Tradies in Business Interview – Why Diversifying Your Income is so Important?
It’s harder than ever to be in small business today, and with the possibility of a recession on the horizon, it’s vital to sure-up your income source. Diversifying your income streams, whether you’re a small business owner or wage earner, is critical for your financial success. In this interview with Nicole Cox and Warrick Bidwell we dive deep into the topic why it’s important and what you can do to bullet-proof your income stream.
Here’s a snapshot of what we covered in the interview:
- Why diversifying your income is so critical to financial success
- Nic and Waz’s best tips for diversifying your small business income streams
- Some excellent examples of Australian businesses who are diversifying for success
- How to retain customers for the long term so you can make the most of your marketing efforts
- Their best tip for what you should do TODAY to get the ball rolling on diversifying your income.
There’s 100% actionable content in this interview so definitely take the time to listen, and share this post with any small business owners in your life.
If you’d like to find out more about Nicole or Warrick, Tradies In Business and how they help Trades business owners to get ‘off the tools’ and into a real trades business then stop by www.tradiesinbusiness.com.au
And here’s the Transcript for our interview today…
Hello there. I’m so glad that you could join us today. I am super, super excited to introduce you to a couple of people that I just adore and love their work and love the work that they do with small business owners. So I’m going to introduce them to you in a second. Just quickly, if you don’t know who I am, I’m Anthea Falkiner and I have a company called Bright Spenders. We help small business owners take control of their personal finances. We have a really unique system that allows them to pay off debt and save faster for whatever it is that excites them in life. That’s who I am and what the topic is about today is really specifically for small business owners, I suppose. But I think this really applies to pretty much everyone out there in the workplace today because we are living in a gig economy.
And I’m going to ask Nic and Waz what they think about that, share with you some of their best tips for diversifying your income stream and why that actually matters today. You know, we are looking ahead at possibly a recession. So maybe we can talk a little bit about that as well. So let me introduce these lovely people. So I’m just going to apologise if it looks like I’m reading this. I am, because I just want to make sure that I get everything in about Waz and Nic, but basically Warrick Bidwell and Nicole Cox, affectionately known as Waz and Nic by their following on the Tradies in Business podcast, share very similar passion in life and that is to help tradies, get off the tools and into real business ownership. So let me tell you a little bit about Waz first. He began his career as a labourer in his father’s building business and, while his dad was self-employed, and he’ll probably tell you about this, he never actually got off the tools and he warned Waz – “if you go ‘on the tools’, mate you’ll end up broke and physically ruined.” which is a pretty harsh thing for a father to say to a son.
But obviously there was a lot of emotion in that. So, while Waz wanted to continue on and get his ticket and his license in building, auto mechanical, and even as a professional race car driver (as all of us hope to do!), he instead chose university and a business degree/accounting qualification. Fast forward 20-plus years work and Waz has owned and run several businesses, including a financial planning firm, accounting practice. And for the past 11 years a business coaching and mentoring operation. Since 2014, Warrick has worked exclusively with tradies to help them avoid the fate of his father and to inspire them to create true trade businesses that provide solid income, time flexibility and choice. And we all want some of that for sure. He’s now tradie wingman to trade business owner right around the country. And then we have the lovely Coxie, Nicole Cox or ‘Coxie’ as Waz likes to call her.
She’s the daughter of a plasterer and, quite literally, the builder’s wife, with early experience in both plastering business and her own building company. Nic has a long history in the construction industry. After watching both her father and husband get caught in the gut-busting cycle of working in their business. She went on a quest to find a better way. Nic has been working with tradies to help get them off the tools since 2014. Something both her and her husband have a great passion for. After all, who goes into business to stay on the tools, seriously? So you can see, they’re very well matched, This pair, they’re not married, by the way, each has their own partners but they work really well together. Having owned four small businesses herself, including a construction company. She is very well-qualified to talk about business and has managed several others.
