All hail the hard copy!

I have noticed, gentle reader, a trend in recent months, some might even call it a backlash, against some electronic media. This is not to say that such means of communication are doomed or threatened, but the death of the hard copy is still a long way off.

One example, is the book. Yes, the book. It was said that the birth of the e-book would directly lead to the final irreversible burial of the printed page. This has proved to be one of the great mis-forecasts of the age. People still buy magazines, newspapers, books, maps, guides, etc in large quantities. Why? There is a feeling of trust with the hard copy. Misguided trust maybe, but it is there nevertheless. The convenience of the e-book cannot replace the tactility of a beautifully bound volume which the holder treasures and enjoys the stimulation of the material in his/her hands.

In the business world, a multitude of people utter the timeless phrase “please print print me a hard copy” or similar. We know only too well that in so many instances it is a waste of time, effort and materials, for that precious hard copy will sit gathering dust until it is eventually fed into the all consuming shredder. But there is a comfort in the hard copy, just in case the computer crashes, or I forget which folder it is filed in (and, needless to say, the backups are a bit behind).

Likewise, we do not trust the electronic signature. Where will it be sent? Will it be accepted as authentic by certain organisations? Best to have a hard copy methinks.

In online purchasing, whether supermarket shopping, or clothes and electronics, customers are resorting to the “hard copy” because they want to feel, try, test, handle and compare, unless they know exactly what they want, at what price, and from where.

Now I know what you are thinking – that I am a dinosaur stuck in the past, awaiting extinction. Well, that’s for you to decide. I did write this on my iPad!

The voting dilemma

As the General Election approaches, I find that, in addition to trying to decide for whom I should vote, I am wondering about the priorities which should affect my thinking. Should my priority be how my personal and family life will be affected by the next Government, or should the effects on my business be uppermost in my mind. There could well be a conflict of interest there.

For example, the Labour Party has recently been harangued in the, mainly, Tory press as being “anti-business.” How true is that in the overall scheme of things. If it’s true is it a valid blanket statement? Or does it only refer to those larger businesses which have a direct impact on the UK economy, as opposed to the micro-business, which, frankly, only causes a ripple on the local pond.

However, if I vote Tory, because of the previous paragraph, could I and my family be worse off (not just financially) as a result? And will I be promoting the continuation of the nuclear deterrent? Do we need one? Should we be beefing up our defences?

Which future Prime Minister will make the best international statesman (or woman)? Or is the UK heading to be an irrelevance on the international stage? Should we continue to be the US’s poodle or align ourselves more closely with the iron Chancellor of Europe?

These are real issues for the serious voter, and, at the moment, I simply can’t make up my mind.

Receipts for cash-in-hand jobs

Ed Balls has been lambasted by Tory MP Peter Bone for not understanding business, by suggesting that receipts should be insisted on for cash-in-hand jobs. Actually. Balls is right and Bone is wrong.

It’s not so much the very small jobs that are the problem, but the principle of it, leading to bigger jobs. Let’s look at a couple of examples.

The window cleaner would be making a rod for his own back if he insisted on being paid by cheque, so he collects cash (in hand) – end of story. He is supposed to declare any earnings for tax purposes, and over the months, from all his customers, he collects a fair amount of money. But in the wider world it is still insignificant.

A ‘tradesman’ quotes £5,000 plus VAT for a job, making a total of £6,000. He then says to the customer, “If you pay in cash, I needn’t charge you the VAT.” (thus saving £1,000). So what is going on? Firstly, he is defrauding Customs and Excise. You can’t pick and choose. You are either VAT registered or you’re not. Secondly, will he declare any or part only of the £5,000 to HMRC? Doubtful, so a second fraud is committed. But here’s the rub. The customer is complicit in the fraud, and when the rogue tradesman’s back is to the wall, he won’t hesitate in saying that the customer suggested it!

The small insignificant frauds can soon escalate into larger ones. Suppose the cash deal was applied to, say, a building job of £60,000. The VAT on top is £12,000 – now we’re talking.

So, by issuing receipts for all jobs, the tradesman is above board, and the customer is also in the clear.

Starting a business? Are you mad? The business idea

This is the second part of my series. In the first part I queried why anyone in their right mind would want to risk everything on something that just might not work. So you have now decided that you will give it a go.

So let’s look to see what is this idea that is going to change the course of the world as we know it?

You must remember that there is virtually nothing that someone else hasn’t already thought about. But nevertheless, let’s explore a bit further.

The vast majority of businesses fall into one of three distinct categories – manufacturing, service or retail. Which does your idea belong to?

Now, be honest. Is your idea new? Or are you copying someone else, perhaps not literally, but adapting their existing business?

