TUFF Tips: Running A Profitable Sole-Trader Business
by Aaron Gerovich on Jun 12, 2023
Staying Profitable in Business: Can I Make It Staying Profitable?
Running a profitable business is a goal shared by all entrepreneurs, and sole traders are no exception. To gain some insights into staying profitable as a sole trader, we had the opportunity to speak with Dan Bailey, founder of Tradie HQ - Sole Traders Shared Workspace. With his experience and expertise in supporting sole traders, Dan shared three hot tips on how to stay profitable in your business.
Tip 1: Always Mark Up Product
One common mistake that sole traders make is not properly valuing their time and services. As a sole trader, you handle various aspects of your business, including account management, running errands, and arranging deliveries. It's crucial to remember that your time is valuable, and you shouldn't provide these additional services for free. Dan advises sole traders to always mark up the cost of products they handle. By doing so, you can ensure that you are adequately compensated for your time and effort, which ultimately contributes to maintaining profitability.
Tip 2: Develop Your Niche/Specialty and Promote It
In a competitive business landscape, standing out from the crowd is essential. Dan emphasises the importance of developing a niche or specialty in your field and making it known to potential clients. This can be achieved through various marketing strategies, networking with other tradies, or leveraging any other effective means of spreading the word.
By establishing yourself as an expert in a particular area, you can attract clients who value your expertise and are willing to pay a premium for your specialised services. Focusing on your niche not only helps you differentiate yourself but also enhances your profitability by commanding higher rates.
Tip 3: Review Your Jobs and Track Profit
As a sole trader, it's crucial to regularly review your jobs and track your profitability. Even if you work alone, it's essential to evaluate each job and measure the time and resources invested versus the returns generated. This process allows you to identify any inefficiencies, areas for improvement, or projects that may not be as profitable as anticipated.
By reviewing your jobs and tracking your profit, you can make informed decisions and take corrective actions early on, ensuring that you are working towards sustainable profitability.
Remember, running a business should not be about working for wages or less; it's about building a profitable venture.
Staying profitable as a sole trader requires careful attention to various aspects of your business. By implementing these three tips from Dan Bailey, you can enhance your profitability and position yourself for long-term success.
Always value your time and effort, develop a niche or specialty, and regularly review your jobs to track profit. With the right strategies and a proactive mindset, you can thrive as a sole trader and make your business not only sustainable but also highly profitable.
Be sure to follow Dan over on the Tradie HQ Instagram account for more sole-trader business tips!