We have now well and truly reached 2022. The streamers are safely tucked away in the bin along with the empty champagne bottles from New Year’s Eve. So, will this be a big year for your trade business? With the proper diligence, there is no reason why it can’t be your most notable year yet.

Here is your ultimate checklist for running your trade business. From organising your finances, through to managing your tax, we’ve got you covered.

Pro tip: Look out for our little snippet on the upcoming Uber Tradies – something to keep your eyes peeled for.

Understand the changes to taxation that are coming at the EOFY

Every year, when the calendar flips over to July 1, a raft of legislation changes come into effect. This is partly because of the previous year’s Federal Budget.

Many of these changes will directly impact you and your business. Because of these amendments, it is important you are aware of what will be different in the second half of this year.

Here are some of the changes you can expect at the EOFY 2022:

• GST compliance program will get a four-year extension: It is important that your GST is documented correctly. The ATO’s increase in activities to check for compliance is set to continue until at least 2023. The ATO will be detecting and dealing with taxpayers who deliberately avoid their GST obligations, as well as providing education. This is why it’s crucial taxpayers know their GST responsibilities.
• The Serious Financial Crime Taskforce extension: This arm of the Federal Government was established to seek out and prosecute the worst of tax evaders. It will continue, after receiving an extension beyond July 1, 2020.
• There will also be changes made to working visas for migrants and deductions in income tax, which could impact tradespeople and their businesses. It is also worth investigating your state or territories laws and legislative changes that will come into effect in 2020.
• For example, Queensland has rolled out a set of new financial reporting laws. This includes a requirement for licensees to notify the Queensland Building and Construction Commission if their financial position changes.

Your top tips for tax time

EOFY can be a stressful time. There’s a lot of paperwork and several tax obligations that need to be met. But when managed well, it’s also a chance for your business to earn a healthy return. You can then reinvest that return into your trade. Here are some tips to help you make the most of it:

• Tools Under $300: If a tool costs less than $300, you can claim a full tax deduction for it.
• Transport: If your tools are kept in your personal vehicle, you can claim running costs as a business expense.
• Sunglasses and Sunscreen: These may seem like everyday items, but you can claim them on your tax return. You’d be surprised how much you spend in a year. Skip the cheap servo sunnies and invest in a quality pair.
• Education: You can claim self-education expenses if the course is job-related, under 12 months, and fully paid before EOFY.

Talk to your customers

Let’s talk about millennials because they are going to take up a major portion of your business clients moving forward.

This generation does things differently to their predecessors. They are reliant on technology and live a fast-paced life. They also have a much shorter attention span, crafted by years of consuming bite-sized portions of information.

Millennials also lack trust

They are used to having advertising campaigns targeted at them on a regular basis.  Because of this, it takes a lot to make them believe the hype. What millennials desire is authenticity. If you can be transparent in all of your dealings and provide unique stories, they will listen. Embrace their requests and personalise the communication, and you will break through the barrier.

The good news is that most millennials are likely to stick with a brand for the long-haul, once their trust is earned.

If you have not got social media accounts, do it now

One in six Australians use Facebook consistently. In actual fact, over 15 million Aussies log onto the social media platform every month. This is an enormous market, yet it is one that many tradies ignore in favour of traditional methods of advertising.

If you have not created a Facebook page yet, we recommended you jump on the bandwagon. It’s a highly effective advertising platform that allows you to access a directory of those seeking out your services.

Google AdWords is another digital advertising method to consider if you are not using it already. This will push your business up the rankings in Google searches, landing your brand smack-bang in front of those who matter most.

Attend industry events

Showing up to industry events and trade shows will help build your network. It will also allow you to learn about the new trends and innovations in your industry overall.

This can be a valuable opportunity to get on the ground level of new work opportunities before they take hold. Position yourself as an experienced expert when this new work stream becomes popular with the general population.

There are thousands of industry events across the country each year and many that will relate specifically to your trade or industry.

While seeking out local events is beneficial, and a great networking opportunity, consider seeking out some of the bigger events in the major cities as well to broaden your horizons.

Look for new markets and opportunities

Nothing stays the same forever. Many industries have been majorly disrupted in the digital age, and it could be your trade that is next to change dramatically.

What Australians want in the near future, according to a recent survey, is Uber-style tradies tracked by GPS, rated by reviews from past customers, and booked and paid for through a smartphone app.