If it is new, how do you know that someone, somewhere hasn’t tried it already and it’s failed? If you are ‘copying’ then can you be sure you will not trespass into someone else’s exclusive business and soon be challenged, even in the courts, with the possibility of having to stop.

Your idea may, indeed, be worthy, but you need to research and explore to see that everything is ship shape before going further. This will be the subject of my next blog, so don’t go away now.

Starting a business? Are you mad?

There is much encouragement to start your own business. The Government did so with a recent slogan under their Start Up Britain banner, implying that “there’s a business in all of us.” (The website by the way is now way out of date). Clearly, this implication is dangerously misleading, as is now being shown by the number of gullible individuals who were seduced by the prospect of untold riches through simply selling a product at the local market.

So let me ask you this simple question. Why do you want to start your own business? Let me list a few reasons which I have heard over the past few months, if not years.

I can’t get a job.
A friend told me how easy it is.
I can get a grant to help me.
I want to get rich.
I want to be a millionaire.
I don’t want to work when I don’t feel like it.
I don’t want to line other people’s pockets.
Etcetera, etcetera, etcetera.

If one or more of the above statements fit you, then, take it from me, you will be heading for disaster, losing your reputation, your livelihood, possibly your house, and certainly your self esteem.

In this series of blogs I am going to cover, in very simple, easy to understand language, various elements of starting your own business. It’s not rocket science (unless you intend launching your own space probe) yet it is vital that you take them on board and deal with them. So look out for the upcoming series, which will include:

Researching the idea
Personal survival
Start up costs
Raising finance
Premises
Costs
Pricing
Getting paid
Cash flow – looking after the pennies
Profit and loss

Looking for finance

If you are looking for funding for your business then, in order to increases your chances of successfully gaining that funding, there are a number of actions you need to take – before you start to apply.
As a start-up you won’t have any previous accounts to draw upon, so it’s important that you prepare fully before applying; you need to convince them that you will be able to repay any loans, or offer a genuine return on investment or, if you are going for a grant, that you will fulfil the conditions of the funding.
So here are some tips to get you started:
1) Finance providers need to understand why you need the money, how it is going to be spent, what contribution you and the company are making and most importantly how they will be paid back and over what period.
The key issues you need to address are:
• What do you need the money for? how will it benefit the company?
• Can you afford the interest payments each month?
• Can you afford the capital repayments?
• What security is available?
• What other sources of finance are available?
2) Decide what is the most appropriate form of finance for your business so you don’t waste time chasing inappropriate avenues. Consider the following:
• If it is to buy a piece of equipment that is going to be used in the business then consider a medium term loan or hire purchase (a hire purchase agreement involves making monthly payments in order to lease an item of equipment and the equipment will only be “owned” once the full amount of the contract is paid)
• If it is to fund a growing business, to buy stock, etc. then an overdraft or even invoice discounting (generally aimed at larger businesses and allows the business to use its unpaid sales invoices as collateral, i.e the business will be able receive funds for its sales invoices before they have been paid) or factoring (the business sells its “future sales” invoices to a third party at a discount and the third party/factor collects the full amount from the customer paying over a proportion of the invoice to the business minus costs and commission) might be the most suitable
• If it is to develop a building project then project finance that can be drawn down at key stages of the project should be considered
3) You will need to write a business plan when applying for funding, and it should include the following:
• What does the company do
• Who owns the company and what are their expectations
• Who runs the company and what is their experience and loyalty
• Who are the company’s main competitors – why are you better/how will you become better/get a larger share of the market
• What are the historical financial results of the company (if any)
• What are the projected financial results of the company
• How are you going to get there (to the projected results)
• What could go wrong and what would be the effect if it did and how are you planning to minimise this risk?
You must do this yourself – it is a hard soul searching exercise but by the end of it you will know your business in more detail and, in particular, you’ll understand its strengths, its weaknesses and their trigger points. This will help you when applying for funding and prepare you for the tough questions that funders so often ask

Today at work

I have a few moments to spare, gentle reader, so I thought I would simply let you know that I am gazing out of the filtered window in the air-conditi0ned office, green trees before me, in adddition to a number of office blocks and small factory units. So what, you may ask, with some justification? Well, I find that when the sun shines, I feel better. I don’t suffer from SAD, but I must admit that on grey soulless days, my motivation does suffer somewhat. There is something about a dull, overcast sky that makes me think “Why bother?” – although I soon snap out of it.

When it is warm and sunny, though, I have a feeling of well-being, that all is well, and I am spurred on to action. Am I unusual in this? To some degree, maybe.

