Business Matters - April 2008 edition

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Business Matters: April 2008

Business Matters April 2008

The UK’s leading magazine for the SME business owner

THE AMERICAN TAKEOVER Doing business in the big apple

£3.00

IT’S ALL IN PACKAGING PREPARING YOUR

TAKING TO THE SKIES Taking over America / James Caan / Preparing your business for sale

We talk to Silverjet chief Lawrence Hunt

BUSINESS FOR SALE

www.bmmagazine.co.uk

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Business Matters April 2008

The UK’s leading magazine for the SME business owner

THE AMERICAN TAKEOVER Doing business in the big apple

£3.00

IT’S ALL IN PACKAGING PREPARING YOUR

TAKING TO THE SKIES

This Month News

4 The secret of success

14 Getting ugly in the US

BUSINESS FOR SALE

We talk to Silverjet chief Lawrence Hunt

23 Your personal brand

32 Some are born leaders

41

• • • • regular features

W

ith Lady Liberty adorning the cover of this month’s issue, there is no escaping the fact that there is a distinct American theme running through this issue.

With the delicate financial position that many of us find our businesses in within the UK, we are looking for other markets and opportunities so with the current weak dollar there is no better time to look to take a slice of the American dream in the Big Apple and then we move on to see who in the race for The White House from Hillary Clinton and Barrack Obama displays natural leadership ability.

Also in this edition Jo Russell spent sometime with James Caan about how he has become one of the Dragons, who’s investment choices are scrutinised by us all.

We also look at why running your business feels like surviving an assault course and why Michael Hayman thinks that to really succeed in business, the business owner needs to add their own personal brand to the marketing mix and also how to make sure that your business doesn’t crack as the credit crunch starts to squeeze.

So have you logged on to our new website yet? Updated weekly it provides you with the latest news, views and advice on how to run your businesses better, plus subscribers have the ability to join our new social network, with our partners Business Scene, to share problems, and market yourselves to your fellow readers.

Simon Clarke - Editor sclarke@clearsightmedia.co.uk

CLEARSIGHT PUBLISHING & MEDIA

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IN Business

What has been happening in business in the last month.

19

Opinion

Jim Moore’s Inside Track: this month Jim looks at exactly what Alistair Darling has done for you.

20

Interview

Jo Russell talks to James Caan about how life has changed since going into the Den.

• • • • business strategy 23

The American takeover

We look at businesses who have jumped the pond to launch in the US.

38

Sales mistakes

We highlight the top mistakes made by sales staff.

41

The born leader

We look at the race for The White House and see who from the race has natural leadership ability.

Publisher & Managing Editor- Richard Alvin Editor - Simon Clarke - editorial.bm@clearsightmedia.co.uk Production and Design - James Conolly & Andrew Lawrence Head of Advertising - Wesley Tatton - wtatton@clearsightmedia.co.uk Contributors: Jim Moore, Felicity Cousins, Gavin Porritt, Donald Findley, Jo Russell, Mark Prigg Louise Shaw, Derek Bedlow, Andrew Price, Sarah Bethell Published by - Clearsight Publishing Ltd, Ensign House, Canary Wharf, London E14 9XQ Tel: 020 7148 3861 Email: info@bmmagazine.uk Web: www.bmmagazine.co.uk Subscriptions – subscriptions@bmmagazine.co.uk Business Matters is printed on recycled paper and the polybag wrapping is bio-degradeable Printed by – Wyndeham Heron ISSN 1754-3096 All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means without the prior consent of the publishers. The views expressed in Business Matters are not necessarily the views of the publishers. Whilst Clearsight Publishing Ltd has made every effort to ensure the accuracy of the information contained in this publication, neither they nor any contributing author can accept any legal responsibility for any consequences that may arise from errors or omissions contained in this publication or from acting on any opinions or advice given. In particular, this publication is general and not a substitute for professional advice and you should consult your own professional advisors where appropriate.

Business Matters issue 159 • April 2008 3

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News Stress is taking its toll With reports revealing that the amount of money lost through sick days is approaching the total budget of for the NHS! It is interesting to find out which illnesses are causing the most time off work and costing industry so much money!

After Musculoskeletal disorders (bad backs), Stress is the second most commonly reported cause of time off work according to the Health and Safety Executive.

This represents an estimated average of 30.2 working days lost per year per affected case and makes stress, depression or anxiety one of the largest contributors to the overall estimated annual days lost from work related illnesses.

The recently conducted PWC surveys estimated that in 2007 13.6% of British Workers believed their jobs were extremely or very stressful.

But what can employers do about this? Employers now have a duty of care for each and every employee and companies are becoming all too aware of the risks associated with stress in the workplace. It is all to obvious tha stress affects productivity and moral and can, potentially cost the employer a substantial amount of money.

One solution that companies are turning to is The Stress Away programme which as been developed by Stress and Anxiety Expert Charles Linden. Drawing on a decade of knowledge and the experience of helping over 95,000 individuals tackle stress and anxiety issues, The Stress Away programme is a cost effective and proven solution with a 'back to work' policy that ensures minimum impact of absenteeism and loss of productivity.

Shadow chancellor nominated for top business award Shadow Chancellor George Osborne, the Conservative MP for Tatton, has been nominated for the Forum of Private Business’s (FPB’s) 2008 business-friendly MP/MEP award, which is being sponsored by England’s Regional Development Agencies.

In addition to his responsibilities in the shadow cabinet, Mr Osborne is heir to Osborne and Little, his family’s successful wallpaper and fabrics business. He has stated publicly that growing up with first-hand experience of the firm’s fortunes has allowed him to empathise with the difficulties of running a business.

"I am flattered and delighted to have been nominated for this award. Small businesses are the lifeblood of Britain’s economy," said Mr Osborne. "I believe that Government should be helping those running small businesses, not making their lives harder, as this Chancellor has done. A new direction is needed – one that helps small companies grow, instead of strangling them at birth."

Over the past year, Mr Osborne has campaigned against the Government’s planned Capital Gains Tax increase, commissioned a report from the European School of Management into the state of small businesses in the UK and launched a deregulation taskforce with celebrity businessman Doug Richards, of the BBC’s Dragons’ Den fame. He has also set out plans for tax reforms, and formed the New Enterprise Council, an advisory body featuring many of the UK’s top entrepreneurs.

Tracy Hoather, whose courier firm Sameday plc is based in Knutsford, at the heart of Mr Osborne’s constituency, said that despite his commitments he worked hard for local businesses.

"People often worry about having a senior politician as their MP because of the amount of time they may spend outside their constituency, but Mr Osborne is always prepared to get stuck in on local issues," she said. "Specifically, he sends out business questionnaires to poll local firms about the challenges they face. He then Founders: Thomas & Penny Power produces a report which you get back, along with a thank you."

The accolade, sponsored by England’s Regional Development Agencies (RDAs), recognises the work of the MPs and MEPs who have excelled in understanding and representing the needs of smaller businesses over the past year.

"Owners and managers of smaller businesses play an important part in the economy, creating wealth and job opportunities," said Len Collinson, National Chairman of the FPB. "That is why we have chosen to encourage politicians to engage with them and to represent them by creating the Business-friendly MP/MEP Award.

The award ceremony will take place in the House of Commons on the 14 May. Ownermanagers of smaller businesses who wish to nominate an MP or MEP should call 0845 130 1722 to request a voting form, or visit the FPB's website at www.fpb.org/award. The closing date for nominations is Friday, 25 April.

Flying high north of the border Scottish Business is flying high thanks to the Scottish Institute of Enterprise Competition.

An Aryshire couple has won the runners up prize in the Scottish Institute of Enterprise Business Plan Competition, scooping a whopping £9,000 start up grant for their courier company.

An Aryshire couple has just scooped the runners up prize in the prestigious Scottish Institute of Enterprise Business Plan Competition, winning a marvelous £9,000 prize of start up capital and professional services.

Sandra and Alistair Patterson’s business

4 For further information on how to advertise Tel: 0870 116 2854

plan was for new business, Boxby, which is a complete delivery solution website, organizing deliveries for everything from Parcels to Sofas, around the UK, and beyond.

The business plan competition was an intense process lasting several months ending in a presentation to a panel of judges.

The Judges thought that the couple excellently described a business with proven and growing potential. Boxby was the winner in the undergraduate stream and coming second overall in what was a very tight competition.

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News Fleet managers: don’t delay Fleets should not use the delay on fuel duty included in the Budget as an excuse to postpone action on petrol and diesel costs.

The April 1 fuel duty rise previously announced by Chancellor Alistair Darling has been put back to October 1 in recognition of recent spiralling fuel costs - since the last 2007 Budget, petrol has risen in cost by around 17 pence per litre and diesel by 20 pence.

However, the fleet software market leader says that upward pressure on oil prices will see pump prices continue to rise during 2008, and that a structured approach to fuel management should be adopted by fleets who have not done so as soon as possible.

Alison Southcombe, marketing leader, said: "The delay in the two pence per litre duty rise gives fleets a little breathing space but the fact is

that price rises seen in the last year dwarf the duty that has been delayed.

"While there is no evidence to suggest that we will see a further 20 pence per litre price rise repeated in 2008, two pence might not make that much difference. Instead, a structured fuel plan is needed." cfc has a standard five point plan to fuel management that it uses to introduce its fleet customers to the basics of fuel management.

Southcombe added: "There is a perception among many fleets that you just have to grin and bear rising fuel costs but, in fact, there is much that can be done to manage down the amount of fuel your vehicles use and the pump prices that you pay."

Volunteering makes a big impact Volunteering England (VE) has launching a comprehensive series of resources to help the voluntary and community sector and small businesses maximise their impact in their communities.

Businesses now have access to a wealth of online resources at www.do-it.org.uk, including enhanced editorial content of the employee volunteering section, a new search mechanism on the site to enable SME’s to find partner organisations that offer Employer-Supported Volunteering (ESV) services, and links to Volunteering England’s ESV tools.

The resources, funded by the Volunteering Hub, are inspired by research from Ashridge Business School which identified a number of challenges for the volunteering sector in engaging with SME’s. It found that an overwhelming majority of SME owners wanted to give something back to the community but lacked time and found it difficult to sift through the quantity of information available. One priority issue was the lack of easily digestible online information, a need met by the new resources on do-it.org.uk.

Cathy McBain, head of Employer-Supported Volunteering at VE, said: “It’s a myth that small

businesses aren’t interested in volunteering they just face very different challenges from larger companies and this new set of resources meets many of their requirements. doit.org.uk’s new web content will help small businesses find suitable volunteering opportunities–- and once they have decided to engage with the volunteering sector, their experience will be enhanced thanks to the new EVM training!”

Fiona Dawe, Chief Executive of online youth charity, YouthNet, which runs do-it.org.uk, said: “do-it.org.uk has been making volunteering easy for individuals for over seven years, but until now there’s been nothing similar for businesses.

EVM training provider Victoria Dickinson said: “I have been an advocate for ESV for several years and I feel that the new EVM unit will offer the resources to help the voluntary sector understand how to work with the private sector in a more mutually rewarding way. Improving the skills and understanding of organisations working with ESV will help widen the diverse range of volunteer opportunities and build better understanding of each others needs.”

Have a motivated workforce A pleasant working environment is key to getting the most out of employees, According to a survey of over 100 London office staff by Metro Desig Consultants.

Only 21% described their current workspace as modern and functional, while 47% claimed their offices were in need of a revamp.

Almost half said that an office makeover would increase their productivity and more than half thought a better working environment would make them more organised (64%) and enable greater job satisfaction.

Forty-three percent are embarrassed by the current state of their offices when clients and suppliers visit, and the most important factors contributing to a pleasant working environment were (as ranked in the top three): Friendly co-workers (70%) Good lighting (40%) Comfortable desk chair (38%) Flexible working options (38%) According to employees, the effects of the working environment permeate into other business areas, impacting the ability to win new clients (40%), client / customer relations (36%), staff morale (57%) and staff retention (43%).

Unsurprisingly, when it comes to attracting new staff, the office environment is key as a significant 57% of employees questioned said that it would affect their decision to accept a job offer.

Daniel Taylor, Managing Director of Metro Design Consultants comments: The office environment says a lot about a business and can give clues as to how professional it is, and the general attitude of staff and management. A thoughtfully-designed space, with attention to the ergonomic details, will no doubt rub off on employees, helping to make them more proficient and more valuable to the business.

Business Matters issue 159 • April 2008

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News Business brains

London offers opportunities for Korean businesses

More than 10 million Brits dream of leaving their job and starting their own business, according to new research.

Over a third of workers have recently thought about setting up on their own, with one in five of those planning to make the leap into self employment in the next year.

The average worker even spends three days of each year day-dreaming about their future business from their desk.

But while 15 per cent dream of becoming their own boss because they aren't happy in their current job, 37 per cent admits the main reason is simply to earn more money than they do at the moment.

More than 40 per cent are thinking of starting up their own business because they crave more freedom in the way they work and a quarter want to turn a hobby into a paying business.

