Contents

Start Your Own Business in the UK

Beginners

Starting Up

Pricing a Job

Book keeping

Registering for VAT

Diversification

Safety and Minimising Risk

Choice of Tools

Choice of vehicle

Advertising your business

Advertising your business

Telephone Number

Appointments

Adding Value

Revision

Contact

Start Your Own Business in the UK

This little booklet provides useful hints and tips about starting and running a business in which you provide a service to United Kingdom customers in their homes, using your own physical labour. You will typically be installing or repairing.

This booklet will help you if you are thinking of starting a business AND suggests ways to increase your earnings if you are already running your own one-man (or woman) business.

This is for those who want to do plumbing, electrical, telephone, aerial, satellite, Internet, air conditioning, cleaning, building, handyman jobs and similar.

I have had established business owners write to me with comments such as “I thought I knew it all but your booklet reminded me of things that I did know but had forgotten. I implemented them right away!”

©2015 Martin T. Pickering

Beginners

Many people reading this are already running a business and are looking for ways to supplement their income. (They won't be disappointed!) But many are complete beginners. Consequently, I have to assume an absolute minimal amount of experience and start at the beginning. 

I hope that experienced businessmen (and women) will see the "easy bits" as a chance to revise and a chance to re-think the way they operate. You may be surprised by the number of times you think to yourself "I didn't know that!" or "that's something I’d forgotten about!"

I have met "weekend jobbers" who would buy a complete system on Saturday morning, dash to the customer's house, install it, then, with the money they make, rush back to the warehouse to buy another system to install in the afternoon. That's really "hand to mouth" and not efficient because you are spending too much time traveling. So you need to get into a position where you can buy stock in advance; you need cash to buy it and room to store it but you will save on traveling and you may get some discount for "bulk buying".

If you don't live near a supplier, you'll have to decide whether you want to travel to one (at least weekly) or pay them to deliver to you. If you travel, that takes up valuable time that you should be using to make money. If you opt for delivery, there will be a delivery charge and you must ensure that somebody will be present at the delivery address to sign for the goods. In this respect, if you work from home, it may be more convenient to arrange for a local business owner to accept delivery at his premises. We'll come back to this, later.

Note: this book isn't just about spoon-feeding you information - although I'll try to do that wherever possible - it's also about directing you to sources of information. In many cases you need to have this information but, if it is copyright, I'm not allowed to include it here. However, I'll try to save you much time in searching by giving you direct links to the information. PLEASE follow those links and read the information. It's essential that you read it.

Starting Up

In the UK we are fortunate in having a system that allows anyone to set up in business without the need for a licence or business premises. All you have to do is to inform Her Majesty's Revenue and Customs Office that you are self-employed and you don't have to do that right away. You can safely wait until your business is bringing in money before you inform the office. However, you must inform them within three months of your starting to trade, otherwise you risk having to pay a fine.

For more information about starting up your business go to this web site and search for "Start your own Business".

http://www.hmrc.gov.uk

Everyone needs a goal so let’s look at a feasible target. Imagine that you were able to work 8 hours a day, 6 days a week, with 11 days holiday. That would be 298 working days each year.

Imagine that you could manage 6 jobs a day and make £56 profit on each.

Your annual salary before tax would be 56 x 6 x 298 = £100,128

Of course you won't be able to do 6 jobs a day for 298 days a year. There will be times when you are sick, need a break, or simply can't get the customers.

Note: I can't possibly guarantee that you will earn any particular amount. It depends on how hard you work, how many customers you find (or find you), prevailing market, local competition and many other factors that are beyond my control.

But it's good to set a target so let's think of it as £100,000 per annum and aim for that.

Once you've "got your foot in the door" you can think about other equipment or services that the customer needs. "Selling up" is an important part of your business. By that I don't mean "selling the customer something she doesn't really need" - I find that idea abhorrent - but looking around to see what she does need. This includes offering to mend things and clean things. We'll cover this in more detail, later, but it's important not to be "blinkered". If your mindset is “It’s not my job to…” then you are limiting your earnings. There will be some things you can do that don’t fit into your personal vision of what your “job” is - but you might be perfectly capable of doing them. The goal is to make a profit so think about what you can do - not what you can’t do.

At the same time, don’t take on work where safety is a consideration. For example, don’t touch a gas appliance unless you are “Corgi registered” and have the necessary certification.

Pricing a Job

Your target is to earn £56 an hour, clear profit (before tax). To achieve this, you need to charge £35 an hour (or part thereof) for labour, and make £21 profit on the equipment that you install. You will typically be adding 40% to the trade price of parts, so making £21 shouldn't be impossible. 

Note: £35 an hour for labour is a typical charge for a semi-skilled worker and most customers will accept it as a fair rate. You may choose to increase this to cover your traveling costs and time. It rather depends on your local area, how much competition there is, and (most importantly) whether you leave the customer completely satisfied with the work. You will soon get a "feel" for how much to charge.

Note: Never charge less than £35 an hour! You must not try to compete with rival companies on price. That would be commercial suicide. Compete on quality and flexibility of work. (More on this later).

Book keeping

You could do your own bookkeeping to begin with but your time is usually better spent doing the work (and earning £56 an hour) while you pay a bookkeeper typically £10 an hour, once a month, to sort out your finances! All you have to do is to put all receipts and invoices in a box whenever you arrive home. The Tax man simply wants a "profit and loss" statement from you. In other words, he doesn't want a list showing every transaction (but you should keep one). He simply wants to know how much you've earned and how much you've spent. The expenditure should be separated into categories including:

Capital equipment: Van, tools, ladders, office equipment etc. that you keep for running your business.

Consumables: Paper, stamps, pens, trade publications, subscriptions, glue, sandpaper, plaster, oil, fuel etc.

Equipment: Everything that you buy to sell to the customer.

You should also pay an accountant to fill out your annual tax return. This will cost a minimum of £200 (and could be as much as £1000) but it's only once a year. Shop around for a good Chartered Accountant. Ask your business friends for recommendations.

