By BiKBBI Director of Marketing and Communications, Michelle Daniels.
2023 is predicted to be one of the toughest trading years we have seen in decades, with businesses big and small struggling with ever-increasing operating costs, staffing shortages and supply chain issues amongst many other challenges.
Despite entering the New Year in a strong position, having been one of the few industries to prosper during the past three years of turbulence, it’s vital that businesses regularly take stock and see if there is anything they could be doing differently. We’ve put together some new ideas to help you navigate the New Year…
HAVE A GOAL AND A PLAN
It might be a chore, but the best results usually follow a goal and robust plan to achieve that goal. Having something to aim for helps to focus your efforts and stay on track. You may need to change course as the year progresses but knowing where you are heading at the start of the year puts you in a better position to get there.
Your goal doesn’t have to be world domination, you need to be realistic. As an example, if you completed 30 kitchens in 2022 and your happy with that, your goal might be to complete 30 kitchens in 2023. You can then build a plan around how you will achieve that. Or, perhaps growth is your goal and you want to turn 30 kitchens last year in to 50 kitchens this year. Or diversify to include bathrooms, bedrooms or home offices? Whatever your aspirations, you’ll need a plan to do that, and you’ll need to think about the logistical stuff like how you’ll physically deliver such an increase in workload as well as the more interesting and perhaps challenging stuff like marketing your services to win new business.
The BiKBBI app has a library of downloadable documents including business planning templates to help put some structure into 2023.
BE FINANCIALLY SAVVY
We will all be feeling the pinch for the foreseeable future with rising inflation and the cost-of-living crisis set to stick around for a while. Making sure you are financially fit is vital as 2023 really will be a ‘survival of the fittest’ scenario. One mistake often made in circumstances like this is to simply cut the stuff that’s easy to do without.
But this isn’t the answer, particularly if your goal is growth. A better place to start is to look at ways you can reduce spend in all areas of your business rather than cutting things out entirely.
Start by looking at where you biggest expenditure is. Most KBB installers tell us that materials and fuel are their biggest expense, so let’s look at that. Are their better ways to buy your materials? Are you making the most of your buying power? If you have sight of your jobs in advance, then bulk buying will deliver better economies of scale. Where are you buying from? Are you getting the best deals? Have you signed up for your BiKBBI TradePoint card? You’ll save an additional 10% off everything at B&Q/TradePoint all day, every day! That could deliver you some huge savings. Click here to start saving.
Equally, if prices at the pump are crippling your business, explore the savings you could be making from a fuel card. This is a particularly beneficial route if you are running more than one vehicle – the bigger the fleet, the more you’ll save. We’ve teamed up with UK Fuels to offer BiKBBI members a 3p per litre saving at the pump at over 6,500 filling stations throughout the UK. Click here for more information on the BiKBBI UK Fuels card.
A wide range of other commercial cost-savers on products and services can be found on the BiKBBI app and BiKBBI members also get access to alternative business financing solutions, so check out our Funder Finder tool.
REVIEW YOUR EXPENSES
If you’re self-employed, you can deduct various running costs from your taxable profit, as long as they are allowable expenses.
Self-employed allowable taxes include office costs (stationery, phone bills), travel costs (fuel, parking, train/bus fares), clothing expenses (branded workwear, uniform, PPE), staff costs (subcontractor costs), stock and materials, financial costs (insurance, bank charges), advertising and marketing (website, social media) and training costs.
It’s worth checking the HMRC website to ensure that you are making best use of the self-employed expenses allowance or contact your financial advisor.
BiKBBI members can also benefit from our partnership with The Accurate Accountant – a national accountancy service specialising in small businesses – for more tailored guidance.
If you are an independent BiKBBI member (a retailer doesn’t pay for your membership on your behalf), you can claim a tax rebate against your BiKBBI registration fees. This applies to your first-year registration and each subsequent year thereafter. Speak to your accountant or tax advisor for more information on how to claim your rebate.
EVER CONSIDERED UPCYCLING?
Never has it been more true that one man’s trash is another man’s treasure. With consumers becoming ever more environmentally aware, offering to recycle their used kitchen is a great way to divert waste from landfill but there could also be some cash to be made.
