Trades Business Coach, Wayne Bettess (Off The Tools Academy / Podcast) and Marketing Expert, Francis Rodino (Lead Hero Marketing Automation) join forces to help you make more money, gain more control and free up your time to grow a trades business that runs itself.
Did you know that unconverted leads and missed sales opportunities is the number one challenge Plumbing, Heating and Trades Business face in 2021?
This is a masterclass for you if:
You’ve been letting sales opportunities slip through the cracks
You simply don’t have the time to follow up with leads
You’re struggling to convert cold leads into hot sales
You’ve been running your business on the back of a fag packet, or still using paper diaries and google sheets
You want to break the exhausting plateau of chasing sales and put in place automated and predictable lead flow
In this unique masterclass, Wayne Bettess and Francis share secret systems, strategies and tactics backed by Wayne Bettess’s 20 years of hands-on experience growing a successful heating business, and Francis Rodino’s 20+ year digital marketing career for top brands including BBC, Playstation, Fifa and more…
It’s time to convert more leads into sales by leveraging top systems to grow your trades business.
If you have answered NO to any of these. I would strongly have you consider that the answer should be big NO!
In this section, I’m going to explain why Being a good Tradesman / Tradeswomen DOES NOT mean you are or will be a good businessman. They are two completely different skillsets. Firstly, If you are serious about expanding your business, then you have to be serious about personal and business development. Ultimately, growing into that new person you must become.
When I first grew a business, I sadly never took note of the above. Didn’t understand that I needed to become a different man, and as a result, I lost it all.
I mean it all, I didn’t even have a van!! Left with Nothing!
A few years of soul searching took place before I re-found my passion and excitement. But, once it returned I knew that my past mistakes had been a blessing in disguise. At the time I was 25/26 and tbh, I wouldn’t listen to anyone. I KNEW IT ALL and the only way I was ever going to learn was by failing BIG!
Back then there wasn’t any easy access to Trade Business Coaches, support groups or networks to leverage. Things have changed so much, a quick search on your phone and you can surround yourself with like-minded people. You Can Start learning by soaking up the mistakes and pitfalls they have all made… ALL FOR FREE!
DO NOT EXPAND WHEN YOUR BUSY… Trade Business Coach Advice
My experience has taught me, the worst time to try and expand is when you are mega busy. This will lead you to make rash decisions. That will end up coming and biting you on the arse…
The first thing I would do in this position is to raise my prices. Raising your prices will, in most cases, stem the influx of work but maintain the profit you are accustomed to.
Once you have bought yourself some time you can prepare, plan and execute with a lot more clarity and certainty.
Once I was back on my feet. I quickly noticed that most successful people I had seen or encountered had one thing in common. THEY HAD A COACH. Whether it be Usain Bolt, the worlds fastest man. A successful local businessman, they all have coaches that help develop & maximise their natural skills.
I decided I need to get a coach right now. Well, it didn’t quite go to plan. I found a coach, and tbh I did learn a lot from the man. Unfortunately, it was all generic coaching, Not a Trade Business Coach. Ao after a few months, I wasn’t finding the value in what he was doing. This led me to find another… then another.
Use a Trade Business Coach- NOT ALL COACHES ARE EQUAL
As a result, I realised that running a trade business is not like any other business. We have a unique set of problems and solution, and the generic coaching wasn’t going to cut it. This cycle continued for a year, or so then I had a lightbulb moment. Why don’t I become a Trade Business Coach!
It became apparent that I actually loved helping and supporting others. I had been doing it for years to people around me so why not!
Over the past 3-4 years, I have dedicated myself to learning and developing my Trade Business Coaching skillset. That mixed with my hand’s experiences gathered in life running successful Trade Business. This reaffirmed that I was on the path designed for me.
TIME TO ELEVATE
As a Trade Business Coach, I work with tradesmen across the UK, From Bristol to Glasgow, Manchester to Bournemouth. What I Have found is, Firstly, some very similar threads. Secondly, They all seemed to think they had to do it all on their own. The biggest part I play as a Trade Business Coach is becoming part of YOUR TEAM, Ultimately, holding you accountable and making sure you do what you say you are going to do! Head over to the Off The Tools Academy page to learn more.