Rosemary French, of Business Link, which carried out the poll, said: ''It's encouraging to see how many people dream of setting up their own business to enjoy the flexibility and benefits of working for themselves."

"The research also showed that nearly as many women as men are keen to become their own boss."

But the poll of 2,000 Brits revealed that a third of people dreaming of setting up their own business might not get round to doing it because they are unsure how to go about it.

Money is another concern with 30 per cent of aspiring bosses saying they are worried about getting into debt or adding to existing money problems.

Almost half would worry about getting the money together to fund the business in the first place.

Surprisingly, 45 per cent of people said they would fund a new company with a bank loan, overdraft or even a credit card.

But 41 per cent of people admitted the current economic climate may make them less likely to start up their own business in the near future.

Think London has begun offering a new free & confidential service for Korean businesses looking to globalise.

Think London, the foreign direct investment agency for London, is showcasing opportunities for Korean businesses looking to expand and grow in London as the UK capital prepares to host the Olympic and Paralympic Games in 2012. London’s economy is forecast to grow by $80 billion by 2012 and will offer huge opportunities for Korean companies looking to invest in the capital.

Michael Charlton, Chief Executive, Think London is visiting Korea in early April to meet with Korean businesses and to co-host a session with KOTRA (the Korean Trade Investment Promotion Agency) to advise companies on how they can benefit from investing in London.

Speaking ahead of the visit, Michael Charlton, Chief Executive, Think London commented, “We believe that many Korean businesses are well placed to benefit from the investment opportunities presented by London’s predicted economic growth of $80 billion by 2012 as well as those relating to the 2012 Games. We are ready to support Korean companies looking to take advantage of these opportunities and globalise their business by using London as a springboard into Europe.

“London is the perfect springboard for businesses looking to go global, with fast access to a range of customers, markets, ideas and finance –all aimed at helping businesses operate on a global scale.”

Help: Samsung one of the companies involved

Outward foreign direct investment from South Korea increased from $4.3 billion to $7.1billion in 2006, with London attracting 25 percent of all Korean projects into Europe.

Think London provides free, confidential and comprehensive advice to help international businesses set up and grow in London. The FDI agency for London is able to assist companies who are interested in applying for any one of the 2,000 main contracts and the further estimated 50,000 supply chain contracts available in relation to 2012. Think London has a well established track record of helping businesses establish themselves in the capital and has helped more than 1,000 companies from 43 countries since 1994. Over the past seven years, Think London has assisted 30 Korean companies to set up or expand in the capital including Samsung Design Europe, Hyundai Logistics, Hanjin and Industrial Bank of Korea.

Plug into cheap electricity Business-only price comparison service Makeitcheaper.com - has bucked the trend for expensive electricity and is offering rates as low as seven pence per unit.

The rates, which can be fixed for a year, are exclusive to Makeitcheaper.com and are available to any of the 1.8 million electricity meters in the UK that are classed as neither residential nor industrial ‘half-hourly’ (where the peak load exceeds 100 kW and the meter is read for consumption every 30 minutes).

90% of these meters are kept with the same supplier from one year to the next and consequently pay ‘default’ rates of around 10p/kWh. Worse still are those businesses which are in no contract at all, perhaps as a

6 For further information on how to advertise Tel: 0870 116 2854

result of recently taking over the premises, and paying rates of up to 15p/KWh. For the smallest business, typically using 25,000 kWh a year, the difference in annual expenditure between ‘switching’ rates (7p/kWh) and ‘outof-contract’ rates (15p/kWh) is £2,000.

Jonathan Elliott, managing director of Makeitcheaper.com, commented: “Businesses in the UK are collectively paying two billion pounds a year more than necessary for electricity because of poor contract choices. If you are being charged more than seven pence per unit then it’s time to find out when your next renewal date is and explore the options to find a cheaper provider.

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IN B U S I N E S S Key £232,000 investment secured

A Gloucestershire company has secured £232,000 from a ‘Dragon’s Den’ style investment deal, enabling it to double in size and expand its services.

It scooped the deal after a pitch event in November organised by the South West Angel and Investor Network (SWAIN) – the south west’s real life version of the TV show Dragon’s Den, which connects private investors, known as ‘business angels’, with companies looking for investment.

Innovative HIP Limited was one of six fledging companies pitching to secure financial backing from the panel of 26 investors.

As a product and services provider to estate agents Innovative HIP’s core business provides Home Information Packs (HIPs) and Profes-

sional Indemnity (PI) cover to the professional property industry. Innovative HIP has an exclusive arrangement with the world’s largest insurance broker to market the PI product to estate agents in the UK. This cash injection will enable Innovative HIP to expand its services following new legislation that kicks in this month, which demands that all new-build properties will have to be sold with a HIP. Innovative HIP will also be well placed to meet the demands of further legislation that states that commercial buildings will be required to have an Energy Performance Certificate (EPC). EPCs are being rolled out over the year to include rental properties – both commercial and domestic. In addition, Display

Energy Certificates will be required for Public Buildings over 1,000 sq m from October.

As part of the agreement Innovative HIP is changing its name to Green CO2 PLC. David Collett is the majority shareholder and is preparing for an AIM listing in May. The company has doubled in size since the presentation in November 2007 and is in the process of acquiring regional HIP companies to create a national presence.

Philip Tellwright, managing director of SWAIN, said: “Innovative HIP’s success in winning this deal is down to the fact that the company operates in an exciting and growing market sector and has already secured a number of high profile clients and established excellent distribution channels.

“The high profit margins on offer were also very attractive combined with a comprehensive business plan which gives investors the confidence they need to make a positive decision.

“Combined with a highly experienced management team with a proven track record, this made Innovative HIP a highly attractive investment opportunity.

SWAIN is an independent not-for-profit company supported by the South West of England Regional Development Agency. It focuses on deals ranging from £25,000 to £750,000 which are too small to be considered by the majority of venture capital institutions. It operates throughout Wiltshire, Gloucestershire, West of England, Somerset, Dorset, Devon and Cornwall.

Supporting the ‘business oscars’ Tenon, the accountancy and business advisery firm is sponsoring The Tenon Award for Entrepreneurial Spirit in the 2008 National Business Awards for the second year running.

Tenon, who has just announced its sponsorship of the Entrepreneur of the Year Award in The National Business Awards for Scotland, has more than 1900 staff in 44 offices and is a leading adviser to entrepreneurs nationwide.

The National Business Awards, which open for entry next month, is recognised as the premier platform for recognising and rewarding success, innovation and best practise in business and have been dubbed ‘The Business Oscars’

by Prime Minister Gordon Brown. The pro-

gramme culminates in a glittering awards ceremony at London’s Grosvenor House Hotel on 13 November.

Andy Raynor, Chief Executive of Tenon, commented, “I was very impressed with the entrepreneurial drive and determination shown by all the finalists last year and, in particular, our winner Summit Media. I am very much looking forward to identifying this year’s finalists and rewarding dynamic companies with creative, entrepreneurial flair.”

The 2007 Tenon Award for Entrepreneurial Spirit was won by Summit Media, one of the UK’s leading internet marketing and e-commerce specialists.

Hedley Aylott, its Managing Director, said,

8 For further information on how to advertise Tel: 0870 116 2854

“When we entered this award, then in its first year, we thought the criteria fitted Summit Media to a tee. They were looking for dynamic companies with creative, entrepreneurial drive, skilled at adapting to market changes quickly and succinctly and a record of identifying and exploiting market opportunities.”

Mike Faulkner, Director of the Awards said, “The sponsors do so much more than provide the funding essential to this independent programme’s existence. Tenon has committed to providing encouragement and support to finalists that includes many hours spent judging and analysing the entry forms. We are absolutely delighted that they have extended their valued sponsorship to 2008.”

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IN B U S I N E S S Team building with a difference

IF you’re tired of your staff singing the blues help is at hand with a unique team building experience to improve working attitudes.

Orchard Studios, based in the stunning Cheshire countryside, is opening its doors to businesses across the country and offering a fantastic day of team building with a difference.

As well as being an innovative, inspiring and highly motivational experience, a day at Or-

chard Studios will cost you only a fraction of the cost of most corporate events – and best of all, it’s great fun and it works.

Orchard Studios has already achieved fantastic results for companies up and down the country including Barclays PLC, Thorntons PLC, AstraZenica, DHL and is happy to tailor days to suit every organisation.

Your workforce doesn’t need to be made up of potential Pop Idols in the making; all they

need is a good attitude, creativity and a sense of humour. There are plenty of roles that don’t involve singing.

Orchard Studios, which has worked with BBC TV and radio, Classic FM, Channel 4 and local radio stations, as well as a host of professional artists, boasts some of the region’s biggest and best studios, with a whole host of state-of-the-art techniques, effects and talented professionals on hand to help your team make their own musical masterpieces.

The aim of the day is for staff members to write, compose, record and produce a professional CD in a single day. This highly challenging but infinitely entertaining task can only be achieved if teams work together, with every role as vital as the next.

Kate Newbould, business development manager at Orchard Studios, said: “What we offer is more than just another day out for businesses. We help staff work together to create something they can really appreciate.

“Working in the studio is fantastic fun. It really doesn’t matter if you can sing or not, it’s all about getting involved creating something beyond your expectations. It’s a great way to boost morale in the workforce, with a serious teambuilding element as well.”

For more information about corporate days at Orchard Studios, or to book your session, visit www.orchardstudios.co.uk or contact 01270 877208.

Workshops’ boost for ambitous women A series of power workshops designed for ambitious businesswomen is getting under way.

Sue Cotter, the Essex Head of women’s business group, The Athena Network, has designed the workshops to help businesswomen up the ladder of success.

She said: “We aim to tap into women’s passion for their companies. Women are brilliant at what they do in their businesses but they are less successful at telling people how good they really are.

“These workshops are ideal to help women take their businesses to the next level.”

The workshop series launches on April 10 at Little Waltham Golf Club, near Chelmsford where the subject is “Image in Business: It’s Personal”.

Other events in the series include May 15 “Your Business, Your Vision”, June 19 – “How to Market Your Business with Ease” and July 10 – “Effective Sales for Women” Ms Cotter adds: “We have pitched the cost at a very affordable level. There are free seminars around for business people but ours will give hands-on support and the result will be that the women who take part will be able to promote themselves more effectively and generate more income.”

Four successful businesswomen will be leading the workshops and will focus in detail on ways of rebuilding motivation and confidence; turning a woman’s different approach to selling into an asset; and how to make your business more appealing to potential customers.

The cost of the workshops is £75 with an opportunity to network with other successful business over the lunch.

For further details phone Sue on 0845 644 3099 or email: sue@theathenanetwork.com

Business Matters issue 159 • April 2008 9

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IN B U S I N E S S The future of networking Increasingly, businesses have been looking to ‘word of mouth’ marketing to find clients with the growth of networking groups providing opportunities for companies to spread the word and get referrals.

Times move on and with the growth of online social networking opening people’s eyes to the power of the internet, companies are looking to see how the increasing number of ‘social’ business networks can be used for marketing and sales purposes.

Indeed, it’s clear from the amount of websites providing facilities for social and business interaction, that networking online is a valid and effective way to build your business.

However, whilst ‘poking’ a friend may be part of a relationship building process, social networking for business has its shortfalls. At the very least, the mere geographical spread of members often makes it difficult to build meaningful relationships for business purposes.

A new business networking website has just been launched that aims to bridge the gap between face-to-face and online networking by offering the exclusivity and geographical proximity that is missing from networking across the worldwide web. Word of Mouse provides the results driven, relationship-building facilities offered by local networking meetings through its unique e-circles – local, online referral networks –

without the commitment of weekly meetings.

Founders Harvey and Andy Lopata have been involved in business networking for nearly 10 years: “We noticed increasingly that the majority of people who attended networking groups were reluctant to commit to weekly meetings,” explains Harvey. “The main reason was not what happened within the network, nor was it the lack of potential for new business; it was simply that people were unable, or unwilling, to commit to attending every week because the reality is that work is not that predictable.”

Seeing the increased popularity of internet networks and the opportunity to offer a more targeted local network online, the two networking experts developed this unique online alternative.

Flexibility “Although people do want the opportunity to develop new referrals, particularly in their local area, they need flexibility - even if it is still within a structured networking environment,” continues Harvey. “Word of Mouse still requires a degree of commitment if members want to maximise referral opportunities, but it offers the freedom of online networking and doesn’t demand hours of their time.”

The model for the site is based around membership of local e-circles. Each business discipline enjoys exclusivity within their e-circle and over time has the chance to build up a trusted group of local business contacts.

Each e-circle is restricted to a maximum of thirty members, to enable

everyone to get to know each other. In fact, because fellow e-circle members are based locally, the opportunity to meet is always an option and actively encouraged. But when there isn’t the time to meet, members can just as easily ask for support and pass referrals to each other without leaving their desk.

“Most online networks are designed to help you build your contact database and raise your profile across a wide area”, comments Andy.

