Tradies Earning Profit Target
Advisory Services News - Issue 26
Good day!
Welcome to this update on ESS BIZTOOLS ADVISORY SERVICES NEWS.
TRADIES EARNING PROFIT TARGET?
There are thousands of tradie businesses in Australia, and virtually every small/medium-sized accounting and bookkeeping firm has one or more tradie business clients.
The “Calculation of Charge-Out Rates” for the tradie business proprietor depends on their team members' experience, working hours, and expected productivity. Unfortunately, many tradies do not approach this process in a businesslike manner.
Many of them rely on a “knee-jerk reaction” for determining charges for services without any guidance on whether the income earned will generate sufficient revenue for the tradie’s business to meet their targeted profit.
In a “Complimentary Webinar being presented on Thursday 4 July 2024 at 11.00am AEST,” we will discuss the benefits for tradies and accountants/bookkeepers from utilizing the ESS BIZTOOLS “Tradies Charge Out Calculator”. This tool helps determine the charge-out rate for individual team members for the forthcoming year, considering:
- Working hours
- Expected productivity on an individual basis
- Employment costs and associated expenses
- Mark-up on external purchases arranged for clients
- Targeted profit for the business
All these factors are taken into account to determine a schedule of charge-out rates for each individual member classification. To register for the webinar click here.
The Charge-Out Rate Calculator also serves as the budget for the tradie’s business, facilitating monthly performance reviews. These reviews may highlight necessary fine-tuning, particularly relating to productivity assumptions, to ensure the overall targeted profit is achieved.
At the start of a “New Financial Year,” it is an appropriate time to utilize the “Tradies Charge-Out Rate Calculator” to assist your clients in setting firm targets for 2024/25. You can then use this data to analyse their performance each month and make suggestions for any needed adjustments in the charge-out rates being utilised.
This is an important and unique service to directly assist tradie clients in achieving their profitability targets.
You can find out more details on ESS BIZTOOLS by visiting www.essbiztools.com.au.