Wayne Bettess looks at the traps tradespeople can fall into when they start out as self-employed, and whether there should be more training for the business side of the job…
When you’re a competent, skilled tradesperson you’re in high demand, so inevitably many will want to become their own boss and set up as self-employed.
You’re great at your job, so the time has come to venture out under your own name. That’s when the ‘Success Trap’ starts to kick in.
While most would have spent years training to learn their craft, the attention was on the technical skills you need work on the tools.
Most tradespeople would never have even thought about the ‘Off the Tools’ part of it all.
Doing the work is mostly the easy part, it’s the business side of things that I see many people struggling with. This simply comes down to the fact that we were never educated on the subject. You only know what YOU know.
You take the leap
When you become self-employed, life begins to change. Many seek the freedom that self-employment can bring. The ability to have control of your working life and make your own schedule. Sadly for the majority, this rarely becomes the reality.
Once you leave employment, you lose the structure that allowed you to thrive in doing the job. Now that is all gone.
On the face of it that’s a good thing right? NO IT’S NOT! Unless you have very strong self-discipline, many will start to fall in the same traps that come with quick growth.
You’re good at your job, people like you and the work you do, so they inevitably start to recommend you. Then you start getting so much work you can’t handle it on your own, so you decide to get some extra hands to help.
The jobs are coming in thick and fast, but slowly it starts to catch up with you. When that phone rings you begin to dread it. You soon realise that not every tradesperson has the same standards as you do.
The Pain Starts
Customers start to complain because you’re not getting back to them as quickly as you used to.
You start to resent going to work, you’re missing time with your family. Money seems to fly in the bank but fly out just as fast, you feel trapped, unmotivated and alone.
Well my friends, you do not have to fall into this ‘Success Trap’. The first step is to start to seek out education on running a business. This will start to build some core foundation knowledge for you to build on.
I’ll close this article with a famous quote: “By failing to prepare, you are preparing to fail”.
Wayne started his career as a Corgi Registered gas engineer at the age 19, and went on to launch his first business at the age of 22. Most recently, he co-founded ‘Off the Tools’ which is dedicated to empowering tradespeople to achieve more in business and life.
Well, Yesterday ended in a bit of panic. I was closing up for the day and had an email from google… The dreaded ” You Have Been Left a 1 Star Review” was the subject line. By the time I had loaded the computer back up, there was another review… Trustpilot 1 Star Review Received the email subject shouted at me!
Arghhh Man, what has just happened I asked myself.
The review stated
Booked an appointment between 4 and 5 pm. Didn’t bother to turn up. No call to say why. However when I called the landline to complain and while leaving a message to say how disappointed I was, someone called me back and when I said who it was and mentioned the no show for our appointment it went quite for 5 seconds before he said “I was about to call you”. If they had bothered to call early and updated me I would not be taking the time to write this review.
WOW, YourNewBoiler.com , one of my businesses, has an amazing reputation with 450 + positive reviews across various review platforms, so I was a bit shocked to say the least. The old Wayne Bettess ( before Shifting from a closed mindset to an open mindset) would have hit the roof. I would have shouted, screamed, moaned and groaned and let it ruin the day if not the entire week.
‘You don’t rise to the situation; you fall to the level of your training!’
Thankfully, Since I started on the journey to improve across The Three B’s ( Body – Business – Balance ), I have become a totally different man. Here is what i did to attempt to resolve this situation
First, I looked on the system at all the notes from my amazing office manager, Rebecca. Thankfully we have systems & processes in place to ensure we always have as much info as possible. In addition rang my right-hand man, Tanino, to find out his version of the event.
This gave me our side of the situation. The next step was to read the review a few times; I wanted to understand exactly what his concerns were before making contact.
This put me in a position of Knowledge; going in blind would have ended up in a sh*t storm.
The next step was I needed to call the customer in question. But, I certainly did not want to end up having a virtual fight with the guy. So, I took 5-10 minutes to a) calm down and b) get prepared for the discussion that laid ahead.
