Episode 94 Podcast Transcript

Speaker 1 (00:00):

Time is of the essence now and most business owners are so tired and stressed and worn out just trying to get to the end of the year. They’re not looking beyond Christmas, and that’s why this is an important step of the checklist so that you get this right. It’s your ability to zoom out a little bit to see what you’ve got to get done to finish this year strong. But the name of the game isn’t just a finish strong. You want to start stronger, and that’s why this pre-preparation is really important. Hi everyone Rob Kropp and Dan Stones here from Pravar Group and welcome back to another episode of The Trade Den. Good to have you back Dan. How are you?

Speaker 2 (00:39):

Good to be back. Hi everyone. I’m very well. Thanks, Rob, into this home stretch of the year, which is great. I think it’s that time of the year we get it. Everyone’s been working flat out. The last thing people want is another checklist, more to do, more admin, more planning, more stuff. But it’s important that we do it right because the owners, we know this through coaching. The owners who plan their shutdown properly, they’re the ones who get to enjoy themselves over the Christmas break. That’s pretty obvious, but more than that, they set themselves up for a big start to the new year and the ones that wing it, as you just said, they’re the ones that are checking their emails, the phones still on them, they never really get to switch off. It’s a tense period and the knock on from that is pretty much you can guarantee at three months of hell.

(01:22):

It’s just the way that it works. So I think breaking this step by step and really going through a process to shut down cleanly and clearly as you said is really important. So let’s start with step one and I think it’s a nice place to start, but it’s pretty obvious and we need to do it though and pay some attention to it, which is finalising all your ongoing projects. So this is where most tradies trip up. There’s half finished jobs, there’s stuff in limbo, there’s urgent things that have to happen seasonally. We know for trades businesses, Christmas is a busy time. People want stuff finished, stuff needs to be done, everyone wants things to be concluded and it usually goes all the way up to Christmas Eve. But what we need to do is make sure that current jobs are either completed or scheduled. That’s the thing. They’ve got to live somewhere. You just don’t want things left in limbo.

Speaker 1 (02:09):

Yeah, this is a big one. We know that we’re going to be talking about invoicing and debtor management later in this episode, so make sure you stay tuned to be able to hear that one out. But this is huge because if you can get in and close jobs out that it means you can get it out of the schedule, get it off your plate, get an invoice done, and that customer can be happy. The last thing that you want to be doing is entering the Christmas break with all these open jobs or open loops or all this work in progress unnecessarily. It just means that you’ve paid for materials or got unhappy customers or whatever it is you want to get in and close things out leading into Christmas.

Speaker 2 (02:48):

So that involves things like looking at your job board and making sure, like we said, what can be realistically achieved. I think being realistic about your expectations is a good starting point and then what needs to be scheduled in and you can start to plan and operate accordingly with that being the reality as opposed to just kidding yourself and just winging it and seeing what comes up, what hits you in the face this week and where can we lead? You really want to have an anchor in the ground to say, this is our plan, and being honest with yourself and your clients about what’s actually achievable.

Speaker 1 (03:18):

This is a time where everyone’s got absolutely unrealistic expectations around what can and can’t get done, and you’re always going to get last minute inquiries where someone’s probably been sitting on a job for the last, I don’t know, months and months, but all of a sudden Christmas comes around, they need it done before the family comes, so the time’s going to be crazy. You got to be able to know what you can do, what you can’t do, what you can say yes to, what you’ve got to say no to, what you should complete and be honest. I liked what you said there. You’ve got to be honest around what’s not going to get complete, especially if it’s a bigger project so you can really communicate that because this is the time of the year where you’ve almost got to somewhat over communicate to clients and really temper those expectations, don’t you?

Speaker 2 (04:02):

And I think this is the big thing. It’s not enough to have your plan internally and here’s how we’re going to operate and we’ve got our little game plan for the upcoming period. You have to communicate, you have to inform clients of where those projects are at and what’s going on. Don’t leave clients in the dark. They have to know what’s going on, otherwise you’re inviting trouble.

Speaker 1 (04:21):

Yeah, it was in their mind they might’ve had this expectation or you’ve previously had conversations around, yep, you’ll be in by Christmas or yep, you’ll have that job done by Christmas and in their mind they’re planning friends coming over or family coming over or the barbecue and social events. But if things aren’t going to get done, it’s all well and good for you to know that on your end, but you’ve got to talk to your clients about that and have those open and honest conversations. You don’t want to be getting to a week out at Christmas and everyone’s tired and stressed and worn out and at the end of their tether having these conversations, you’ve got to get in there and have these conversations early.