The way I handled bookkeeping was this: I got a receipt for everything I bought, including items like magazines (if relevant to the business). When I arrived home, I emptied my wallet and chucked all the receipts into a drawer. I put all the invoices into another drawer. Every few weeks my bookkeeper visited and recorded every transaction in a hard-back book. This (to me) is boring stuff and I won't do it. All I want is the totals! That's the exciting part. I like to see my profit increasing month by month.

(You can claim back tax on the cost of consumables, etc., provided that you register your business now).

A more modern way of handling your accounts is to use an on-line service such as https://www.clearbooks.co.uk 

It's advisable to open a business bank account. You don't need to register a business name unless you really want to. Nor do you need to have a limited liability company (but there could be advantages so discuss it with your accountant). Many small businesses simply open a business account in their own name, such as (for example) "John Smith trading as OddJobsRus”. 

Customers can then make cheques payable either to "John Smith" or to “OddJobsRus”. You can put “OddJobsRus” in bold type at the top of your stationery and "John Smith Trading as OddJobsRus” at the bottom with your trading address.

You might like to apply for membership to the Federation of Small Businesses. For around £90 a year you will get a quarterly magazine and access to free legal help. If somebody decides to sue you or if you have problems with an employee, you'll find this help invaluable.

What you really DO need is public liability insurance and this can be expensive so shop around. Again, ask your business friends about it. Public Liability Insurance is designed to cover businesses from the threat that they will be sued by a member of the public. The basic concept of public liability is that it will cover your business in the event that it causes injury or death to a third party; it will also cover you in the event that you damage a third party's property.

Registering for VAT

If you sell more than £81,000* worth of taxable goods or services in a 12 month period, you must register to pay VAT. As soon as your income exceeds £81,000/12 = £6750 per month, you'd be very wise to register for VAT immediately.

The last thing you want is a back-dated VAT invoice when you haven't been charging VAT!

*Figure for 2015. It tends to increase each year.

A lot of people don't like the thought of getting involved with VAT and deliberately limit their earnings so they never exceed the limit. This is a very short-sighted attitude. Remember that your theoretical earnings target is £100,000 per year so, in order to achieve this, you will have to register for VAT anyway. (You should be jumping for joy!)

Of course, once registered, you'll have to add 20% to your prices* but most people won't gasp when they hear "thirty five pounds an hour plus VAT".

*20% is the "normal" figure at the time of writing. It was reduced From 17.5% to 15% during 2009 then increased to 20% in January 2011. Some items (such as printed books) are zero-rated for VAT.

As an official "collector of tax" you'll have this money in your bank for up to 3 months, so make sure it's earning interest.

You will need a VAT registration number before you can buy from some trade warehouses.

A colleague of mine writes as follows:

"Last week I attended a workshop run by HM Revenue and Customs about the basics of starting your own business. I found the workshop to be very good and it really helped to have the human interaction and be able to ask specific questions. Because of this I thought I'd  inform people of the workshops because I'm not sure how well they are advertised to people new to business. I only heard about it when I phoned to register as self-employed but you can go along no matter what your current work status is and it's free.

The workshop I attended covered only the basics but there are further ones which are more detailed which you can sign up to. It also covers your obligations for National Insurance, record keeping and how your tax return works."

Here is the link to the relevant section of the HMRC web site if you want to know more about these workshops:

http://www.hmrc.gov.uk/startingup/bus_sup.htm 

(The link was correct in January 2015 but you might have to search or ask HMRC if it no longer works.)

Diversification

My friend, who repaired TV sets for many years, recently took a 7 day crash course for "Part P" (Building Regulations - Domestic Electrical Installations) and passed first time. 

I was quite surprised because he was forever asking ME questions about electrical stuff (and I'm not qualified on that side). Anyway, he hasn't looked back. He closed his TV repair shop, bought a van and went on the road. He's now installing lots of outside lights, external points for lawnmowers, internal extensions, air conditioning (he did mine), TV and telephone extension sockets, door bells and other slightly unusual stuff. 

Wiring conservatories is also a big part of his work as he made an agreement with three local suppliers to be "their" electrician.

Diversification is definitely the key. If you offer a service that nobody else offers, you can name your price! The point is to charge a fair price, not a "cheap" price. If people think you are cheap, they won't look up to you. They will recommend you to their friends as "cheap" but not necessarily "competent". £35 an hour is definitely the absolute minimum in the UK.

One of my acquaintances ten years ago was charging £23.50 for a satellite dish installation! He was doing 12 per day. I told him to double his price and he told me I was crazy as he would lose half his business. I had to explain the maths to him. Anyway, he tried it and STILL got 12 jobs per day. He had to put his price up to £55 before the numbers started to fall. So he ended up working less hours for a LOT more money. You really shouldn’t need to undercut!

Another local guy doubled his business by changing his name to "Hallmark Installations". Don't ask me why but Joe public REALLY CARES about the name. "Mick's Satellite" got a lot less business. So choose an "upmarket" name.

Safety and Minimising Risk

All types of manual work are potentially hazardous. Anyone involved in upgrade or installation work owes a serious duty of care to the general public, including occupants of the buildings in question (and to their employees if they have any).

The Health and Safety at Work Act 1974 has been substantially modified and extended by the Management of Health and Safety at Work Regulations 1999. The net result of these regulations is to place clear and direct responsibility on “managers” (i.e. you) for all aspects of Health and Safety Management, and requires extensive use of Risk Assessments to ensure companies meet the aspirations of their own Health and Safety Policies. These policies must in turn be relevant, accurate, and regularly reviewed. They should be used daily as a means of ensuring focus is maintained by all staff and management in minimising or, ideally, preventing accidents. You need to have a written policy regarding safe working practices.

Managers will be held accountable by the Health and Safety Executive for all accidents and dangerous events, and serious consequences can result. As a self-employed individual, you are effectively a "manager", even if you have no employees, and you must consider the effect of your actions on public safety - not just your own (although that's important, too!).

The Confederation of Aerial Industries (CAI) has compiled a General Statement on Health and Safety that is particularly relevant to the installation industry, and has also produced a booklet entitled "Guidelines for Safe Operating Procedures for Ladders". The Independent Digital Standards Commission (IDSC) has a "Health and Safety Advisory Manual" and "Code of Practice for Installations" covering similar subjects. 