Businesses such as the Used Kitchen Exchange will pay for good quality used kitchens in good condition. Equally, consumers may very well choose businesses that offer a more sustainable service. You never know, you may gain some extra commercial credibility (and income) by doing the right thing and not relying on what you’ve always done.
INVEST IN YOUR FUTURE…AND THEIRS!
If you have been paying attention over the last two years, you’ll know that the UK KBB installation sector is troubled. And you’ll also be aware that BiKBBI has been calling for installation businesses to embrace apprenticeships.
There are many reasons why this is the right thing to do but, for you personally, it could be the perfect solution for strengthening and growing your business during an economic downturn.
Firstly, there are literally hundreds of kids signed up and ready to embrace a career in KBB installation. We are not talking about the school dropouts and no-hopers that were signposted to apprenticeships in the 1990s when education institutes didn’t know what to do with those that weren’t cut out for higher education. We are talking about bright, driven youngsters from all backgrounds with aspirations to work hard, earn a fair wage and maybe even run their own business one day.
The BiKBBI, along with others, have worked tirelessly on the creation of a fit-for-purpose KBB installation apprenticeship that delivers all the skills that you need from a trainee to add value to your business, and we have secured government funding for the educational element of the apprenticeship.
There is nothing better than ‘grow your own’ talent that you can teach, guide and shape into a tradesperson that works to your standards and reflects your business, plus it’s cost effective, the training element is funded and you are helping to solve the impending skills gap crisis. A bit of a no-brainer really!
MAXIMISE YOUR BiKBBI MEMBERSHIP
We completely appreciate that our members are experts at what they do and that, in most instances, you have been in the trade for many years.
But, let’s face it, whether we like it or not, the world has changed enormously over the last few years including consumer expectations, legal rights, commercial legislation, regulation and the law. The fact is, we all do things differently today than we did just two years ago, and we forecast that changing times will continue based on the current uncertainty and the fast-moving world that we live in.
Your BiKBBI membership provides you with a wealth of support and resource to help you run your business. Keep a close eye on our communications and download the BiKBBI app for access to useful guidance and benefits.
DON’T LEAVE RISK DOWN TO LUCK!
History has shown us that economic downturn negatively affects consumer behaviour. Retailers will inevitably see a rise in compensation claims and tradespeople will see an increased number of their customers withholding balances and/or disputing work. It is vital that you ensure your dealings with customers follow the letter of the law.
Ensure that you completely indemnify yourself before, during and after installation. Enter a legally-binding, written contract for all work, including legitimate Terms and Conditions and a fully itemised quote for the work that you are undertaking. If the scope of work changes before or during the install, even if it’s a small change, make sure you submit a Variation Order and get it signed by the customer.
Failure to have a contract, Terms and Conditions of service and a Variation Order will leave you and your business exposed to the turmoil often associated with tough economic times of trading.
Template contracts, Terms and Conditions, Variation Orders and much more can be found on the BiKBBI app, which is completely FREE for members.
You could also consider signing up to Protect my Install (PMI), a multi-purpose installation management platform available only to BiKBBI registered businesses. As well as generating new business by matching customers with installers geographically, the PMI platform takes care of everything from quotations and contracts to workmanship guarantees. PMI even protects payment via ESCROW, offering peace of mind for you and your customers.
On the subject of risk, don’t assume that your current policy provides you with the right level of protection – especially if you chose the policy based on cost alone. Unlike motor insurance and the legislation in place to protect drivers, commercial insurance is a real minefield, with many policies reducing premiums by removing key cover.
We see thousands of policies each year and we’re never surprised to see policies that aren’t worth the paper they’re written on. For example, it’s not unusual for us to come across a policy held by a bathroom installer that excludes the installation of sanitaryware!
Don’t get caught out. BiKBBI registered businesses have access to a specialist insurance service from one of the world’s largest insurance underwriters. Take advantage of a FREE, no obligation review of your current insurance policy by contacting Marsh Commercial.
EDUCATION | STANDARDS | SUSTAINABILITY | COMPLIANCE |