Speaker 2 (04:59):

And don’t assume that a little loose end, it’ll sort itself out. It’s not a big deal. It’s not a huge job. It’s nothing like that because those little loose ends that are happening in December turn into giant cracks and amazingly big pains in the ass when you get to the break and you’re trying to do something and one phone call can derail a whole day out of your break. So I think ensuring all those loose ends are tied up is really critical as part of this. Step two, communicate the holiday schedule. Now this is different to how you communicate where jobs are at with particular clients. This is that idea that most people think that everyone just knows we’re going to be shut down over Christmas, and most people do know that trades businesses in Australia, it’s Christmas time, it’s the quiet time everyone’s on holidays, but assuming that’s trouble because they don’t necessarily know what to expect in your particular world. So making sure you communicate the break, the holiday, the shutdown that’s going to happen in your business is really important.

Speaker 1 (05:51):

Some businesses choose to have a hard shut for a two week period. Some businesses have just a normal, a small shut just over the public holidays. I know a lot of our clients try and run skeleton crews wherever they can because it’s their opportunity to keep the money rolling in over that Christmas period wherever possible. So every business does things differently. Sometimes you don’t have a job to be able to run in over Christmas, so you can’t just make the assumption that you’re either going to be shut or closed. So it’s so important that you talk to your clients around when you’re on and when you’re off so that they’re not trying to ring you over those breaks. You’ve got to be able to talk to suppliers, you’ve got to be able to talk to subcontractors. You’ve got to be able to let those people around you in your circles know exactly what is going on and not going on so they understand when you can and can’t be contacted because the worst thing you want is trying to be spending quality time with your family, copying phone calls over the break unnecessarily.

Speaker 2 (06:55):

Yeah, I like these sort of conversations if they’re done correctly. And by that what I mean is do it a week or two before you shut down. Don’t do it the day before. Don’t go, oh, have we done the message? Have we done our out of office? That will communicate what the dates are, but really be proactive. You get on the phone, Hey, hey, are you going? You looking forward to a break? I’m just ringing to let you know we’re going to be shutting down on these periods. Here’s our plan. This is where your job’s at, and it’s amazing at that time when you do it without the pressure and the headache, it’s amazing what you can learn from clients about their plans for next year and where they’re at at the moment and what they’re facing. You pick up a lot of information at this time of year if you’re really paying attention and you’re well organised.

Speaker 1 (07:33):

Yeah, I’m also a big believer of running a skeleton crew wherever you can. So if you are in that space and you can run a skeleton crew, make sure you communicate that as well where it may not necessarily that you as the owner are going to be on because maybe you are going to take time off, but you’ve got a couple of your ground crew in there working on particular jobs to keep the money rolling through. Then make sure you communicate that to the people around you so that your customers and suppliers who are open know that this is going to be the person who’s on call or in charge of this job or these jobs, just so you can communicate that so that the people around you know that you are going to be offline, but the business is going to be online with a skeleton crew. So it’s really important to communicate that accordingly so people around what’s going on.

Speaker 2 (08:23):

Yeah, I like it. That takes care of pretty much operationally the people and the expectations, which is great. Step number three is organising and securing your tools and equipment. Another big one, you don’t want to come back in January knowing that there’s shit laying everywhere. You’ve got stuff that’s broken down, oh yeah, we didn’t get to that. Stuff’s either been stolen this happens, sites get vandalised, things go on. But I think making sure you’ve got a little plan on how do you lock away those valuable tools, you secure things and you organise your tools and equipment before you go on break’s really important.

Speaker 1 (08:54):

This is a really big one because notoriously this is where a lot of job sites get broken into, especially for those doing work for bigger builders and construction companies and everything that it’s the norm in the industry for people to shut down the construction industry to shut down over the two or three weeks over Christmas. And so this is a time when anyone who can get their hands on anything will do that. And so this is where you can bring all your vans and your trucks back. You bring all your utes back, bring all your tools back, make sure you don’t have materials sitting around on job sites that can get stolen. So you’ve got to be understanding that this is your hard earned money tied up in materials and assets. You don’t want it lying around. So the more that you can lock everything away and make it safe and secure means that you can open up shop in January and everything’s ready to go and you’re ready to crack on with a positive start to the year. The last thing you want to be doing is dealing with a bloody insurance claim in January, and you can’t get onto the pipeline of work that you’ve filled up because you don’t have the gear to get stuck into it. So it’s so important.

