How to win commercial contracts as a tradesperson in the UK

Why commercial work pays better (and how to break in)

Commercial contracts offer something residential work rarely does: predictable income over months or years. A facilities management contract with a chain of retail units, maintenance work for a housing association, or planned works for a local council gives you steady cashflow without chasing individual customers every week.

The catch? Getting your first contract takes effort. You need the right paperwork, the right approach, and usually a track record of similar work. Here is how to get started.

Get your paperwork in order first

Commercial clients expect more documentation than Mrs Jones down the road. Before you tender for anything, make sure you have:

• Public liability insurance — £5 million minimum for most commercial work, £10 million for larger contracts
• Employer's liability insurance — if you have any staff, even part-time
• Professional indemnity insurance — increasingly requested for design-and-build contracts
• CSCS card — required for most commercial and construction sites
• Gas Safe / NICEIC / NAPIT registration — as relevant to your trade
• Health and safety policy — written policy required if you employ five or more people
• Risk assessments and method statements (RAMS) — you will need these for every job

Missing any of these is an instant disqualification from most tender processes. Get them sorted before you start looking for work.

Where to find commercial contracts

Contracts Finder (gov.uk/contracts-finder) lists all UK government contracts over £12,000. Local councils, NHS trusts, housing associations, and government departments all post here. Filter by your trade and location.

CompeteFor lists subcontracting opportunities from major contractors. If a large firm wins a council contract, they often need local trades to deliver the work. This is how many smaller firms break into commercial work.

Direct approaches work too. Property management companies, retail chains with multiple sites, and housing associations all need reliable trades. A well-written letter with your credentials, insurance details, and examples of similar work gets attention. Follow up by phone a week later.

How to write a winning tender

Tenders are not quotes. A quote gives a price. A tender explains how you will deliver the work, why you are the right firm, and what it will cost. Most tenders are scored on quality (60%) and price (40%), so being cheapest does not guarantee the win.

Cover these points in every tender:

• Your understanding of the brief (show you have read it properly)
• Proposed methodology (how you will carry out the work)
• Programme (timeline with milestones)
• Team and experience (names, qualifications, similar projects)
• Health and safety approach
• Social value (apprenticeships, local employment, environmental practices)
• Price breakdown (transparent, itemised)

Social value now accounts for 10 to 20 per cent of scoring on most public sector tenders. Employing apprentices, using local suppliers, and reducing waste all score points.

Pricing commercial work

Commercial rates are typically higher than residential. You are paid for reliability, compliance, and administrative overhead as much as for the actual trade work. Factor in:

• Site inductions and travel time between sites
• RAMS preparation for each job
• Invoicing and payment terms (30 days is standard, 60 days is common)
• Retention (5 to 10 per cent held for 6 to 12 months after completion)
• Professional insurances at higher levels

Build these costs into your rates. Do not price commercial work at residential rates and then wonder why you are not making money.

Building a track record

Your first commercial contract is the hardest to win. Start small. Maintenance contracts for local businesses, reactive repairs for letting agents, and subcontracting for larger firms all count as commercial experience. Keep records of every commercial job: client name, contract value, scope of work, and a reference contact. You will need these for future tenders.

Payment and invoicing

Commercial clients expect professional invoices with purchase order numbers, detailed breakdowns, and specific formatting. Use invoicing software like InvoiceAdept to produce consistent, professional invoices that match what procurement departments expect. Late payment is unfortunately common in commercial work, so factor payment terms into your cashflow planning and use the cash flow calculator to model different scenarios.

Key takeaway

Commercial work is not harder than residential, just different. Get your paperwork right, start with smaller contracts to build your track record, and price your work to cover the extra overhead. Within a year or two, you can build a commercial client base that provides far more stable income than chasing individual domestic customers.

FAQs

Do I need to be VAT registered for commercial work?

Not necessarily, but many commercial clients prefer VAT-registered suppliers because they can reclaim the VAT. If your turnover is below the £90,000 threshold, registration is optional but may make you more competitive. Check the VAT calculator to see the impact.

What payment terms should I expect?

30 days from invoice date is standard. Some larger organisations pay on 60-day terms. The Late Payment of Commercial Debts Act gives you the right to charge interest on late payments, though exercising this with a client you want to keep requires diplomacy.

Can a sole trader win commercial contracts?

Yes. There is no requirement to be a limited company. However, some larger contracts require a minimum turnover or specific insurance levels that sole traders may find harder to meet. Many sole traders win smaller maintenance and reactive contracts successfully.