See http://www.cai.org.uk/information/cai-publications 

More on Safety

When you carry out work there is always a risk that you will cause damage. You should be prepared for this in advance. We mentioned Public Liability Insurance on a previous page. This will cover you for damage, death and injury but it's a good idea to minimise damage by calling out an expert if you cause a leak.

Always make a note of the exact address, postcode and phone number of the place where you are working. Write this on your invoice pad before you start the job. 

You'll need this information if you damage a gas pipe, water main or armoured electricity cable and need to call on an emergency engineer.

You should also keep a note of the emergency numbers to call.

National Gas Emergency Service: 0800 111 999

Overhead Electricity Line service: 0800 404090

Regional Electricity Emergency numbers:

Central Networks Eastern Region: 0800 056 8090

Central Networks Western Region: 0800 328 1111

EDF Energy (London): 0800 028 0247

EDF Energy (East of England): 0800 783 88 38

EDF Energy (South East): 0800 783 88 66

Northern Electric DL: 0800 66 88 77

Npower: 0845 331 331

Scottish & Southern Energy (South): 08457 70 80 90

Scottish Hydro-Electric: 0800 300 999

Scottish Power Manweb: 0845 272 2424

SWEB Energy: 0800 365 900

United Utilities: 0800 195 41 41

Western Power Distribution ( South Wales): 0800 052 0400

Western Power Distribution (South West): 0800 365 900

Yorkshire Electricity DL: 0800 375 675

You should also note down numbers for emergency plumbers and electricians who live locally and will come to your rescue should you need them. It's also handy to befriend local electricians, plumbers, builders, plasterers, carpenters and decorators in case you damage a wall, ceiling or roof and need to get it repaired in a hurry. If you cause damage but are able to call in a friend to repair it right away, you can usually avoid a claim altogether. That way you only really need to be concerned about personal injury cases.

Unless you are a really careless person, such incidences should be very rare but, if the worst happens, you'll give your customer a much better impression if you are able to take charge and correct the situation quickly.

In addition, you should ask these professionals for a stock of their business cards and give them yours. At every opportunity, give a collection of cards to your customers. This is FREE ADVERTISING.

Disasters: Here are some examples from customers:

"Well the t1t who came to install it has just gone and smashed my porch window!!! Drilling a hole through the wall, he didn’t realise that it was gonna come out level against the window and bang, window smashed. On top of that he said he did not want to carry on the installation in case anything else went wrong.”

“They flooded my house! Now waiting to see if the water has damaged the wooden flooring. I had to sort out an emergency plumber, so I chose a fairly expensive one as they are paying.”

"When I had my aerial installed they managed to break several of my roof tiles. My roof is old and needs replacing so this is not completely unexpected but they didn't bother to tell me, so I only found out when it rained next and my bedroom ceiling changed colour from water ingress.

I then had a wonderfully frustrating experience trying to get them to do something to remedy the situation. First they sent someone round to make sure there was no asbestos in the damaged ceiling plaster. They then sent someone round to inspect the damaged roof and decided it wasn't damaged because they couldn't see it from the road. I contacted them and told them I could clearly see daylight through my cracked tiles from within the loft so they sent someone else. He once again examined my roof from the road and they refused to fix anything.

It took several weeks to reach this point and I was so fed up I gave in and had the roof fixed myself."

"The installer who did it managed to drill through a gas pipe!

He managed to finish off the install by switching off the gas at the mains. He left me £100 in cash and told me to get the gas problem sorted out myself."

Problems DO happen, even when you think you are being careful. The ability to get it fixed quickly will improve your reputation. Also, it's better to give your own plumber £50 for a quick repair than to give the customer £100 and tell him to sort it out for himself!

If at any time you have to dig a hole, bear in mind that there could be cables or pipes underground. On private land there's unlikely to be any public record of what's buried. Dig carefully! On public land (under roads, pavements and common land) there are records but they may not be accurate. However, in the latter case you must ask for copies of any available plans. There's a useful guidance document (csmanual.pdf) that you can download at the bottom of this page:

http://www.central-networks.co.uk/Content/Safety/safety_practices.aspx

Some of the most lucrative work can be found in educational premises. Schools, colleges and universities often need to have language laboratories installed or updated. 

If you have any questions about electrical wiring and earthing, a good place to ask is:

http://www.diynot.com/forums/viewforum.php?f=8 

Ladder Safety

Please read the HSE guidelines:

http://www.hse.gov.uk/falls/casestudies/ladders.htm 

http://www.hse.gov.uk/falls/leaningladders.htm 

http://www.hse.gov.uk/falls/stepladders.htm 

Download more information:

http://www.hse.gov.uk/falls/downloads.htm 

Your Heath And Safety Must Come First

Determine the installation type and assess the risks. Look at the government information and make your own check list. It's a good idea to print out your own copies. This is useful if you should decide to decline a job. You simply show the checklist to the customer and say: "sorry, health and safety problem!"

You might like to consider what will happen if, for example, you fall off a ladder and injure yourself. This happened to a friend of mine. He suffered the common "window cleaner's foot" injury, which required surgery and two months of being unable to put weight on his foot. He was off work for six months. Income insurance is expensive but you should consider it essential. As a minimum you should have mortgage protection and ensure that it covers you for personal injury.

Choice of Tools

The quality of your work will be limited by the quality and type of tools you have so let’s take a look at some possibilities.

Pipe locator

With safety in mind, the first tool is an electronic pipe locator. This will detect metal pipes and wiring buried in plaster up to two inches deep. Before you drill any hole you should check for the presence of metal. Of course there are some things that you may not be able to predict or detect. An installer told me that he once drilled into a brick cavity wall below knee height and pierced a gas pipe! Now, gas pipes are not supposed to be put inside cavity walls but some cowboy plumber had done just that. The installer had to evacuate the house and call out the emergency services as the entire wall cavity filled with gas. The situation was quickly brought under control and the installer got good publicity for his quick reactions and for keeping his head when others might have stood back and lit a cigarette!