“Referrals will come from a handful of the relationships you build through these networks, but it is a numbers game. With Word of Mouse, the network is kept small, targeted and local which enables members to meet offline if they wish to, thereby reinforcing the relationships that they have built within their group online. After all, people will refer people they know, like and trust, and it is difficult to build such relationships purely online.”

As with any network, ultimately the success of Word of Mouse depends on members using the site proactively. But by giving its members a focal point for a local network, without the ‘bind’ of a regular meeting; it is certainly offering a viable new networking opportunity for people who simply can’t commit to meetings at the same time every week.

The e-circle model provides the convenience of local contacts at the click of a mouse. This is a significant step forward for effective, efficient networking and word of mouth marketing and looks set to change the face of business networking online.

For more information about Word of Mouse and advice on networking, please visit www.wordofmousenetwork.com.

BT increases phone flexibility for business Small businesses can now present a more professional image to customers and partners by intelligently managing their phone, mobile, and fax communications with the launch of BT RingCentral.

The new virtual phone system is the latest in a series of web-based tools from BT Business that are specifically designed for smaller companies. It offers a sophisticated phone system – including advanced call management and PBX features, voicemail and internet fax capabilities – without the cost and hassle of buying and in-house maintance.

For only £15 (excl VAT) per month, companies get a non-geographic 0800 Freefone or an 0844 Contactcall number that can be configured for multiple extensions with voicemail, call screening and forwarding, a click-to-call button to use on web sites and e-mails, call logs for sales leads, fax and message alerts.

BT RingCentral allows callers to be welcomed with a professionally recorded custom greeting, in-queue music or promotional announcement. It also enables users to make, screen and answer calls online, through their PCs using the “Desktop Call Controller”.

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Bill Murphy, managing director of BT Business, said: “The telephone is still an essential business tool, but when combined with a phone system like BT RingCentral, it becomes even more powerful for small businesses. It allows them to present a more professional image by giving them the tools that have traditionally only been open to big business and also gives them more control of how they communicate, with customers and partners.”

For more information about BT RingCentral, customers should visit: http://www.ringcentral.bt.com

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Advice

The secrets of survival

o the decision has been made to go it alone. Casting the master-servant relationship aside after years of promising to do so has finally arrived and the world is now your oyster.

Launching a small business is tough, with the line between success and failure being extremely fine.

However, there are a few simple questions and rules, which, if followed through, may make the difference between deciding to throw in the towel before you get your feet wet or wading into the murky depths of small business ownership.

Involving those around you from an early a stage in the process as possible is important,

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says the Institute of Directors. Support from those close to you will be vital in the early stages of developing a business, as they will be the ones affected by long working hours and stressful situations. Acting as a sounding board, these people could be a useful resource for providing help with routine tasks.

Understanding whether you are the right person to take on the running of a small business is also a vital step in the due diligence process. You wonâ&#x20AC;&#x2122;t have the safety net of working for a large organisation and issues such as financial insecurity, stress and long working hours may not suit you as a person.

Carefully assess the reasons why you want to strike out on your own.

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The business needs to survive from day one, so make sure the product or service being touted is a must-have and not a nice-to-have.

Many people opt to begin a small business by using a skill they have acquired in their spare time as a hobby, but consideration should be given to whether it will be a viable proposition to take to market.

Detailed plan Business Gateway suggests that anyone embarking on a business venture, whether experienced or not, should always develop a detailed business plan, including route to market, projected costs and profits and anticipated customer base.

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Advice

Sometimes running a business will seem like you are running an assault course.

How can you make life easier?

From an early stage in the process of developing an idea for a business, a unique differentiator will make all the difference. Even if an idea has been tried out before by including a different feature or benefit, the product or service may appeal to a different audience.

Daring to be different may just pay dividends in the long term.

Researching the marketplace is a key factor to success. Knowing your competitors and the size of the market will provide an indicator of whether the time and concept is right for such a business to be launched. Sounding out potential customers, suppliers and distributors will elicit a wide range of information.

Ian Girot of Clydesdale Bank’s small

business start-up team says: “People looking to banks for financial support in setting up a business will need to have done their homework in respect of convincing the lender that the idea is a viable one.”

Research research research Rather than taking the plunge and risking everything by striking out in business before all the necessary preparations are taken care of, consideration might be given to using spare time to carry out research into the idea while still employed. In this respect, there is an element of security, but one that might prove too comfortable for those not putting 100 per cent effort into the new venture.

Asking for help is not a weakness but a sign of strength of purpose. Acknowledging that you cannot do everything involved in a startup will ensure that you can focus on the job in hand of developing the business.

Seeking advice from others who already manage their own businesses is invaluable and rather than having to pay for advice, consider offering equity in the new business.

Planning, planning and planning is so important to the success of a business. This is not just to convince your backers that the idea for your venture is sound, but also to ensure that there is a course of action to follow and which can be altered if things go wrong.

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Te c h n o l o g y

CHANGE NEEDS TO BE MORE THAN COSMETIC The products manufactured and packaged by AIM-listed Swallowfield plc can be found on the bathroom shelves of households across the world, but two years ago, the companyâ&#x20AC;&#x2122;s complexion was far from rosy.

CEO Ian Mackinnon explains how he went about putting the colour back into the business.

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Te c h n o l o g y

any of you reading this article could be forgiven for not knowing the name Swallowfield since the products we develop, manufacture and package don’t bear our own name but, rather, those of the household-name and global brands we service.

However, from our base in Somerset, we have now been formulating cosmetics and toiletries for more than half a century and count amongst our achievements the launch of the first consumer aerosol into the UK in 1950 as well as being the first company to eliminate the

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use of CFC gases in aerosols in the 1970’s.

Today, we are an AIM-listed, £45 million turnover company operating internationally and providing full-service solutions for global and household names in the cosmetics, personal care and household goods marketplace.

Ringing the changes This was a different picture only two years ago when Swallowfield issued the third profit warning in a row and the Board of Directors realised that significant change was necessary

in order to re-establish Swallowfield in its historical industry-leading role. Losses in the half year leading up to my appointment as CEO amounted to £700,000.

Things had to change and so the turnaround process began. In my new role as CEO, it was clear to me that, externally, we needed to strengthen our commitment to our customers, both new and existing, and expand the range of services and facilities we were able to offer them. Equally importantly, however, we needed to make changes internally to

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Te c h n o l o g y put our own house in better order and make the business more efficient and, ultimately, more profitable.

Customer intimacy One of the first areas we tackled was to refocus our relationship with customers. Swallowfield had started life in 1876 as an independent pharmacy in Wellington High Street, Somerset, and, although the business had grown beyond all recognition since those days, there was something in that day-to-day contact and commitment to customer service which we felt we needed to replicate in the 21st century marketplace.

As the business has evolved from a pure manufacturer into a service and solutions provider, it has also becoming increasingly important to remain close to customers’ changing needs and constantly review our commitment to quality, cost, service and innovation. Our strategy has focused on strengthening and building upon the services we already offer as well as broadening our portfolio of products.

This effort has been renewed over the past year with a major PR and marketing drive to communicate the message to customers that we are committed to providing them with a range of bespoke product options to meet their individual needs rather than an off-the-shelf package of initiatives which are not really tailored to address their specific issues.

erty – including formulations and quality systems – in return for exclusive access to the European markets, thereby creating new sales opportunities in Europe and giving customers even greater assurance on the quality of products Swallowfield is sourcing from China.

Slightly closer to home, a hugely important milestone in Swallowfield’s global expansion was the opening of our production facility in Tabor, in the Czech Republic in December 2007.

The 5000 sq metre facility opened ahead of schedule and allows us to fill, finish and package colour cosmetics, fragrances and other liquid products with significant cost efficiencies but with the same quality systems already in use in our UK plants.

International presence An important element of this commitment to customers was the ambition to expand our international capability in order to enhance our ability to service the global aspirations of our clients and exploit the potential of emerging markets and reduce the cost base of the business.

We, like many other British companies, are very aware of the benefits of setting up operations in China. Swallowfield had been operating a sourcing office in Shanghai since 2004, which had allowed us to form close partnerships with a select group of suppliers in this region and given us greater control over quality and delivery of products form this part of the world.

We made a significant step forward in China in 2007 by agreeing heads of terms for a joint venture with Shanghai Jahwa, one of China’s largest players in the toiletries sector. Under the terms of the deal, which gives Swallowfield a 10 per cent stake in the company and a seat on the Board, we provide our intellectual prop-

Whilst we had to accept a certain increase in freight costs associated with moving an operation overseas, the labour costs are approximately a third of those in the UK and, because Swallowfield was operating the facility itself, rather than using an outsourced partner, we knew we could guarantee quality, thereby giving the company a strong competitive edge in Europe.

The strategic development of Swallowfield’s international capability over the past year has been vital to the continued growth of the company and to maintaining its competitiveness in a challenging economic climate.

As the price of oil and other commodities continues to rise and put pressure on input costs, our international sourcing capability provides us with a means of defending against those increases and reducing the amount we have to pass on to customers. It also allows us – and our customers – to get closer to some of the fastest growing economies in our market

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sector, such as Eastern Europe, where rising incomes are driving an unprecedented consumer demand for the kind of products we make.

Internal changes The final piece in the jigsaw of our recovery programme was a wholesale review of the way we operated the business. Our ISO 14001 accreditation means we are always seeking to be more energy efficient and to minimise waste sent to landfill but, in addition, we have also looked at ways of making our finances work harder and rationalised our property portfolio.

One of the key areas I asked the Board to focus on in particular over the past year was the reduction of the company’s debt and a tighter control on costs to ensure we were operating as efficiently as possible. The strategy has paid off as our recent interim results record our lowest net debt level since December 1988 – a reduction of 64 per cent – and we have also made good progress in reducing our inventory costs.

Also important was the successful completion of the sale and leaseback of property we owned at Lowmoor, which generated a beforetax profit of £1.25million and represents a more efficient way of managing our property portfolio to the benefit of the entire business and our shareholders.

A by-product of our commitment to improving and reducing the impact of our operations on the environment has been the realisation that there is actually a market for some of the materials we consider as waste. For example, we have identified a company that is able to extract and recycle the metal and plastic components of our aerosol cans meaning we can generate a positive environmental impact, whilst also creating a revenue source of the business.

This sort of lateral thinking is characteristic of the way we are now approaching all aspects of the Swallowfield business.

The future The measures we have put in place over the last two years to grow and strengthen the business have put us in very strong position for the future, despite the challenging economic climate.

A combination of very practical measures aimed at improving overall efficiency as well as some high-level strategic decisions about our positioning in the market has enabled us as a Board to reverse Swallowfield’s fortunes in a way that is far more than just ‘cosmetic’.

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Opinion

The Inside Track with Jim Moore

o, Alistair Darling delivered his first Budget. To be honest, there isn’t a lot to say. I feel duty bound to relay my thoughts on the implications, but once this article has been signed, sealed and delivered I won’t give it much more thought. So here are the highlights – and I use the term ‘highlights’ loosely….

What are the implications for the likes of me and you, the successful entrepreneur? Well, step up ladies because you will be given a boost with a new fund to encourage female entrepreneurs – but at £12.5m, it’s pretty trivial.

And like all entrepreneurs, in the face of either assistance or adversity, you will do your best to succeed.

Predictably, it’s been confirmed that the Capital Gains Tax flat rate will be 18%. A step in the right direction given that it’s a cut, but this will only benefit small businesses making gains of £1m or less. You and I know that this is just a drop in the ocean, and gives no incentive to the real job creators, those driving our economy and those making a substantial gain in the property market.

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I don’t know about you, but I’m uninspired by Alistair Darling’s first budget, but what does the contents of that famous red briefcase actually mean for us?

Tax rise While we are on the subject of small businesses, it looks like our Darling is giving with one hand and taking with the other…because corporation tax for small businesses is set to rise to 22% from the current 21% whilst for larger businesses corporation tax will be reduced to 28%.

Now, as you have probably guessed, I’m most interested in the effect on property. Key points are: • £8bn to be invested in affordable housing.

• Stamp duty on shared ownership not to be levied until 80% threshold of ownership passed.

• Some new opportunities in shared equity for key workers and first time buyers.

None of which is very exciting. Taken together what does this all mean for the property investor with a small to medium sized portfolio? I tend to see it as generally (but not overwhelmingly) positive.

If you put together the previous announcements now implemented on CGT this will be good for most landlords who will now pay 18%

versus the previous regime of 10, 20 or 40% depending on the profit and income tax band (and further complicated by removal of taper relief). In addition there is some general invest-

Darling is giving with one hand and taking with the other… ment in housing (see above on FTB’s, stamp duty, affordable housing) and help with getting people on the ladder. In the meantime, if you are already an investor sit tight and don’t sell; historically property is an excellent investment

and bounces back (not that it has actually gone down yet in year on year terms). Right now with more people renting, yields are likely to ‘firm up’, and the macroeconomic fundamentals in terms of supply versus demand suggest that prices must rise in the medium to long term.