The plan was to have a phone call with the gentlemen, Unfortunately, he wouldn’t take my call.
Therefore I had to resort to texting him ( never a good thing, people get brave via text ). I introduced myself, then went on to ask him his side of the situation. This now gave me a complete picture ( as close as possible ) of what actually took place.
The man was a tad aggressive in the first few exchanges, however, I slowly went to work on him. Explaining a few things like the fact he had actually booked a virtual quote, and the time slot of 4-5pm was just that, a time slot not a fixed appointment time.
He started to calm down and then I decided the time was right to ask him to reconsider the review he left on google and trustPilot by this point!
Below you will see the amended review…
I didn’t know time slots for virtual appointments are 1hr slots and I stayed in from 4 to get a call at 5. I did not know this and Wayne took the time to contact me and point out I was being a plonker when I threw my dolly out of the pram. To be fair he didn’t actually say that, but I was an idiot and should have shown more empathy.
What a turn around! This was now a 4 star review on Google and TrustPilot!
We turned what seemly looked like a very bad review into a 4 star review on two platforms. This goes to show how much we can impact people if we take the right approach with them.
Master Trades Business Coach / Entrepreneur / Podcast Host
P.S. Want to start learning more about elevating your life & business? Go check out my Free Industry Leading Podcast – Off The Tools
https://offthetools.co.uk/wp-content/uploads/2019/06/6f2bd0f9-a3c0-4df6-9ab6-49f407497dbe.jpg402702Wayne Bettesshttps://offthetools.co.uk/wp-content/uploads/2021/03/logo.pngWayne Bettess2021-05-05 14:57:002021-05-06 12:55:50Arghhhh… a ONE Star Review
Calling all British Gas engineers that have been forced out recently…
Off The Tools ™️ is dedicated to supporting our industry, so we are going to put on a business Bootcamp in partnership with Elite Heating and Plumbing for any of the people that have been forced out by the fire and rehire policy that BG has implemented.
Wayne Bettess is a leading Trades Business Coach, He isn’t like traditional business coaches in regards to the fact that he still owns two businesses in the heating industry, YourNewBoiler.com & WarmaHome.com.
Wayne’s story is one of many Success and Failures, Trials & Errors and he is passionately dedicated to elevating others to achieve more across their entire lives. Wayne is the Creator of “The Three B’s” and lives and breaths it on a daily basis.
https://offthetools.co.uk/wp-content/uploads/2021/04/OFF-THE-TOOLS-ALLIANCE-02.jpg7002000Wayne Bettesshttps://offthetools.co.uk/wp-content/uploads/2021/03/logo.pngWayne Bettess2021-04-16 12:39:012021-04-16 12:54:52Shocking!!! British Gas Fire & Rehire
I spent a bit of time going through my Kickstarter ( a document I developed to keep me focussed). It made me look back at some from a few years ago.
When I started on my journey to become a world-class business coach for tradespeople in the UK. The overriding take away from the reflection was that people were laughing at me. Laughing at who and what I wanted to become. Laughing at what I wanted to create for the tradespeople of the UK. Some of this was behind my back and some were to my face.
It was tough period
For the most, it seemed there was a lack of knowledge. No understanding of what a Trade Business coach can do for a person, for their life and for their business!
Which led to many people trolling me, telling me
I was not qualified
Said I could never do it and
Belittled what I was trying to create!
Fast forward a couple of years and…
We now have a community of over 3.5k people striving to elevate in their life and business. Of which hundreds have had coaching from me on my unique programs.
I have so many clients & prospects that want to work with me at Off The Tools Academy. It’s humbling & a tad overwhelming!
I’m not a conventional business coach
– I wear joggers, hoodies & a hat
– Often swear & have banter
– Have unplanned rants and sessions
– Still running a trades business ( one of the regions largest independent new boiler installation companies )
And most of all, I am honest about who I am, where I am, what I can do and do not try to present myself as this finished article.
Ultimately, this allows me to help people make the changes they need to get results. In all areas of their lives.
