Cash flow can be the difference between your business succeeding and failing. 

You do not just need money for general operational expenses, but also also need funds to purchase supplies for future jobs and pay employees.

It may seem shocking, but failing to invoice a customer soon after carrying out work is all too common. It is a mistake that can lead to cash flow problems, and risks a customer developing ‘buyer’s remorse’ before paying.

Similarly, failing to invoice quickly can make your business seem unprofessional and lead to a lack of repeat business.

With the help of MEA’s bookkeeping partner TradiesWorld Bookkeeping, we’ve listed some essential processes to implement in your business, to help you get your finances on track.

What you need to know:

1. Set up an online accounting system and make sure it has a phone app to enable you to create an invoice as soon as you have finished the job – Xero, MYOB or QuickBooks are great systems for tradies to utilise.
2. Set up a credit card or EFTPOS facility to enable you to accept customer payments as soon as you have completed the job.
3. If doing residential work, let your customers know that you expect payment as soon as possible – this can be as simple as asking ‘will you be paying by cash or with credit card’ prior to starting the work.
4. If payment isn’t made upfront, invoice your customers as soon as possible to ensure you can purchase materials for future jobs – if invoices go too long without payment, you’ll need to have tough conversations with your customer that the job cannot continue until you are paid.

Need help with your bookkeeping requirements? TradiesWorld Bookkeeping offers a range of comprehensive ATO compliant services tailored to tradies.  Learn how they can help your business.

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