So don’t panic because property investment fundamentals are good and there are some relatively minor changes that will help in terms of realizing profitability. The economic environment means that everyone is prepared to offer a deal so at the moment there are some great deals available from developers for the sophisticated, experienced and well advised investor.

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Interview

James Caan The tame dragon Jo Russell talks to James Caan about how his life has changed since entering the Den

ames Caan is not a man to let the grass grow under his feet. By the age of 40 he was a self-made millionaire, having created and sold two executive headhunting firms.

But rather than sailing off into the sunset with G&T in hand, Caan has since graduated from the Advanced Management Programme at Harvard Business School, become a mentor for MBA students at London Business School, and set up a private equity firm, which currently has four companies in its investment

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portfolio. Oh, and become the latest dragon on Dragon’s Den, where on top of filming obligations, he has already taken three entrepreneurial charges under his wing.

Time, he concedes, is a problem. “Before I did Dragon’s Den, I was working Monday to Friday and pretty much home by 6-7pm. Now I don’t get home until 9-10 pm and I work seven days a week,” says Caan. But it is not just the filming commitments and responsibilities to his investments that takes his time, he explains. “When I first joined the series, I

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expected to get about 5,000, maybe 6,000 hits to my web site from people looking for investment or advice. Last month, I got 213,000.” Of these, there are five or six approaches still in the pipeline.

Entrepreneurialism is clearly in vogue, with a fair few of us harbouring an idea that we are convinced will make us millions. Yet Caan spends a lot of time, with the MBA students he mentors and through his web site, cautioning that there’s more to it than that. He believes that entrepreneurship is a hugely misunder-

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Interview

stood concept, both by those with some level of business sense and the general public at large. “A lot of MBA students think that by writing the most amazing business plan, the business will come to life. People without the academics think that they can come up with an idea in the morning and it’s going to change their lives. They don’t understand that it’s not just about the idea. It’s the execution – having a plan, a strategy, understanding your market and the commercial financial dynamics, where you buy products from, how you price and sell

it. My input is making people understand the journey they must go through in order to achieve success.”

Innovation The mix of qualities required is best exemplified in Dragon’s Den, where Caan has to date invested three times. Of two out of three of his investments, he is fairly scathing in terms of originality of idea. He describes Fit Fur Life, a company selling dog treadmills as “OK, but not a knockout,” while Laban Roomes’ idea of

goldplating luxury items, he insists, “was not a ‘wow’ idea at all.”

The Chocbox, a £1 plastic junction box that makes it safer to join electrical cables together, was probably the best idea from an innovation perspective. But interestingly enough, they are all doing as well as each other. Roomes and GoldGenie have secured a deal with Harrods, Fit Fur Life has new customers including the Guide Dogs Association, while Peter Moule, the entrepreneur behind the Chocbox, landed a £25m contract with one of the largest elec-

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Interview

Before I did Dragon’s Den, I was working Monday to Friday and pretty much home by 6-7pm. Now I don’t get home until 9-10 pm and I work seven days a week,

sold in 2002, by which time it had a turnover of £130m and operations in Australia, Europe and Asia. In the meantime, Caan had co-established Humana International, as a means of expanding Alexander Mann, but under a global brand. Six years later, in 1999, this was sold to CDI International, a New York listed company.

Branding Fresh from his stint at Harvard, Caan moved into private equity, creating his latest brand, Hamilton Bradshaw. Branding is something that Caan considers on a very personal level.

He describes how, when he first started, he tried to imagine his business as a personality, and the sort of personality that it should have.

His vision was for an upmarket high-profile executive search firm that stood for integrity, professionalism, dynamism and quality. That was encapsulated in the name Alexander, and as the jobs being placed were predominantly male, Mann swiftly followed.

The next step

trical wholesalers in the country, using Caan’s contacts. Moule had stated on the show that it wasn’t so much the investment that he needed from the dragons, rather their contacts and expertise. By recognising that there was more required for business success than the initial idea, Caan says that Moule “got it spot on.”

Ambition Caan’s own journey down the road to entrepreneurship began in 1985 when, against his father’s wishes, he set up Alexander Mann.

It was a tough call. “My father’s ambition was that I would join the family textile business.

He’d created a business that he was very proud of, so when I decided to set up something completely different – recruitment – which

he didn’t really understand, he was very disappointed,” recalls Caan.

Trying to raise finance, with no business track record, proved impossible, and Caan funded himself through the use of three credit cards, each with a £10,000 overdraft facility. “I ended up with a £30,000 overdraft, which was unsecured and so quite attractive,” he says.

Caan funded himself through the use of three credit cards The business soon took off, having found a niche providing headhunting services for the volume middle management bracket. It was

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“When I set up my private equity firm 25 years later, I was sitting in the kitchen thinking what sort of business will this be?” continues Caan. “For some strange reason, the image of the Bradford & Bingley logo, with the two guys in the bowler hat, sprang to mind. When you’re dealing with money it’s about being established, being safe, having integrity. I thought one should be called Hamilton and one Bradshaw.”

And what of James Caan the brand? “Well, it was either James Caan or Robert Redford, and I thought that I was more of a James Caan,” he quips.

Caan clearly relishes his role in the dragon’s den and respects his co-dragons, recognising what each of them brings to the show. Ask him which of them would invest in Alexander Mann were it to be brought to the den now, and he reasons that it would probably be Duncan Bannatyne, as, “we have quite similar styles.

He’s quite down to earth in his approach and recognises the value of people.” There is a pause, to reflect the scenario. “It would be quite a compelling idea,” modestly concludes the company’s millionaire founder.

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Taking over We talk to the British businesses who are leading the charge

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Making it in the US

Doing business in the United States The legal considerations

Derek Devgun advises on some of the legal questions that need to be asked when thinking about setting up a business across the pond s the largest national marketplace in the world, the United States of America is an attractive proposition for many overseas businesses.

However, it is always a good idea to do your homework first. Use this article as a checklist to become aware of some major considerations that apply when you are considering doing business in the United States.

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Think About Legal Structures Possibilities for direct investment include making a direct investment – for example, by establishing a branch office, forming a partnership, setting up a corporation or setting up

a limited liability company. Direct entry into the US market by way of acquisition is also common, and the methods for doing this – mergers, purchase of assets and purchase of shares – will also be familiar to British business people. Alternatively, it may be more appropriate in your situation to sell into the US market indirectly, by establishing a relationship with a distributor or independent sales representative or agent. This takes less investment, but laws in some states can present problems when it comes to terminating such arrangements.

The choice of legal structure ultimately is dictated by a number of complex tax, legal/liability and business factors, a full discussion

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of which is beyond the scope of this article.

However, it is important to remember that the variety of possibilities means that it is almost certain that you will find a legal structure that works for the way in which you wish to structure your US business.

Direct investments also potentially trigger a variety of pre-approval, filing and/or periodic reporting requirements, which – if applicable – should be discussed with your legal advisers.

Be Mindful of the Law The United States is well deserving of its reputation as a leader among free markets, but that does not mean that it is free from regula-

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Making it in the US tion. Some of the laws that you will want to keep in mind as you develop your business plan include the following: Import/export – how to get your products into and out of the United States, and what it may cost in the form of customs duties.

Employment – hiring and firing employees.

Employment laws in the United States tend to be more flexible than those in other countries.

Immigration – how to get your employees into the United States.

Antitrust – laws against market allocation and price-fixing are strict, and frequently vigorously enforced.

Product liability – the litigious culture in the United States is legendary, but clear instructions for use and warnings on products sold in the United States can go a long way towards protecting against unlimited product liability exposure. Business insurance is also strongly advised.

Taxes – these include state and federal income and state sales taxes (but as yet no value-added tax), as well as employment taxes (for funding unemployment and social security programs).

Protect Your Intellectual Property Any inventions should be protected with appropriate patent filings if protection is available. Trademarks can also be federally registered for national protection. Disclosure of confidential information should always be protected with an appropriate confidentiality and nondisclosure agreement. Technology that is provided to other companies may be protected with a license agreement. In short, a little planning can offer significant protection in the long-term.

If in Doubt, Get Advice The complex and highly-developed nature of US commercial laws makes it imperative to get good legal and accounting advice. This is true even if you use commercially available forms to prepare initial versions of documents – which can save money when used in collaboration with effective legal and financial advice. Because of variations in state laws, it is also important to make sure that your legal advisers are familiar with the laws of all states in which you are engaging in business.

To purchase US legal contracts, go to www.contractstore.com.

Here’s how we benefitted

Ronnie Lennon is the director of Vivomed, based in Downpatrick, County Down.

The company sells sports medicine and first aid supplies to sports teams, schools and businesses. Vivomed uses telesales, web sales and direct marketing to build its client base.

What we did Monitor web based sales "Within our product range we were exclusive distributors of a selection of Dutch sports braces in the UK and Ireland. In both countries we had quite strong web sales. We knew the Dutch manufacturer was launching a new collection of medical braces, and because we had researched the American market we proposed selling them online to the USA. "The Dutch manufacturer was impressed with our web expertise and we agreed to develop a website exclusively for the sale of their braces in the USA."

Research costs "The sports braces were relatively light to post and were ideally positioned for an overseas, web-based, sales strategy. This meant we could calculate the costs of door-to-door

delivery to USA customers."

Promote the company website "We created a brand new website for the exclusive sale of the Dutch sports braces to the USA. Having invested in the website it's fundamental to have a strong visual presence on the main search engine listings. We found advertising on well-recognised search engines as the quickest and easiest way of doing this. When someone in the USA was searching for medical and sports braces, Vivomed's new website was the first name on the list of suppliers.

"We have also worked on our own site to ensure we continue to be recognised and have a high presence on the free search engine listings.

"An American magazine also gave the sports brace a great review which generated additional interest in the website."

What we would do differently Invest in promotional material "In our haste to go to market we may have overlooked the importance of investing in additional promotional material to include with mailed orders.

This could have helped us generate even more repeat business."

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Making it in the US

Turning ugly Richard Alvin talks to Mark French about opening up his unique brand of agency in the US and America’s facination with UGLY

In the late 1960’s there wasn’t the supermodels of the stature of Claudia Schiffer, Cindy Crawford, Kate Moss or Naomi Campbell, but there was a glut or normal people who were needed to be in advertising that the buyer could associate with.

So in 1969 Mark French founded what was then the first character model agency

called Ugly and you could say that he has never looked back as steadily their roster of models grew as did their clients.

Its name notwithstanding, Ugly doesn’t just represent the odd and grotesque, but real people. The agency believes it is tapping into a shift in advertising trends, in which advertisers seek models who

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look more like customers, on the theory that the customers can better relate to them.

The agency now gets up to 100 emailed applications per day. But photos that give a good laugh are filed in a desk drawer.

After over thirty years running Ugly in

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Making it in the US

A quick look at their casting book highlights models sized zero to 30; little people of four feet and under; and sumo wrestlers, old ladies, drag queens and tattooed bikers, among others.

the UK, Mark set about expanding the business away from the UK. There was only really one option as the first venue and that was America. The land of the free, and so French hooked up with Simon Rogers, who after working for more than 20 years as a fashion model knows the business inside and out and had been friends with French since they were teenagers.

The unions ‘Whilst it was a struggle at first as the US is very different to the UK as there is a different union for every aspect of the business’ commented French the progression has gone very well and now Ugly NY is perhaps New York City’s only modeling agency specializing in booking non-professionals. A quick look at their casting book highlights models sized zero to 30; little people of four feet and under; and sumo wrestlers, old ladies, drag queens and tattooed bikers, among others.

“Other agencies avoid these kinds of people,” said the Shadow casting director, Renée Torrière. “Ugly has made a home for them.”

Ugly NY, which opened its doors in the summer of 2007 has signed on nearly 500 models so far and the pair hope to expand their brand to other cities, among them Los Angeles and Berlin.

French actually decided to launch the New York arm of the business as a franchise which Rogers runs as it was a lot easier using that model he explains. That said he still spends one week every month in New York and feels that the inside of the EOS cabin is his home from home as he sees it so often.

Ugly NY talent representative Yvette Ulrich says that New York is the best city for this kind of agency.

“A lot of New Yorkers, they’re not trying to be anything else: this is it, they show up as is,” she said. “It’s not like they’re getting dressed up in the morning, that’s who they are.”

In demand Ugly models can sometimes earn the same rates as runway or other traditional models, though mainly it expects to offer part-time gigs paying a few hundred dollars a day.

“I tell them, you can make money being you, the way that you look, because it’s beautiful,” Ulrich said.

Native New Yorker Najwa Moses welcomes the chance to make money from her appearance, whether or not the looks she gets are flattering.

“My hair is unusual and I’m pretty tall, so I’m always getting looks,” she said.

“Some are positive and some are negative, but they’re looking.”

She was booked as an extra for the movie version of Sex in the City because, she said, the directors liked her different but fashionable look.

Model Betul Alganatay, featured on Manhattan Storage ad on billboards, says she chose Ugly NY because she didn’t want to get lost in a bigger agency.

“Ugly has a different attitude towards the business,” she said. “They look at it in a human way.”

