5 x Reasons Why You’re BUSY … but Not PROFITABLE!

Does chaos reign in your world? Is important stuff slipping through the cracks? Does everyone in your team feel frazzled, including you? Are you crazy busy all the time? 

Ange
And you’re still not making enough money. 

Andy
Thanks for joining us on The Tradie Show. 

Ange
Yes, and this week is a perfect episode for every trade business owner whose mind is Pinging 24/7 and switching from one thing to the next. We see you. 

Andy
You’re watching your bank account closely and no matter how hard you work, it’s not filling up. Perhaps you’re even losing money. 

Ange
Can you relate to feeling like this? 

Andy
Well, listen up because today we’re going to share with you why this is happening.

Ange
And most importantly, how you can fix it.

Andy
Uh, that definitely sounds like a plan Ange. You’re listening to The Tradie Show. This is the podcast for trade business and contracting bosses like you, who want to lead with confidence, make more profit and create a better lifestyle. 

Ange
We’re your hosts, Andy and Angela Smith, husband and wife team and co-founders of Lifestyle Tradie. Are you ready to have some fun? 

Andy
Hell yeah.

Ange
Let’s start at the very beginning, Andy. If you take yourself back to when you started your trade business, your days were filled up pretty fast, right? 

Andy
For sure. From deciding on a vehicle, getting branding done, meeting with potential customers, writing quotes, hustling for work, then doing the work. 

Ange
Hmm, that was only the beginning though, wasn’t it? What about the nights spent invoicing and doing all the book work? 

Andy
Yeah, I’ve definitely spent Quite a few nights invoicing and doing bookwork, but to layer that constant feeling of working around the clock, we’re also a 24/7 business. So we had calls in the middle of the night that would literally jolt the whole house awake.

Ange
Yeah. I can’t say I enjoyed those 3am wake up calls with the phone literally on full ball. One minute you were completely dead asleep. And the next it was like, you’re at a rave. 

Andy
Yeah, that’s definitely true. And I had to have it up full bore. So I didn’t miss a job. It’ll always be etched in my brain about how bone tired we both felt. You know, we’d crawl out of bed in the morning and we’d do it all over again the next day. 

Ange
Yeah, literally on repeat day after day after day. We’re painting such a great picture of life for a trade business owner, right? 

Andy
Yeah, that’s right. But I’d say that our listeners are actually saying, yep, at times, at times. That sounds a lot like me. 

Ange
Yeah. What feeling exhausted, spinning your wheels? 

Andy
Most of us get caught up like this because we’re so desperate to make money. And we thought we could do a better job than our old boss. And we didn’t factor in the reality of it all and how hard it can be to run a business.

Ange
Yeah. Look, I’d say you just didn’t know any different. Sometimes the naivety of what you don’t know is actually a blessing in disguise. 

Andy
Yeah, it’s certainly true at times. 

Ange
Well, to be honest, Andy, I think there’s definitely some ego going on here and I say that respectfully. There is reluctance of trade business owners to ask for help when the constant chaos becomes your absolute normal.

Andy
Oop, Angel’s spoken. There’s a reality check. 

Ange
Well, you were one of them. And when you realized you needed help, you actually stuck your head in the sand first. It had to get really bad. And for me to say enough is enough before you actually start listening. 

Andy
Yes, that is harsh, but a hundred percent true. And sadly, that’s the way we older blokes were brought up, but we know now it doesn’t need to be that way, right? 

Ange
Right. 

Andy
Being a trade business owner is super, super busy. There’s always so much to get done in a day, and the bigger you get, the more chaos you create. 

Ange
Yeah, valid. But just because you’re busy doesn’t mean you’re making any more money.

Andy
Good point, Ange that is correct. In fact, there’s five reasons you’re so busy, but you’re not making any money. So let’s talk through them, starting with the first one. You think being busy equals more money. 

Ange
Yes, you keep saying yes to more work and anything that comes your way you take on board. But there comes a time that you literally can’t keep up.

Andy
And some people think that’s a good problem to have. But it’s not a great problem if there is no money in the work. 

Ange
But you don’t know that though, do you? You think the solution is to employ more people. Throwing a juggernaut of people and vehicles and work orders, the idea of being busy actually makes you feel good.

Andy
Well, it actually makes you feel important, like the big man on the sides, you know what I mean? You feel like everything has to go through you and you’re in control.

Ange
Oh, Andy, I’m facepalming right now. But you know what? You’re spot on. Everyone likes to feel important. 

Andy
Yeah. There’s this false belief that more revenue is good. The problem is you’re looking at the wrong metric. I mean, having great revenue does not mean you have great profit. 