I Just received a couple of reviews from some lads on my brand new ‘No Excuses 90’ program. It just filled me up with pride in what I have achieved on a personal & professional level in such a short time.
Trust me when I tell you that, I have only just begun…
Wayne Bettess here, I have been a heating engineer for over 18 years. I’ve witnessed the boom times and the bust times, this is why I feel we fellow trade professionals are being left well behind when it comes to what we earn.
Over the past 15 years our industry prices have been very stagnant!
Back in 2002, when I started my career as an apprentice plumber, the company whom I worked for charged £65 + VAT for a full boiler service, £600 + VAT labour for a boiler swap and £400 + VAT labour for a power flush.
Do these figures sound familiar? If so I suggest you read on…
Almost everyone I have approached about this subject has instantly expressed that they are fearful of raising their prices, common reasons are :-
“ I will lose a lot of my customers”
“ My customers will complain”
“ They have been loyal customers so it’s not fair”
“ I haven’t got the confidence to do it”
Yes… the above (and more) reasons are valid objections, BUT (it’s a big but) at the end of the day, your business is there to serve its customers, if you are not running your business at a fair and healthy profit margin there is not a Fair Exchange and one of the first things to slip is the service your customer receives. To be blunt you have to stop focusing on the negative reason as to why you shouldn’t raise your prices and start focusing on the POSITIVE reasons as to WHY YOU MUST.
Let’s get technical…
In the examples I’m about to give below, I am only going to use The Bank of England Inflation rate over the past 15 years. (Inflation, in brief, is how much £1 can buy you at any given time in the past compared to the present). I’m not even factoring VAT rises on a day to day goods we buy and the higher taxes most are paying, which would compound this issue even further.
In 2002, when I started my career, the price for a boiler service was circa £65 + VAT based on The Bank of England Inflation figures you would need to get £95 + VAT to be in the same financial position in 2018. Basically what you could buy with £65 in 2002 would in today’s values cost you £95!! When we use bigger figures it really starts to hit home how far off a lot of small businesses are from reality, see some examples below:-
2002 – Labour charge for 1 Boiler swap – £600.00 + VAT
2018 – Inflation based labour charge for 1 Boiler swap – £950.00 + VAT
2002 – Labour charge for 1 Power flush – £400 + VAT
2018 – Inflation based Labour charge for 1 Power Flush – £620 + VAT
2002 – Labour charge for 1 Boiler Service – £65 + VAT
2018 – Inflation based Labour charge for 1 Boiler Service – £95 + VAT
Now let me increase this further
So you can see the huge impact it has, examples below now assumes 30 boiler swaps a year, 10 Power Flush a year and 288 Boiler services ( 6 a week for 48 weeks a year).
2002 – Labour charge on 30 Boiler Swaps – £18,000.00 + VAT
2018 – Inflation based labour charge on 30 Boiler swaps – £28,500.00 + VAT
2002 – Labour charge for 10 Power flush – £4,000.00 + VAT
2018 – Inflation based Labour charge for 10 Power Flush – £6,200.00 + VAT
2002 – Labour charge on 288 Boiler Service – £18,720.00 + VAT
2018 – Inflation based on 288 Boiler Service – £27,360.00 + VAT
Based on the assumptions above, if your charges have remained pretty much stagnant you would be £21,340.00 worse off today compared 2002!!!
The cost of goods and services increased by 58.5% over this period. Source: Hargreaves Lansdown
Figures based on the Retail Price Index (RPI) as at August 2017. Source: Office for National Statistics.
Above figures are estimated figures and
HAVE I GOT YOUR ATTENTION YET?
It is Unsustainable NOT to Increase your prices…
If you are not making a fair and healthy profit margin, you can not serve your customer effectively. As there has to be a fair exchange in all transactions. Increasing your prices will also increase the service you can provide (well it should!!). You will be able to invest back into your business, improve systems, process, training, innovation etc.
Although you may not think it, our customers are human just like us. We only have to look at our own behaviour to get a gauge to how our customers will react when we increase our prices. In the majority of cases, if a product/service we buy goes up we accept it. It’s just the way it is and we simply accept it and carry on as normal. We may have a moan & groan about it but in general, we just accept it… SO WILL YOUR CUSTOMERS!
