Just finished your education, training and apprenticeship as a tradesman?? Want to switch to self employment after a stint as a tradie in a bigger firm?? Well, the time is right to make the switch. According to an Ibisworld report, this industry is expected to witness a recovery over the next five years. This is the time for you to take the plunge and set up your tradie business. Here is how you go about it.
Make your business plan
Creating your business plan lets you give definite form to your idea. Your business plan need not be long but it should be practical, comprehensive and realistic. It will have the following:
- Your future goals
- Your business objective
- What market you aim to target
- How you will train employees
- How big your team will be
- Overall marketing strategy and anything else that you wish to add
- A well designed business plan becomes a blue print for your business to follow.
Decide the business type
A critical step is to define what kind of business you wish to start. Typically, tradesmen choose to set up a sole trader business or a full fledged company. The latter is tougher to manage and also involves higher capital cost. If you start up a sole trader firm, you have complete control over the operations. However, you also have complete responsibility for the financial liabilities. You need to cover this risk thoroughly with the right insurance. Once you have decided your business structure, register your business name in the Australia Business Register and also get your ABN (Australian Business Number).
Get necessary licenses
Licensing requirements may differ from state to state. You need to check what the rules say for your state and you can do that here. The nature of work you will take up, your business structure, location- all impact the licensing you need. To give you an example, you may need a contractor’s license plus a building work supervisor registration. You can get a general license or a specified license and supervisor registration as per your choice and if your credentials permit.
Set up office and team
The next step is to set up your work place and hire a team that matches your passion and principles. Do not start big here. You can always hire more people as your business grows. Remember that the more people you hire, the more cost outlays in the form of paychecks you shell out. The same goes for your office too. Keep it small and simple when you start out. You can expand when your finances permit.
Get your risks covered with tradie insurance
This is one of the most critical initial steps when you set up your tradie business. Some insurance covers are compulsory for Australian businesses. These include worker’s compensation and third party personal injury cover (if your business has motor vehicles). Apart from these forms of insurance for tradies, public liability insurance is another critical cover you need for your tradie firm.
What does public liability insurance for tradies do? It covers you in event a third party suffers some kind of damage or loss from your firm or workforce. As a tradesman, you are exposed to such risks every day at work. So is your team. When you go out to a client worksite, you come in contact with many people. When potential clients walk into your office, you face a possibility of a claim arising from them with such reasons. When you send a team member out to work, they expose themselves and your business to this risk.
Public liability insurance Australia covers you in such cases by safeguarding your business’s financials. For instance, if you face a claim from a potential client that he was injured at your office premises, you could end up paying:
- Court fees
- Attorney fees
All of this can amount to a prohibitive sum that drains your business. Fearing the financial impact, you may choose to avoid a legal battle. However, claims like these also impair your market reputation and future business prospects. With public liability insurance covering these costs, you can take on a legal battle to protect your reputation without anxiety.
A sound public liability cover for your Australian tradie business makes your firm more attractive to future customers too. They know that you are well prepared to handle contingencies that could otherwise put you out of business, leaving their project midway.
With the industry set to revive, this is a good time to start a tradie business. Follow the right steps, starting with a business plan to ensure that you make the right beginning with strong foundations that underpin your success. Cover your fledgling business with the right kind of insurance including public liability cover so that you can work towards your goals with complete peace of mind.