Electric drill

Since you'll be drilling a lot of holes for cables, you'll need a drill. A household drill is not ideal! An industrial "SDS" drill will last longer and do a better job. Always carry a spare; you don't want to abort a job just because the electric drill died. If you use a mains-powered drill you should use an isolating transformer with a 110 volt drill to minimise risk of electrocution. These can sometimes be bought second-hand from someone who is retiring from the trade. A battery powered drill is essential for situations where there's no mains power within reach or where it would simply be inconvenient or potentially dangerous to have a trailing power cord (up a ladder, for example). Carry a spare battery and charger unit. 

Ladders

These are going to constitute a major expense but you can't manage without them. You'll need a two- and a three-section ladder, plus a roof ladder and all the accessories to go with them if you plan to do any work up there. The ladders need to be sturdy but lightweight. You may be able to buy at least one of them second-hand, which will reduce your initial outlay.

Sundry tools

You probably have a collection of tools already but I recommend you buy only the very best. Tools from “Snap-On” tend to be expensive but they have a good guarantee and tend to be more reliable than most.

Stationery & Consumables

Invoice pad - you need to record all transactions.

Diary - never forget an appointment.

Pens, pencils - you can never have too many!

Business cards.

Self-adhesive labels (blank).

Self-adhesive labels (printed with your contact details).

Shoe covers (so you don't soil the customer's carpets).

Spare (clean) overalls.

Deodorant, electric shaver, toothbrush etc.

Not exactly a tool but a handy thing to have is an empty plastic 2 litre milk bottle. You can squash it so it takes up little room in your van. If you get caught short or the householder won't let you use her toilet, you can discretely fill the bottle!

It has other uses, too. Fill it with hot water to warm your hands in winter. Fill it with iced water to cool you in summer.

You can also cut out strips of plastic from it if you need to insulate something or cover a hole.

Choice of vehicle

Buy a used vehicle - never new (it depreciates too quickly). You may already have a vehicle, in which case I apologise but you might still find some relevant points here. I'll call it a "van" to save my typing fingers but you could probably use an estate car.

Dependent on your business, the van has to be capable of carrying ladders. Unless it's huge, that means you'll have a roof rack. Please DO NOT use elastic straps to secure the ladders. I nearly took my eye out with the hook on the end of an elastic strap as it slipped from my fingers and whipped back at me like an angry snake. It left a big scar on my forehead! You can buy securing clamps with quick-release "wing nuts". These are designed for the job and will hold your ladders secure even at the highest speed. Likewise don't skimp on the roof rack itself. Get a sturdy rack that's designed for the vehicle. Make sure it's clamped down tight. The wind load on a set of ladders doing 50 mph can be enough to shear a cheap roof rack. Always think of safety.

Fitting out the vehicle

Everything you carry (including your spare wheel) ought to be easy to access when you need it. A "cowboy" will hurl everything into the van and drive off. There are certain disadvantages to this "timesaving" method, as you'll soon see!

For driving stability, and therefore safety, any heavy reels of cable and tool boxes should be positioned over and slightly forward of the rear axle. They should be secured so that, if the van has a collision and/or rolls over, nothing is going to come forward and clobber you. A van with a steel compartment separator is ideal but, if this is impractical, you should take other measures to ensure your safety.

For convenience, everything in the van should be easy to remove. You'll want to empty the van at night, unless it's in a very secure lockup, so the easier you make it, the quicker you can do this task.

Your tools should be in more than one tool box. Arrange them so the frequently used tools are in one box and the rest are in another. There's no point in humping a kilogram of cranked left-handed crowsfoot spanner out for every job if you use it once in a blue moon. Arrange the tools so that it's obvious if anything is missing. Your frequently used small hand tools can be kept in a tool belt which can be put in its own storage compartment or box when you are driving.

Tool chests should have wheels and drag handles (like airport suitcases). You might feel that only sissies use them but months or years of lifting heavy tool chests will damage your fingers, spine, shoulders, elbows and knees. You rely totally on your body so keep it fit, healthy and DO NOT strain it unnecessarily. You'll get quite enough exercise without lifting heavy tool chests!

Your van should have a heater that works in winter and air conditioning that works in summer. That might seem like an extravagant luxury but it creates a bad impression when you turn up for a job lathered in sweat because you've spent the last hour driving in an oven; likewise if your fingers are too cold to grip the tools in winter. You'll be doing a lot of driving so it makes sense to do it in relative comfort.

That's all I want to say about fitting out your vehicle. It's a very personal choice and you should be the one to decide how you want to do it. However, I do suggest that you try to look inside some local traders' vehicles. If you ask them for advice and tell them what you want to do, most of them will be glad to explain why they fit their vans the way they do. You could get some useful ideas. Bear in mind that your customers will judge you by the state of your vehicle. A van with everything simply heaped inside gives a bad impression. You need to be organised and look organised.

Fuel economy

Remember that you'll be traveling quite a long distance over a year so fuel economy is an important consideration. Choosing a small engine will not necessarily get you the best fuel economy. If a small engine is struggling to pull a heavy load it may use more fuel than a larger engine. The best compromise for a small van is a 1.8 litre turbo diesel. A larger van will need a 2 litre turbo diesel.

I would also recommend that you get a vehicle with an anti-lock braking system and always keep the tyres and brakes in top working order. This is your livelihood so it makes sense to minimise the risk of accident. Take lessons with the Institute of Advanced Motorists. They will have local volunteers who will advise you how to drive safely and economically.

Great Britain http://www.iam.org.uk/
Ireland http://www.iami.ie/
Northern Ireland http://www.amni.org.uk/

Advertising your business

The best and cheapest advertising is “word of mouth”. The next cheapest, if you can DIY, is a web site. To begin with you might also need to advertise in your local paper, Yellow Pages and Thomson's Local but this can be very expensive! 

Make sure that your advert describes exactly what you offer in as few words as possible. Make sure the spelling, grammar and punctuation are perfect. Nothing gives a worse impression than a mistake in an advert (apart from two mistakes)! First impressions count.

Supply your advert to the publisher printed legibly so there's no mistake. Don't scribble it. Keep a copy in case of arguments later. If the publishers make a mistake, refuse to pay for the advert.