That would change the way trades industries operated entirely, and those savvy with how it would operate would succeed before those who were late to the party.

While Uber Tradies might not be a real thing yet, it is an obvious need and could very likely become a reality. So, keeping abreast of surveys and information streams like this will prove beneficial, as they can give you a window into the future.

By preparing for these changes, gaining early experience and marketing before the rest of the pack, you can assert yourself as an industry leader.

Adopt mobile payment platforms

Most tradies can attest to the pain point of their job that is invoicing.

Paperwork soaks up valuable time that could be better spent on the job and can result in delayed payments and constant calculations to determine your revenue stream.

Luckily, these days, there are many ways you can accept payments on-the-go, with mobile platforms built right into your phone or tablet. Combined with invoicing software, you can invoice and receive payment on the spot at each job site, to simplify the paperwork side of your business. Who doesn’t want to watch their cash flow speed up?

Speak to your financial provider about the applications that your bank offers and how you can install them into your device. Turning your smartphone or tablet into a mobile POS machine allows you to power up your process across the board.

Manage your workload

It can be easy to say “yes” to every job that comes your way.

When times are good, and business is booming, accepting jobs from all angles seems like a great way to build revenue and grow your brand.

But there are some inherent dangers in doing this. If you are accepting more work than you can handle, you are opening the door to burnout, mistakes and errors, and costly oversights that can damage your reputation.

If you are growing rapidly and getting lots of work, make sure you scale your workforce accordingly, so that you have enough employees to handle the volume.

Also, make sure you have the vehicles and equipment to handle the workload – many tax incentives can assist here, including the $20,000 instant asset write-off which has been extended until at least June 30, 2020.

Speak with your accountant and financial institutions to see if a business loan is the right option in this scenario to accommodate for all of the extra work.

And finally, remember to save for a rainy day – because every mountain has a valley.

Look after your body

Many tradies think that the physical nature of the job is enough exercise and they don’t need to do anything extra.

While the physical side of the job is good for the body, it does open the door to injuries. What would your financial situation look like if you were injured and could not work for several weeks or even months?

Several exercise routines will only take a few minutes each day that can build your body to withstand the rigours of your job and help prevent these injuries. Try to focus on programs that are based on your body’s core, endurance exercises and cardio.

Watch out for the warning signs

Watch out for any alarm bells on the job as well. If you feel any of these symptoms, it is time to put down tools and seek medical attention.

Pain: This is your body sending you a signal that it is time to stop. Being a hero and pushing through the pain barrier is only going to increase the likelihood that you will suffer an injury.

Head spins or dizziness: Otherwise known as positional vertigo, this is what happens when you put too much strain on your heart through exertion and lifting heavy objects. If you start to feel light-headed, stop and take a break immediately.

Numbness: If you feel nothing at all when lifting and parts of your body go numb, it is time to stop and seek out medical advice. This sensation is likely to be caused by compression of a nerve or decreased blood flow.

Chest pains: Never muck around with this. Get straight to a medical professional. You do not want to risk a heart attack under any circumstances.

Remember, this is not additional work, this is just servicing for your body. You wouldn’t flog your work ute for 12 months straight without giving it a service, so treat your body the same way.

Improve your cash flow situation

Do you know what your precise financial situation is? It can be hard to get a read on that when you are dealing with the actual job itself. From quoting, invoicing and buying supplies, through to taking care of your accounting and your advertising and marketing – there’s plenty to keep you busy.

Tools to help your financial management

There are some simple ways you can streamline your cash flow without having to increase your workload dramatically. Here are some tips to help keep the money rolling in:

• Set a budget: It sounds simple, like a basic fundamental. That’s because it is, but so many people don’t set budgets, and it hurts your cash flow situation.
• Outline all of your annual costs in your budget. Include tools, advertising, staff, vehicles—everything. Put it all in black and white. Then, when you’re considering a new purchase, you can quickly check if the extra money is available.
• Track your money and payments: Keeping track of your finances can be challenging—especially with late client payments, overdue bills, and trying to save money. Fortunately, many free apps can help automate this process. Set up automatic bill payments to avoid late fees. Use automated reminders for clients who are late to pay. Schedule regular transfers into a savings account to build a financial safety net.
• Get customers paying quicker: Invoicing and waiting for payment can be a major issue for tradies, particularly when clients are slow to respond. Offer a variety of payment methods, such as direct deposit, BPAY, credit card, and PayPal. The more options you provide, the fewer excuses clients will have to delay payment. Better yet, make sure your invoice templates are up-to-scratch, so they can find your payment details without any hassle.
• Negotiate: Don’t take it as gospel that the prices your suppliers give you are final. Ask for longer payment terms. Request discounts for regular purchases. See if you can return unused materials. These steps can help bring your costs down.
• Use handy tools to quote accurately: If you often get bogged down in providing quotes, make use of pre-existing resources. Tools like our free export quote checklist can help you send quotes more efficiently and effectively

Check your KPIs

It’s important to set clear revenue goals and regularly track your earnings to stay on course.

