One of the biggest assets to grow your exports is free - THE U.K. FLAG – are you making the most of it? 500 years ago, if a ship arrived offshore, would you run for the hills or fire up a feast? It's pretty likely you'd make a snap judgement based upon the flag you saw flying - and how fast you could run. A similar scenario still plays out if your product or brand is unknown when it reaches an export market for the first time. A customer will look for your flag. If your brand is relatively unknown and the perception of the U.K. as the 'Country of Origin' is positive in your target market, then leverage it. Not just a 'MADE IN THE U.K....' (or DESIGNED IN THE U.K.) on pack, but print the U.K. flag on packaging, build it into presentations and leverage iconic images from the U.K. on social. Landscapes, buildings, celebrities, you name it. It works. I’ve seen the boost it can make to a company’s sales many times. ‘MADE IN THE U.K.' not only plays an important role in first … [Read more...]
Preparing for BREXIT if you export to the EU
Start with an EORI number Do you currently export with all or some of your international sales focused upon the EU? If that is the case, then after the UK leaves the EU, those firms that trade with the EU will need an economic operator registration and identification (EORI) number to comply with customs rules. A lot of EU-focused exporters have yet to apply for their EORI - so now's a good time to prepare for the future. Here’s a link to double-check if you’re all set, or guidance on applying for your EORI – a good thing to get sorted so you can get back to growing your exports. https://www.gov.uk/eori How BREXIT might affect you The Office for Budget Responsibility (OBR) has predicted that BREXIT could lead to tariffs of 4% being imposed on goods traded with the EU - up from zero currently - and that higher trade barriers with the EU would "weigh on exports". The OBR added this was "not necessarily the most likely outcome" but also "by no means the worst case scenario." (They … [Read more...]
6 Good Reasons Why You Should Consider Exporting In Your Next Strategic Review
Quarter 4, planning the office party, trying to bring in orders before the second week of December. Oh…..and BREXIT and a General Election. Right now, thinking about a strategic review and thinking about growing your business through exporting maybe about as much a priority as a choice between parsnips or sprouts. You feel like you’ve got enough on your plate. But imagine selling your product or service to a whole new audience, imagine adding 10%, 20% to your bottom-line, imagine how it would feel to have a global brand. When businesses go global not only can revenues rise, but there are a host of benefits that can accelerate your growth that you may not be aware of, not forgetting the impact upon potential exit values. So is it really a good time to add ‘start exporting’ to your 2020 ‘wish-list?’ BBC News reported recently that despite US v CHINA and JAPAN v SOUTH KOREA trade disputes (and in the UK, the ‘B-word’) - global trade has grown at 3% this year. It's a really good … [Read more...]
Five ways to improve your business productivity
You will probably be familiar with the adage: Productivity = Potential – Interference. Many of us are battling daily with interference of one sort or another, both external and internal. Potential is not always something that is easy to quantify, or to realise. Growing a business, finding a market, and bringing in orders takes time and effort, and often a bit of luck. It’s also likely to take some time, so those frustrating interferences are the key focus if you want fast results. Productivity is critical Superficial measures do not always show the bigger picture – if two businesses are paying different wages, you cannot assume that the lower payer makes cheaper goods, without knowing their productivity. Obviously, if the higher-paying business is more productive than the lower payer, their output might still be cheaper. Higher productivity gives you the opportunity to take better control of your prices and margins, allowing you to undercut competitors without undue pain, or to … [Read more...]
Why do earn out clauses often create conflict or end up in court?
How do you value your business when you're selling it? In recent years there seems to be more significant differences in expectation of valuation between buyer and seller, and increasingly the Earn-out clause has been used as an appropriate way to bridge this gap. The clause basically retains interest and motivation for the seller by holding back a portion of the sale price until certain performance criteria are met, and minimises risk to the buyer of overpaying for a business that doesn’t perform as well as its previous owners say it will. If it is planned and executed well then the buyer can gain more than originally envisaged, but it is full of risk for the selling entrepreneur and conflicts are almost inevitable. So what’s the problem? You might base the sale price of the business on an assumed level of financial performance over the next 24 months, but the seller is cautious and insists on part of the value being deferred and wrapped … [Read more...]