Ange
Yeah. Actually, that is so important. I’m actually going to repeat it again. Having great revenue does not mean you’ll have great profit. Revenue is actually a vanity metric. 

Andy
Yeah, actually all trade business owners beat their chest about the number of vehicles on the road, their number of staff with this incredible turnover. Seriously, don’t be a d**k. But, I have to admit, I did this for a very long time in my business as well. 

Ange
Yes, of course. You’re saying this respectfully, right? 

Andy
I’m calling myself a d**k.  Here’s where the big man syndrome falls short. You know, you hit the end of the week and you’re looking at your bank account wondering how you’re going to pay your team their wages. It’s like, what? 

Ange
Yeah, you’re the one who takes all the responsibility, all the pressure. I get it. 

Andy
But you’re also the one who’s being paid potentially less per hour than the rest of your team. Work that out. Am I right or am I right? 

Ange
So I’ve got to ask the question, how did you get here? You know what? I know how. You guys said yes to every job thinking that all customers are created equal.

Andy
I agree. And this couldn’t be further from the truth. I suggest you scroll back through your feed to season nine and listen to the podcast on ditching the D grade customers where you need to rank your current customers A, B, C or D for d**k.

Ange
Yeah, look, we need to stop and take a good look at who we’re actually working with. 

Andy
And make some decisions about some customers who are clearly not fabulous and start telling them no. 

Ange
Well, more is not better. More customers, more tradespeople, often means more chaos, not necessarily more money. 

Andy
Yeah, this model of having a bigger team is not right based on growing an unprofitable workload. Shaky grounds to a business that one.

Ange
Yeah, you’ll be making more revenue, but you’re actually not making more profit. 

Andy
And this brings us to the second reason. You’re so busy, but you’re just not making any money. You’re not watching any numbers on a daily, weekly, or even a monthly basis. In fact, I shake my head anytime I’m having a conversation with a trade business owner who tells me their accountant is taking care of this.

Ange
We’re big fans of accountants, but you need to be asking the right questions. What sort of help is your accountant actually giving you? So do they simply just read P&L and balance sheets to you at the end of your financial year meeting, or do they analyse what it actually means? Do they give you advice on how to fix it?

Andy
And I reckon this kind of stuff is not happening for probably a good 80 percent of trade businesses out there. They’re just not getting the right information from their accountant. 

Ange
Interesting. The truth is your accountant probably doesn’t really even understand your industry enough to even give you advice, nor is the care factor there because it’s not what they’re actually being paid for.

Andy
In fairness, I bet a lot of tradies are not upholding their end of the bargain either, right? You know, when your accountant has asked you for paperwork, you’re like, yeah, yeah, yeah. I’ll send it to you later. And then they just get crickets. 

Ange
You’ve never shown interest, right? So why the heck should your accountant? You have to understand your business way better. 

Andy
You got to know what numbers to watch both financial and non-financial to see if you’re tracking okay and tracking against what? Well, guess what? That is a great question too. 

Ange
So, you need to understand what you need to earn to break even to start with, not to mention what your weekly targets are to hit the goal that you want for the year.

Andy
Goal? Target? You’re talking jargon! 

Ange
So, here within lies the problem, right? It’s not your fault. 

Andy
You can’t fix it if you don’t know that it’s broken. 

Ange
Great point. Okay, now let’s get to number three on why you’re so busy and you’re not making any money. You’ve got no process, procedures, or systems in your trade business.

Andy
Okay, okay, so where do I even start in unpacking all of these issues? 

Ange
So, the first and most obvious one is you’re scaling chaos. When there’s no efficiency and everyone does things their own way, this is when mistakes happen and there’s heaps of double handling. 

Andy
Double handling, triple, quadruple handling. Ultimately, it costs money in the long run because it eats up a hell of a lot of time. 

Ange
I agree. And everything just takes longer. 

Andy
This is the single biggest monster when it comes to every job. The one thing that’s not tangible and therefore the one thing trade business owners are sh*t at managing.

Ange
Yeah. Well, unlike materials, say, which you can touch and feel, your systems and processes are not a physical thing. 

Andy
And when you’re feeling a bit overwhelmed and a bit out of control, Your team doesn’t understand your expectations. And guess what, guys and girls, it’s all in your head and it’s confusing for everyone out there.

Ange
Hmm. So we don’t mean to make you feel even more anxious, but if we don’t talk about it and bring awareness to these issues. Then what’s happening on a daily basis and how do we fix it? 

Andy
Yeah, and I’d like to think the industry can be fixed and we don’t want any tradie to live the life that Ange and I did, because it definitely hurts and I tell you what, I don’t want anyone going down that cycle.

Ange
Without systems and processes, things play out a little bit like this. You are constantly putting out spot fires, you haven’t built a great culture, and there’s no direction for the business at all. 

