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Accounting for Electricians
As you know, running a business as a domestic or commercial electrician can be challenging. Apart from the danger and physical demands of the job you also need to contend with long hours, emergency call outs, extensive travel, heavy regulation and ongoing training requirements.
While clients expect you to rewire their homes, crawl into confined spaces, install power points, down lights and new electrical appliances – bookkeeping and administration often don’t get the attention they deserve. While GST, BAS and tax payments often represent some of the largest financial obligations for a self employed electrician, many end up paying too much tax and incur fines for non-compliance.
Having an accountant who understands the mechanics of running an electrical business can mean the difference between just surviving and potentially thriving. Over the years, Mal Wells and his team of accountants have mentored dozens of electricians through the various stages of their business life cycle – from start up right through to sale. Apart from the usual small business compliance issues of GST, BAS, PAYG and superannuation we assist electricians with managing their cash flow and selecting the right software to prepare quotes, invoices and manage their payroll and sub-contractors. We offer you experience, technical tax knowledge and most importantly, an intimate understanding of your trade.
THINKING OF STARTING A BUSINESS AS AN ELECTRICIAN?
Starting a business is a bit like building a house. You need solid foundations that include the right business structure, the most suitable accounting software, adequate and appropriate insurances, a marketing plan including a lead generation website and various social media channels.
Your choice of business structure is critical and there are a number of different options such as sole trader, partnership, company and trust. Asset protection is a key consideration when selecting a business structure because of the high risks associated with the building trades. When choosing a business structure you also need to take into account your family situation, your forecast level of profit and your future plans regarding admission of new business partners.
Accounting software is another foundation brick in the business wall and the wrong choice can be catastrophic. Poor financial records are one of the biggest causes of business failure in this country and up to date, accurate records let us make informed business decisions. Our mission is to make sure your accounting software matches your business needs with your level of accounting skill. The wrong choice of software can lead to records that resemble a 'computerised shoebox' which conflicts with our brief of helping you reduce your bookkeeping and compliance costs. Where required, we train you to use the software to reduce your costs and frustration.
As you know, to build a house you also need the right tools. When 'constructing' your business we also use a number of tools including our start-up expense checklist to identify all your potential establishment costs. It dissects your start-up costs into several categories including tools, equipment, IT expenses, professional fees and marketing costs. These figures can then slot into a cash flow budget template to produce projected trading results for your first year of operations.
For an electrician, your van or ute is arguably your most important business tool and you can download our Motor Vehicle Tax Guide from the resources section of our website. It explores the alternative methods of claiming your vehicle expenses and the distinction between a business and private trip for tradesmen. In addition, through our affiliate partners we can also assist with vehicle finance (chattel mortgage, CHP or lease) and get you fleet pricing on your new car, ute or light commercial van that could save you thousands of dollars.
To be frank, that’s just the beginning. As accountants we can do some financial modelling and prepare some ‘what if’ scenarios. This gives you an understanding of your business’ best and worst case profit scenarios. Next, using industry benchmarks we can compare the performance of your business against your competitors so you understand what is working in the business and what needs working on.
MARKETING YOUR BUSINESS
For electricians, your marketing can be the difference between gloom and boom and one of our biggest points of difference compared to traditional accounting firms is our marketing expertise. We can assist you with your branding (business name, logo and slogan) and offer you advice regarding your website design and content. If required, we can also help you create a corporate brochure and harness the power of social media to win more referrals.
From a marketing perspective most self-employed electricians rely on customer referrals and traditional marketing methods like yellow pages and local newspaper ads to grow their business. While some of these techniques remain effective, you need to move your marketing focus online to align with the shift in consumer behaviour. Google is now the number one source of new business for trades people including electricians.
To generate leads your website must appear at the top of page one in a Google search for 'electricians in your suburb'. The truth is, most of your competitor's websites are nothing more than electronic billboards that simply list the who, what and where of the business. Over the past few years we have worked with dozens of clients to help them create quality affordable websites that pay for themselves many times over. Your website should be the heart of your marketing and you need to look at it as an investment not a cost. We can offer you advice and assistance with your content, search engine optimisation and video production plus we'll make sure your website is responsive to mobile devices and contains calls to action.
We also recognise the fact that all our business clients want more sales, more customers and more profit so we also give you access to one of the world’s most successful marketing programs, the ‘Business Growth System’. It contains details of more than 80 breakthrough marketing strategies supported by videos, templates and checklists. Access to this ‘vault’ of resources would normally cost you $500 per month ($6,000 per annum), however, as a client of the firm you get unlimited FREE access. In addition, you also get FREE access to the ‘Grow Your Business in 5 Days’ video training course that could have a massive impact on your future business growth.
Here at Hyde Cooper Wells we are different to most accounting firms because we view the tax return as the start of the client process, not the end. Our mission is to help you fast track your business success and we offer electricians a range of tailored tax, accounting, financial and marketing solutions including:
- Start-Up Business Advice for Electricians & Sub-Contractors
- Advice regarding the Purchase or Sale of your Electrical Business
- Tools including the Start-Up Expense Checklist
- Templates for a Business Plan, Cash Flow Budget, Letterhead and Business Card
- Advice and Assistance with the Establishment of Your Business Structure
- Tax Registrations including ABN, TFN, GST, WorkCover etc.
- Preparation of Business Plans, Cash Flow Forecasts and Profit Projections
- Accounting Software Selection and Training – Bookkeeping, Invoicing, Quotes, Payroll and Reporting Requirements
- Preparation and Analysis of Financial Statements
- Preparation of Finance Applications
- Bookkeeping and Payroll Services
- Income Tax Returns and Tax Planning Strategies
- Assistance with your Marketing including your Branding, Corporate Brochure etc.
- Advice and Assistance with your Website Development, Content and SEO
- Wealth Creation Strategies and Financial Planning Services
- Industry Benchmarking and KPI Management
- Vehicle & Equipment Finance (Chattel Mortgage & Lease)
- Monitoring and Controlling Labour and Sub-Contractor Costs
- Advice & Assistance with Pricing your Services
- Advice & Assistance with Claiming Motor Vehicle Expenses
- Recession Survival Strategies
- Advice regarding Employee Relations and Workplace Laws
- Business & Risk Insurances (Income Protection, Life Insurance etc.)
- Business Succession Planning
In summary, we are so much more than just tax accountants. We are ‘business and profit builders’ who offer strategic advice and practical business solutions that could give you a serious competitive edge in your industry. We work hard to understand your business and over the past decade electricians and the building trades have become a niche area within our firm.
If you're an ambitious electrician looking to boost your current results or if you're looking to get your business off to a flying start we invite you to contact us today. You can expect practical business, tax, marketing and financial advice that could have a profound effect on your future business profits. To book your FREE, one hour introductory consultation simply call us on (03) 5995 3466 or complete your details in the box at the top right hand side of this page and we will be in touch.