Over the years, I have been involved with people who wish to start their own businesses, or, indeed, are running such a venture, but require some assistance either to move forward or to provide some troubleshooting expertise to help eliminate a barrier to progress. However, there are those who will find any and every excuse to avoid action. When running a training course, and the inevitable ‘no-shows’ are manifested from the delegate lists, I often use the all-embracing excuse – “It’s too hot, or too cold, or too dry, or too wet to start a business.” In fact, just the other day, one of my compadres received a call from someone who had an appointment to say they were postponing it. Why? Yes, you’ve guessed correctly. “It’s raining!” they said. Unbelievable. Those people just do not deserve to succeed if that is their attitude. Thankfully, the vast majority of people I have the privelage of working with, do apply themselves to the tasks in hand, and are dedicated to becoming established and making their mark on the business world.

Now, shall I have another cup of coffee, or just stare out of the window?

Heart attacks

What genius came up with a “scientific” study to suggest that working for a bullying boss increases the risk of a heart attack by 23%?

Anyone who has worked in such an environment already knows only too well of the heightened blood pressure, the stress, the palpitations that result from working for a trumped up, inadequate human being, who grandly tries to make up for his or her shortcomings by being a bully and trying to scare people.

What these people don’t realise is that, as well as ruining their workers’ lives, they are actually building for themselves a reputation that will eventually catch up with them. Over the years I have, thankfully, had bosses that, whilst varying greatly in their abilities, have not been bullies. Pressurised? Of course. Unnecessarily? At times, certainly. The remedy? Play them at their own game. Call their bluff, when you know you are on rock solid ground with your argument. Afraid of losing your job? Isn’t that better than losing your life? Think about it.

Stimulating the economy

There is a brilliant letter in today’s Daily Mail, by Duncan Barnes, from Croydon, who has been an independent retailer for 35 years. I would like to endorse all that he says, which, briefly is:

David Cameron is claiming that the Coalition is ‘delivering’ yet the GDP forecast has been downgraded to ZERO!

The only way to get the economy going is to stimulate consumer confidence to get spending moving. (You don’t achieve it by creating jobs. That comes later. [my words]) Every purchase by everyone increases demand right down the supply chain. Infrastructure projects are too long term. Any funding via the banks is doomed – it just won’t happen, except in a few cases, again mainly long term projects. Quantatitive easing has not worked. So Mr Barnes offers a common sense solution, viz:

Give the money direct to people to spend. Imagine the effect of giving £1,000 to every taxpayer per month for three months. The only stipulation is that it must be spent. It cannot be saved or used to pay off existing debts. Such a scheme could easily be implemented by way of vouchers that retailers could offset against VAT or redeem them with the Treasury. The cost of such a scheme could easily be offset by cutting the overseas aid budget to those places who clearly don’t need it and bloated welfare handouts.

Mr Barnes ends by saying that David Cameron should bring into Government a handful of ordinary people who run businesses and have to make end meet on a daily basis. Quote: After all, unlike politicians, we are in touch with reality.

Common sense? Of course, but so basic and sensible that it will never be adopted, unfortunately. More power to your elbow, Mr Barnes

Twenty five years

2012 sees twenty five years of involvement with the Enterprise movement. Based on an average of, say, three clients a day, four days a week, forty five weeks a year, it means I have worked alongside 13,500 clients over the whole period. I am glad to say that the majority of those have been meaty, successful businesses, providing their owners with a good standard of living, despite the inevitable ups and downs of business life. Many have retired and sold their businesses for a substantial sum, others are still trading themselves.

Of course, there have been many non-starters, where they person has been totally unsuited to the life of an entrepreneur, making a good living by remaining an employee. There have been the inevitable inventors whose ideas have been wholly unsuitable for the market, two springing to mind being plastic headstones and four poster beds for cats. Others have been the proverbial pain in the you-know-where. But overall, the past twenty five years have been, without question, the most satisfying of my working life. The thrill and satisfaction of helping people start up and grow their businesses is something which cannot fully be described in words alone. There have been the relatively small handful, where the business has grown to become market leaders and household names. There have been those who would never have got their ideas off the ground, but, thanks to organisations like the Princes Trust, they have been given a kick start and now are millionaires in their own right.

Recently, the Government promoted the start of businesses under the strap line “There’s a business in everyone.” This, of course, is utter garbage. There isn’t a business in everyone. The majority of people are not entrepreneurial in their outlook. They need leading. They need an employer – someone who, bluntly, tells them what to do each day, sorts out their tax and NI issues, and welfare, and pays them for going on holiday or sick leave. The life of the average entrepreneur is precarious at best, health threatening at worst.

However, there are still many who aspire to start their own businesses, and still requires my services to enable them to achieve their dream. It still provides the same kick for me as it did in 1987.