Builder's Business Tips

I’ve worked in the building industry for over 25 years, in fact my Dad was in the industry and about one third of my clients are in the industry, everything from builders, subbies, tradies and even two of my sons are currently apprentices. I know the game, the challenges and what people in the industries sometimes don’t do particularly well. Here are 14 very practical tips for builders (or the serious sub-contractor who wants to go places):

1. Be professional.
2. Type your quotes.
3. Learn to quote.
4. Outsource your bookkeeping.
5. Surround yourself with great people.
6. Look the part.
7. Clean up after yourself.
8. Turn up when you promise.
9. Know your business.
10. Do not bite off more than you can chew.
11. Job code
12. Consider QA.
13. WH&S is important.
14. Do not put all your eggs into one basket.

Running any business these days can be a challenge, and I particularly see if for those in the building game. There is heaps of red tape, onerous requirements from the Government and other organisations; it’s important you are on your game and performing at your best level. However, if you are one of the best in your field, whether it’s a recession or good times, you will always have work.

If you’d like more info on the 14 tips mentioned above, feel free to contact me on This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Email Etiquette

1. Don’t CC/ to the entire list, especially if larger, ie a business group, club, membership group etc. Spam all and not confidential especially members.
2. If you receive an email, as a group, don’t “reply all” unless all really need to see.
3. Don’t email when angry (and on personal level too in bad form to break of relationship via email, and text on post it!)
4. Don’t reprimand staff via email
5. Think first before you send, and certainly re-read before sending so you it makes sense.
6. Emails are legal documents, so if important, keep a copy, or print a copy to keep.

Working With Kids

Many of us (male and female) juggle the responsibility of work and business with being a parent. It can be a challenge, to say the least. There just doesn’t seem to be enough hours in the day, or days in the week. And of course, kids are great at making us feel guilty. My kids favourite is “you love your computer/clients/staff more than me!!”. Next thing you find yourself feeling guilty. But remember this – and I feel my kids this – if I didn’t work and wasn’t successful, we might be on Government benefits and they wouldn’t have their Xbox, Razor Scooters, computer, ipod or mobile phones etc.

The first thing I think you can do for your kids is involve them. Explain what you do. I’ve had many a discussion in the car on the way to school about small business, bookkeeping, work practices etc. Of course you have to edit the discussion according to the age of your child. I’ve talked about franchises and why someone would get into a franchise with my then 14 year old. Remember many business skills can benefit anyone in life; whether it be how to use a computer, write a cheque or do the banking. I can remember a client of mine telling me about their new Office Junior being sent to “do the banking” and not having a single clue what to do. She went to the bank, left the deposit on a counter and promptly left. Fortunately banking staff got to the cash deposit before an opportunist customer took action. My point is that get your kids to help you. An 8 year old can easily (and even enjoy) shredding. A 12 year old (once shown) can do basic filing. It’s not “slave labour” as your older children may chime, you are:

• teaching them the valuable lesson of work ethic
• teaching them skills – which will look great on a resume later on
• getting help via delegation
• spending time with them AND
• showing them that money doesn’t grow on trees – it has to be earned.

Kids are sponges and they learn things very quickly.   Hand them money without them having to earn it and they sure will get used to it quickly; when it comes to working for someone, they will have no (good) work ethic.  I’ve had office juniors in my own business who initially thought it was fine to sit and chat, use their mobile, text messages or sit doing nothing.   Short of winning Gold Lotto, I’ve not yet come across a way where people just give you money for nothing – I have to work hard for it and so do my children.   My now 18 year old was shocked years ago when he didn’t get the full $10 for the front lawn; I gave him only $7.  He stood there and wanted to know why I’d “short changed” him.   He’d done a chocking job; he’d missed the entire side strip and so I said that wasn’t satisfied and would not be paying in full.   If a client of mine wasn’t satisfied with the job, they wouldn’t just pay me in full; I would have to either rectify or get only part payment – if I was lucky.   Since that day, he’s mowed the lawn properly – and been paid – in full.  Sometimes he even gets me to come out and “inspect” his work before putting away the mower.