Nic is passionate about improving the lives of business owners and encouraging, encouraging them with both personal and business growth. So hopefully you’ve got a sense of these guys. They really know their stuff. They know businesses inside out. So if you’re listening and you have a trades business, this is particularly interesting and important for you. But no matter what kind of business you’re in, I don’t think it really matters whether you’re a tradie or not. This information is going to apply to you today. And that’s why I brought them in. So, welcome guys. Do you want to say anything? I feel like I’ve been blabbing for hours.
I know, it’s nice for someone else to talk about me, instead of me.
So, Why don’t you tell us a little, I mean, I know that intro kinda talked a little bit about why Tradies in Business, but I want to hear from you – like why did you create this podcast and this whole kind of empire that you’ve designed around this help for tradies?
Thanks, Anthea. Both Warrick and I’ve got a lot of experience. I supposed with I guess there’s a couple of things that built Tradies in Business. So there was obviously trade business fails. We see them every day. We’re talking about businesses here where, the business owners are too tired, too stressed, too overwhelmed. They’ve got too much going on to actually get themselves to a point where they can pull themselves out of the business and do the stuff they need to do to run their businesses effectively. But then we also see that effect on mental health.
We both have a great deal of personal experience on how that affects business owner’s mental health, and that’s our real driver behind what we’re doing. We really want to help them improve the mechanics behind their business so that they have that space to have good, healthy, mental health. We see far too many tradies or tradie business owners or business owners in general, really that are in a terrible position in their lives where they are so stressed and overwhelmed that they just don’t have, I guess, the space in their lives for the relationships that they should be having, for their family, for even friendships and time to go out and play golf or hanging out on the weekends and just relax and a lot of what we’re teaching trade business owners, we’ll allow them that time within the week and their day even to have that space so that they’re not trying to cope with the mental pressure as well as the pressure from their own business. So that’s how we came to be. It was over a cup of coffee.
A cup of coffee at a roadhouse – a truck stop. Yes. halfway between where we both live because we live about 90 minutes apart. So yeah, we got together over a cuppa, re-connected cause we’ve worked together a bit over the years and pretty much got to the end of that and said “Hey um… We should work together.” cause it’s sort of both coming at trades from our own angle and yeah. So, thought we’d combined forces so
Awesome. And so yeah, so you recognized this shared passion and thought, it just makes sense to come together? Beautiful. So I’m going to just launch straight into the topic today cause I don’t want to faff around. Not that, you know, finding out about you guys and faffing around at all! I love chatting with you guys, but let’s just really hit it hard. Hit this topic hard. So, you know there’s a lot of talk about us living in the gig economy, right? And people have different ideas about what that means. I’d love to know what you think that means and why you think it matters to have a handle on that for us as business owners.
Well, I thought I knew what it meant, so I Googled it to make sure and I guess, you know there’s the whole gig economy. It’s so these bite size chunks of, of work being done and the why I see that is, is both an opportunity and a challenge or a potential risk for what are largely, with trade business owners, traditional businesses, you know, they’re the bricks and mortar type businesses. They, have to come to my house to fix my toilet or to install my, my pool or put in a new driveway or whatever it is. You know, they’re not digital businesses, although they do exist in the digital realm. And I think the risk there for trade business owners, for any small business owner really is that consumers have been trained in that gig economy headspace. You know what I mean? That transactional nature of buying something,you know, we’ve got online shopping where I can go and compare seven different pairs of mountain bike shoes before I pick the one that I want and then I’ll go find the cheapest price and the lowest shipping and the fastest delivery. And it’s just all about a transaction. There’s no relationship there. Well I think that’s a big risk for trade business owners being small to medium enterprises is it they get swept up in that whole transactional nature of business and that generally draws prices down. Which is a big risk to Families, you know, creates more financial stress if we’re not making a margin out of fix a cashflow. Well, I think the opportunity there is being in that bricks and mortar business, it’s almost like there’s this embedded opportunity to develop relationships with customers that isn’t there for a shoe business, selling online, you know, it’s really hard for an online shopping business to actually build a relationship with me as a customer.
