Poor cash flow is one of the biggest challenges tradies face – and the number one reason many trade businesses struggle or go under.
To stay on top, your business needs more money coming in than going out, so you’ve always got cash ready for materials, to pay subcontractors, cover vehicle repayments, and, of course, pay yourself.
If you’re feeling the pinch, the reasons are usually one (or more) of these:
Not Sending Out Your Invoices 📄✉️
You can’t get paid if you don’t send your invoices.
Simple – but so many tradies fall behind because they’re too busy or leave it until late at night or weekends, stealing precious time from family, mates, or downtime.
Need help getting your time back?
If invoicing is eating into your nights and weekends, check out these simple strategies for tradies to stay organised, get paid faster, and free up your time.
Late-Payers ⏳💸
Overdue invoices are one of the biggest cash flow killers in trade businesses.
Most tradies hate chasing payments (don’t worry – as a bookkeeper, I actually like it!).
It’s not just about chasing money though – it’s also about setting tighter payment terms. Instead of 30-day terms, consider 7 or 14 days to keep cash moving.
Too Many Unpaid Hours 🚗🛠️
Hours spent driving between jobs, quoting, doing bookwork, or managing staff all add up – and most of them aren’t billable.
If you’re not charging for your time or factoring it into your pricing, it’s eating into your profits without you even realising.
Too Many Employees? 👷♂️👷♀️
Hiring too many staff can blow out your costs fast.
Employees are expensive – not just in wages and super, but in training time, admin, and management stress.
I recently worked with a tradie business with five employees. After crunching the numbers, we realised they were actually more profitable with fewer workers and smaller jobs.
More staff isn’t always the answer – sometimes smarter pricing is.
Not Charging Enough 💰❌
Many tradies price their jobs based on what others are charging – without actually knowing their own costs.
If you’re undercharging, you’re setting yourself up for a cash flow disaster.
To make a real profit, you need to know your numbers.
Here’s a guide to help you work out your pricing properly and set your business up for long-term success.
Poor Supplier Terms 🛒📉
Materials are a major cost in trade businesses.
If your suppliers aren’t giving you reasonable payment terms, it can seriously squeeze your cash flow.
Negotiating better supplier terms – or even shopping around – can make a huge difference to how much breathing space you have.
Sloppy Bookkeeping 📚🔍
If your books aren’t up-to-date, you’re flying blind.
Good bookkeeping gives you clear visibility over your cash flow, profits, expenses, and upcoming tax obligations – so you can make better business decisions and stay ahead of the ATO.
Need Help Improving Cash Flow in Your Tradie Business?
At Tradies Bookkeeping, we help tradies just like you get their cash flow sorted – fast.
If you’re ready to get paid on time, take control of your numbers, and finally get ahead, give us a call on 0424 467 921 or email bettina@tradiesbookkeeping.com.au.
We’re here to help you build a business that actually pays off.