Anyway, there’s really no such thing as ugly, according to Rogers. “There’s boring,” he said. “But not ugly.”

Business Matters issue 159 • April 2008 27

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Making it in the US

“Two great nations divided by a common language”

Taking to the skies awrence Hunt’s not your average entrepreneur and doesn’t do anything by halves. To create his exclusively business class offering, he gutted a Boeing 767 and gave it a complete refit, removing standard issue seating for 300 passengers and replacing it with 100 custom-made seats, which transform into luxury 6’3’ flat beds. It’s an irony not lost on him.

The airline is offering return flights between London Luton Airport and New York Newark for an average fare price of £999, compared to an industry average price of between £2,000 and £3,000.

So how has he managed to keep the fare price so low while offering so many extras? First, he says, he had to find a feasible business model to fit with his ideas, which was no easy feat. “The airline business typically competes on one thing: price. So it was very important for us to have a competitive price point, and I felt that the price point we needed to achieve was so low that other airlines wouldn’t even attempt to compete with it.”

To figure out the economics Hunt called on Air Foyle, the airline business that his family has been running for more than 20 years. Air Foyle operates predominantly in the cargo business, but has

L

Never a better time: With the weak dollar, now is the time to begin exporting to the US

The key to successful trade with the US is to take advantage of cultural similarities, but not to assume the two markets are the same.

This is the message from Lesley Batchelor, chair of the Institute of Export which plays a leading role in supporting UK businesses of all sizes to expand overseas.

The Institute is likewise the only professional body in the UK offering recognised, formal qualifications in international trade.

Batchelor has amassed a huge wealth of expertise in marketing and international trade over three decades in key roles with blue-chip clients including Ciba-Geigy Pharmaceuticals, Fujitsu Europe, Canon and Coca-Cola Europe.

She says that too many UK firms mistakenly believe the US is a simple market to succeed in because of cultural similarities.

“The US is a very tough market to crack, but British firms are well placed

to succeed there – as long as they have the right product.

“As the dollar’s prolonged weakness makes British exports relatively more expensive, those products which will be most appealing are the higher quality items. Americans are very demanding consumers, so the more desirable your product is, the more likely it is to thrive.

Batchelor stresses that the key to a successful US operation is targeting the right market.

“The sheer geographical size of America cannot be overstated – the country is made up of a host of very different markets, both at a state and city level. Good local knowledge is invaluable, so look to establish good relationships with agents and partners covering specific areas.

“Deliver a high quality product in a professional manner to the right market, backed with appropriate marketing and reliable logistics and success is yours for the taking.”

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Making it in the US

We talk to Silverjet CEO Lawrence Hunt about how he set up his business only airline Silverjet

g

also worked with the commercial sector, providing airline start-ups such as easyJet with the licences, aircraft and crew it needs to operate. “With a lot of analysis, we were able to come up with a model that allowed us to produce a flat bed, thirty-minute check-in, real business class premium service, for £999, whereas traditional airlines are charging £3,000 – £4,000.”

Driving down costs One of the chief ways that Hunt has managed to offer such a competitive fare is by focusing on one type of aircraft, one type of route, in one configuration, which is the same model as other low-cost carriers. This dramatically reduces the cost of operating, he insists. “BA has more than 20 different types of aircraft in its fleet, and every aircraft needs the whole infrastructure around it: engineering, safety, parts and so on, so you replicate all of those costs in your business every time you bring a new type of aircraft in.”

Fuelled by dissatisfaction with existing business class standards, which he felt weren’t offering value for money, he talked to customers at airports during the planning stages. “We didn’t say, ‘were you: highly satisfied, satisfied, quite satisfied or dissatisfied’. We just said, ‘tell us

about your perfect airline experience’.”

Using this market research, he and his management team were able to come up with a list of 20 key differentiators to work on, which now feature as part of the Silverjet package. These include ladies-only toilets, no overhead lights waking people up on night flights and no food trolleys that bang into seats.

Understandably then, his competitors, namely Eos and a new low cost option from BA, which also fly the London-New York route, have been getting twitchy.

Around 4.2 million people make the Atlantic traverse each year, making it three times bigger than any other route in the world. However, although it appears the journey is crowded enough already, Hunt is certain there is room for another player.

He also feels confident that most others will struggle to match him on price, since this route is such an important producer of profits for other airlines.

The entrepreneur has managed to negotiate private facilities at both Newark and Luton, to achieve his target of a thirty-minute check-in. He pursued these airports because he was impressed with the efficiency at both. “There’s a reason why two thirds of private jet owners come to Luton. They tend to be quite discerning about where they fly to.”

It doesn’t come as a complete surprise that someone who can launch an airline so quickly is a deft negotiator. The company was set up when it floated on AIM on May 12 2006, and the first flight took off eight months later, on January 25 2007.

In 2005, Silverjet’s founder went into the City and set about rounding up investors, with “a very comprehensive business plan, a very strong management team and a number of deals on the table.”

However, Hunt concedes that convincing investors to stump up the cash was one of the most difficult aspects of the start-up process. “You don’t have to be a rocket-scientist to raise money, but you’ve got to have real persistence and really believe in your idea.”

He also maintains that it’s vital to strike

while the iron’s hot when it comes to securing investment. Silverjet floated on the day the markets started going south, according to Hunt. In fact, he reveals the IPO date was brought forward because the team was nervous about market turbulence.

“The markets can turn in a day. You can have a conversation with an investor on a Monday and he says yeah, tomorrow I’ll give you the money, but then he wakes up on Tuesday and all the screens are red and he says, no, actually, I’ve got cold feet now.”

The team make the business He modestly insists that his management team was what sold the idea to investors, helping him to raise £26m in equity. The handpicked team, including former head of in-flight services for BA, Martin Bridger, has been involved with 18 start-up airlines.

However, Hunt’s long-standing career as a successful entrepreneur must also have been somewhat reassuring to investors. The serial entrepreneur has been involved in six start-ups, and his first solo project, a technology firm called Rapid, developed the first internet booking engine for travel.

Opportunities for expansion are almost endless, says Hunt, who is looking to offer routes to places like Dubai, India and South Africa. What he offers business travellers, he says, is value for money. “Most small businesses can’t afford £4,000 for a flight, but they also need a flat bed and fast check-in.”

The company is way ahead of forecasts for bookings, and expects to be profitable soon.

With the Dubai route having just gone live and with previous rival Maxjet bowing out of the race the future looks bright for Silverjet. Opportunities for expanding out of Luton are being explored, and other possible routes have been identified. “So, if you then think about the whole network around the world, excuse the pun but the sky’s the limit.”

Business Matters issue 159 • April 2008 29

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Making it in the US

Gaining that competitive edge W

hile the Americans and the British have similar language and culture, the two nations are still quite different when it comes to business. Understanding these idiosyncrasies will ensure you are better equipped to negotiate deals and develop long-term business relationships. There are some primary aspects to consider: •Americans often build relationships through business, not business through relationships. Work out the details of the deal first, the relationships may come later.

• Active selling is expected, often to a degree that may be regarded as excessive in the UK. • Time is money, so be well prepared with samples, packaging and sales sheets. Know your return-on investment calculations or sales forecasts, pricing and logistics. Deadlines are real and short; respond quickly or risk losing the business.

• Know your competitive advantage over specific US suppliers, as well as your domestic and international track record.

• Being direct is a virtue; ask for what you want, say what you mean and do as you say. Being shy and unassertive may be seen as a weakness in the US. Americans won’t take offence to well-phrased, direct questions because they always reserve the right to say no.

• Be positive. British tendency to be self-effacing or downplay achievements can clash with Americans’ can-do attitude and tendency to take information at face value.

• Effective follow-up is essential and often involves persistent and repetitive attempts to make contact.

If you have called or emailed someone 2–3 times and have not heard back from them, do not assume they are disinterested. Instead, remember that persistence is expected in the US; it may take you as many as 10–12 attempts to get a response, whether positive or negative.

• Business conduct in the US is generally conservative, polite and succinct; it is important to clarify benefits for the prospective customer.

Key to success The key to success is not being large but having a strong product or service offering and being able to clearly articulate your competitive advantage. US buyers are time poor and bombarded with marketing collateral and sales pitches from hundreds of companies.

As a result, it is extremely difficult to get their attention. Success in the United States is often based on persistence. It is not uncommon for a buyer to need to hear your message numerous times before they can differentiate it from all the others.

You should increase your chances of getting noticed by keeping the message concise and diversifying the channels you use to deliver it, such as email, telephone, publications, third parties and personal visits. Americans were the inventors of the 30-second sales pitch. Whether you like or loathe the idea, the level of marketing noise bombarding buyers and the number of competitors makes it a necessity.

You need to be sure you can move a US buyer from passive disinterest to

30 For further information on how to advertise Tel: 0870 116 2854

Use your britishness as an advantage curious engagement as quickly and effectively as possible – ideally in 30 to 60 seconds.

This concise pitch should include the following four elements: • Articulate the problem your product addresses, the solution it provides and why it’s better than its competitors. For example, “My software solves the problem of product tracking in the retail industry and provides a 30 per cent higher savings rate than my two top competitors”.

• Use American English. It sounds like common sense, but many UK business people speak in metric units, reference British locations and use British slang in US pitches.

• Try to reference companies that are already active in the US when establishing your advantage or credibility.

Whether presenting testimonials or claims against competitors, the US buyer needs to quickly understand who you are in context of his or her current environment.

• Be specific about the benefits. Avoid using generalities such as improved return-on-investment, productivity or sales. Instead provide specific numbers, data and percentage increases on aspects of business that show you understand the buyer’s concerns.

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Advice

Business Matters issue 159 â&#x20AC;˘ April 2008 31

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Advice

2008: the year of the ‘personal brand’ Businesses need to draw upon the personalities of their owners and leaders to succeed in these tougher economic times is the conclusion of Coutts & Co’s report ‘Face Value: your reputation as a business asset’author Michael Hayman

T

he success of prime time television shows such as Dragon’s Den and The Apprentice have revealed a growing public fascination in businesses and the personalities that lead them.

On one level, this might be dismissed as mere entertainment. But it also reveals a changing relationship between entrepreneurs, the engine room of the UK business sector,

and society at large. At the heart of that relationship lies the reputation both of individual businesses, and their founders and leaders.

This is the conclusion of a new report I have written called ‘Face Value: your reputation as a business asset’, published by Coutts & Co., the private bank. With 18,000 clients in its entrepreneurs’ practice, Coutts knows only too well the reputational pressures that are begin-

32 For further information on how to advertise Tel: 0870 116 2854

ning to bear down on Britain’s business-owners and leaders. The bank has observed that what has long been true for large companies – that reputation matters – is increasingly true for smaller firms, and start-ups as well.

Given a personality-driven media, business leaders are developing their own personal ‘brand’. How they build and manage that brand will prove critical to their career. And, because

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Advice

Feeling the heat: Mitchelin-starred chef and restauanteur Tom Aitken

the reputation of individual business leaders and the companies they run has become inextricably entwined, the very success of companies is at stake as well.

The front line Personal reputation will become especially important in 2008, as economic conditions tighten. Individual business leaders will be on the front line when it comes to demonstrating their leadership credentials.

The report finds that the brand of a particular company, and that of its leader, has merged. In today’s business environment, a company leader is more often than not the personification of the company; he or she represents what the company is trying to do, and the values by which it operates. The consequence is that the reputation of a company is now often inextricably linked to that of its leader.

But if the reputational stakes are higher, so too the challenge of building and maintaining an effective reputation has become tougher. In an era of 24-hour news, weblogs and bulletin boards, companies are scrutinised more intensively than ever before, a problem exacerbated by the rise of an aggressive, scoop-hungry media. The media cannot rely on simply reporting the news any more, but must seek to break it. This hunger for scoops, assisted by

new tools such as the Freedom of Information Act, has turned even mini scandals into front page news. It is clear this style of media is not going to disappear anytime soon.

No wonder that the public’s trust in authority of all sorts is waning. Paradoxically, the level of mistrust appears to be rising as transparency increases. In the political, rather than the business sphere, the incidence of sleaze and self-dealing is probably no higher than it ever was, but individual cases are more likely to be exposed, the media coverage more extensive and hostile and the sanctions more severe than in the past.

The result is what could be termed the rep-

‘...as economic conditions tighten.

Individual business leaders will be on the front line...’ utation paradox – as those in authority are subject to more extensive best practice standards and disclosure requirements than ever before, so the public believes them even less. Transparency goes up; trust goes down.

Viewed against this background, it is clear that establishing a reputation for integrity and fair-dealing is harder than ever before. The

public is cynical about what those in authority are telling them, requiring leaders in all spheres to devise inventive strategies for establishing and maintaining their reputation. As Coutts discovered, in daily conversations with its entrepreneur clients and in interviews for the ‘Face Value’ report, those companies where the chief executive’s name is above the door have most to lose.