But for a tradesperson we’re generally, I’m going to phone up or maybe email, there’s going to be a quote process. There has to be sort of that human to human contact. I think that’s a huge opportunity to really build relationships with customers and give people more than what they’re seeing elsewhere with gigs. You know, whether that’s getting your letterhead created by someone in the Philippines, or whatever it is. So I sort of think there’s that double-edged sword nature to it. It’s a, I’m going to defer to Coxie because she’s probably got a better answer than that.
No, that was great. That was great. I love that. I also did a bit of Googling today and I actually think that it’s a huge opportunity to be educating our clients around what they can expect from our service because it’s so different than, you know, when by talking about a gig economy, it’s just a pay for do, it’s just come in and do whatever it is and move on.
Whereas what we’re talking about in so many small businesses is actually an opportunity to educate our clients and build a relationship much like what you’re saying. So that we have the know, like, and trust factor so that we have an ongoing relationship that can encourage loyalty, which is the big thing when we talk specifically about trade businesses is that loyalty so that we have the repeat customers. So yeah, I certainly think there’s a real risk there with the way currently we’re being educated as consumers around this, you know, just get it over cause it’s cheaper, it’s quicker, it’s the same car that gets me where I want to be versus a cab, but we can actually educate our business consumers around what it is that the value, of what we’re doing is bringing to them as the consumer. So yeah, I think it’s a race, but I think that if we’re quite smart now and we start educating and building upon that education and become the experts in our field, which we all are, then we’re really negating a lot of that risk.
And it sounds like so much about relationship building, you know, isn’t it? And what’s really interesting to me is that you know, we live in this so-called gig economy. It’s a very atomised, you know, where we are looking for the cheapest kind of consumable out there. But on the other side, we’re craving relationships with people. We’re on social media, we’re disconnected from people and we’re actually really, craving that connection. So that’s a huge opportunity for business owners to create that connection. And if you think about the amount of money that you might spend as a business owner on advertising your business and getting the word out you know, it’s all about retaining customers so that you can actually get the value of all that, the money and the hard work and effort that you’ve spent on, on getting that customer in the first place.
Yeah. Great. So let’s have a talk about particularly about diversifying income and why, why do you think it’s important to do this? So this is really, I think for small business owners, but it’s really anyone and even wage earners this is important for, because, well, why do you think it’s important?
I had a really different view on this to Waz, so I was probably thinking really tradie specific and if you’re thinking about a typical tradie in business, their body is their biggest tool, but their bodies are going to break, there’s just no way to stop them from breaking down over time. Yeah. Again, it might be mentally because the overwhelm is too much or it might be that, physically, we start to break down like my husband, his shoulders are no good and suddenly can’t work, so we need to be looking at ways in which we can diversify our business so that we aren’t relying on the one income stream in case something goes wrong.
Like I have an accident on the way to work. Or somebody calls in sick and suddenly that job can’t be performed. We need to have a broad, or as broad as we can, at least a couple of streams of income that we can rely on within our business so that if worst-case scenario comes in, whatever form that might be. I was thinking physically, you’re thinking a bit broader than I was that we have a diversified stream of income to draw from.
I probably look at, in terms of my old financial planner hat that I used to wear for years, which, which is, you know, you go see a financial advisor, they’ll talk about spreading your investment risks and not putting all your eggs in one basket. And I suppose when we, we’re sort of narrowing our business and if all I do is paint new houses for builders, if that market gets affected, which you mentioned the big “R” word earlier in recession, then one of the early things that we see as building approvals fall away and the building market softens or collapses.
It’s a, you know, if all I’ve been doing is painting houses for builders, I’m going to be really badly impacted in that sort of market condition. But if I also have an aspect of my business that is resealing old roofs for existing homes that’s going to help sort of buffer me from that those market fluctuations or risks. Or if one of my builder customers falls over and goes broke, you know, I’ve got this other aspect of my business. So for me, it’s sort of like investment risk where you don’t want to have everything in property or everything in BHP shares, you want to sort of spread it across a few. So you, you sort of take a few of the hits with the means. That’s kinda how I looked at it.