I recommend NOT using the word "free" in an advert because it can get you into a lot of trouble. Let me give you an example:

A shop not far from mine advertised "free local call out". They sent a technician to return a repaired television to its owner. On arrival, he duly plonked it on its stand and connected it. When he switched it on to demonstrate that it worked fine, the customer asked if he could "just tune the recorder in". He agreed to do that and spent thirty minutes tuning in the channels and making sure that the unit recorded programmes and played them back through the TV. When the technician arrived back at the shop, the manager demanded to know why it had taken so long to do a ten minute round trip. He explained and the manager sent an invoice to the customer for £35 labour.

The customer reported the matter to the local Trading Standards office and they took the business to court. The shop lost the case because the magistrates ruled that a "free callout" meant exactly that. The shop could not charge for any work done during a "free callout". The business was fined and warned to change its advert.

So, if you do advertise "free" anything, be very careful how you arrange your charges. If you are on a "free callout" you can't charge for anything on that visit. You'd have to make a separate visit and ensure that the customer agreed in advance to pay.

I suggest you simply offer "local callout". That doesn't commit you to anything but many people will interpret it as "free". What it actually means is that you will go to the customer's premises if they are nearby. It leaves your options open, making it easier to politely refuse to attend a more distant callout without charging extra. (You don't earn any money by driving so make it pay). You can put your definition of "local" in the Terms and Conditions on your web site.

Keep Track of Adverts

This is a most important point. If you advertise in various places you need to keep track of which adverts work. If your local paper adverts cost £2000 a year and bring in zero business, you need to know that! Keep a book next to your phone at home and another with you in the van. Each time you receive an enquiry, ask "where did you see my advert?" and write down the answer. Make a note on every invoice too. It can be simply a code like "YP" to indicate "Yellow Pages". Get your bookkeeper to add up the totals and find out how each advert is performing. 

Change or cancel underperforming adverts! Do not waste money on them.

Free Advertising

The best advertising is free advertising. The next best is nearly free.

A web site is a very cheap way to advertise. You can fill it with useful hints and tips that will help your customers to solve small problems by themselves. You can include photos of yourself, of your van and of installations that you've completed. You can include testimonials from happy customers. It will make you look "professional". It will give your customers confidence in you. It will cost very little; typically £25 a year.

Having a personalised web site like "TomRogers" instils confidence in your customer. He likes to know your name. It makes him feel more comfortable.

If you can't get a personalised web site like Tom-Rogers.com or TomRogers.co.uk or ThomasRogers.net then you ought to include your name in your advert.

The best "free advertising" is by word of mouth. A happy customer will tell her friends. An unhappy customer will also tell her friends but that might not get you any business. I'll cover "making the customer happy”, later.

Leaflet Drops

These can be a waste of time and money. The only exception is on, for example, a new housing estate where none of the houses have whatever you supply. However, even here it might be better to go to the estate office and work out a deal. Offer them, say, £10 for every job that they pass to you.

Professional organisations

This can be a good way to advertise because membership means that you get listed in the relevant traders directory and you can probably get cheap insurance and legal cover, too.

Business Cards

You should draft out your business card. You can put lots of detail on the card but, if you overdo it, it will look cluttered and the print might be too small for older people to read comfortably. So I recommend keeping it to a minimum. Give your customer a business card or two. If she lists ten friends that might be interested, give her ten cards!

Labels

Anything you install or repair should also have a label with the same information on it AND the date. Should anything go wrong in the future, this lets the customer find your contact details easily and removes any arguments about guarantee. Get a few thousand labels printed.

I recommend Able-Labthis company, which offers a choice of good labels at bargain prices:

Steepleprint Ltd
5 Mallard Close
Earls Barton
Northampton
NN6 0LS
(01604) 810781

Allow plenty of time for delivery. It's normally about 3 days but can run into weeks at times like Christmas.

Telephone Number

Supposing you use your home telephone number in your adverts then decide to close or change your business. You might continue to receive business phone calls for months or even years afterwards. One simple (free) remedy is to get an 0844- local call rate number which diverts to your (secret) home number. If you change or close your business, you simply dump the 0844 number and it hasn't cost you a penny to “change” your number!

See this web site for details of how to get your own free 0844- number:- http://www.switchboardfree.com/ 

Another possibility is to use a service such as that provided by “Skype”. You can rent a number based in your nearest large town and anyone calling it will be transferred through to your Skype account on your computer (Windows or Mac).

Additional software (such as “Piezo” on a Mac) allows you to record the conversations.

If you don’t answer the call, a message will be recorded automatically and you will be notified via email. It can also be forwarded, if you wish.

You can use Skype on an iPad or iPod Touch or iPhone (and others), making it possible to receive calls while you are out.

Check out this type of service from the various providers if it appeals to you. More comprehensive services are available but you have to pay for them.

An alternative is BT's call sign combined with Twin Talk adaptors. You get assigned an extra number to your line and the Twin Talk adaptors allow you only to receive calls to your 2nd number in the office for example (with answering machine).

It can be added to your calling features pack and, for a lot of people, wouldn’t cost anything extra.

It is also very useful for business - not as a business line as such but a dedicated Fax line. I know a lot of people at the minute have to turn on the fax machine when they expect a fax as they are sharing the line with the main number.

The best page for info. that I found is http://www.twintalkhelp.com/tt_multimedia.htm with shockwave presentation, video and user guide. The presentation is quite good.

Although it's a lot simpler than all that really... 1 line, 2 numbers to use however you see fit (fax machines, answer machines, 2x DECT cordless sets...)

Then of course you need BT call sign (one of BT's calling features) - Look for it (or something similar) here http://www.productsandservices.bt.com/

I think its very useful and few people seem to know about it - possibly because BT would rather you took out an extra line.

Appointments

Arranging the appointment, making the customer happy and adding value.

It is important that the prospective customer can contact you and get a reply right away, otherwise you will lose the business to someone else. This is a basic point but it's amazing how many traders choose to ignore it. They must be fully booked for the next year!

If you give a landline number, there must be someone available to answer it all day long. An answer phone is useful for holiday periods but otherwise a human being is preferable. If you can't guarantee someone can answer your home phone, make sure the call is transferred to someone else. You could, for example, pay a disabled* person a small sum to act as your answering service. Note that they should be "self-employed" and offering you a service. You don't want to get involved in the intricacies of PAYE, pensions, tax etc.