It's Year End Time Again

Wow, can you believe it’s June already? It seems just like yesterday we were taking down the Christmas lights. The weeks just turn into months. So, it’s year end again and I wonder how many of us are truly prepared? Here are some practical tips for small businesses to be fully prepared and enjoy the New Year in relative ease:

• Accountant. If you’ve not visited your Accountant yet, get onto this as a matter of urgency, tax planning works best before year end; doing it in October is somewhat pointless and quite limited.
• Software. Is your bookkeeping and payroll software up to date? There are changes to labels on Payment Summaries and tax rates … you need the latest accounting software to handle this correctly. MYOB for V19 for example has the upgrade for the Payment Summaries, and then the next version will have the new tax scales.
• Payroll. Are your payroll records up to date? Do you have current addresses for all your staff and all their tax file numbers (TFN’s)? Has this been entered into the payroll software or system? Do you have the FTB figures from your Accountant if you have FBT labels to complete on your Payment Summaries for staff?
• Bookkeeping. How’s the bookkeeping coming? Is the data entry up to date and the bank reconciliations completed to at least end of May? And that’s May 2010, not May 2009 or earlier!
• Super. If you want the deduction in the current financial year, then the payment must be in the hands of your Fund by 30 June. This means the cheque clears by 30 June, not you posting it some time in July. To avoid fines and penalties it must be with the fund by 28^th July, but of course if paid in July, then becomes a deduction for the 2010/2011 year. Remember also that the contribution caps have changed this year (under 50’s it’s now $25K and for over 50’s it’s $50K).
• Claim all Deductions. Be sure you are stocked up on things you need – everything from small hand tools, to stationery, printer cartridges, stock, materials, memberships, periodicals, rent, insurance and your vehicle services. My view is that you get the deduction this year and should be spending very little in July/August as you are fully stocked.
• Deadline Reminders. 14^th July. This is the deadline with payment summaries need to be issued to your staff. 31^st July. This is the date that Portable Long service Leave Certs need to have been issued. 14^th August. Deadline for Payment Summary Reconciliations to be sent to the ATO. 31^st August. Will be the deadline for your WorkCover Annual Declarations. And that’s not counting your BASes and IASes.

This is a busy time for most business owners or managers, so ensure you are on track and organised and your team are ready for action. Work with your bookkeeper, consultant or Accountant to ensure that everything is under control and organised. And of course, once you’ve met all the deadlines, completed your BASes, then don’t forget to send the file and information to your Accountant promptly. There is no need to wait till March or April next year to have that last minute panic rush to prepare your tax.

So to you all, we wish you a Happy New Year.

Delegate!  Delegate!  Delegate!

We all say how time starved we are and that we have “no time” but the fact remains that many small business owners have not fully developed the art of delegation. Yes of course we’ve all used the excuse “no one can do it as good as me” or “by the time I show them, I could have done it myself”. These are just that, excuses. Here is what you need to do:

• Write a list of the tasks you do regularly. Then really look at each item in the list. Seriously, are you the only person who can chase up your debtors? Could someone else do the invoicing or put the newly delivered stock away?
• Now, armed with your list of things you can delegate, then think about who it can be delegated to. Now, remember, even if you don’t have staff, there are definitely tasks which can be delegated. Bookkeeping is a perfect example. Chances are you hate this chore, you aren’t that good at it, it takes you away from doing what you do well (your business) and it takes so much time you end up staying up till midnight to “do the books”. The smallest business can delegate this out to a contract and professional bookkeeper. Many work on an hourly basis; if you need 2 hours a month or 4 hours a week – they are flexible and you often only pay for the time used.
• Once you delegate a task to a person, you need to train them how to do the task (unless of course it’s the professional bookkeeper who has come to you strongly recommended). I strongly suggest you have a Corporate Policies document which says how major tasks are done. If you have someone debt collecting, how often does it occur? Have the “Final Notice” template letters been written? How do they track who they have called and when? What is the policy re follow-up? Don’t just assume the person will know how you want this done, or will necessarily know how to do this well. Set procedures leave little room for ambiguity and it’s great having the processes in place for when you have to train the next person – the training time is reduced substantially when there are pre-written support notes and instructions.
• Closely monitor the recently delegated task. Ensure the person is proceeding as desired and if not, provide further training or guidance (plus positive support).
• Empower your staff. If they don’t have the authority to do anything, then you will spend an awful lot of time in supervising them and “holding their hand”. Additionally, they will become disenchanted and feel you don’t trust them.
• Regularly review their progress with brief update reports so that you don’t loose touch with what is happening in your business.