What is a Terms of Service agreement and why could your business need one?
Terms of Service are exactly that – the terms you agree with a 3rd party who is commissioned to carry out certain services for your business. That 3rd party could be a freelancer, a contractor, a company or an off-shore service supplier. It can also serve as the terms you agree with a client who has instructed you to render services. Unless Terms of Service are agreed and the document is signed, you don’t have a legally enforceable document. Both parties need to agree to the terms set out. The terms can be set out by you or the person doing the work, or both. The document becomes legally binding if the agreement has been signed and dated by both parties. Hopefully, without confusing the issue too much, certain terms of service may not require a signature by both parties – a simple ‘yes’ on an email may suffice. You need the advice of a commercial lawyer that will help you decide if the agreement will require signatures. Planning Terms of Service Firstly you need to … [Read more...]
Five crucial ways to improve your business productivity
You will probably be familiar with the adage: Productivity = Potential – Interference. Many of us are battling daily with interference of one sort or another, both external and internal. Potential is not always something that is easy to quantify, or to realise. Growing a business, finding a market, and bringing in orders takes time and effort, and often a bit of luck. It’s also likely to take some time, so those frustrating interferences are the key focus if you want fast results. Wages & Productivity Superficial measures do not always show the bigger picture – if two businesses are paying different wages, you cannot assume that the lower payer makes cheaper goods, without knowing their productivity. Obviously, if the higher-paying business is more productive than the lower payer, their output might still be cheaper. Higher productivity gives you the means to take better control of your prices and margins, allowing you to undercut competitors without undue pain, or to … [Read more...]
Better budgeting in 10 steps
Many entrepreneurs and their management teams don't devote enough time or attention to the process of preparing annual budgets, especially when they operate in rapidly growing or uncertain markets. A financial plan in a private company is at risk of becoming gradually ignored over time, devaluing the operational benefits of measuring performance against budget and the process next time round. With a careful and efficient planning process a business will set a much clearer picture of where it is heading, knowing what to do at each stage to hit and exceed targets, but also how to react when these are missed. With the benefit of our collective experience of managing hundreds of budgets and plans, we have put together some top tips on making your budgets more robust, realistic and valuable. Get everyone involved - It is a common place misconception that your finance team puts a budget together. A business plan and its budget should be produced by the collective … [Read more...]
LGBA Marketing Advisor, Susanne Currid, Appears As Expert Judge On The Apprentice Final 2017
Congratulations to our colleague and marketing advisor Susanne Currid who recently participated as an expert judge on the final of The Apprentice on BBC1. Susanne told us, “Back in June, I had a very unexpected email. A TV producer had got in touch and asked me if I would be available to act as an expert judge on a show they were recording. Little did I realise at the time that she was talking about BBC1’s The Apprentice. A week later, I found myself sitting at a table in City Hall with leading business directors, expert advisors, Lady Karren Brady, Claude Littner and Lord Alan Sugar. To say the situation felt surreal is a bit of an understatement. However, I was also very excited and honoured to take part in such an iconic TV moment. I was delighted to take part and to have a chance to quiz the candidates on their pitch during the recording session. Well done to James White and Sarah Lynn on their surprise double win. They were both credible … [Read more...]
Essential ‘Must-Haves’ in a Business Relationship Contract
When embarking on an entrepreneurial venture with anyone, including people you trust (i.e. family and friends), be assured that there are always risks involved. To protect your interests for the future, it’s advisable to make your business relationship official by way of a commercial contract. Commercial contracts provide a practical framework which enables you to focus on your business needs and consider the associated risks. Once in place, they will provide your business with a greater level of protection from future potential issues. You need to be savvy in business and if you’re inexperienced about contracts, it makes good sense to take advice from those with skills and knowledge in this area, particularly in the legal field. Consider this – if you agree to go into business with your father, will you both view it as a continuation of your father/son comfort zone relationship, or will you view it as a new scenario? Many do not separate the friendship or family … [Read more...]