Speaker 2 (10:03):

It really is. I think there’s two things, little tips that I like about it is one, giving gear a good cleanup and just making sure everything’s where it belongs, where it’s tidy, where it needs to be found at the start of the year that you’re going into clean vans, that you’re getting clean equipment out. It’s a good fresh start to the year. It doesn’t set you off on the back foot. So I really like that to start with. The other thing I really like as well as a tip is to take photos of how you leave things. If you are leaving things on site, where are things at? Where is that equipment? Wherever it is, take some photos because you won’t remember and if heaven forbid something does go down, you want to be able to pull out something that says, well, that’s where it was, and I know that without having to try and mentally remember it or hold onto it in your mind as you’re trying to have a break as well. Onto step four, let’s talk about managing invoices and financials. Another one, this is huge. This is make or break, not just for January. We talk about this in previous episodes. We’ll talk about it again because it is so important, but this is what sets you up really for the first half of the year, getting this step right?

Speaker 1 (11:08):

Yeah. Christmas is notoriously a challenging time for a lot of business owners and you got to remember that you run a business, not a bank, and during this period there’s a lot of people shut down and go away on holidays. And so the most important thing is that when you complete a job or get to a stage claim, the earlier you can invoice the better throughout that period. You’ve got to remember it lands on someone’s desk, it has to be approved, marked as complete. They’ve got to do all their checks and balances, get into their accounts payable system or onto whoever’s desk to get it paid, and then it’s actually got to get paid. And the closer that is to the Christmas period, the bigger the risk that you have this drop over into the January period when everyone decides to come back. So getting jobs completed, invoices out, and then debtors followed up before Christmas. You want to make it a mission of yours to have as much money clawed back into your bank account and not into other people’s bank account. Otherwise, you’re going to be starting on the back foot from a cashflow point of view in January.

Speaker 2 (12:16):

And as we said, those dates start to stack up. That chase is longer than just, Hey, we’ve just got to get through January soon, it becomes February or March and April, and it’s a long road back from there.

Speaker 1 (12:27):

Because what are some of the common costs that come over this period? What starts to stack up?

Speaker 2 (12:32):

Yeah, well, obviously you’ve got annual leave that doesn’t stop. You might have supplier payments for projects next year kicking in those sort of things. They’re not going to not want to be paid or those due dates aren’t going to get any longer. So I think you need to at least understand that you start coming back into end of quarter. If you’re chasing payments, you’ve got obligations with the tax office, their super contributions, all of those things that are scheduled payments, they’re not going to stop. If you are tied on cash, you end up playing that game of, well, how do I juggle to either pay entitlements, pay suppliers, pay the government, who can I pay given the money that I’ve been able to hang onto as opposed to keeping that flow, that cash flow healthy?

Speaker 1 (13:14):

It’s such an important thing that the cash management over this period is absolutely critical. So it starts with invoicing to then followed up by debtor management, and then as soon as you get back in January, you’ve got to get straight back into invoicing and debtor management straight away and catch up all those loose ends because if you don’t really manage this period well, as you said, you can really struggle. And sometimes we’ve seen it with clients who haven’t done this well, it’s taken them to March or even further into April or May to really get back onto their feet to recover from a period that they didn’t manage well during that time.

Speaker 2 (13:54):

Yeah, and I think that the step we said before about making sure you’re realistic and your expectations plays into this because I’m an advocate when we’re coaching and you’ve got to watch how many jobs you’re kicking off in this period. It might be that, Hey, there’s work to be done. Everyone wants stuff. We can start all this thing. If I can’t get to the end of a job though and I can’t invoice, then you’ve got to look at the benefits and the pros and cons really carefully about starting new jobs in this period as well.

Speaker 1 (14:20):

So true.