Detecting Theft in a Small Business

“It won’t happen to me” is the song so many of us sing, when it comes to theft, loss, accidents or anything that’s particularly unpleasant. But the fact is that 80% of small business in Australia, during the business life, will be hit by employee theft or fraud with the median loss being $98,000. Analysts believe that internal theft is a primary cause of a large percent of business failures. Here are some tips on how to detect theft in your business. Each of these items on their own do not automatically correspond to there being theft; they are just indicators – the majority of employees are honest; but you should keep your eyes open. General business indicators:

• Missing records or gaps in number sequences (ie shopping dockets, orders or job/invoice numbers being skipped)
• Missing stock, inventory or merchandise
• Unlocked exits, especially at the back of the business
• A large number (dollar value or volume) of credits in the books
• Your business takes in a fair amount of cash, but has virtually no reconciliations in place
• Financial reports are rarely provided – although an excuse is always provided.
• You are working “like a dog”, have heaps of work on, but just don’t have any money
• Downturn in your bottom line (or change in ratios) – don’t automatically blame the economy
• You are a business with a turnover of $1.2-2 million
• You have 1 office person handling purchasing, invoicing, receipting, banking and book work
• The business owner is so busy, doesn’t have time to check things (and staff know this)
• The business owner is trusting; in fact they think of their staff as like their family.

Specific indicators about the staff member:

• Shows signs of alcohol or drug abuse (or is a gambler, which may be harder to detect)
• Displays abrupt changes in emotional behaviour
• Complains a lot (and often they are planning on leaving your employ)
• Defensive or hostile when asked about their work
• Says “sure” then you ask for something, but you never get that information
• Overly diligent, want to do everything, even tasks normally they would not need to
• Won’t take holidays (because this is frequently when theft is discovered)
• Work long hours, especially outside normal business hours
• Puts things away when the owner enters the room; like they are hiding something
• Grab the mail (as naturally they don’t want others to see what’s happening)
• Parks near exit doors (for easy access to steal stock out the back door)
• Appears to be living beyond their means.

It’s believed that 25-40% of staff will steal at some point; it might be only a box of pens, or with a mechanic this year, it was $480,000 in cold, hard cash. If you feel something is not right, keep your eyes open, get financial reports (even if you have to learn the computer system to do so), ask an independent such as your accountant to review your figures and start checking things like your bank and credit card statements. If you spend an hour a week monitoring your business, checking your financial reports and being attentive, would this be worth saving $480K in theft? Discovery can be devastating; but not as much as your thriving business going under.

Nice as Honey

We’ve all heard “honey gets more flies than vinegar”.   I had an interesting communication with a professional a few weeks back.  This fellow was rude, arrogant and generally I would classify as a bully.   Within about 30 seconds of getting on the phone with him, he had my bristles up.  Later I thought he could have achieved a far better result by simply applying a little bit of honey to his manner.   Had he been pleasant, introduced himself and explained what he needed, asked (rather than demanded), and generally treated me in a pleasant way and with a little respect, do you think he would have achieved so much more, so much easier, and so much quicker!