*A disabled person is less likely to wander off on a shopping spree.

Whoever takes the call must have access to an up to date copy of your diary. There's an Internet solution to this. A web site diary to which only you and your assistant have access. See http://www.businessitonline.com/diary-scheduling-software.aspx 

Your web site should include an enquiry form and it's essential that it sends the prospective customer an automatic reply immediately. This can easily be set up as a "holiday reply" on "yahoo.co.uk" for example. (I prefer to suggest this as a temporary solution; it doesn't look very professional if you use a free email service. You really should have your own web site and email system so I urge you to achieve this. It's very inexpensive).

When the appointment is made the customer's full details should be noted, including postcode, phone number and where they found your advert. A time and date should be agreed upon. Any change to this arrangement should be discussed with the customer in advance. If you will be late or early, phone first before setting off.

The customer should also be asked about any special parking restrictions. There's nothing worse than turning up at the address to discover double-yellow lines or impossible access!

So make sure the question is asked specifically: "Can the van park within ten metres of the house on hard-standing without blocking access to other properties or breaking the law?" (If the answer is "no" you'd be wise to decline the job. The parking fine could be more than your profit. Remember the "minimise risk" philosophy. Don't be embarrassed to turn away bad business). You can also type the customer's postcode into a map site like "multimap" and print out a local map, which can be attached to the job sheet. The more you plan ahead, the smoother things will run and the more likely you are to leave a happy customer.

The customer should also be informed, in advance, regarding how you expect to be paid. Many traders are reluctant to accept a cheque because cheque fraud is becoming more prevalent. Make it clear to the customer that you expect to be paid in cash, if this is the case. This will avoid any misunderstandings and the need for a frantic trip to the nearest cash machine. In the long term you should plan to get a Merchant Account so you can accept credit card payments. I recommend you do this through the FSB (Federation of Small Businesses) because they can usually get you a reduced rate.

Be punctual or, when it's impossible to be punctual, phone the customer to explain what time you'll arrive. 

Before you arrive, ensure that your overalls are clean and you don't have objectionable body odour.
(The customer probably won't comment if you smell but you won't be invited back or recommended to friends!) If you are a smoker, more than 60% of your customers will be annoyed if you stink of cigarette ash. (This might be a good time to think about not burning your profits and destroying your health). Take it from a lifelong non-smoker: if you stink when you visit my house, you won't be invited in. This is not prejudice; it’s simply a truth that your best friend might not tell you.

Real Comments from Customers

"I recently refused an engineer as at the door the BO was disgusting...he looked like a tramp! I politely refused the equipment he was offering (well I couldn’t say go away you stink!)"

“The engineer that arrived stank of BO really bad, he also didnt pair the card to the box so my mate had to ring up Sky 8 hrs later and do it himself.

The same thing happened when the satellite box was replaced. The engineer stank like he smoked 400 fags a day. I had to febreeze the whole downstairs after he had gone."

When you arrive, park sensibly and carefully without blocking a neighbouring driveway or damaging a pavement, fence, grass verge or garden border. Check your paperwork and make a mental note of the customer's name. Names are important.

Before entering the house, put on your shoe covers so you don't soil the carpets. Greet the customer warmly, stating your name and reason for being there. Smile! (I am continually annoyed by traders who turn up at my door and, when I open it, give me a surly look and say "well, can I come in?”)

On one occasion I was expecting a plumber but the electrician turned up (on the wrong day) and we'd got as far as the bathroom before it occurred to him to explain who he was! So, when the door is opened, put on a big smile and introduce yourself like: "Good morning, I'm Tom Rogers, professional wotsit system installer. Are you Mrs Smith?"

Now, let me tell you about a friend of mine. He's dead now, bless him, but while he was still running his installation business (and I was out of work) he would take me in his little van to help out. On arrival he would always greet the customer like a long lost friend. "Any chance of a cuppa?" he'd ask. "I'm absolutely parched!"

Whenever possible he would follow the customer into the kitchen and chat for a couple of minutes. He would ask about the job to be done but he would be looking around to see what other work might be needed. In one house he spotted a TV bracket that was lying on the 'fridge. 

"Need that putting on the wall, Mrs Smith?"

"Oh, My husband said he'd do that last year but never got round to it."

"Not a problem. I'll do it before I leave."

And he did. He fitted the bracket and didn't charge for the work on his invoice. As a result, he received a £10 cash tip which he put in his pocket.

"Oh dear," he might say. "The seal has completely perished on your freezer door. Were you thinking of buying a new one? I'm going to the warehouse on Thursday so I could pick one up and drop it off on my way home. Would you like that?"

He made lots of "back-end" sales this way. He could make £20 - £50 simply for collecting equipment on a trip he was making in any case. The customer got a good deal and saved herself some hassle. He made sure that it was always a win-win situation.

Nor was he too proud to clean gutters. If the customer offered him £40 for 30 minutes work scraping out gutters, and if time permitted, he would do it. If you buy a high-pressure water lance you can offer a gutter- and driveway-cleaning service.

The point I'm making is that you should look for extra work and additional sales which you can do while you are already there. Don't be too proud to do menial tasks if they earn money. That way it's like having an extra job but it costs you nothing in fuel and traveling time.

And this brings me to another logical suggestion:

Your telephone assistant should ask the customer "do any of your neighbours want a similar job doing at the same time because, if they do, we will give you £10 discount for arranging it?" 

The £10 will easily be covered by the fact that you save on traveling time and costs. Indeed, it may mean that you can fit in an extra job in the day.

Finding customers is the hardest thing when you start up a new business so you should grasp every opportunity!

Remember that your original target of £100,000 relied upon your being able to earn £56 for each of 6 jobs per day, 6 days a week. It's a nice target but a very high expectation! However, if you can do more jobs in a day, or charge more for each job, you'll stand more chance of achieving your target!

The more jobs you can do in the same street, the more money you can make! So don't hesitate to look around the customer's house for more jobs. (At worst, you could always come back another day. The best customer is a repeat customer!)

Do look at neighbours' houses. Is there an aerial falling down? Is there something that should be replaced? If you see something that you could fix, OR that one of your professional friends could do, get your customer to introduce you to the neighbour and recommend you. Most customers will do that if they are happy with your work (and if they get on with the neighbour), so go for it!