Andy
It’s the old head in the sand scenario, and if you don’t sort out your systems and prioritise your team, it’s likely they’ll leave to go to a better offer.

Ange
Ouch. So the best thing you can do is engage your whole team in the development of your systems and processes and literally train them even if their intention is to leave. 

Andy
You never know what life will throw you at any time, but we believe in training your team up. Now I hear a lot of people go, but what about if you train them and then they leave? And then I say, but what about if you don’t train them and then they stay and they’re just absolutely rubbish and cause you an amazing amount of headaches, you know? The best thing to do is to make sure you train them and try to keep them for the long term. 

Ange
Yeah. Look, I couldn’t agree more with all of that. So let’s move on to reason number four. You’re so busy, but not making any money because you’re working on the wrong things. You’re way too busy doing the “do” to work on how to actually do it. So, if you want to scale without chaos, you actually have to stop and learn what to work on first and literally in what order. Otherwise, your business is going to be a basket case by the time you hit what we call this scale up phase of business. I’m sure you didn’t sign up to lose your hair like Andy did. 

Andy
Oh, wow. Yeah, but guess what? It’s real, people. 

Ange
There doesn’t appear to be a baldness gene in his family. 

Andy
That’s another strike.

Ange
I know. 

Andy
Nasty too. But guess what? I’ve learned to love my bald head. So thank you very much. So I understand you’re a tradie, a plumber, a sparky, a fridgey, a carpenter, a landscaper, a proud tradie at heart. But you also need to be a manager, a leader, an entrepreneur, a visionary. You need to step up in this role if you really want a profitable trade business.

Ange
Couldn’t agree more. Your time is valuable and you need to use it wisely. 

Andy
Yes, you have to make sure you delegate to others the tasks that are repetitive in nature to free up your time to work on the business. 

Ange
Good point. There would be plenty of times in a week that if you stop to think about it. That you are doing repetitive tasks that actually your team could and should be doing.

Andy
Yeah. Like one of our super intelligent business owners with a team of close to 50 employees discovered he was still delivering trailers to the site. 

Ange
Yes, he was like, what a waste of time, right? 

Andy
Yes, but he was sure he was stuck in the business and he couldn’t work out why he was so busy. So it wasn’t until we unpacked how he was spending his time that he got a serious reality check. That was not a good use of his time. Of course, there were many things he was doing that he shouldn’t have been. 

Ange
Yeah. Valid. And we nipped that one in the butt real quick, hey? So let’s just move on to reason number five. You’re so busy, but not making any money because you don’t ask for help, even though you’ve never been taught this stuff.

Andy
Yeah, it’s a double edged sword. You know, TAFE taught us the rules and regulations and I know all of you out there are great technicians with excellent skills, but no one has taught us the business side of things. 

Ange
Yeah. You’ve got to think about managing a team or managing your cash flow and learning how to make a profit in your business.

Andy
And guess what? Most of us are always on the tools in the trenches and doing the hard yards. And guess what? That is important. Don’t get us wrong. 

Ange
But it’s your job to maximize billable time. You need to actually elevate your thinking and to work on high return and investment activities. You need to work on your business, not just in it.

Andy
Has anyone heard that before? That is something for years everyone’s been talking about, work on your business, not just in it. But what I want to do is I want to ask everyone out there now, what do you actually think you’re worth an hour? You know, how much of your time, what are you worth an hour? And also ask yourself, where is my best time spent? And also, where are you most valuable? 

Ange
Ballard, you’re actually not just the plumber or the sparky or the fridgey or whatever trade you’re in. 

Andy
Yeah, I remember when I was introduced to someone in the early days and when asked, what do you do? 

Ange
I know this one. Oh, okay. You’d actually respond with, I’m just a plumber and I used to correct you like once we were out of earshot and I’d say to you, Andy, you’re not just a plumber, you own actually a very successful plumbing company and you’re the boss and the leader.

Andy
Yeah, but I didn’t want to feel like a wanker. I remember standing next to one of my mates once and I asked him what he did and he goes, I’m an entrepreneur. And I just saw it there. And I hated and loved that you did correct me, but I did realise I had bigger responsibilities if I wanted the business to be successful.

Ange
Yeah, it’s true. It was, I guess, a bit of a reality check that you can’t do it alone, right? 

Andy
That’s right. And at times I had some really important decisions to make. It was like I was Flipping a coin, heads I do this, and tails I do that. 

Ange
That sounds like a super intelligent way to make decisions. 

Andy
Not. And that’s the problem though, isn’t it? Us tradies, we are too damn stubborn to say, yes, I think I need some help. But for you listening, I’ve got a serious question for you. Who are you asking for help from? Because if your response is your dribbling mates down at a pub on a Friday night after a couple of schooners, or maybe it’s your parents and think long and hard about their track record of operating a successful trade business.