Yeah. And I’ve actually got a really good example of this with a client that we started working with probably about four or five months ago. And they run a fibreglass fabrication, business for they make, they make the molds for one of the big motorhome companies. And they’re, their only client. And so suddenly something happened where that company was taken over by another organisation and all of a sudden their invoices were getting super, super delayed, you know, where they had been paying really promptly. All of a sudden the rug was pulled out onto, under them. And they were in a real bind. And so luckily it all came good and that, that client started paying again, right. But they were working through some internal sort of change issues. But it was a huge wake up call for them that they needed to really think about either having a number of different clients or you know, creating products for themselves and actually on selling them, you know, so, yes, it can be a very serious problem if all of your money is tied up in one client, or one particular investment model, or something like that.
Okay. Or You know, the tradesperson is the only one who can currently make the most money for the business and they bugger their back. It’s like it’s a sudden financial impact from the business side.
Yeah. And we all know that income protection insurance usually doesn’t cover anywhere near what it should.
I don’t know what the stats are, but I think it’s something like 70% of Australians are underinsured.
Massive problem. So can you give some examples of some businesses that you’ve worked with or even you know, that you’ve noticed out there in the marketplace that have diversified successfully and done this well?
So one of the biggest examples I’ve seen is Brisbane local example and I’m not entirely sure now whether they’re just still based in Brisbane. I think they’ve actually branched out quite a bit further. But we stopped. It’s Fallon Services I think they’re now called, and it was one gentleman, Mr Fallon, he’s quite elderly now and he started his business as an electrician and from there he started to see the demand. He brought in other services to his business. So he’s gone from offering not just electrical services but plumbing, painting, carpentry, air conditioning, gas fitting, the whole game of, I guess of some home maintenance services that you might need. So it’s gone from just being a Sparky. Suddenly he actually stepped out of the business and created a business with other service trades they could run out and actually perform the work so that he had all of the answers for the industry. So whenever somebody had a problem at home and they needed a quick answer, and I’m pretty sure now it’s a 24-hour service as well, it’s not just you got to wait till the next business day and they have someone on call ready to come to you immediately. So you can imagine what a big structural change that would be in business to be able to step out of just being a one single tradie growing that business to becoming a substantial business and then stepping right out and having all of these other types of businesses within your business. That level of diversifying is quite enormous, but it’s a great example of how one small business with a sole trader can grow and become something quite terrific.
So in that situation, Nic, that’s an example where the business owner is not literally doing all of those different things. What they’ve done is they’ve partnered with all sorts of other companies who do that really well, and you know, and can guarantee their work and they’re really just putting it all together and they’re packaging it, aren’t they?
Okay. I guess it’s no different to a supermarket selling various brands or popping into Bunnings and I need X, Y, and Z and I have a choice of different brands? It’s all in the one spot. So, and that’s exactly what they’re offering with Fallon. I mean, it’s so under the one label as Fallon, it’s his Brand, it’s his name, but there are all these sub-services that they’re able to offer from the one spot.
Very interesting, what about you Waz?
Yeah. So, so we actually have one of our partners, in tradies in business that we’re starting to do some more work with. And I got some big things coming over the next sort of six to 12 months with these guys, privately owned company in Brisbanestarted by one guy. And they have plumbing, they have electrical wholesale, so it’s the PGW group.
So they’ve got Samuels, plumbing stores, nationally, CNW electrical, Sheriff electrical. They’ve got solar divisions. I’ve got, I’ve lost count of how many different divisions within this one business across multiple industries, different product supply types, different niche markets. They have even branched out overseas now into Southeast Asia and it’s, it’s all started with one guy and started in the trades and it’s sort of spread from there. But yeah, you know, they are also very buffered I guess. I mean there’s a lot of building industry spin to it, but some of the brands are into renewable energywhich is obviously a huge market now. So, you know, they’re sort of they’ve got these aspects to their business that are really future-proofing them. But I guess helping with that multi-service model kind of thing, I guess.