OK, back to the job. You've greeted the customer, seen the kitchen, so now get her to show you around the house and explain the job as she sees it. Get her to show you the mains electricity cut-off switch and fuse board (“consumer unit”), the main gas tap and the main water tap, if she knows where these are. (Don't press the point if she doesn't. Just explain that you would feel more comfortable knowing where they are in case you have to deal with a one-in-a-million emergency).

This should also give you an opportunity to look for more work that needs to be done. You may see nothing but occasionally you'll notice a leaking tap, faulty toilet cistern (good reason to use the toilet), faulty fluorescent light or something that you could make money on. Even if there's nothing you can handle, you could recommend another tradesman and get a "back-hander" off him, or a reciprocal job.

Never lose sight of your goal, which is to make as much money as possible. You should try to achieve this as easily as possible but without "ripping off" the customer. Look for opportunities to do the customer a favour by actually saving her money. If you can do a job for £20 that would otherwise cost her £40 if she called out another trader, then you are doing her a favour. If you see an old, faulty fuse box and can get her an electrician who can replace it with a modern consumer unit before it causes problems, you are doing her a favour.

Before you begin the work, explain to the customer what you plan to do. Your idea of what she expects might be way off the mark so discuss it before you drill any holes.

At this point you might find it's impossible to comply with the customer's wishes. She might insist on having a satellite dish on a north-facing wall or an aerial pointing into dense forest. Some customers have very fixed ideas of where they want things to be. If the customer insists on making the job too difficult or impossible, politely decline and leave as quickly as possible. There's no point in wasting time trying to educate a stubborn customer. Let someone else have that pleasure!

Assuming that you go ahead with the job, work tidily. If anything needs to be moved out of the way, ask for permission. Put down "dust sheets" if there's the slightest risk that you'll make a mess, and tidy up afterwards.

If you need to go into a loft without a floor, try to minimise the risk of putting your foot through the ceiling. Use a crawling board. You can use a couple of sheets of plywood, thick enough to support your weight. Wear knee pads. If there's loose fibreglass insulation, wear a face mask and try to minimise the amount of fibre in the air by putting down dust sheets or "Viscreen" polythene sheet. 

Adding Value

You should try to leave something behind for the customer (not a baby!)

Whenever possible, try to give the customer something extra if it doesn't cost you much. This will earn you respect (and money) in the long run. Even something as trivial as oiling a creaking gate can make the customer think you are wonderful. You could also get key ring LED torches with a printed fob or pens made with your web site address and phone number printed on. 

At the very least, leave your label, printed with your contact details. It really does inspire confidence if a customer is assured that she can contact you if things go wrong and encourages repeat business.

If you install a bracket on a white wall, it takes only 2 minutes to spray it white so it blends in. If you bolt brackets to a wall, paint them to delay the onset of rust. You might paint all brackets at your home and give them time to dry. Little extras like this are what make you stand out from the other installers who can't be bothered. Always aim to do a top quality job. It makes the customer less likely to complain about the price and she'll call you for the next job.

Another simple way to give added value at virtually zero cost is to hand the customer a pre-printed sheet of paper that explains how to use or look after the equipment that you've installed. Or that simply explains what it does. Remember: The more you can leave behind that has your details printed on it, the more likely you are to get repeat business. So a sheet of paper that describes (for example) how to set a TV PVR to record a programme, or how to set a room thermostat, is worth potentially much more than the couple of pennies it cost to print. You can type it out once on your computer then print a dozen copies to hand out. 

Draft out a letter-headed sheet on your computer. Use it as a proforma to create information sheets.

Consider each sheet of paper to be a free advertisement for your business. You can also use these information sheets on your web site, thus attracting even more customers!

You can also give a "Recommend A Friend" (RAF) sheet to your customer when the job is complete. This has your details on the front. Your customer fills out her name and address on the back and hands the sheet to a friend. If the friend uses your services within (say) 30 days and hands you the RAF sheet, you post the original customer a £10 cheque and a letter of thanks. (This can be pre-printed to save time). Again, this is a very cheap way to "advertise" your services.

IMPORTANT: Always always clear up any mess you make! Even if the customer offers to clear up, YOU do it! This is your final chance to make a good impression. Take away all rubbish. Make good any ladder marks in the lawn.

Finally, don't forget to stick your labels on everything you install, and write the date on each one. This prevents any arguments about guarantee and ensures that the customer can contact you. Be sure to put one on every user instruction booklet. You could also stick one on the side or rear of the equipment. 

By the way, you should always honour guarantees, even if it's inconvenient and costs you. But don't do a "free call out" if the problem is not your fault. Say: “you must pay if I can prove it’s not my fault.” Show the customer the cause of the problem, get her to agree that it wasn't your fault, and charge at least enough to cover your traveling costs.

Since I wrote this book, a few people have complained to me that they can't find customers! Well, there's lots of work out there. I get emails every day from rich, dnon-technical people who can't DIY. They want home cinema systems, phone extensions, TV points etc. That's what you need to advertise. Don't put yourself forward ONLY as an installer of (whatever you think your main occupation is) and don't call yourself an "engineer" because people think you'll charge more. Try something like this:-

"XXX FAULTY? LET ME FIX IT! NEW XXX INSTALLED ONLY AS A LAST RESORT. LET'S KEEP THE PRICE DOWN. XXX extensions to other rooms a speciality. YYY or ZZZ no problem. Tel: 0123 123456."

Don't pay for adverts if you can possibly avoid it. Adverts eat into your profit margin. Do it by word of mouth and handing out cards and information sheets as far as possible. The people with the most cash and the worst DIY skills are often doctors and dentists, so surgeries and hospitals are the first point of call. The next is lawyers, solicitors and bankers. If you work for poor people and give special discount for pensioners, that’s great but consider it to be charity work and not your main occupation.

Revision

We have covered setting up your business, finding and looking after customers.  Now let's review the main points.

1. You need a bank account and it makes life much easier if you keep your business account separate.

2. You need suitable transport and equipment and (of course) a driving licence, road tax and business insurance for the vehicle.