Speaker 2 (14:21):

So I’d be really careful of that. Step number five, and this is now turning away from how do we end the year, but it’s a big part of the checklist, which is planning for a smooth return, really important between about being set up for what happens when you get back. That plan can’t extend to, I don’t know, whenever you break or whenever you get on the Christmas break and go, well, we did that really well, and then you come back day one with no plan, no idea, and you’re just like, all right, where do we pick up from here?

Speaker 1 (14:47):

Yeah. The problem around this period is when if you think about December, you always at least lose a week off December. So instead of having a four week month, you’re down to a three week month and then January, what could be a four week billing month comes down to three. So you always lose generally two weeks in that period. And this is why most trades businesses at best break, even at best during this period, sometimes you can make a little profit if you’ve managed the schedule well, but a lot of businesses that we see anyway, they either make a very small profit break even at best or sometimes go backwards. They have to budget for a loss and minimise as much loss as they can. But if you don’t hit the ground running in January instead of January being a three week month, at best it can turn into a two and a half or two week month because you haven’t scheduled correctly and communicated correctly the moment you come back.

(15:45):

So what I mean by that is you don’t want to see Christmas as a finish line, it’s just a moment in time. You’ve got to be able to look beyond Christmas and go, right, what are we doing? Come the first week back, what’s the schedule look like? What are the resources that we need in terms of people and any equipment or anything like that? And then what materials do we need ready to go, ready to go to be able to hit the ground running? Because as soon as January rolls around, it’s bang, let’s crack on and be as productive as we can so we can maximise the billable period as soon as January rolls around. If you don’t get this right before January, you’re going to spend the first week burning time, aren’t you? Just to be able to kind of pump everyone’s tyres and get everyone back into gear.

Speaker 2 (16:29):

Oh, absolutely. And I think that extends to your subcontractors and availability there. Confirming availability and supply is really the key element of this. We’re talking about scheduling obviously in meetings, but I think the worst thing you can do is realise that you’re short on materials in the back of the queue for a trade or a subcontractor that you’ve just assumed as, oh, he’s a good guy. We’ve worked with him before. I’ll just give him a shout. And he turns around and says, well, hey, you didn’t ring me. I’m solid. I can’t help you at this moment. And then you’re trying to find in a really tight period some resources or some labour or some materials and you’re scrounging around on the back foot again.

Speaker 1 (17:05):

And if you think about lead time, sometimes that’s 4, 6, 8 weeks of normal business time. And so if you are doing something in early December and you need it for early January, you probably should have been doing your orders back in November. So time is of the essence now, and most business owners are so tired and stressed and worn out just trying to get to the end of the year. They’re not looking beyond Christmas. And that’s why this is an important step of the checklist so that you get this right. It’s your ability to zoom out a little bit to see what you’ve got to get done to finish this year strong. But the name of the game isn’t just to finish strong. You want to start stronger. And that’s why this pre-preparation is really important.

Speaker 2 (17:45):

I love it. And people use your phones as you listen to that. If you think of something, hey, that’s important. It’s not important right now, but it’s going to be first week. Put the reminder somewhere. Don’t try and remember because guaranteed you’ll miss things. Stuff will fall through the cracks. But put a little reminder in your phone, put it in your calendar, wherever you can do it that you don’t have to try and mentally just hold onto tasks, put ’em onto paper, really important. Step number seven, switch off. Enjoy your break. Really important that we don’t miss this step. All the preparations done, the communication’s done. Things are locked down. It’s important to really, I don’t want to say it, but I will work on your break. Really work on having to switch off time and enjoying yourself over the time.

Speaker 1 (18:30):

Yeah, if you’re going to be offline, actually be offline. And I know Jacqui sometimes my wife Jacqui hates this sometimes where I’ll get to Christmas and then I’ll be like, right, I’m turning my phone off and I’m putting in the top drawing. It’s going off for a number of days. And she doesn’t love it because then all phone calls and messages have to come through her. It’s like she becomes my little assistant to get to Rob. But I love that time where it’s like, alright, you’re on break, you’re on break, and you turn off notifications, you turn off your email, you turn off social media, you have a bit of a digital detox and you just unwind and be present in the moment and be where your feet are and be with your family and your friends. If you’ve had a great year, just reward yourself with a great break and enjoy the time and enjoy the downtime. You deserve it. So there’s a lot to be said by just unplugging and just being in the moment.