Stay tuned for my helpful tip sheet detailing a number of strategies to help you implement raising your prices to improve your business, your income and your service to your customers.
I really hope this has opened your eyes as to the need for you to raise your prices if this helped you please share it with a friend, family member or work colleague.
https://offthetools.co.uk/wp-content/uploads/2021/04/OFF-THE-TOOLS-ALLIANCE-01.jpg7002000Wayne Bettesshttps://offthetools.co.uk/wp-content/uploads/2021/03/logo.pngWayne Bettess2021-04-11 09:24:002021-04-13 06:39:39Why you must raise your prices!
I have wanted to write this article for a while but just couldn’t find the words to get my point across, that said here goes…
Who are BOXT
For those unaware of BOXT, they are, in all sense of purpose a tech startup. They offer homeowners a way to buy a new boiler online, for fixed-price boiler installations across the UK. Utilising a network of self-employed small business owners.
When BOXT first came on the scene there were a few murmurs and a bit of intrigue but, that was about it. Then they, in a rather dramatic turn got investment from Robert Bosch Holdings who bought a large stake in the company! Yes, that’s the same Bosch that owns the UK biggest boiler brand, Worcester Bosch!
This made a big wave across the industry and quite frankly were they really starting to take off in a positive and negative manner!
Many people quickly demonised Worcester Bosch and the whole BOXT model.But this did not stop BOXT, which has seen explosive growth across the UK’s boiler Installation market!
What Boxt offer
What they offer is a unique, modern and restriction-free way for homeowners/landlords to buy a new boiler. At very competitive prices, delivered quickly and efficiently across the country. I feel it has had a similar effect as what UBER had on the London black cab industry… At first, people didn’t pay much attention. Then as they got traction, people were caught off guard and subsequently lost a huge chunk of their industry from under their noses.
Now, I see so many people speak negatively about what BOXT are doing and how they are doing it. In all honesty, I feel this shows that many are a tad nervous and scared of the effect BOXT may have on their own small Plumbing & Heating business.
BOXT run a totally different model to 99% of the industry, they acquire most of their customers via pay per click advertising. I have recently read a great article that goes into more detail about all of this, go check it out here – https://tradeinitiative.co.uk/boxt-triple-threat/
MIND YOUR OWN BUSINESS…
Well, I’m the opposite, I have watched the rise of BOXT and rather than moan and groan about what they are doing, I took the decision to improve my own business ‘WB GAS LTD’. I haven’t got the deep pockets and infrastructure that BOXT have. However, what I have is something that BOXT doesn’t and quite frankly will never have. That is the ability to put a personal touch on each and every new boiler installation we do.
I have taken the explosive growth of BOXT as an opportunity to improve many aspects of YourNewBoiler.com . We started with improving my ‘Customer’s Journey’ which for me, is the most important part of a small business. Especially so, in the competitive New Boiler installation market. I looked at BOXT and could clearly see that they need big numbers. Plain and simple they need 10s of thousands of new boiler installations to become a profitable business. However, a small family firm like YourNewBoiler.com does not. I took the decision to not try and fight BOXT ( This would be crazy ).
Instead, I set about visualising how I wanted my customers to experience YourNewBoiler.com to be.
I started with these areas:
How we took the initial call
How we conducted ourselves on appointments
Ways we got our quote out to the customer
Methods of how we followed up and confirmed a new boiler installation
How we actually installed the New Boiler
How we offered aftercare to our customers
Plus so much more…
I then started to implement the changes into YourNewBoiler.com . This created a culture in our small family firm to have the customers experience at the centre of everything we do and say. So I would suggest you Mind Your Own Business. What I mean by that is… stop letting someone else’s business change or deviate you from your own targets and aspirations.