3. You need to inform the Inland Revenue office of your intention to be self-employed.

4. You need an invoice pad, telephone message pad, appointments diary, business cards, business labels and information sheets.

5. You need a web site. 

More than 70% of the UK population now has access to the Internet at home or at work. Ignoring this fact is like throwing away money. A web site is the cheapest possible form of advertising - even if you won't or can't create it yourself. You can put useful information on it, special offers, provide a Contact Form.

But it doesn't have to be professional. Your customers will probably appreciate a more amateurish site with a "Mom & Pop" feel. The important impression to make is that you know how to do your job. You are not trying to sell web design - you are selling yourself. 

6. You need to arrange Public Liability insurance as soon as you can afford to (you can't really afford not to).

7. You need overalls*, tools and consumables. The list provided in lesson 2 is not exhaustive but it will help you to make a start.

*If you dislike overalls, try to dress in clothing that is clean, tidy and practical. Having your company name embroidered on it makes you look more professional. A tie helps - you can buy really nice looking clip-on ties that don't choke you. Remember, you are dressing to please your customers, not yourself. First impressions count. And please, please, make time to shave each day and have a haircut every month! Don't turn up looking scruffy. It can be very off-putting. It can even be frightening for some customers.

What we've covered so far can be applied to almost any business where you offer a service to a customer at home. Now I want to concentrate on the technical aspects of those services that are likely to make you the most money.

Just as a comparison, think about a painter and decorator. If you do this type of work you'll spend many hours at the same premises and your earnings will probably be limited to, say £120 for an eight hour day. That's £15 an hour. Some people would see that as a good wage. If you could work 365 days a year, you'd earn £43,800. In fact you couldn't possibly work 365 days a year. You'd be lucky to manage 6 days a week = 313 days, less a fortnight holiday = 299 days, which would earn you £35,880

Now consider installing or repairing equipment. You should be able to earn £56 an hour, 6 hours a day*. That's £336 a day and, if you worked 299 days a year, you could earn £100,464. That's your potential. I'm not saying that you'll achieve these sort of earnings in the first year because, to begin with, you may struggle to find customers. But follow the guidelines in these pages and there's no reason why you can't do very much better than a painter and decorator. It's entirely up to you to learn the technical stuff and to "market" your business, as we've discussed in the previous lessons.

*Allowing for traveling time you could be out for 8 or 9 hours a day. You'll need that holiday - but you'll be able to afford it!

The advantage you have over a painter and decorator is that you can do a lot of small jobs at an average of £35 an hour. Eight hours' work should earn you at least £35 x 8 = £280 a day in total from different customers. A decorator is likely to be on the same job for at least a day and the single customer is not going to pay him £280 a day, simply because it is a lot of money and looks like a rip-off. Do you see the implication? The way to make the most money is to do a large number of small jobs for different customers - preferably in a small area to keep your traveling time and costs low.

While on the subject of traveling, we need to consider the problem of traveling between jobs. Obviously you need to minimise this but there's a conflict of interests. Every customer wants to know the exact time when you'll arrive to start the job, however it's impossible to say.

What I suggest is that your telephone assistant books each appointment for a specific day, narrowing it down to am or pm if that's unavoidable. When a day is full (6 jobs booked) your assistant plans your route to minimise your traveling. She then informs each customer when you'll arrive, to the nearest hour. This is not always possible or practical but it will reduce your costs and time (increasing your earnings) if it can be done like this. And remember that it's imperative you contact your customer if you can't make the appointment on time.

You'll see that, to run a business successfully, you have to be very disciplined and organised! Never forget that the customer is the one who is paying your wages. You must learn to love your customers. They will sense it and they will make you rich.

Previously I mentioned my friend, the installer, who always asked for a cup of tea. He looked after his customers. When he died from cancer there were 200 uninvited guests at his funeral. They were all customers and they were all happy to stand outside the church in the rain and listen to the service. Many more customers couldn't attend and sent flowers instead. You'd think a royal prince had died.

Be a prince to your customers and you'll do well.

Make a start on your web site

It doesn't have to look professional but it should contain useful information and the English should be free from silly mistakes in spelling, punctuation and grammar. If you don't want to do this yourself, there are thousands of college kids who are desperate to get experience. However, don't expect them to generate the text or to "borrow" images from other web sites. (You could be prosecuted for that). You must provide all the text and images and let the web page designer do his job, which is page layout and uploading the files

.

Let me remind you that your web site is your information database. It's where you tell your customers how to use and care for the equipment. It's also your (almost) free advert that shows prospective customers that you are both knowledgeable and helpful. You will eventually have your favourite pieces of equipment, which you install for your customers, so you should be able to create a page of information for each. You might like to password-protect some pages so that only customers who have paid can look at them.

It's really not difficult! Take a little time to list local businesses and make your own services prominent on the site.

People simply want information. By making the information of interest to local people, you can attract principally those people who are most likely to use your services. This is (almost) free advertising and, if you can charge local businesses for a larger insert (or their own page), it can even become profitable!

Also consider placing a weekly lineage advert in your local paper. This is usually quite cheap but can be effective if worded correctly. In addition, take advantage of any shops that let you place a card in their window or have an "items for sale" card display. 

If the newspapers or shops don't accept business adverts, or charge a premium for them, make it look like a private advert by offering a "XXX- unwanted gift". This could lead to several phone calls and an installation job or two. When they phone, you might talk them into letting you do something extra. The main object is to get the phone call. Then simply put on your salesman's hat and get the job!

Remember that your vehicle provides free advertising space. All you need is a list of jobs that you can do plus your phone number and web site URL. The bigger the better. The simpler the better.

Contact the Author

The author welcomes feedback and questions. You can contact him via the SatCure web site where you will find an email contact form.

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About the Author

Martin Pickering began to mess with electronics at age 10. He gained his degree in Electronic Engineering at age 22 and went on to design telephone equipment for GEC Telecommunications. At the same time, he was running his own CB Radio repair and modification business, published a CB newsletter, published repair books, and sold spares by mail order before the Internet was invented.

He also spent time with Siemens Ltd, Brother Industries and Eurosat Distribution before quitting in 1995 to concentrate working full time in his own SatCure business, which includes writing books.