Book a free online 30 minute Business Advisory Session
Have you got a business opportunity or challenge that you’d like some impartial, expert feedback on? Improving your sales? Looking for investment? Improving your team’s performance? Getting better results from your marketing? Expanding your team? Considering a sale, merger or acquisition? Or do you want to review your business strategy Then why not book a free 30 minute Business Advisory Session with one of our expert business advisors. These informal sessions are designed to help you gain new insights to support your next steps. This month’s sessions will be available from 2pm to 5pm on Friday 23rd June and will be delivered on Skype. The number of available slots are limited so early booking is recommended. Please note, each session is a maximum of 30 minutes. To book your free advisory session on the 23rd June please email susanne.currid@lgba.co.uk with your name, business name and a short introduction to the business … [Read more...]
6 Important Technological Considerations For A Start-Up
1. Watch the cash! Obviously, for a start-up, this goes well beyond spending money on technology, but it’s important to keep it in mind when choosing software. Where possible, invest in systems that allow you to pay monthly with no tie-in. Even if you feel that your business requires something more bespoke and specific in the medium term, selecting Pay-As-You-Go systems initially can pay dividends. Initial use of a Pay-As-You-Go system will allow you to test your requirements and then purchase a more bespoke solution from a more informed position. Consider things like dedicated or hosted servers, and shared environments, so that you are not spending money on in-house servers and so on. Rarely are these necessary nowadays, and in fact they can limit your flexibility. The online environments are usually available for a monthly fee as well, and this helps cash flow as well as limiting risk. If your requirements change, or if the business fails, you are faced with a relatively small … [Read more...]
What Are The Essential Elements Of A Good Funding Business Plan?
It is generally accepted that a business plan is essential for business owners who are seeking to raise money to help fund their businesses. However, a business plan written by the management team can easily fall into the trap of being inward focussed, i.e. centred around the management benefits of planning. To secure finance, you will need to have a business plan, which is specifically targeted to meet the individual requirements of your finance providers or your investors, and not your management team. How does a Funding Business Plan help? Whether debt or equity, a potential backer wants to see why you need finance, how you plan to use it, and what evidence you can provide to back up any claims. It helps convince lenders and investors, that the business owner has thought the strategy through. It also gives any actual investors a set of financial benchmarks for which the business owner and the management team can be held accountable. What should be … [Read more...]
What Data Should You Measure For Improved Business Performance?
Almost any conversation that you have with a business owner will involve a discussion about the current business progress: “How many orders do you process each week?” “What was the turnover for the last month or quarter?” Most business owners will be able to answer those questions fairly easily, but then you can dig a bit deeper: “How many orders went out for delivery later than they should have done?” “How many orders were short of stock?” “Do you know which orders or customers made you the best margin?” Questions like these can be harder to answer, because many businesses are not set up to record this information. Very often, it’s a matter of waiting for the telephone call or email which asks about the late delivery, or the missing stock. Besides having to field these calls, which is often hard work as customers may well be angry by this point, the business is losing money; either directly through inventory shortages, or indirectly through a failure to retain dissatisfied … [Read more...]
Making Tax Digital
This is the new initiative by HMRC for which the consultation document has come out. Consultation will close 7th November with draft legislation in December and the start of implementation in 2017 with full implementation as from 5 April 2018 with all taxpayers on stream by 1st January 2019. It will apply to all taxpayers both business and SA taxpayers. For businesses it will be a major change to the way they relate and report to HMRC. In this article we will only address Make Tax Digital (MTD) as it is applicable to businesses. The MTD for businesses will apply to all businesses with a turnover greater than £10,000 p.a. Submissions to HMRC must be made quarterly with a 5th adjusting submission 9 months after the financial year-end. Submissions must use commercial software. The free HMRC software has been withdrawn. Micro businesses used to keeping their records on spreadsheets which are submitted to their accountants once a year will now be … [Read more...]
