Starting a Trade Business – What Do You Need to Know?

Setting up a new trade business is a shrewd move in today’s economy, with skilled trade labour in higher demand than ever before. But for skilled workers looking to make the jump into self-employment or a new business venture, the barriers to entry can seem high? What do you need to know about starting a trade business before you get started?

Logistics and Legality

Your desire to build a trade business may come from a successful career as an employee within a larger business or firm. As such, you will be relatively unfamiliar with the process of instituting a new business, whether as a sole trader or limited company.

If you are looking to create a freelance trade business, you may benefit more from registering as self-employed. For self-employed tradespeople, all profits are treated as personal income, and taxed accordingly. This tax can be offset by business expenses incurred throughout the tax year in question.

A limited company is better for those planning on building a business with staff and premises; registering as a limited company means you can enrol staff in PAYE schemes. Business and personal assets are also treated differently, protecting your own financial standing in the event of business hardship.

Managing Your Supply Chain

Building a successful business requires more than your aptitude and skillset. You will be part of a delicate economy, and reliant on a number of different mechanisms in order to provide a reliable and high-quality service. One key part of this equation is supply.

You need to build and foster a positive relationship with reliable suppliers, so that your projects do not become postponed as a result of shortages beyond your control. Finding a good source for treated timber can ensure your business keeps to its schedules and project deadlines – with a knock-on effect on customer satisfaction and overall reputation.

The Importance of Reputation

Speaking of which, reputation is a fundamental asset to the growth of your trade business – whether you intend to carry out domestic repairs and renovations or large-scale commercial projects. Word-of-mouth referrals are often the most valuable kind of marketing to the trade business, as new customers come to you with a clear knowledge of your results and capabilities.

Building and maintaining a positive reputation requires a dedicated approach, not just to the quality of your work but also the interpersonal handling of a given project. Good communication is essential to this, from the clear illustration of project steps to regular updates on progress.