Responsibilty Emma Willis, who contributed to ‘Face Value’, is the founder of a custom shirt making company that bears her name. She writes that choosing her own name for the company gives the business, and its products, additional individuality and helps to strengthen the brand, but she also acknowledges that there are risks associated with this approach. “Putting my name to the company has made me directly responsible for the business and brand and the relationship with the customer, and I enjoy this responsibility. A possible disadvantage is that I am held directly responsible for any failures, as well as successes,” she writes.

The Michelin-starred chef and restaurateur Tom Aikens also argues that there is commercial value to putting his own name to his restaurant, which opened in 2003. “At the time,” he writes, “I was a well-known chef with a fairly high media profile. The industry and

Business Matters issue 159 • April 2008 33

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Advice food writers knew me and my background, so there was a brand already in place. Because of my name, people had a view of what kind of restaurant it was going to be, so calling the restaurant Tom Aikens saved time in terms of restaurant PR and profile raising.”

But he adds: “There’s considerable pressure attached to having your name above the door.

People expect to see you, to know that you’re cooking – which is why I’m working in the kitchen at least five days a week.”

Profile Both these successful entrepreneurs accept that personal profile is an asset on which they, and their business, can capitalise. But the press, while happy to build up a business success story can be just as quick to turn on those they have previously lauded. The ‘hero-to-zero’ story is one that is now as familiar in the business pages as it is in sport, celebrity or political columns.

So how should entrepreneurs approach the tricky task of reputation management? I do not advocate a high press profile for the sake of it, or insist that every chief executive should aim to remake themselves as a celebrity. A high profile can work for some business leaders – think Richard Branson – though certainly not

for all. But neither is ignoring the media an option – in the words of Doug Richard, entrepreneur, former ‘Dragon’ and contributor to the Coutts report, the days of the silent CEO are gone. No longer can a company founder hide behind the company’s name and leave all the public relations and marketing to their specific departments. Today’s CEO must also be the company’s CIC – its Communicator in Chief.

A second piece of advice is: monitor the internet. The rise of blogs, bulletin boards and ‘citizen journalists’ armed with mobile phone cameras, means that all companies are being scrutinised all the time. And once an allegation (however incorrect) has appeared on the internet, it can mushroom with remarkable speed until the mainstream media is reporting it as accepted fact. Undoing the damage is much more time-consuming and costly than jumping hard on the initial allegation and squashing it.

Thirdly, entrepreneurs and business leaders should be aware of their rights as the subject of press coverage. Injunctions and libel suits are indeed weapons in the armoury, but they are ‘doomsday’ devices to be used as a last resort. A more productive approach is often to insist that any journalist or broadcaster follows best practice standards for responsible jour-

nalism, as set out in the UK’s top court in 1999

by Lord Nicholls in Reynolds v. The Times.

Often, contact with a media outlet’s legal team along these lines, can lead to allegations being softened or withdrawn entirely.

Standing out In 2008 companies will have to work harder to stand out and people will count more in bringing a company story to life. Business leaders must be aware it is not only their decisions that are on the line but their personality, record of achievements and way of doing business. The forward-thinking business owner or manager should be prepared for this new environment by effectively managing their reputation. By the time your reputation is under attack, it’s too late.

Michael Hayman is chief executive of The Communication Group Plc, and author of ‘Face Value: Your Reputation as a Business Asset,’ published by Coutts & Co. For a personal copy, please email your postal address to lgilman@thecommunicationgroup.co.uk or visit www.coutts.com to download a copy.

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34 For further information on how to advertise Tel: 0870 116 2854

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Advice

Peparing your business for sale Neil Ackroyd, principal partner at Precision Corporate Finance looks at what can be done to prepare a business long term for sale – including how its value is likely to increase by planning for the future.

ny item for sale benefits from quality presentation, whether it be a bottle of perfume or a three piece lounge suite.

Businesses are no different. An owner manager who allows him or herself time to gift wrap their company and put on a big bow for good measure will reap substantial rewards.

Undertaking the “wrapping and packing” takes time – anything up to three years – but it is time that is so so well spent.

A sale of a business involves assessing purchaser appetite, finding the buyer who will pay the highest price and negotiating the deal. A disposal planned over a period of time follows the same procedures, but only after the business has undergone changes that enhance its appeal dramatically.

A

Managing those changes is the key to improved sale value and those changes can be brought about extremely cost effectively by the appointment of change management consultants typically at no higher annual cost than an average secretary and certainly less than a top personal assistant.

Maximise potential A corporate finance house that offers change management consultancy will install a change manager in a business, with the sole responsibility of identifying areas where change is needed, drawing up a strategic plan for implementing the change, all with the objective of maximising potential purchaser appetite.

36 For further information on how to advertise Tel: 0870 116 2854

Throughout the implementation of the plan the manager will be totally focused on the exit objectives of the owner/manager, offering relevant M & A advice to dissect the whole process.

The plan will concentrate heavily on the strategic changes to enhance potential purchaser appetite but will also look at “housekeeping” matters. It is amazing how many deals fall over or suffer a reduction in price achieved because relatively simple problems are unearthed during due diligence. It isn’t unknown for actions that would have cost £5,000 to implement at the appropriate time bringing down the sale price by £100,000 just because they were not acted upon earlier.

These areas can include accounting sys-

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Advice

Undertaking the “wrapping and packing” takes time – anything up to three years – but it is time that is so so well spent.

tems, health and safety, legal issues, environmental considerations and site presentation.

A plc (who is likely to pay the highest price for a business) is unlikely to look twice at any company with suspect financial systems. The change manager will identify any weaknesses and recommend remedial action – even if that means the appointment of a new financial director. At the end of the day good financial systems will drive profits and produce many operational benefits along the way.

A squeaky clean safety audit is worth a fortune – we all know that this element of a company’s operation is one of the biggest nightmares with which to contend.

Deal with any issues Disputes over title and ownership of land can get bogged down in protracted legal arguments; if the problems are identified and resolved before the sale process gets a full head of steam they don’t become time critical, and don’t have an adverse effect on the price achieved.

Environmental issues are, as we know, becoming increasing critical in all aspects of company life. A contaminated site is a difficult site to sell, and a messy shambolic site can be a deterrent to a sale. Potential purchasers who have made initial offers for a perfectly profitable business can often simply walk away after the visit to an unattractive and unappealing location.

So much for housekeeping Critical Sale Factors, including analysing management capability and options post sale, customer spread, market penetration and contract analysis are equally as important in the preparation of maximising the sale value.

Any company in which the owner manager is the heartbeat of the business will be particularly difficult to sell for a reasonable price – without a substantial “earn out” or other

unattractive tie-ins. A change manager would assess the importance in the role of the existing owner and where necessary assist in the recruitment of an additional resource to the management team. This can’t be done in the short term and needs to be carefully planned.

However, this throws up the question: is the management team strong enough to cope with the additional burden and demands? If not, it would be necessary to bring in new people at director level – filling managing, finance, sales or operational director positions. A team seen to be strong is eminently backable, and the vendor reaps the reward in an enhanced sale value.

Getting the right team Building up a skilled effective and professional management team can be done in months but getting them to full potential takes much longer – as does the input required to build up and consolidate an attractive customer base. Any business, no matter how profitable, with over dependence on one or a few key customers will command a significantly lower sale price than one with a more even spread of income.

It must be remembered that a change manager is more than a management consultant – he or she undertakes a pivotal role, identifying problems and overcoming them while the owner/manager continues to run the business and not take his or her eye off the ball to deal with the M & A matters that are constantly at the forefront of the change manager’s thinking.

Another important consideration is confidentiality; any appointed consultants should

be aware of the delicate nature of their role. It is imperative that the service is seen to add continuing value to the business by staff and not simply a checklist for selling the company as this could undermine the whole process.

The result can be an increase in price by 23 times what would otherwise be achieved. Alternatively, it could result in a disposal that would otherwise fail going through to legal completion.

Any owner manager with the luxury of time should seriously consider change management now to attract potential purchasers with heavy wallets who will be in a position to write out hefty cheques in time for the arrival of the Olympic torch in London in 2012.

Neil Ackroyd may be contacted at: Precision Corporate Finance: Tel: 0845 201 0320 or neil.ackroyd@Precision-corpfin.com

Business Matters issue 159 • April 2008 37

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Marketing

The sales mistakes

Sales performance trainer Andy Preston highlights the most common mistakes made by internal salespeople and field-based teams when engaging in sales conversations. ne of the greatest challenges to Sales Managers and Directors in charge of a sales team is managing what individuals are actually saying to customers on a day-to-day basis. How many of you are sales managers or directors and truly know what your sales team are saying to your customers?

If you're anything like most that I meet you'll have some idea, but would probably be horrified to learn exactly how the conversations go between your sales team and individual customers day-to-day. It's hard enough if you're managing internal salespeople, where at least you can

O

1

Telling the Customer theyâ&#x20AC;&#x2122;re wrong!

Customer "I'm not convinced about the reliability of the machine. I've heard you can get problems when it's been running for a certain period of time".

Salesperson "Well I don't know who you've heard that from but that's just plain wrong! This

overhear some of their telephone conversations, but if you're managing a field-based team the problems become far worse!

Whether it's just carelessness, or a lack of focus, salespeople say the strangest things to customers, without any thought of where it might lead them! Below are some actual examples of phrases I've heard salespeople say to clients or prospects, either over the phone when I've been listening to calls or directly in front of them when I've been doing field visits with the salesperson.

machine is the best on the market and never breaks down!"

Customer "Oh really? That's not what Jim said over at XYZ Machinery where you installed one last week and have been back to it twice already".

Salesperson "Oh. So you know Jim at XYZ Machinery? Ermâ&#x20AC;Ś" This type of response happens so often it's

38 For further information on how to advertise Tel: 0870 116 2854

frightening! The salesperson hears an objection, can't deal with it, panics and makes something up on the spot in a desperate attempt to sound convincing!

The result? The salesperson loses all credibility in front of the prospect or client and is so embarrassed not only do they not get their outcome from this call, but they rarely feel like they can call this person back ever again.

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Marketing

2

Not Listening To the Customer

Customer "I'm sure that it's a great system but I don't think we need anything that complicated here".

Salesperson "It really is good. It's the best system on the market and you can even program it remotely and configure it in real-time from an external location" Customer "I don't think we'd use that feature, it's too complicated for us and we don't have the budget for such an extravagance".

Salesperson "Oh so budget's a problem for you is it? When will you get your new budget?"

Customer "Not until next March".

Salesperson "Oh so we'd probably be better waiting until then wouldn't we. Shall I call you back towards the end of February? Great, speak to you then".

No, No and No! How on earth did the salesperson mis-hear what the customer was saying to him? The problem is, most salespeople don't listen to what the customer is saying to them, they're too busy thinking of what they're going to say next! You wouldn't believe how many conversations I listen to where buying signals are missed and critical information is ignored because people just aren't listening!

Even worse, the salesperson then left the call and wasn't going to call back for a few months time. What do you think would happen in that time? That's right - a competitor would call the customer and actually listen to them, propose a solution more to their needs and close the business, leaving our salesperson to call back in February already having lost the business.

3

Making the Customer feel worthless

Customer "What's the extra charge for?"

Salesperson "That's the small order charge.

All orders under £50 are subject to it" Customer "But I don't need any more than what I've ordered. I don't see why I should have to pay a penalty for placing an order with you. I'm sure that some of your customers don't pay that charge, is that right?"

Salesperson "Well our gold level customers don't pay it. But that's because they spend a lot of money with us" Customer "So are you saying that you charge it to some customers and not others? Why is my business worth less to you than theirs?"

Salesperson "Errrrmmmm……"

Blabbermouth strikes again! Instead of ex-

plaining what the small order charge was for and suggesting ways around it, our salesperson has now created an irate customer who feels that their business isn't important to the company! Anyone suggest a better way to get a customer to seek out another supplier?!!! Again a small situation that escalated into a very big one!

4

Making a complaint worse

Customer "Martin, we've been having a few problems with our xyz system, can you do anything to solve it? We're getting sick of it going wrong."

Salesperson "Well I'd like to do something to help, but you're outside of your warranty period you see" Customer "And?" Salesperson "Well we'd have done something for you if it was still in the warranty period, but it's not" Customer "So are you saying you're not willing to help me?"

Salesperson "Well as I already said, it's outside the warranty period. But we do have a great range of new machines you could buy….."

How helpful was our salesperson in this scenario? Not very! Not only by stubbornly

sticking to "policy" did he annoy an existing customer and virtually drive them to his competition, but he also put in a very badly-timed sales pitch as well! I'm always astounded how much effort salespeople will put into winning new business, and then as soon as the customer is "on-board", they treat them like a second-class citizen, and virtually drive them elsewhere! Not very helpful if you're trying to build long term relationships and business with your customers is it?

How many opportunities do you think the average salesperson blows? How much money do they leave on the table every month? How many deals do they lose that they could (and should!) have won? If you explore this within your organisation, the answers may scare you!

Andy Preston is director of acclaimed training company Outstanding Results www.outstanding-results.co.uk

Business Matters issue 159 • April 2008 39

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Advice

Only one true leader

Pennsylvania will vote and America will listen but there is only one true leader, according to leadership expert John Fay MBE he upcoming and all-important Pennsylvania primary to be held on April 22 has been touted for months as being the decisive calendar date in the election race.