Yes, you may have to work a bit harder on the business, but quite frankly a lot of small businesses have had it fairly easy over the past 10/15 years. The internet has allowed just about anyone to start a business with minimal costs and effort. With BOXT growing so fast I see this as a point in time where small business owners have two choices. You can give up and go work for BOXT, someone else or grab the bull by the horns and spend time, money and effort on improving your own business.
I created a Business focussed group on Facebook, Come join us here – OFF THE TOOLS
https://offthetools.co.uk/wp-content/uploads/2021/04/re1.png536950Wayne Bettesshttps://offthetools.co.uk/wp-content/uploads/2021/03/logo.pngWayne Bettess2021-04-11 09:23:002021-04-13 06:39:44Mind YOUR own business… How you can counter the BOXT effect.
Hello, everybody, my name is Wayne Bettess. In today’s session, I am going to try and explain exactly what VAT is, debunk a few myths and simplify the process. I would like to add, I’m not a qualified accountant. What I’m sharing today is just my interpretation of VAT, and the methods that I use to simplify it, always seek professional advice from your accountant. I have over 10 years of experience running non VAT and VAT registered businesses. So I have got a wealth of experience around this. Hopefully, the information that I share today will hopefully ease some pains that you might have and answer some questions. And ultimately, give you the confidence to move forward and drive your business in the direction that you want it to go.
FACTS ABOUT VAT
I’m going to start off with a few facts about VAT. So the current VAT threshold is 85,000 pounds, that’s your turnover, not your profit, okay? So the basic, it means the sales income comes into your business, if you exceed 85,000 pounds, then you should register for VAT. And that figure is based on a rolling 12 months. It’s not linked to the financial year, it’s a 12-month rolling period.
That can catch some people out because they feel that they might be keeping under that threshold. When in reality, if they looked at the 12 month rolling, they might be over. And there’s penalties and fines and it could cost you a fair bit of money. If you are not aware of that. Most of you that are VAT registered, and will submit our returns quarterly.
That means every three months, you have to compile the information and it gets sent and paid to HMRC as required. One thing that a lot of people don’t know is that you can actually reclaim up to four years on previous purchases, not for like materials that you’ve used. But for things like tools, vans, any stock that you might have that you still hold. It that can actually be quite a nice little kickback that you get.
Make sure you keep the receipts, and it needs to be qualifying purchases. So make sure you do a little bit of due diligence on that. However, you could end up on your first return ended up getting a fair chunk of money come back into the business.
A random fact that you may not know is that over 130 billion pounds were collected last year in 2020. That is just an unbelievable amount of VAT revenue for the government.
So it is a vital part of the UK economy. And I just thought I’d share that random fact, there is a lot of misconceptions when it comes to VAT.
Okay, some of these are –
That you will lose a lot of customers
that you think that you’re going to be 20% more expensive than everybody else around you.
I’m going to lose income by being VAT registered.
For a lot of people, they’re just scared of the complications and the extra time that it’s going to take to do it.
I’m hoping that over the course of this little session that I’m going to debunk some of these, and at least ease some of the pain points that you might have.
Let’s get started now. I’m going to start off with good old Mrs Smith. You know, we all know Mrs Smith. In the example that I’m sharing on the screen right now, this is for a non VAT registered company. So it’s very, very straightforward. You’ve got in one column, you’ve got your materials. In the other column, you’ve got your labour, and then you obviously have your total price that you invoice your customer. In this case, Mrs Smith. The materials are 1200 pounds, which does actually include VAT, if you’re not VAT registered, you’re still paying VAT on the materials. So just to be clear that you know VAT is on everything that we buy pretty much.
There are exemptions, but I’m not going to go into that in our industry, the majority of the things that we buy are going to have VAT. But when you’re a non VAT registered business, in essence, it doesn’t make any difference you pay the price and that’s the end of it.
Then you’ve got your 600 quid labour. Some will argue that that’s too cheap. I’m just using this as an example. It’s not meant as a pricing discussion. Ultimately that gives us the grand total of 1800 pounds that Mrs Smith will be billed and be happy to pay you guys.
Okay? Nice and straightforward.
