What Is It?
A trade business plan sets out what your business does, who it sells to, what it charges, what it costs to run and what you expect it to bring in. For a trade business the useful version is short and specific: your services and the area you cover, your day rate and materials markup, your startup costs, your cash flow across the year, and the registrations you need in place before you take the first job. It is a working document you update as your costs and customers change, not a form you complete once and file away in a drawer.
About This Template
Starting a trade business takes more than being good at the work. This plan makes you answer the questions that decide whether the business survives its first year: sole trader or limited company, what you charge for a day and for materials, what the van, tools and insurance actually cost, and where the first customers come from. It is deliberately three pages rather than thirty, because for a one-van business a plan you finish and come back to beats a document abandoned halfway. Lenders expect a written plan and financial projections too, so the same pages do both jobs: a working plan for you, and evidence for anyone funding you.
When to Use
- When setting up as a self-employed tradesperson for the first time
- When applying for a business loan, overdraft, or grant funding
- When transitioning from sole trader to limited company and you need to reassess the business
- When expanding the business, for example hiring your first employee or taking on an apprentice
- For annual business reviews, to track progress against your goals and adjust your strategy
- When pitching for commercial contracts that require evidence of business planning
What to Include
- Business overview: trading name, your name, your trade, business structure and start date
- Executive summary: the business concept, target market and key financial goals in a few lines
- Services and market: what you offer, the customers and area you want, and who you are up against locally
- Pricing strategy: day rate, hourly rate, materials markup and the profit margin you are aiming at
- Startup costs: van, tools and equipment, public liability insurance, scheme or trade body registration, marketing and website, plus the total
- A 12-month cash-flow projection: expected income, expenses and net position across the year
- Marketing plan: Google Business Profile, trade directory listings, website, local advertising, referrals and social media
- Registration and compliance: HMRC, competent person scheme or trade body, public liability, employers' liability if you take on staff, and a business bank account
Tips
Be realistic with your financial projections. Base them on the work you can actually deliver and build in a buffer for a slower start
Factor in all the costs employed tradespeople often forget: vehicle lease and fuel, public liability insurance, scheme or trade body registration, tool replacement, accounting fees, and marketing spend
Choose your niche early. Trying to do everything means competing with everyone, while specialising lets you build a reputation and often command higher rates
Plan your marketing before you need work, not after. Set up your Google Business Profile, get listed in reputable trade directories, and build a simple website before day one
Review and update the plan every six months: your costs, your customers and your goals all move, and a plan that no longer matches them stops being useful
Filling In the Cash Flow Projection
The cash-flow page is where most trade business plans fall over, and it is the page a lender reads first. It splits the year into four quarters, each with money in, money out and the net position. Fill it in on the basis of when cash actually moves rather than when you raise the invoice: work you finish in March and invoice on 30-day terms is April's cash, and that gap is what empties an account in a month that looked busy.
Put the lumpy costs in the quarter they land instead of spreading them evenly. Insurance renewals, scheme registration, vehicle costs, tool replacement, your accountant and your Self Assessment payments all arrive on their own schedule, and a forecast that averages them hides the quarter that hurts. If you are a sole trader, include your drawings as money out: what you take to live on leaves the account even though it is not a business cost.
Be conservative on the way in. Assume a slower start than you are hoping for, assume some customers pay late because some will, and keep a buffer. If the projection only works when every quarter goes well, it is not a plan. For a government-backed Start Up Loan, expect to be asked for a month-by-month forecast and a personal survival budget alongside this summary, both of which Start Up Loans provides its own forms for.
Working Out Your Day Rate
The pricing page asks for four numbers: your day rate, your hourly rate, your materials markup and the profit margin you are aiming at. Work them out from your own costs rather than copying the firm you used to work for. Their rate carried overheads you may not have, and it left out ones you now do.
Start from the days you can actually bill. A year holds far fewer chargeable days than calendar days once you take out holiday, illness, quoting, invoicing, collecting materials and the days nobody books. Add up everything the business has to pay for across a year — van, fuel, insurance, registration, tools, phone, accountant, marketing — add the income you need to live on and the tax due on it, then divide by the billable days. That figure is your floor, not your price.
Then check the floor against what your local market pays and decide where you want to sit against it. Going in under the going rate to win early work is a decision with a cost: it sets the anchor for repeat customers and referrals, and a rate is harder to raise than to set. Write the number into the plan so you have something to hold yourself to when a customer pushes back on it.