Speaker 2 (19:26):

And not just sort of putting the phone, but delete the apps off your file. You can always reinstall apps, you can always pick up what’s there. It’s amazing when you do that that you don’t really miss anything at the end of the day. If you’ve, you’ve planned, well, the emails will all be looked after the socials. You don’t need to be on top of. You can let go of knowing everything that’s going on in your world for a couple of days. That’s really, I think the starting point to spending quality time with family and friends, which is why you’ve set yourself up in this position in the first place.

Speaker 1 (19:54):

And go and enjoy yourself. Go and have a hit of golf or go and spend some time doing some fishing or go and spend a couple of days camping with your friends or time away doing whatever you want to be able to do. It’s get out and see the place and enjoy it. It’s go and do something fun and enjoy the festive period. I dunno what you’re like. I know I used to be, Jacqui used to call me the Grinch and on the back of my, you won’t be able to hear it if you’re listening to the audio, but if you’re watching this on YouTube, I got a little Grinch man that sits on my bookshelf because Jacqui used to call me the Christmas Grinch because I never used to love the Christmas period. But since having kids, and we got three young kids, as you probably know, if you’re listening to The Trade Den, I love this period now, it’s great. We get in and put the Christmas tree up and enjoy Christmas and spending time with the kids and catch up with family wherever we can and just enjoy the time. So yeah, Rob’s no longer the little Grinch man anymore.

Speaker 2 (20:51):

Yeah, I agree. I’ve got mine. You can see if you’re looking, mine’s a little, he’s in the background. I can see my little Grinch too. We talked about that. I think it was last year. But it is true, and I think it’s a reminder and it’s a way of going. I need to be present for what is good. And those rituals that happen, I mean ours, we’ve got grown up kids. We still pile into the car and drive around looking at Christmas lights. It’s a different feel to it. We have a lot of fun doing it, but it’s one of those things. But being present for that, and it’s not a chore, you actually start to look forward to it knowing that you’ve worked for that moment. You’ve got that ability to go. You get to go and have Christmas as opposed to you have to survive Christmas. And I think it’s a big step. And doing this checklist is going to help you do that sooner and enjoy it more.

Speaker 1 (21:35):

It’s so true because if you don’t get yourself sorted in the run up to Christmas, you might have two weeks off, but you spend the first week off just busted, absolutely worn out, and you’re trying to recover from the 12 months it’s been, and then you finally start to relax a little bit and then you’re like, oh, shit. New Years is here. I’ve got to get cracking on. And so you never get to really enjoy your time. So that’s why we said at the top of this episode, we don’t want to add more admin or checklists and stuff to your plate at this time of the year, but as long as you can take one golden nugget out of today’s episode to be able to go, right, if I just did that this year and worked on this year and then I know years to come, I can keep making improvements on the way that I manage this shutdown period, then we know that you’re going to be able to get into Christmas and enjoy this festive period a hell of a lot more than you may have done last year. So don’t think you have to perfect it this year. We see this with clients all the time. We run a similar group call across our programmes around this topic to more detail, but it’s, clients always say, they’re like, oh, I’ve heard this so many times, but I always take one more golden nugget. So don’t aim for perfection, just aim to be better than you were last year, and it’ll just ensure that you just show up better and enjoy your time more over the Christmas break with your family.

Speaker 2 (22:53):

Yeah, absolutely. And Rob, before you go and relax, people can still reach out to you for discovery calls.

Speaker 1 (23:00):

They can. It’s that opportunity to be able to acknowledge where you are and what you’ve been able to do for the year, and maybe you haven’t achieved what you wanted to be able to achieve. And so many business owners get to this time of the year and they look back and go, you know what? I had good intentions, but nothing’s really changed. And so obviously nothing’s going to change from a coaching perspective between now and the new year. But if you know that you want to be able to really make some serious change in the new year and aim to have your best year yet, then jump across to strategysession.com.au. Fill out the application form and book in the time that suits us both in the new year, and let’s have a really great conversation around how the year has been. What is it that you really want to change and committed to change, and let’s put a plan in place to be able to make it your best year yet.

Speaker 2 (23:53):

I love it.

Speaker 1 (23:53):

Thanks for tuning into today. Hopefully you’ve taken at least one golden nugget away. Get to work, get cracking on this checklist, and enjoy the festive period with your family. Until next week, take care.

Speaker 2 (24:05):

See you soon.