You know, everybody when we start out this is basically the model you get your material costs, you get your labour, and you end up with the total price. Now I’m going to share with you for a VAT exam. So if you’re VAT registered, this one is more similar to the journey that you’re going to take. So again, we start off with our materials. What you will notice though, is that I’ve labelled it as materials as 1000 pounds, plus VAT.
For me personally, this is how I price things. I priced the materials, excluding VAT, the labour, excluding VAT, and then add the VAT to get me to the total price. It’s a method that I just prefer to use, it works well for me, and it simplifies the process. So again, 1000 pounds plus VAT, 600 pounds labour plus VAT equals 320 pound lie in VAT, that is due to the HMRC gives us a grand total of 1920. As you can see, this isn’t a 20% rise in your price.
As you can see here, you were 1800 on your total. And now you would be 1920. Okay? And as you can see along the bottom, it says is a 6.7% rise on this example, not a 20% rise, okay? Because this is a very important message here. A lot of people think that it makes them 20% more expensive across the board, and it doesn’t, okay?
In this simple version, you’re only less than 7% more expensive. All right?
And I really want to want to emphasize that because a lot of people think that it’s 20%, which is a huge number, but it’s not. Okay? I’m going to break this down a little bit further for you. Okay, so on this simple equation, you currently ovate the HMRC 320 pounds in VAT. But now your VAT registered, you get to offset the VAT that you’ve paid on your materials, which is 200 pounds. So tech at you actually only owe the VAT man 120 pounds. All right. So you’ve collected 320 in VAT, you’ve offset the 200 that is applicable on your materials. And now you are ended up with the figure at the bottom, which is 120 pounds. Okay. But because you’re VAT registered, you can now offset that on lots of different things.
So obviously, your materials are the biggest VAT that you get to reclaim but all your overheads, your marketing, your advertising, any other qualifying business expenses, bands and things like that.
And that has to be factored in, because it basically means that your business is now going to cost roughly 20% less to run. That’s so important to realize, because over the month, over the year, all that VAT adds up, and you’re now getting that back. So it’s not all doom and gloom, it doesn’t mean that you’re out of pocket. In a lot of cases, you can actually make savings and move forward.
I know that was a very simple example. I wanted to start with that purely to simplify, so you could hopefully understand the process involved. And I’m now going to share a bit more of a complicated example. Okay, so this is based on a one week of average trading. It might not be exact, but I’ve tried to sort of have a mixture of jobs in there. So I’ve included three boiler swaps, 10 services, and for repairs.
And as you can see, the top line is your VAT example, if you’re VAT registered. So in this example, you’ve got 3400 plus VAT of materials. You’ve got 2775 plus VAT in labour, which means that you have a VAT collection of 1235 pounds, and that gives a total price that you’re basically you’ve invoiced out to the clients is 7410. Now, below is the non VAT registered example. So you would have 3,400 plus VAT comes to 4080. So you would have had a material costs of 4080. The labour cost would have been 2775, giving you a grand total of 6855. Again, based on a bit more of a complicated example, to try and emphasize the point. Now, on average are around 8% more expensive being VAT registered than you was being non VAT registered. Nowhere near the 20% that so many people think they are.
Wayne Bettess / Off The Tools
So please, please take that message that you’re not going to be 20% more expensive, as you can see from this example, okay? And I’m going to break that down a little bit more. Okay? So that technically do you’ve collected is 1235, the VAT to offset based on the materials would be 680 pounds. But we can include overheads and other costs, I’ve used an overhead of 600 pounds a week, which gives us a VAT claim, clawback of 100 pounds. So you from that 1235 that you’ve collected, you’ve only technically own HMRC 455 pounds. Okay, so you’ve collected 1235, but you owe the VAT man 455, based on this one weak example.
So in summary, becoming VAT registered, removes the glass ceiling in your business. What I mean by that is, if you constantly try to stay below the VAT threshold, you’re putting a ceiling, you’re putting a fake ceiling, on what your business and what you can achieve, because you’re basically limiting your success.