If your business hits a slow patch and jobs start to dry up, adjust your revenue goals and cut back on spending where possible. Set a profit margin target for every job. If you’re not meeting those margins, it may mean you’re accepting low-paying work or your costs have increased.

Use a comparison tool to review your staff costs against others in your industry. This helps ensure you’re paying fairly without overspending on wages.

By setting these benchmarks—and adjusting them as needed—you can keep your business financially stable and reduce the risk of hardship.

Stand out from the crowd

Having a point of difference is vital for you to differentiate yourself from the ocean of other trades businesses in your sector. To do this, identify what it is that you do better, or differently, or the additional services you provide – then shout them from the rooftop.

It could be simple things that you haven’t thought of, like removing rubbish from the site when you are done or near instant replies to queries.

Turn these points of differences into slogans, and include them in all of your marketing efforts; post it on your website and social media and include it on your cards, quotes and invoices. Assert yourself as an authoritative leader in your industry.

Assess your licences and insurances

It is important to check annually whether your licences and insurances are up-to-date. Additionally, there have been changes in your industry within your state or territory.

For example, NSW is currently considering licensing requirements for a range of trades including painting, glazing, and shower screen and kitchen benchtop installation.

Beyond this, the refrigeration industry is facing licensing changes in 2020. Within this, the Australian Refrigeration Council (ARC) is set to announce the establishment of a new advisory body. The body will provide industry-specific advice to businesses in this sector on what these changes will mean.

And public liability insurance, which is essential, could face changes, too. It’s set to undergo changes regarding the distribution of liability in the future, under Federal legislation. Speak to your insurance broker about the cover that you need for your industry. Make sure you ask them to be specific about what is mandatory. Have them fill you in on what you don’t need so you can prevent signing up for unnecessary coverage.

Check for changes and updates in the building and construction industry

The building and construction industry is highly regulated and involves businesses from many different areas of trade.

The Federal Government has a database where you check for changes to regulations that relate to you. This includes codes and practices to make sure you are compliant.

Here are some of the essential pages to check regularly:

• National Construction Code: Incorporates all on-site building and plumbing requirements into a single code which you will find here.
• Australasian Procurement and Construction Council: Responsible for the procurement, construction and asset management policy for the Australian, state and territory governments.
• Australian Building Codes Board: Home of the National Construction Code (NCC) Series and all the codes and regulations you will need to know about.
• Australian Paint Approval Scheme (APAS) and Painting Contractor Certification Program: Provides listings and accreditation schemes for the coating industry. APAS also tests and certifies paints and coatings and PCCP accredits painting contractors.
• Commercial Building Disclosure: Are you a part of a building project that needs to report energy efficiency information to the CBD? Find out through this portal.
• Nationwide House Energy Rating Scheme: Information on the NatHERS scheme which estimates and ranks the potential thermal performance of residential buildings in Australia.

Be realistic about the new homes market for 2022

The housing market is a gold mine for tradies. People from all industries are coming together to build these homes and estates and keep the cash flow coming in.

The last two decades have been great for tradies. The housing industry is experiencing significant growth, with plenty of new houses under construction.

That may not be the case in 2022.

Property values in Sydney and Melbourne are set to decline further, with some housing prices predicted to drop by up to 11% this calendar year.

This will impact the housing markets across the country. It also has the potential to ease the demand for new housing, apartments and residential towers.

Fortunately, the previous boom means that most contractors are booked up well into the new year already. The result? A temporary sense of security.

For trades businesses who have not booked ahead, 2022 could be more a competitive landscape than previous years.

Embrace the future

Use this as an opportunity to take all of the tips in this guide and put them into practice to grow your business in 2022. Head to our resources page to find more helpful advice towards improving your operations and revenue.