Ange
Hmm. Do they actually have the skill set to be giving you any advice or do they simply just have an opinion and are super happy to share it? 

Andy
Right. Put a stop to that right now. 

Ange
I agree. And instead, find a mentor and someone specifically who has been there before you. 

Andy
Exactly. Someone who has walked the road you want to walk and lived in the trenches. They’ve done the time and come out the other end with lessons to teach and share. 

Ange
Yeah, I agree. So this is what the super successful trade business owners are doing right now. They’re actually dropping their ego and they’re saying, yep. I can do better. Show me how. 

Andy
Yeah. Life won’t change if you do nothing. It’s actually time to be brave and reach out for some advice. What have you got to lose? 

Ange
Yes. Fair question. Nothing to lose and plenty to gain. 

Andy
It’s time for our question of the day with our Ask A&A segment, where you let us know what you’re having trouble with in your business and we see if we can help out.

Ange
Yes. So today’s dilemma comes from Marty in Queensland, who writes, I’ve resorted to calling myself the janitor. Because I feel like, all I’m doing my business is cleaning up everyone sh*t.

Andy
I love that, Marty, well done mate. 

Ange
He writes, so where do I even start? Because I want to work on growing my business and not constantly fixing screw ups day in and day out. 

Andy
Well firstly, I have to ask a bit of a hard hitting question, Marty. You’ve come to us for the truth. And definitely not a cuddle. 

Ange
Oh God, here we go. Go easy. 

Andy
No, no, don’t worry Ange. And Marty, I say this respectfully, mate. I want to ask you this question. Is it your team’s fault? Or is it your fault? Because we can be very quick to point fingers at our team when in actual fact, it could be us that recreated the problem in the first place. 

Ange
Yeah. So that’s valid. Marty, if you’re maybe getting callbacks or perhaps you’re fixing or trading mistakes on the job, it’s clearly costing you loads of money. And it could actually be a sign that maybe you didn’t employ the right people for the job in the first place, or you’ve just not done the training well enough. 

Andy
Yeah, either way, that is a huge skillset problem amongst your tradies and it needs to be addressed immediately.

Ange
I agree. And if it’s only one tradie, then it should be addressed one-on-one with them. But if it’s actually happening with the entire team, then we need to actually sit them down and do a review on their actual skill set. 

Andy
Yeah, for an example, if your plumbers are always using, say, a jetting machine, then you need to get them to rank themselves out of 10 of how confident they are with using this piece of equipment.

Ange
I agree. So if they rank themselves low, we knew training was required. And what we’d actually do is buddy them up with another tradie that was way more confident using that piece of equipment. And that way, we gradually lifted the entire standard of the team. You really do need to take responsibility as an owner so that you can fix these sorts of problems with really good training.

Andy
Yeah, exactly. And sometimes the way to not do it is, you know, you don’t want to be ranting and raving and just yelling at them all the time saying, you guys should be better. 

Ange
That’s right. So Marty, if you’re constantly putting out fires and you’re calling yourself the janitor, then you perhaps maybe only have yourself to blame. Ouch. 

Andy
Yeah, it is an ouch, but I have to say there’s, there’s no doubt about it. There are a few donkeys out there as well. So I feel for you, Marty, but most of the time. When we go down this path, you know, it’s the old saying, don’t blame them, train them. 

Ange
Yep, exactly. I hope that helps you out, Marty. Let us know how you go. We’re keen to hear. 

Andy
So if you’re like our friend Marty here and you’re trying to systemize and structure your trade business so you don’t end up being the janitor too, then we want to help you. 

Ange
Yes, no matter if you’ve been in business for 8 months or maybe 8 years, getting your systems in order means less time chasing up quotes, less time keeping track of jobs.

Andy
Less time instructing your team on the upcoming week’s work and less time cleaning up all the screw ups. 

Ange
And in the process, this saves you a ton of stress, admin and paperwork, and it adds back time in your week and money in your back pocket. 

Andy
If you want to understand how creating a solid structure and systems will help your business, then book in for a free one-on-one strategy call with me today.

Ange
The links in the show notes of this podcast, or go to lifestyletradie.com.au and scroll to the bottom of the page where you’ll see a calendar link. This is important guys. Book in today so you can make 2024 your best year ever. 

Andy
Thanks for joining us today and I look forward to chatting with you very soon.

Ange
See you later.

Andy
Subscribe to The Tradie Show wherever you get your favorite podcasts. Rate and write us a review or for more information about Lifestyle Tradie, head to lifestyletradie.com.au.