If Hillary Clinton fails to deliver a strong victory then the powers that be in the Democratic party may force her hand to stand down.

Clinton has spent much time in the state gathering support but Fay, who founded change management and leadership consultancy SFL, says Barack Obama's concentration on areas other than Pennsylvania should not damage his campaign.

He said: "This primary is the chance for Obama to gain a notable victory over Clinton even if he is not the outright winner.

"He has reduced a 20-point lead to six points in a state and has increased his standing with the people living there. He realises there are still other primaries worth considering and is not solely concentrating his efforts on Pennsylvania.

"Clinton has dedicated more time to visiting this state but Obama realises stakes will also be high when North Carolina and Indiana vote on May 6.

"He has taken time to garner support na-

T

tionwide which demonstrates higher levels of leadership. Clinton is managing small parts of her campaign, dedicating time to Pennsylvania and attacking Obama perhaps without looking at the bigger picture.

Vision "Obama is a leader who has the vision to bring people together with a common vision for America whereas Clinton is a classic manager in control of her campaign and banging the drum on her achievements in delivering programmes from the Senate.

Without the leadership ability to win the hearts and minds of the people, she appears to lack authenticity."

Despite confidence from the Clinton camp, Fay is convinced Obama will still have the upper hand in the election race.

"Obama is more charismatic and has mass appeal across all levels of American society.

Republicans like Obama whilst they have no time for Clinton. Clinton cannot even stick to a

campaign message which shows a lack of consistency. This is not encouraging for the electorate.

"Obama can afford a loss in Pennsylvania and still triumph in the election race.

America should put its confidence in Obama as a leader with vision rather than backing Clinton who can manage the day-to-day but can't ignite the passion which has historically driven American people to great heights of success."

Business Matters issue 159 â&#x20AC;˘ April 2008 41

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Financial Advice

Be healthy, Wealthy and Wise Gavin Porritt, Independant Financial advisor looks at how to add benefits to your staff’s salary packages n a competitive world where costs are key to success, employee retention plays a vital part. Long serving employees save on recruitment costs and the training of new staff.

Due to the public perception of the state of the NHS, an employee benefit package that contains Private Medical Insurance can be more attractive to new and existing employees.

From a business perspective providing medical insurance to your employees has the potential to reduce time off work due to sickness. Loss of work time due to sickness is not only expensive (£588 per employee per year according to the Office for National Statistics’ Labour Market Trends Report in April 2005), it also impacts on team moral and places an additional work load on the remaining team members.

When running a smaller business your success depends greatly on teamwork. It therefore pays to ensure that you and your employees are all performing at their peak. Health insurance can help you to manage employee absence due to ill health and give you access to support throughout the policy year. Health insurance can provide: • prompt access to diagnosis of health problems • prompt access to non-emergency treatment • reduced waiting times, helping to get your employees back to work quickly • a choice of admission time or date at a convenient time around work and family commitments • a choice of consultant or hospital • a highly valued employee benefit, proving useful for employee retention and recruitment as mentioned earlier You and your employees can also cover family members under the company medical insurance plan. However, it should be noted that, for the purposes of calculating a head count, they only count employees of the company, this is important as there is always a minimum size to corporate schemes.

If your company is subject to corporation

I

tax, health insurance is an allowable business expense. However, directors and employees are liable to tax on the premiums paid on their behalf. Employers' National Insurance contributions are also payable on the taxable private medical insurance benefits enjoyed by employees in a tax year. There is, of course, no tax on any benefits claimed, provided premiums

42 For further information on how to advertise Tel: 0870 116 2854

are paid entirely from company resources.

In summary Private Medical Insurance can be a valuable addition to your companies financial portfolio.

As always if you have any questions or comments e-mail them through to me on bm@forumwealth.com.

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Finance

Don’t crack in the crunch

Maximising cash flow and reducing bad debt is now more important than ever if businesses don’t want to crack in the credit crunch n February Mervyn King, Governor of the Bank of England, stated that “tighter credit conditions will bear down on demand” and he projected poor growth forecasts and higher inflation. At times like this, banks may refuse or reduce credit facilities and so it becomes vital that businesses have their own stringent credit control systems in place to ensure cash flow is maintained.

Chris Burke is a partner within leading law firm Pearson Hinchliffe, and is a specialist in debt recovery. He has highlighted a number of simple steps businesses can take to reduce the risk of bad debt.

“A healthy cash flow is vital if a business is to succeed, particularly in a difficult economic climate and debt management plays a major role. All too often businesses find themselves heading for financial disaster through the lack

I

of employing some basic financial management tools.

“It is fairly common for businesses to factor their debts with the factoring company taking a percentage share of the overall invoice. In addition, some insurance companies also offer credit insurance against bad debt, thus removing the painful consequences of a customer becoming insolvent.

Not cost effective However, some businesses may find the cost of factoring and/or credit insurance to be prohibitive. It is therefore vital that businesses tighten up their own credit control procedures.”

Chris is keen to stress that these procedures should be put in place before a business agrees to supply to a new or existing customer.

44 For further information on how to advertise Tel: 0870 116 2854

“Credit reference checks can be carried out at relatively low cost and should flag up any problems that a proposed customer may have had or any uncertainty as to its financial stability.

Steps can then be taken to either walk away from the customer or ask for added protection, such as insisting that the directors of a limited company provide a personal guarantee.

“It is also important to identify precisely who the customer is. Are you dealing with a private individual, a company or partnership? It is surprising how many businesses still operate on trust. Try to record the terms of any agreement in writing to avoid the risk of dispute at a later date, even if this is by way of a purchase order or a simple letter. Set out precisely what you have agreed to supply and for what price, etc.”

The terms and conditions of doing business should be given careful consideration, as this

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Finance “A healthy cash flow is vital if a business is to succeed, particularly in a difficult economic climate and debt management plays a major role. can be a further mechanism by which companies can reduce potential exposure should a debtor company become insolvent. As Chris explains, “A strongly worded retention of title clause can mean that you still own the goods you supplied until they are fully paid for, and can recover them, even if your customer has become insolvent.”

Invoice straight away Other tips include raising an invoice for goods and services supplied as soon as possible. The invoice should clearly state when payment should be made, and this does not automatically have to be 30 days. Once the goods have been supplied it is good practice to contact the customer to ensure the goods have been received in satisfactory condition.

It is important to enforce the time limit set out in the invoice and Chris explains the steps to be taken if these terms are not adhered to.

“If the customer does not make a payment in accordance with the time limit set out on your invoice, you should contact the customer immediately. If payment is still not received, or

satisfactory proposals of payment not made, then a ‘letter before action’ should be sent demanding payment within a short period of time, failing which Court / Insolvency proceedings will be brought.

“At that stage, many businesses are fearful of employing solicitors to pursue the debt, as they believe this could lead to substantial costs being incurred. However, like ourselves at Pearson Hinchliffe Commercial, many solicitors offer flexible payment terms and operate, by agreement, a ‘No Recovery ,No Fee’ service.”

It is also vital to instruct a solicitor or debt recovery specialist that ensures the customer’s full entitlement is recovered. “If you successfully recover your debt from your debtor you should ensure that you recover not only your invoice, but also interest on that invoice, costs and administration fees which you are entitled to by law, under the Late Payment of Commercial Debts (Interest) Act 1997.

Unfortunately, some debtors will still not pay even after Court proceedings have been brought and a judgment obtained against

them. At that stage a business needs to seek legal advice to ensure that the appropriate and most cost effective method of enforcement action is taken. This could involve County Court or insolvency proceedings, charging orders, attachment of earnings, bailiffs or third part debt order.

Effective procedures As economic conditions become increasingly challenging and credit deals more difficult to secure effective in-house cash flow and debt management are key to overall success. Chris concludes, “It is inevitable in recessionary times that some debtors will simply not be able to pay because they are insolvent. However, it is in these times that businesses need to consider their credit control policy and systems to ensure that the risk to their own business is minimised. Some careful planning, combined with good old common sense can make the difference between success and failure.”

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bmmagazine.co.uk/competition Business Matters issue 159 • April 2008 45

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Finance

Shifting a taxing decision John Brazier talks about the announcement to penalise family businesses who play ‘the tax game’ he Chancellor of the Exchequer announced in the Budget that his widelyfeared proposals to penalise family businesses for sharing profits among their owners will be postponed for a year.

This is a reprieve for the hundreds of thousands of businesses who would have been affected if the proposals had come into force on April 6th this year as originally planned; but it adds another twist to the long-running saga of the Government’s attempts to attack family businesses.

T

A look back It all started back in 2003, when the Inland Revenue (as it then was) announced its intention to apply the Settlements Legislation to jointly-owned businesses. The legislation had been around for decades, but had not been applied in this way before: the intended result was that where ownership of a business is shared between two people but one ostensibly generates much of the revenue, profits distributed to the other must be taxed as the income of the fee-earner.

This was principally targeted at IT consultancies, like the ones the Government had previously attacked with the IR35 rules, and the Government openly admitted as much in the ensuing test case: Geoff and Diana Jones of Arctic Systems Ltd, with the close support of PCG, fought all the way to the House of Lords, which gave its ruling in the summer of 2007. Geoff works as an IT consultant, and Diana provides office support; they each take a salary and the remaining profits are split 50-50. A tax saving arises because Diana is able to use up her allowances with the dividend. The House of Lords ruled that this did not constitute a settlement: HMRC’s attempt to re-interpret leg-

islation retrospectively, which had been roundly condemned by independent commentators, had failed: tens of thousands of businesses were saved from back-dated tax bills of up to £40,000.

The Government immediately announced that it would legislate, and in December 2007 produced draft legislation on what it called “income shifting”. This was even more wide-ranging than the attempt to re-interpret the settlements legislation: any profit sharing within a partnership or limited company that takes place along what HMRC sees as “noncommercial” lines will be caught. The legislation gives enormous latitude to HMRC to say what is in scope and what is not. Pretty much nobody outside the Treasury and HMRC had a good word to say about the proposals, but the Government seemed hell-bent on introducing them: it was a welcome surprise when the Budget announced that they will be postponed for a year.

A Family Business Tax PCG has rejected the loaded terminology of “income shifting” used by the Treasury: it seems deliberately designed to make perfectly legitimate distributions of profit seem somehow dodgy or underhand. A more fair term seems to us to be the Family

46 For further information on how to advertise Tel: 0870 116 2854

Business Tax: this reflects the type of business that will be most heavily affected (although in principle any partnership or jointly-owned limited company can be in scope).

The family way The problems with the FBT proposals are legion. They suggest that all contributions to all businesses have to be “commercial” in order to escape a tax penalty: but family members go into business with each other because they are family members – they contribute finance, undertake work and accept pay in a way that would not be acceptable to purely commercial business partners.

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Finance

Yet the proposals break with the traditional principle that profits are distributed on the basis of the ownership of a business: they insist that they must be taxed as though distributed on the basis of the contribution made to the business.

So, in short, businesses will be faced with having to record every item of work for the business and every contribution made to it – whether it’s ideas, advice, investment for instance.

Then they must research the commercial value that would apply to these contributions on a “commercial” basis, even though no commercial comparators may exist: how does one value, for instance, the conversation about what business opportunities to take that family members might have last thing at night while putting the cat out?

Distribution Having completed this tax, businesses will then have to decide which owners have earned what amount of profit; tax must then be paid on dividends or profit distributions as if profits had been distributed in this way, irrespective of whether this is the case or not.

At this point in articles of this sort, it’s customary to say something like, “it sounds complicated, but don’t worry, it isn’t.”

Unfortunately, this is every bit as complicated as it sounds: the proposals are so horrendous in their implications that they have attracted arguably unprecedented levels of criticism from even normally reserved tax and accountancy bodies, never mind the groups representing the businesses who will be so viciously attacked.

Where next for the FBT? The Chancellor’s announcement of a twelve-month delay to the proposals at least indicates that the message is getting through that these proposals simply will not work. This follows extensive campaigning by PCG, in addition to our formal consultation response and discussions with officials. We secured an Early Day Motion in the House of Commons against the proposals, which attracted the support of over a quarter of all MPs: this was a remarkable level of support and made it the twelfth most-signed Motion in the House at the time of writing. A petition on the 10 Downing

Street website attracted over 7,000 signatures and reached the top 20 most popular petitions.

PCG also held a press briefing at the House of Commons with Liberal Democrat and Treasury spokesmen, and mounted an advertising campaign in the national press ahead of the Budget.

But for all the progress so far, the Government is still committed to pressing ahead with the legislation. They are consulting on making it work, but it is so fundamentally flawed that this will be like pushing custard uphill. We hope that they will see sense and drop the whole thing: but keep a close eye on next year’s Budget all the same.

John Brazier is Managing Director of The Professional Contractors Group, www.pcg.org.uk, a not-for-profit trade body that provides business support and advice to freelancers.

