customers and I am picking up good tips on this forum also like offering optional add ons in quotes etc,

 

[princegoose]

ive already got customers at the moment that seem to trust me, got a quote for van signage at roughly £200, getting the logo and website and hosting for £85 although i did get quotes off a graphics designer for £600 !!! I was brought up with manners so that seems to help win people over, also I am good at my job so hope that helps haha just going to be honest with my customers and I am picking up good tips on this forum also like offering optional add ons in quotes etc,

£200 sounds good for van sinage, my local place quoted me £250 for 3 sides and not the way i wanted it done. so went to the sign builder.co.uk all 4 sides for £105 delivered, have to put it on myself (job for wife). hopefully get it tomorrow, will let you know how it goes.

the yellow pages for my area isnt free anymore so paid £60 for smallest advert possible. Had ONE phone call from it in the first week it was released but nothing since. theres 4 pages of nice shiny large plumber adverts.

yell.com was £100ish for a lightweight listing, which gets me onto the first page when searching plumbers in my town, which im happy with. pay in monthly installments too which is nice.

 

[cr0ft]

@GQuickley67,

Do a Google search for the program mate. I don't think I can give out website addresses on here but there are a few people selling it. It's not the cheapest but if you learn how to use it properly (not difficult I promise) it will save you having to use an accountant. It makes doing you end of year tax returns pretty straightforward. Also keeps track of payroll, stock, all invoicing. It's an all in one solution. You do have to take their annual support package but I think this is the way that all accounts programs are going to go.

 

[GQuigley67]

just a quick update on my situation, just back from my funding panel, secured my funding for the van (£4000 loan £500 grant) paying back at £80 a month for 5 year will have a free business advisor for 2 years to help me with the business side of things just hope to get regular work got a LGSC coming up and a Boiler Swap and other various bits and bobs so hope it keeps up

So I'm a happy Plumber at the moment hope it continues haha

 

[villa_tom]

Good Luck

 

[dontknowitall]

20% cost for the loan (£800). That's expensive (in my book) but if you need the money to buy the van because you haven't any then you have to pay.

What I do is run my own business in credit and save up for things as I need them - more time consuming but much cheaper. If you can get to this stage then you'll find things much less stressful.

So, what I would do, is pay your £80 a month and each month AND put aside another £20 in a deposit account (or somewhere where it's hassle to withdraw it). After 5 months you've saved £100. Then as more business comes in, I'd save more per month, say following three months £30 a month so in 8 months you've saved £190. As one or two bigger jobs come in, save some one off larger sums of money. If I have my maths right and you can pay it off in 12 months you'll save yourself £640, own your own van and get to spend a week's wages!

The idea is you plough as much into YOUR business as possible and as little as possible into someone else's business.

The quicker you can pay off your loans, the more your takings are working for you (and not someone else) and the more relaxed you can feel about your business.

This sounds a little draconian, but unfortunately it's not until a few years down the road with loans that you find how expensive they are. I was given this advice (from a managing director of a £1m+ turnover company) when I started and found it most valuable. He said to run the business like your household budget. He told me his company's not had a loan for a good ten years and they save it for when times are more difficult (firstly) and secondly for capital investment.

Hope you find this info useful as it's given as a view point and NOT TELLING you what to do!!

 

[GQuigley67]

20% cost for the loan (£800). That's expensive (in my book) but if you need the money to buy the van because you haven't any then you have to pay.

What I do is run my own business in credit and save up for things as I need them - more time consuming but much cheaper. If you can get to this stage then you'll find things much less stressful.

So, what I would do, is pay your £80 a month and each month AND put aside another £20 in a deposit account (or somewhere where it's hassle to withdraw it). After 5 months you've saved £100. Then as more business comes in, I'd save more per month, say following three months £30 a month so in 8 months you've saved £190. As one or two bigger jobs come in, save some one off larger sums of money. If I have my maths right and you can pay it off in 12 months you'll save yourself £640, own your own van and get to spend a week's wages!

The idea is you plough as much into YOUR business as possible and as little as possible into someone else's business.

The quicker you can pay off your loans, the more your takings are working for you (and not someone else) and the more relaxed you can feel about your business.

This sounds a little draconian, but unfortunately it's not until a few years down the road with loans that you find how expensive they are. I was given this advice (from a managing director of a £1m+ turnover company) when I started and found it most valuable. He said to run the business like your household budget. He told me his company's not had a loan for a good ten years and they save it for when times are more difficult (firstly) and secondly for capital investment.

Hope you find this info useful as it's given as a view point and NOT TELLING you what to do!!

well the loan is 4% interest, pretty good if you ask me its from a charity princes scottish youth business trust, they reduce payments if your struggling also considering a bank is about 12% +

if I can save up to pay the loan off then I would do that obviously to reduce my overheads, the good thing also is that I have business advisors helping me for free for the first 2 years with the business side of things

 

[the_ace]

What age do you have to be to go for that loan GQuigley67? Sounds right up my street!

 

[GQuigley67]

under 26 mate need to make up business plan etc, alot of work for young people goin into business if your older then not much help !! bit unfair to be honest but i aint complainin

 

[the_ace]

I applied for a "rapid response" fund because I got paid off this fund is available for 3 months after you've been paid off. I put in a claim for an FGA, my GS registration and money for advertising, will update if I get it. Also worth noting that the Job Centre can cover 50% of training costs for self employed people!

 

[GQuigley67]

nice one, I'm waiting on compensation money coming through from a car crash am getting £2k at least think that'll get ma FGA and a wee holiday