Let’s face it folks, the people you deal with are people, so here are some practical tips on dealing with people:

1. Use their name.  A simple “thanks Mary” goes a long way.
2. Relate to them.  Maybe you forgot to order something and it’s 4:55pm and you need the item shipped today.  Explain your dilemma, get them on board and they might be inclined to help you out.
3. Ask, don’t demand.  Do you think “I need you to …” would work better than “You have to …”.  Phrases like “can you please help me?” or “I would really appreciate it if you could ... “ will take you a long way.
4. Keep patient.  If you suspect the call is going to be long winded and frustrating, then don’t do it just before lunch when you’re starving, and possibly do another non-brain task at the same time, such as tidying your desk.
5. Thanks.  I’m not just talking about the per-functionary “thanks” but a genuine “thanks heaps for your help today!”  And if they really went heaps out of their way and helped you in a huge way, then take the time to either send them a thanks note OR ring their boss and say how great they were.

If you have a tendency of being sharp, snappish, impatience, or downright rude, then you need to mend your ways.  Bully tactics will get you only so far, but a pleasant and friendly manner will get you so much further.  And guess what, when you are nice to people, they are nice back and before you know it, you are enjoying your day – and achieving positive results.

BAS Deadline Extended for Some Stone Consulting Clients   

As previously advised I now have my Registered BAS Agent Number (plus a couple of the team are in the process of gaining theirs) and accordingly, you may be eligible for the extended deadlines.  Essentially, as a client of Stone Consulting, if we lodge your BAS electronically and all your obligations are quarterly, then you can have an extra month to pay your BAS.  This is not applicable for those who lodge paper forms.  Many of our clients have enjoyed the ease of electronic lodgments through us for some time however, I would like to make an offer to any client who has not use our electronic service – one free Electronic BAS lodgment simply by mentioning this Client Alert.  After seeing how easy and efficient the electronic system is, and having the extra time to pay, I’m sure you’ll see value in utilising this service in future.   Simply let any of our team know you’d like to trial the electronic method for your next BAS.  Valid till 15^th November 2010 and one per client. 

MYOB Live Accounts

This web/browser based version of MYOB was released this month (early August 2010) and is ideal for small businesses who want to access MYOB via the web.  You can do invoices and have items, contacts, expenses, banking and reports.  There is no upfront software purchase, simply pay $25 per month, which I believe includes the bank feeds and GST.  You can have a free trial for 30 days; a file setup just needs to be done first.  Want to know more; just ask Amanda or Donna at Stone Consulting. 

Social Media

Social Media’s 3 main avenues are Facebook, LinkedIn and Twitter. LinkedIn is a World Wide gated-access social network which works on multi-tiered contacts, particularly for professional people and boasts over 5.5 million users. It seems to be used mostly for people to :

• Connect to people from prior places (jobs, education etc)
• Online resume for job hunting
• Connecting for business and business opportunities.

So the big question is how to get the most out of LinkedIn and make it work for you? You can of course read the internet instructions, but they only tell you how functions work, and are in my opinion quite generalised. From my own quick research and experience I have a few ideas, and I’ll share what I’ve discovered so far:

1. Complete your profile fully and do include a photo. I’ll admit that profiles without photos or hardly any information don’t draw my attention … how do I know what that person does, their services, their point of difference, if they have zilch in their profile? This is a form of advertising, so sell yourself. 
2. When you link with someone check out their connections and see if there is anyone you know, or want to know, and link with those people too.
3. Use LinkedIn to search for someone specific you want. Let’s say you are looking for an Accountant, you can search this category and then see if you have any mutual connections and ask for a referral to that Accountant. 
4. When you meet someone, or get their business card, check if they are on LinkedIn and connect to that person.
5. If you connect with someone on LinkedIn who you really think will be a great lead, then be sure to follow up and invite them out for a cup of coffee – to give both you, and the other person, the opportunity to learn more about each others business and to ascertain if there might be the possibility of a good strategic alliance.
6. Update your profile regularly … not only adding new material, but keeping it up to date so that you appear on the regular LinkedIn Updates and your connections grow. I believe in many ways it’s about being seen and touch points, so allocate regular time each week to keep your profile working.

So, these are my ideas … I would love to hear from anyone with any additional suggestions or ideas, similar to this, on how to make LinkedIn work – I’m sure of everyone out there, some of you have some fantastic ideas and suggestions you’d be happy to share. Thanks in advance. :) Donna