Good turnover for 1st year?

[Millsy 82]

When you first set up how much did you turnover in the 1st year (if you don't mind I don't mean to be cheeky as I know a lot of people don't like talking money) I set up in May last year and going through yet another quiet patch! I've got jobs in the pipeline but nobody wants anything done for a month!

At the moment I am looking at my options as there are a couple of employed jobs and sub contracting going around me, it's not that I'm short of cash but it's the boredom has set in big time.

From the end of May to know I have turned over around 30k but due to having to do courses etc and having to buy tools (I've mainly done service and breakdown over the past 5 years so had no decent drills etc) I have earnt virtually nothing, which I was expecting but I was hoping to have been closer to 40k buy now.

Is that about normal for the first year? Was I expecting too much (I was hoping for around 50k in the first year, that's turnover not profit)

I have a load of flyers going out in a week so hopefully they will have the same response they had last time which would get me a bit closer.

I've got most of the tools I need now but there is still a couple of things I need but not desperately so hopefully i will earn some money over the next few months.

 

[gassafe]

I don't pay much attention to turnover... It's the profits that count!!!

For example buying gas & oil boilers etc will make your turnover seem high but that's not profit. If your on 30k turnover with small expenses then your doing well...

The 1st year is always a slow start, it's about building a customer base & keeping you head above water, get a good name & it will grow... Plus you still have a long time left to complete your 1st year figures!!

 

[Millsy 82]

As I said that due to having to buy tools etc I know my profit is non existent at the moment but I was expecting that, if I add on the cost of bits that I bought before I left employment it will defiantly be minus figures lol.

I am in a fortunate position that my out goings are very low as I have no rent/ mortgage etc and I know this is the only time in my life that I have the chance to go self employed without putting huge financial strain on my self and partner. The only problem is we live with her parents so when I'm sat at home all the time waiting for the phone to ring I know what they are thinking.

I would say that 90% of my work is gas/oil etc so I know a fair chunk is materials but I wouldn't of thought much more than 12-14k although I have not kept a log of that (something that I'm going to start doing from now on).

My dad who is also my accountant said not to worry about I am doing well but then I respond with how can I be doing well when I'm not working a lot but he just says don't worry about it.

 

[wetdrip]

Where are you based Millsy?

 

[Millsy 82]

I'm down in cornwall.

 

[hammers4spanner]

Its hard down the southwest as its retirement home for plumbers and gas fitters.

I would say you need to earn 25 k profit here minimum or just as well go on the cards

But then you have a boss which has big draw backs

So if your happy earning less and not struggles then happy dayss

 

[hammers4spanner]

I wouldn't worry to much about the phone either otherwise it becomes an obsession.

Patience my fellow carrot cruncher

 

[wetdrip]

I'm down in cornwall.

PM being sent.

 

[Millsy 82]

Its hard down the southwest as its retirement home for plumbers and gas fitters.

I would say you need to earn 25 k profit here minimum or just as well go on the cards

But then you have a boss which has big draw backs

So if your happy earning less and not struggles then happy dayss

That's the aim I'm hoping by the 3rd year I will be on 25k at least. I went for a few jobs but the money they were offering was around that and the hours were 8-5 I thought if I'm taking a drop in wages I will give self employed and try and cut back on the amount of hours I do.

 

[Shower Engineer]

My first year turnover was £ 14,614.84, I spent £ 7,564.25 on materials and after all other deductions I paid myself £ 2,465.15. That was back in 1986 though!
My second year the figures were roughly double that and the third year were about x3 after which they flattened out. All my work was domestic plumbing and heating.
I was lucky, single and living at home. I also had a part time job teaching plumbing at our local college.
So I have now been self-employed for nearly 30 years and the best bit of advice I can give you is keep on top of the bookwork. Doesn’t matter if you father is your accountant you need to know the figures inside out. Just keep a simple Excel sheet and keep it up to date. Make sure that you do this at the end of every month if not more frequently. Sounds like you have been self-employed 8 months and you don’t know how much you have laid out on materials? That is a worry.

I was the same as you and it caused me a lot of sleepless nights, just do the figures regularly and you will know if you are doing ok. If it’s not working out you will also find that out before it is too late.
If you find you are quite then have some leaflets printed and drop them door to door, maybe staple a business card to them. Try including an incentive “Introductory offer - boiler service and system inspection £ xx.xx” “Free inhibiter check and top up with every service”

Persevere and you will be fine, just try and avoid working for builders!

 

[gassafe]

Keep an eye on rollimg turnover... Over 81k in a 12 month period & you will have to register for vat!

 

[Millsy 82]

My first year turnover was £ 14,614.84, I spent £ 7,564.25 on materials and after all other deductions I paid myself £ 2,465.15. That was back in 1986 though!
My second year the figures were roughly double that and the third year were about x3 after which they flattened out. All my work was domestic plumbing and heating.
I was lucky, single and living at home. I also had a part time job teaching plumbing at our local college.
So I have now been self-employed for nearly 30 years and the best bit of advice I can give you is keep on top of the bookwork. Doesn’t matter if you father is your accountant you need to know the figures inside out. Just keep a simple Excel sheet and keep it up to date. Make sure that you do this at the end of every month if not more frequently. Sounds like you have been self-employed 8 months and you don’t know how much you have laid out on materials? That is a worry.