Top Preparation Tips When Raising Finance For Your Company
Now that the economy is on the mend and confidence is rising, management teams are beginning to look at new capital expenditure and therefore ways of raising the required funding. The first thing to understand is not to rush into anything and to make careful preparations before applying for any type of funding at all. Complete a credit check on your own company; find out what the funding providers will see about your company. Make certain that any County Court Judgements, if any, are satisfied before you apply. Check that any debentures that other funders may hold are still applicable and if not have these removed. It is shocking how many funding providers and managing directors, fail to remove expired all asset debentures from the records. Also make certain that you are up to date with filing your latest set of accounts. It really does not matter what type of funding you require, most providers will want the same information from you, have it prepared in … [Read more...]
A view of what’s to come with HMRC’s Digital Tax Accounts for businesses and individuals
HMRC has embarked on a scheme to introduce digital tax accounts for individuals and businesses over the 2015-2016 calendar year with implementation dates in 2017. This scheme is not without its controversy largely around HMRC’s consultation (or lack thereof) and the way it’s been implemented. Digital tax accounts are not unique as a number of other jurisdictions have already introduced them. The digital tax accounts are broad in their implication as they include pre-populating self-assessment returns, quarterly tax reporting by businesses and individuals, tax on-line as well as an anti-money laundering service. Pre-populating the SA return with information known to HMRC will by itself be useful if, and it’s a big if, one can trust HMRC to enter the correct information. If HMRC’s past performance is any guide this may become a problematic area as changing what are known as incorrect figures has yet to be configured. Furthermore, unlike some other … [Read more...]
What you need to know about the new Person of Significant Control Register
With the tax crack down governments in the G20/EU have agreed to have legislation in place for transparency in ownership of companies and LLP trusts. The UK has this now in place and all companies/LLP's must have a register and declare their Persons of Significant Control (PSC) to Companies House by June 2016 (Companies Act 2006 Part 21A). This is in addition to your normal company secretarial records you are obliged to keep. A PSC is defined as a person who has one of the following attributes; Directly or indirectly holds more than 25% of the shares Directly or indirectly holds more than 25% of the voting rights Directly or indirectly holds the right to appoint or remove a majority of the directors Otherwise has the right to exercise or actually exercises significant influence or control Has the right to exercise or actually exercises a significant influence or control over the activities of a trust or a firm which is not a legal entity but … [Read more...]
Taxing Times for Small Business
This year will be the year in which many new taxes are implemented and a number of new consultations will start. Many of these are reasonably well known as announced well in advance of the implementation dates. However, it is now common that the autumn statements also have new tax initiatives which are due for implementation by April. The last autumn statement was typical in this regard. The following are some, but not all, new measures which affect mainly SME’s. Auto-enrolment: Most SME's are due to come on-stream with the pension auto enrolment in 2016. It’s a cost to the company but comes with social benefits. However, it’s admin intensive in the beginning and requires knowledgeable payroll staff. It includes part time staff under certain circumstances and includes domestic employers. One and two man companies can apply for exemptions to the PR by means of an email. Regretfully many SMEs are not aware or have chosen to ignore it, risking high penalties as a result. Company … [Read more...]
A New Lender who even likes start-ups
At the end of last year I had a meeting with an interesting lender. They do short term loans from just 3 months, but unlike most short term lenders they will also do loans of up to 10 years. They like new starts, adverse credit and sole traders. They will lend from £25,000 to £1m. It is quite quick taking around 2-3 weeks to get a loan. The interest rates start at 1.16% per month, which is lower than the usual adverse credit lender. The only stipulation is that the client must be a home owner with enough free equity in their property. The lender is happy to take 2nd, 3rd and even 4th charges against the property. Getting funding for start-ups is very difficult these days and most have to resort to equity Crowdfunding and therefore sell a % of their companies and usually too cheaply. Now there is an alternative, a lender who will happily lend to start-ups that have free equity in their homes. … [Read more...]
