Good Companies cost money to run as they invest in correct image, marketing,insurance, training,staff, tools etc. The most disappointing aspect of landscape construction is the ability of the unskilled/unqualified individual/firm to under price the market rate, looking for and achieving a quick buck. I had hoped by now that a government would have addressed the uneven business playing field. In my opinion, it should be no trade body membership or Company registration - no trading. The onus on the customer to make sure they are employing suitable firms or they are breaking the law. What would this cost to set up, not alot & everyones a winner except the rogues. A stipuation would be joining the register, and a qualifying point could be that each firm takes on a young apprentice each year, or is able to keep the same one for a maximum of 3 years until they gain experience. This would help young people enter the market & would be a vote winner amongst the young.
I can prove how uneven the playing field is. I used to be a member of a national paving scheme, infact one of the founding members. I gave it up 3 years ago as the credibility I was looking for by being a member was not there any more in my opinion. They recently recognised the way the scheme had become less professional & decided to make it a qualifying criteria that you had to be VAT registered to be a member. The result in my county - everyone was removed from the scheme. I do not believe you can be an established business and not be VAT registered, the turnover is too small.Think of all those "firms" that have been competing against you, taking work off you on the basis that they are automatically 20% cheaper. It angers me that you are penalised by the system while trying to do the right thing. Its about time governments protected the consumer & businesses by putting correct legislation in place. Anything these forum sites can do to assist this is a good thing in my book.
Duncan Ross www.gardendesignco.com twitter gardendesigncom
Sorry, but sadly I can't see any way how you'll ever get round two issues here:
Firstly, some clients will value a "deal" over quality every time. Either learn to avoid them, as they always end up losing you money, or go in to another industry. We will always have cowboys who won't ever be eliminated as there is always a client who can be conned, rubble that can be fly-tipped and VAT that can be avoided.
Secondly, business is never a level playing field. A builder friend of mine has layed staff off this month as he's lost quotes that he he priced at cost, yet others are pricing in order to stay in business for another month and then default on the bills. You can't ever expect everyone to play by the rules and you can't legislate or affiliate the rogues out of any industry where cash is an option.
duncan ross said:
Well that stirred up a hornets nest, which it was partially designed to do. It was NOT meant to be offensive to anyone but to have a sensible discussion on "levelling a playing field". I put forward a few ideas, some could have been better phrased, but the whole idea was to stimulate alternative ideas on how to achieve this. Unfortunately, some have taken it as open critiscism without supplying their own opinions on how this idea could be achieved to benefit themselves.
To conclude, VAT threshold has no affect on quality of work what so ever - agreed. However it is a threshold we have to operate with currently. Every business must start somewhere, & I suggested tax/VAT exemptions to allow them to plough profit back into their business. Landscape contractors cannot operate under this limit with cost of materials that maintence people do not have.
My point was not to demonise one man bands. My point was to find ways that all legitamate businesses can prosper in a competitive market place, be they one man bands or larger firms. What I am looking for is a professional market place that provides a good service to the consumer, & they in turn pay promptly for satisfactory work completed, with a come back to the person who supplied the trade should there be any issues.
So, that said, lets discuss ideas that could help us all to achieve our goals of fair pay for a fair days work @ the expense of the chancers who come into the industry to make nothing but a quick buck, leaving others to suffer the consequences.
Any positive ideas ?????
You may not be aware of what Sandra Loton-Jones, CEO of BALI said last year:
"Loton-Jones is quoted in a Hort Week article as saying, "Our members' contracts are as keen as they can be and they get increasingly frustrated when they find the work they hoped to get has been taken by people who are not VAT registered and not fully aware of the legislative position. The world has changed so much - with Work at Height Regulations, for instance, that are not just affecting tree work. You have to adapt work practices to conform to legislation.
"These people devalue the industry and make it look like something anyone can turn to."
It was an ill-thought out and erroneous comment (especially when some BALI members are not VAT registered) and I feel the comment would have only have been made due to the managerial culture at BALI at that time.
Sorry Duncan, I think that your argument is totally wrong on every level-may have a place in a Soviet-style command economy though.
If your quality, value for money and customer service are ok you will have nothing to fear from businesses with illegal trading practices.Furthermore, the government has greatly increased the VAT threshold recently in order to encourage small businesses to start-up, something which is desperately needed at the moment.
I run a small successful business, CRB checked, insured, qualified but I have no desire to grow it above the VAT threshold due to my personal circumstances.Maybe I should go on the dole instead ?
we are vat registered as most or work is business too business it makes not a lot of odds too us ,that said i feel the vat threshold is way too low ,and the vat rate is far too high a flat rate of 10-12% should be fine .
As soon as you hit 20% vat rate it makes it all the more tempting to go cash in hand for a lot of people ,shis does not help anyone.
Hey, i have really enjoyed reading this thread and all comments in it. i have been trading for nearly 3 years in devon mostly doing maintenance however i am now attracting landscaping projects as well. i currenly employ a ful time maintenance gardener, a full time apprentice and a part time labourer. i have no doubt that very soon i will be forced to register for VAT. i have discovered that my prices are slightly on the low side and when i eventually register for vat they will automatically jump 20%. i am worried how this will affect my business i am keen to up my image and buy new vehicles before this happens so that i can project the image of a reputable, professional firm that warrants the prices i will be charging. my point is that vat registered or not people buy from people they like and trust and its not always the price that puts people off. if they like you and trust you they will buy from you even if you are 20% dearer surely?
Get more commercial clients who can claim it back.
Thats right I am fully qualified sole trader. I am below the VAT level and given the paperwork and time involed in completing it (as informed by a family friend who is a company accountant) I have no intention of joining it unless i need to.
Agreed, not since Capability Brown anyway...
Duncan - Sempervirens said:
There is no such thing as a 'Landscaper'.
Perhaps the UK should follow other countries leads, and you must be qualified and insured before starting any kind of business?
Having written the original text & reviewed the comments you can see why the landscape trade is in my opinion less professional than it was 20 years ago. Thanks to the few who have posted sensible solutions eg Pauls a flat rate 10% & everyone pays it, that can't be anymore even. So many people are just critical without offering solutions that would suit them. I think it shows how narrow minded a lot of people are in this trade, with little forward thinking & desire to improve. I will probably get flack for it, but I don't care. I never once mentioned that anyone under the vat threshold must be second rate, asked for protectionism on larger companies etc. What I can tell you are facts. 1. We are still achieving prices today that are the same or less than 20 years ago, when we could charge eg. £50/m2 for block paving. Hardly any other industry could sustain this, dont know what a drop that makes in real terms, maybe someone does. 2. Outside the home counties, the average size of a landscape firm probably does not exceed 3-4 people. Reason- there is no profit to grow & improve your business as Mr white van man wil pull up & do the job for a £100 day (if lucky). The size of the business reflects the health of the industry & state of the economy, which we can't do anything about. The health of the industry is determined by its professionalism, and generally people have a low opinion of landscapers as too many untrained/ unskilled, have a go's & cowboys are in the market. Some of the jobs I visit I am embarassed to see what has been done in the name of landscaping & the customer views you with suspicion as you may also be someone who is happy to take the money & do a poor job.
So unless landscapers are prepared to be the low paid sector of the construction industry, we need to start becoming more professional, and thats where I started with this debate. Good trade body membership, good agreed business practices, code of conduct, basic skills levels are all needed.