Yeah. Beautiful. So, I mean, imagine people listening to this, maybe they’re running a small business and they’re thinking, ‘Oh my God, that sounds really overwhelming to have to, you know, create a package or something like that. You know, how would they even start to do that? They’ve got all these questions. What I mean, I guess my answer would be don’t try and do it on your own. Like try and find a business coach or you know, check out tradies in business to actually get support to do something like that. Because there are plenty of business coaches out there who’ve really worked at and helped other businesses restructure and create a new model for doing business and have to do it on your own. We’re, we’re, we’re so lucky that we have people that you can connect with and so you don’t have to reinvent the wheel, basically. But what would you say, what’s one action step that people could take today to start diversifying their income?
I think we agree on this one. We did chat about this before we spoke with you and, well I think we agreed, we’ll see if we agree is a, I think a big one is looking for that recurring income stream. So a lot of, you know, if we’re talking trade businesses, that’s who we coach. That’s who we consult to. A lot of them tend to be on that sort of installation, new work. I’ll come in and I’ll put in your new garden for you as the landscape architects. And once it’s installed then you know, we hire five, I’ll give you the gift basket. You give me a testimonial and that’s great. See you later. But there’s this opportunity that I think goes begging for a lot of trade businesses in the maintenance, and you know, it might be that you introduce a landscape maintenance aspect to your landscape installation business or same with the pool companies.
You know, there’s a lot of trade businesses that do this well. And there’s a lot that haven’t really tapped into that opportunity. Even builders, you know, set up a subscription to come back and adjust your doors and windows once a year. And I’ll just pay you an annual subscription to do that. Plus, you know, up here on the Darling Downs where I live, everyone has adjustable collars on their stumps because the horrible black soil up here moves and houses move. So, you know, come back three times a year and adjust the stumps for me and charge me a fee for that because they don’t have to worry about it. So I think there’s those ongoing sort of maintenance or subscription type things that are not only a great way to create a recurring income stream but also keep you in contact with those customers that ordinarily you would do a job for once and probably never see again inside of a five-year time frame. But now you’re talking to them on a regular basis. They paying money on a regular basis. They’re part of your customer base. It’s an excuse to talk to them about your latest and greatest product or a fantastic event that you’re running or whatever it is. And sort of loop all the way back to what we said at the start, which is building a relationship with your customers because that’s going to create more of an income stream and more of an opportunity to solve problems with it.
Let’s not forget, it’s almost all your marketing done once you’re being paid to do your own marketing because they’re a customer and they’re locked into that relationship, they’re not looking anywhere else. You’ve just made it easy. So if something else goes wrong, I’m coming back to you because you’re the person I always use. So subscriptions are a great way to start to inject another income stream into your business. And you can start looking for those by just having a big broad look at what your business is, who it services and how it services them. And is there just one small tack on that you can add to that over a lengthy period. And from that brainstorming session, yeah, I guarantee you’ll come up with several different so that you can add into your business and show there’s some strategy and some thinking around how you’re going to add those in. But once you’ve got the idea and you open the door, it’ll just come hard.
So what you’re saying is take pen and paper right now, a blank piece of paper. Brainstorm all the kind of ways that your business could help your customer. And that’s really what it’s about. Like, I can hear people going, Oh, this subscription model, everyone’s doing it. You know, they just want our money. I can hear it. You know, I can sense that there’ll be people listening into this conversation thinking that but what I think about that is your customers, if you’ve done a great job for them, they want to actually have that ongoing relationship they’re actually looking for. It’s a bit like, like I remember when I did my first and my only ever skydive I remember coming down from that skydive and just being like a million miles an hour talking and saying, Oh, it’s like, well, how much does it cost to get a parachute? And lessons and all that. Honestly, if someone had up-sold me at that point, I would have been in, but no one did. And you know, I then I kind of forgot about them and now I’m 40 or something. And I’ve never done it again. Right? But your customers, if you do a great job, they WANT to have that ongoing relationship with you. So you’re giving them an opportunity to do that. That is serving both of you. It’s, it’s allowing you to create value for them, but also giving you a long-term income as well. There’s a good partnership. So coming back to the piece of paper, what is the, what is the question that they should have with their pen in hand as they’re brainstorming? Like what, what are they brainstorming exactly?