I was the same as you and it caused me a lot of sleepless nights, just do the figures regularly and you will know if you are doing ok. If it’s not working out you will also find that out before it is too late.
If you find you are quite then have some leaflets printed and drop them door to door, maybe staple a business card to them. Try including an incentive “Introductory offer - boiler service and system inspection £ xx.xx” “Free inhibiter check and top up with every service”

Persevere and you will be fine, just try and avoid working for builders!

14k in 1986 is like 40 nowadays so I suppose it's not too bad.

When I first started I kept track of my incoming and outgoings and I did that for a few months and my dad said not to worry about that as he is doing that for me.

What I have decided I'm going to keep track of is how much I make on a job and spend per job as on smaller jobs I know exactly what I make but larger jobs I'm not 100% certain what I make I know it's around x amount (1 boiler change and soil stack replacement was between £350-£500 for boiler and £230ish for soil stack) so I know roughly what I'm doing.

I think my dad would tell me pretty quick if I was in trouble or heading for trouble as it would be him I would be moaning at if it didn't work. Lol.

 

[Millsy 82]

Keep an eye on rollimg turnover... Over 81k in a 12 month period & you will have to register for vat!

Blimey I'll be so lucky! Lol.

I know my exact turnover from start of July as I do a job sheet so I know whose paid, what I'm owed etc as I started dealing with a letting agency so wanted to have something that I could look at and say I sent you the bill on such and such date, invoice number blah blah, for job completed on this date etc so I knew where I stood.

 

[gassafe]

I don't keep a record of each small job profits, as there's no point etc.

i keep an invoice book & receipts book, every month I list all incomings & all outgoings plus file the receipts for that month. Sounds like your leaving too much to your dad, this is Your business... Just throw the books at him end of year for him to work out your tax etc...

 

[Millsy 82]

I don't keep a record of each small job profits, as there's no point etc.

i keep an invoice book & receipts book, every month I list all incomings & all outgoings plus file the receipts for that month. Sounds like your leaving too much to your dad, this is Your business... Just throw the books at him end of year for him to work out your tax etc...

As I said I did but he did it again and came up with a completely different figure I worked out as -£1500 and he had it -£3000! I asked him how he did it and he just smiled. It is his job and I am paying him for it and he wants to do it so who am I to stop him from doing it.

 

[rocketmanbkk]

I agree, turnover can be deceptive because of expensive materials etc,

My first year I made a loss of nearly £5k. But that's with a van, tools etc.

This is my second year and I will either break even or make a very small profit,

3rd year I hope to profit £15k

Yr 5 £30k and then steady unless I buy new van.

It's all good,

Good luck.

 

[wetdrip]

Do most of you add 20% on materials as pimlico do?

 

[Roger Welton]

As others have said turnover means nothing, profit margin is the main thing, no point running over huge amounts of cash for a small profit, its definitely worth keeping a little spreadsheet of income and expenditure so you can keep an eye on your margin, and rolling turnover (for VAT).

edit to add

it looks like my first few years were as follows in terms of turnover

1 - £35k
2 - £40k
3 - £50k
4 - £68k

I am presently running just below the VAT threshold and trying to keep it that way!

 

[Millsy 82]

Do most of you add 20% on materials as pimlico do?

Yeah I do but I think that's what puts me above other tradesmen, unless they get better prices.

 

[quality]

Do most of you add 20% on materials as pimlico do?

I double my materials

 

[lame plumber]

forget what others do, here in the SW you'll find some on £20 an hour or less and others charging £75 for the first hour and 45 thereafter. Its sometimes better to charge more and do less rather than working fm dawn till dusk for peanuts. If you are near Rock or any other London 2nd home spot, get your charges up, they expect to pay, the locals will moan but if you turn up on time and do a good job they will pay, its just the odd one or two that winge and pig, so forget them and move on.

 

[village idiot]

You say your dad is responsible for your accounts etc and you see no need to do what he already does. I think you should still keep records of your work.

 

[Millsy 82]

forget what others do, here in the SW you'll find some on £20 an hour or less and others charging £75 for the first hour and 45 thereafter. Its sometimes better to charge more and do less rather than working fm dawn till dusk for peanuts. If you are near Rock or any other London 2nd home spot, get your charges up, they expect to pay, the locals will moan but if you turn up on time and do a good job they will pay, its just the odd one or two that winge and pig, so forget them and move on.

Over a couple of years I hope to rise my prices as I'm totally in your way of thinking. I got my dad to phone around a few local lads and find out what they are charging and I'm around the same price as most of them.

I did a job down st Ives in August, if ever I get one down there again they will be charged 2 hours minimum as I spent an hour trying to find a parking space.

 

[lame plumber]

You need a moped and box for St Ives, like the lifeboatmen 🙂

 

[Millsy 82]

You say your dad is responsible for your accounts etc and you see no need to do what he already does. I think you should still keep records of your work.

From this thread I've decided I'm going to start doing it again. It didn't take long to do what I was doing I think about half hour a week. I'm also going to work out what I earn off the jobs as well it may put my mind at ease or make me double check my prices.