How to set up trade accounts with material suppliers

To make your business profitable, you need to buy materials at the best possible price. The most direct way to do this is by opening dedicated trade accounts with local and national builders' merchants. This unlocks trade-only pricing, gives you the option of credit to help with cash flow, and provides access to a wider range of materials than you would see in a retail DIY store.

Why do I need a trade account?

While you can walk into any supplier and buy materials off the shelf, a formal trade account separates your business from the general public and offers significant advantages:

• Trade Pricing: Access to discounts and prices that are not available to retail customers, directly improving the profit margin on your jobs.
• Credit Facilities: A credit account allows you to buy materials and pay for them later (usually within 30-60 days). This is incredibly helpful for managing your cash flow, as it means you can get paid for a job before you have to pay for the materials.
• Dedicated Service: You'll often get a dedicated account manager or build a relationship with the trade counter staff who can help you source specific items, arrange bulk orders, and organise direct-to-site deliveries.
• Wider Range: Trade account holders can often order from a much larger catalogue of specialist materials and equipment that aren't kept in the main store.

How to open your first trade accounts

The process is straightforward and designed for tradespeople. Follow these steps to get set up.

1. Choose Your Suppliers: Identify the key suppliers in your area. Include big national chains (like Travis Perkins, Jewson, Selco, or Screwfix) and, just as importantly, smaller local independent merchants. Independents can often offer more personalised service and flexibility. Ask other tradespeople who they recommend.
2. Gather Your Documents: You are setting up a business account, so you will need to prove your business is legitimate. You will typically be asked for:
   • Proof of your business identity (e.g., your UTR number if you're a sole trader, or your Companies House registration number for a limited company).
   • Photo ID for the business owner (a driving licence or passport).
   • Proof of your business address (a recent utility bill or bank statement).
3. Decide: Cash or Credit?: You will usually be offered two types of accounts. A 'cash' account gives you trade pricing, but you must pay for goods as you take them. A 'credit' account provides a credit limit and payment terms. If your business is brand new with no trading history, it's often easier to be approved for a cash account first. You can apply for a credit facility later once you've built a relationship.
4. Complete the Application: Most suppliers now have a simple application form on their website. You can also do this in person at your local branch. Fill it out accurately and submit it with your documents. Approval for cash accounts is often instant, while credit accounts may take a few days for the supplier to run credit checks.

Top Tip: Don't just open one account. Set up accounts with two or three different merchants. This allows you to quickly compare prices for materials on a job-by-job basis, ensuring you always get the best deal for you and your client.

Once your account is open, make an effort to introduce yourself to the staff at your local branch. Building a good relationship with the people on the trade counter can be invaluable when you need materials in a hurry or have a tricky item to source.