DO NOT BE HELD BACK
By becoming VAT registered, you’re allowing your business to grow unrestricted. Yes, you’re going to be more, you’re going to be slightly more expensive, but you’re not going to be 20% more expensive. And the customers that you will lose, because of the slight increase in cost, you know, more than likely, will be the ones that will hold you back, if they can’t absorb a little bit of an extra cost for your personal and business growth, you know, are they really the customers that are going to help you build a business that you want.
One of the most important things about being VAT registered is that it’s actually going to make you a better business person because it forces you to stay on top of the finances, in your business and on your accounts, because you have to check them and submit every 3 months, it means that you’re more consciously aware of what’s going on in your business.
Modern Tech makes it easy
Thankfully, you know, modern software like zero QuickBooks, sage, and cash flow, they all make the system that make it work seamlessly, and do all of the hard work for you. So it doesn’t become time consuming, it doesn’t become complicated. The system that you can use, will do majority of the hard work for you.
Becoming VAT registered, is just part of the journey of running a business, do not let it hold you back. You know, it’s like growing up as an adolescent child, you don’t have many responsibilities, but eventually, you’re going to grow up into a young man or lady and your business becoming VAT registered is an important growing-up milestone. It’s something that you shouldn’t be scared of, you’ve just got to embrace it.
Yeah, you might have to learn a little bit, you might have to do a little bit of research on what in more detail on VAT and improve your operations in your business. So you can manage it. But that’s a good thing because that’s growth, and growth is so so important.
So that’s pretty much it. It’s a nice, short video. This will have answered and explained some of the questions that you may have had. There’s more to it than this. There are flat-rate schemes, there’s the new VAT reverse scheme for the construction industry. These are subjects that are very vast and not the purpose of this video.
But if you are interested in that. I’m happy to get an accountant on and on my podcast and do a show based around the VAT reversal scheme and the flat rate schemes. And basically, hopefully, give you guys a better understanding of the more technical sides of VAT. Everything that we have discussed today is for the majority of us, what you need to know is nice and straightforward.
Don’t let it hold you back. And yeah, no excuses, guys. Let’s go.
Well, Today was a small mistake, a misjudgement and certainly out of character.
i got caught with my fingers right in the biscuit tin!
Let me frame my thought process before i explain it all.
As you know, i put myself out there and it has huge benefits for me.
But it also has some flaws too…
One of them is that i get a huge amount of fake leads on my website… i totally get it, people ( maybe even YOU) want to see what I’m about, see what i do and how i do it.
It really doesn’t bother me ( apart from the ball ache of sorting my metrics each month hahaha)
Its my choice to put my head above the parapet, and you certainly cant have all the upsides without a few downsides… thats just the way it works!
But a few days ago i decided to do the very same thing to another guy that helps trades businesses elevate their business & life, similar to what i do.
They caught me red handed! Proper tail between the legs moment !
He was very kind about it all and We exchanged a few polite emails and that was that really.
I decided to look and think about why i did it. I wanted to unearth the lesson in my mistake… ( a process i always follow when i make a mistake in my life ).
Firstly i had to own the mistake, accept that it was my choice and my decision…
I believed ( wrongly!) that Because it happens to me, all the time . I thought nothing of doing it to others!
But two wrongs will never make a right it will just make more wrongs!
2+2 will never be 5 and two wrongs will never make a right!
Upon reflecting on it in my ‘No Excuses Focus planner’ ( that my world class daily planner I’ve been building ) i understood that the mentality i held in that momement was one of following the crowd, herd mentality, competing over creating, basically being a sheep!!!
That ain’t ever going to lead me on the journey that I’m creating for myself and family.
“Do to those as you would have them do to you.”
To summarise the above i felt like a right diccckkk head, but as always the mistake, misjudgement , error, what ever you want to call it, unearthed a vital lesson for not just me but for anyone else that decides to read this!
I drifted for years competing with everyone and it led me all the way to Nowhere… i then shifted my mindset on to ‘creating’ instead and only then did my whole life changed.
Sadly i had a little slip back into a bad habit but most importantly for me, i identified it, faced it , and took the lesson, adapted my thoughts and moved on.
So il close this out with a couple of question for YOU
Is there something in your own life that this can relate to?