Tradies spend a lot of time getting work done on various projects for clients with the goal of business growth and profitability. Business growth and profitability are closely related, on the one hand, growth requires a tradie to be in control or have oversight of the various business functions and profitability on the other hand, is as a result of sound financial management principles.
It is common in business that clients may sometimes delay in paying what they owe you or even fail to pay up. The question then is, what can a tradie do in a situation where a customer fails to pay. One way to protect your business is to demand payment up front which can work for some clients but then you might end up losing business to other businesses that offer better payment terms. However, another means of protecting your business against bad debts is to get credit insurance. Credit insurance covers your business, so that you still get paid even if they go under or fail to pay you.
Is your business starting to grow at a rapid pace and going into overdrive? Once the business experiences extreme growth, one problem that arises is cash flow or alternatively, the question of how to finance the growth. The business owner needs to look at getting capital through investment or using debt through a financial institution. This is how a business owner will finance their growth. Both debt and equity finance requires a solid business plan and a good adviser. This should include a strategy for the finance and also how the business will look 1 year down the track and 5 years down the track. Lets explore 2 options for funding business growth.