Alright. I like to think of this in terms of the problems that your customer might have. Say, In the 12 months after you leave the job site, their house, their commercial property, whatever the heck it is that you’ve done, what are some of the problems or frustrations that they might have, or that they might need to solve, over the next 12 months? And in that I guarantee that there is a service, there’s a followup product, there’s a maintenance plan, there’s a subscription service, whatever you like, but there’s, there are problems that are going begging that the customer probably doesn’t even know someone can solve for them. But they hate the fact that after the trees grow a bit and the stakes that were holding them up are all loose and the ropes cutting into the trunk, they’ll don’t know what to do about that. And so if you come back three months later and remove them and restate the trees to make sure they grow straight, you’ve solved the problem for the customer. Sometimes they didn’t even know they had but there’ll be grateful that you did because they realised that that could have created a bigger problem by you know, killing the damn tree that you planted for them and now they’ve got to replace it.
So to add to that, I’d be suggesting thinking about the things that your clients are currently complaining about. So if you’re getting callbacks to say that, ‘hey, my tree looks a bit wonky’. Why is it wonky? There’s a service there or if you’re knowing that it’s actually gonna make your life easier. If you are the regular landscape gardener and you go twice a year to do the hedging, it’s, you know, it would be so much easier to do that hedging if you did XYZ every three months and then the hedging on the sixth month, then there’s another service there as well.
So if you’re thinking about those annoying calls that you’re getting that you don’t really want to get the problems that natural problems like, you know, with the expansion of the, the walls, we get cracks. So how can we fix the cracks before the clients are actually seeing that they’re a problem, or the doors get jammed, or the windows get jammed? All of those kinds of problems that happen naturally, normally, it’s a normal part of your business is where your extra business can come from. There’s another stream there every time because clients just want the problem to be gone, they don’t mind paying a little bit of money for the problems to be gone, but they want it gone. They don’t want to have to about it. And if you’re doing the thinking for them, not only creating an income stream, you will become a rock star business who is always tacking in for any problem before it’s a problem.
Perfect. Some really, really amazing examples that you’ve given us today. I love the one, what was the business called that, brought in all those other. (Fallon) . Yeah, I’m totally going to Google them. So thank you. Thank you so much today for just everything you’ve contributed, so much food for thought and I think like, I’m just going to keep this really short, this interview because I think we’ve got gold just in what we’ve got today. I don’t want to ramble on for hours and so I really appreciate your time. Tell us a little bit about how, you know, we can find you. There are people listening to this and they maybe want to get a bit of business coaching. Just help to do exactly what we’ve been doing. Where can they go
We’re everywhere. Just start by Googling Tradies in Business. We’ve got so many different offerings. We start with a freebie podcast, which has got, you’ve been on the podcast with us Anthea, absolutely nuggets of golden information in the podcast from the podcast, the natural transgression really from there is the Facebook Group. We have a huge Facebook group. It’s a free group with 1200 likeminded tradie business owners and we invite our, tradie business owners to come in as a couple of questions you’ve got to answer so we can make sure that you’re authentic and you’re not there just to glean the information and run away or spam us and then from there we have some paid offerings. So if you head on over to TradiesinBusiness.com.au, You’ll find that we have some lower-end levels for those tradies that are really go-ahead and try to use and ready to DIY their own business education. From there we have a couple of steps up including business coaching as a final level if that’s something that people are interested in. Did I miss anything? Not really. We’re on Instagram, Facebook, wherever you. All socials are Tradies in Business, you can find us everywhere.
Easy, peasy and I have, I have consumed your podcast on my walks pretty much every day for the last, I don’t know, eight months or something like that and it’s super entertaining. They have, he F$%it Friday. Do you still do that? That’s pretty hilarious. Like they get into some pretty seriously, serious, topics on that F’it Friday. I highly recommend listening to it. Thank you, guys. Really appreciate you coming on. We’ll definitely connect again, I’m sure. Thanks so much.