More information about the Family Business Tax can be found at www.familybusinesstax.co.uk

Business Matters issue 159 • April 2008 47

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Forum of Private Business

Keep the right side of the law The Forum of Private Business warns business owners to ensure that they are fully compliant with the Manslaughter Act introduced last month, in order to avoid prosecution.

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he implementation of new government regulations, and the resulting increase in red tape, can be the scourge of the business owner’s life. Last month a raft of new legal obligations affecting tax, employment, health and safety and more were brought in.

In a bid to reduce the burden on businesses affected by new legislation, the Government introduced ‘common commencement dates’ in 2004. During these bi-annual CCDs, or ‘red tape days’ as they have become known by many, the major government departments introduce many new regulations.

Adapt and change In theory, these red tape days, which take place on 6 April and 1 October, should prepare businesses to adapt to the changes and save them time and money. However, in reality, many find it difficult to react to the avalanche of new laws when they come into force.

Of the new legislation brought in on 6 April, the FPB is particularly concerned about the potential impact the introduction of the Corporate Manslaughter Act, and changes to the sexual harassment laws, could have on ill-prepared businesses.

The FPB, which campaigns for the fair treatment of private businesses, representing over

25,000 members, has warned that transport firms and businesses which provide company cars could be liable under the Corporate Manslaughter Act if they fail to introduce stringent health and safety procedures. Businesses face being publicly named and shamed and fined up to 10% of their annual turnover should a death occur as a result of ‘gross management failure’.

The FPB’s Policy Representative, Matt Goodman, said: “Because of the relatively high instances of road fatalities, business-owners in the transport industry – and those who provide company cars – should make sure their employees are fully aware of health and safety best practice.

“The Corporate Manslaughter Act means that they must establish clear health and safety procedures and monitor them, or face heavy fines and public censure.”

The FPB is also concerned about the last minute changes to sexual harassment laws, which impose on employers a duty of care to protect staff from harassment from customers and suppliers and were introduced with just three weeks’ notice.

Under the amended Sex Discrimination Act, employers can now be held liable if, after being informed on at least three occasions, they fail

to take all reasonable steps to prevent staff from being subjected to forms of sexual discrimination such as lewd comments or sexist jokes. It is expected to cost smaller firms at least £10 million to comply with the new laws, and tribunals will have powers to award uncapped amounts of compensation to employees whose cases are successful.

Eradication not possible FPB spokesman Phil McCabe pointed out that, in practice, it could prove difficult for those firms that have regular contact with large numbers of customers to completely eradicate all forms of discrimination.

He said: “While it is important to protect employees from any form of discrimination, these regulatory changes have not been given adequate publicity and will take many businessowners by surprise.”

The FPB has produced guides on health and safety and employment for 2008, which include essential advice for businesses-owners on how to protect themselves from falling foul of the new corporate manslaughter and harassment legislation.

Visit the website www.fpb.org for more information

Business Matters issue 159 • April 2008 49

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Finance

Its all about margins

Cash flow expert Donald Findley explains that you need to look at how much profit your business makes and not how large your turnover has become.

see a lot of businesses that are very busy but they just arenâ&#x20AC;&#x2122;t making any money.

Let me give you a recent example of a small telemarketing company that carries out business to business marketing.

This story is a classic story of a couple of guys who had worked in the industry for many years deciding to set themselves up independently.

They rented an office, recruited a few telesales staff and set about building the business.

This side of things took a little longer than expected so they obtained an overdraft and a

I

loan, signed up for a factoring deal and also borrowed personally to support the business, thus accumulating more overheads.

They signed up clients and delivered a good service and in positive months made a decent profit. The trouble was that there were also poor months: sometimes campaigns were delayed or there were problems and sometimes gaps between campaigns. And as a result of the large fixed costs such as staff, premises, servicing debt etc, these bad months overwhelmed the good months, and when they looked at the cash in the bankâ&#x20AC;Ś there wasnâ&#x20AC;&#x2122;t

50 For further information on how to advertise Tel: 0870 116 2854

enough money to pay directors wages again this month.

So they redoubled their efforts and worked even harder. A year on and they were facing exactly the same problems, just with higher debts; the same the following year and the year after that.

What was wrong?

When finally I got to meet them it was fairly clear that the business model was bust, you might think. No, not a bit of it: they had a new plan, a great business coach. They wanted me

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Finance Give up the business and keep it very simple. Work from home self-employed, do it all yourself, there’ll be virtually no overheads. Yes it is hard work... ...but you know you can do it, buy is your expertise. to deal with the personal debt whilst they sorted out the business. They were renting, having sold their properties long ago to put into the business, and were drawing very low salaries, if any at all. Thus they were in a strong position to get most of, perhaps all, of their unsecured debts written off.

Better or worse?

Fast forward six months. The strategy of writing off the personal unsecured debts was on track, unfortunately the business wasn’t.

They decided they couldn’t afford the business coach and the last six months have turned out to be much like the last four years, only slightly worse. However, there were some wonderful contracts in the pipeline and though the deal wasn’t quite closed, the financial projections were very rosy. Things were difficult though: the directors hadn’t drawn a wage for three months and the VAT man was banging at the door.

I decided it was time for some home truths: of course I could have lost the clients, but I had to try. I suggested that the pattern was repeating itself and that in six months the profit would have slipped through their fingers. They are intelligent hard working people, they know their business, it was just that the business model was broken.

If you have a turnover of £12,000 a month, rather that £12,000 in fixed costs and loan repayments which means you have earned zero, you’ve both earned at least £5,000. If you have a bad month and turnover is £5,000, rather than being £7,000 in the red, you will both have earned £2,000, and because your personal debts have been dealt with you can probably get by, even in your bad months.

The change Roll forward 12 months, you’ve employed a decent business coach and you are exploring smarter ways of growing your business….or perhaps not. Perhaps you have a small group of clients who really value your work and you can increase your margins and reduce or eliminate the bad months. You now average £15,000 a month turnover, £12,000 profit. You might even decide to reduce further and concentrate on the highest value clients where your expertise is really respected. In three years time, it is still just the two of you with a part time admin person, but you work four days a week, take decent holidays, but earn the same”

The truth For a period, there was more denial and then the truth began to dawn: “We had to spend so long dealing with creditors, training our staff, or sorting things out when they mess up, it took longer than we expected to deliver campaigns. If we had done it ourselves there wouldn’t have been a problem”.

It was the moment I had been waiting for. I was then able to suggest looking at a business model where they would indeed do all the work themselves. We went back to first principles, they have good clients that liked their work: so for a time they could focus on delivery.

“Give up the business and keep it very simple. Work from home self-employed, do it all yourself, there’ll be virtually no overheads.

Yes it is hard work, you will probably spend all day on the phones but you know you can do it, after all, what your clients buy is your expertise, nothing else.

I’m reminded of the old story told to me by a wise friend who had spent many years in Kenya. A development worker was talking to a farmer who just had a small field. The family lived very simply but seemed content, they didn’t have much, but they had enough. The farmer was sitting by his field in the shade of a tree doing not very much and watching the world go by.

The development worker tells the farmer he should get up and WORK. The farmer, being a polite fellow, listens. “Yes,” says the development worker, getting into his stride, “you

should get up and get another field, and then another”. “And what do I do then?” asked the farmer politely. “Well, you employ people to plant the crops, to look after the crops, and to sell the crops. And then you buy another field and employ more people, and so on and so on.” “And what do I do then?” asked the farmer. “Well,” said the development worker, “then you can relax and sit under the tree and look at all you have achieved.” Perplexed, the farmer replied: “But I’m sitting relaxing under the tree now.” Even more perplexed, the development worker walked away scratching his head, trying to work out where he had gone wrong.

The farmer had sufficient margins from his field. It wasn’t much, but it was enough. Why risk taking on loans, employing people, getting stressed out, when he was fine as he was. I suspect that there are many small business people that could learn a thing or two from that Kenyan subsistence farmer.

Trimming the fat Catie runs a small café in London’s East End. She used to have a much better business, she provided cakes to city firms. She was persuaded to take on a large loan and expand her business, unfortunately, just before the last recession. The first thing the city firms did was cut out the expensive cakes. Didn’t make the slight difference of course, but they felt they were tightening their belts. She lost her business, hence the small café she runs now.

Beware the disease of over- optimism, especially in the current economic climate. If you are thinking of re-mortgaging your home or taking a secured loan for your business or even signing a personal guarantee, think, think and think again, and maybe see a Cashflow Dr first!

Donald Findley has been providing solution for business for 20 years.

Cashflow Dr and its sister company Debt Dr can help you cut your losses, organise a smooth and cost-effective exit and get you started again, or we can rebuild the business. We protect your assets, and help you sleep at night. Tel 08456 449 220 email: df@debtdr.co.uk Website: www.cashflowdr.co.uk

Business Matters issue 159 • April 2008 51

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Letters

Your Letters Send your letters to the editor via email to letters@bmmagazine.co.uk or fax on 0845 638 0341 The editor reserves the right to edit letters before publication

Letter of the Month...

Green Crimes I was very surprised to see Business Matters putting a positive spotlight on Stephen Williams of SLR Technology, (News, BM156) who commutes weekly between Frankfurt and Liverpool, presumably by air. This really is an example of bad practice, which all of us in the business community should be seeking to shun, not to emulate. I hope you will avoid highlighting such appalling business practice in future.

Simon George, Director Wootton George Consulting Ltd ed: We have to admit that this element relating to environmental impact did not enter our minds when reporting on Stephen Williams activities, but it is a valid point that you raise and one that we should all bear in mind.

GOING GREEN I picked up a copy of Business Matters and thought this looks worth a read, so took it home. It sat on my desk for several days until I finally got around to opening it. At first I was fairly surprised at the articles in the publication, as they looked very interesting...but then I realised a fact that hadn’t crossed my mind before, I have never picked up a publication that had so many articles I wanted to read! Sounds bizarre, but generally I read one or two articles and then the magazine is done....the rest are either too basic or uninteresting. In issue Jan 2008, I read 19 of the articles....this is unheard of for me. In fact, it became a bit of an arduous task making the time to read the text!

So praise where it is due, I think

you publication is of the highest quality...thank you for an excellent read.

Nigel Stone Chief Executive, Infinite ed: we are pleased that like many of our readers, you find the content of Business Matters both interesting and informative. We currently have the largest monthon-month increases in our readership of any UK business magazine and we thank all of our readers for their comments both positive and negative!

RETAIL REBELLION As an organisation that has the interests of over 4,000 small retailers at heart, I was interested to read your article ‘The end of the high street’ in the January edition of Business Matters.

We should be quite clear there is

52 For further information on how to advertise Tel: 0870 116 2854

no quick fix for the high street and just wringing our hands will achieve nothing either. We need to make government understand that the small independent on the high street fulfils a vital social as well as economic function. It provides for many elderly an important welfare role, as well as providing choice, easy access and the recycling of revenue within the local economy, an often overlook attribute. The unrelenting power of the supermarkets is contributing to an epidemic of closures and these shops will not be resurrected.

The key to success is twofold.

Firstly to ensure small businesses are giving the necessary financial support in terms of rent and rate relief and secondly to amend planning guidelines to put a more effective break on out of town and edge of town development. As a member of the Conservative Enterprise Commission on small shops we are intent on delivering this remedy and soon.

John Dean Chief Executive British Shops & Stores Association

these services is not officially the usual 17.5% tarriff. I was aware of this when recently reviewing our travel spend over the last year and requesting staff find their missing VAT receipts only to be informed that Last Minute and virtually all of the other ticket and booking companies do not suuply VAT receipts. When we contacted the companies we were advised that they do not issue VAT receipts because the VAT element is not actually calculated as 17.5% of the booking total but in the margin that they are operating on between the purchase price that they buy the tickets for and what they sell them for.

Peter Laurence Halstead PLC ed: Thank you for bringing this to the attention of both us and our readers. We have contacted HMRC for further clarification and will cover this topic in more detail in our May edition which will be focusing on business travel and how best to maximise your budgets whilst also ensuring that your business is as environmental aware as possible.

A TWO-PIECE DEBATE I would like to draw yours and all of the readers of Business Matters attention to an oddity in the VAT rules relating to bookings using companies like Last Minute.com.

Whilst i am in no way suggesting any wrong doing on the part of the companies it appears that the VAT element of bookings made on

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Advice

Looking out whilst also looking in roject management is a discipline that, more often than not, sits between various functions and rarely has an external focus. That, however, changes when the project being worked on involves the outsourcing of a service to a third party.

The role of the project manager is key to the success of the outsourcing work being undertaken. It is this person’s responsibility to co-ordinate issues such as internal and external resources, timelines, deliverables and whether the piece of work is actually going to add value.

As editor of outsourcingtip.com, Olivia Taige suggests that project managers will almost always be landed with responsibilities that normally lie within the remit of business managers.

She says: “When defining project parameters, project managers need to be commercially focused, questioning and defining the detail of why the project has been initiated in the first place.”

The initial phases of developing an outsourcing project hinge on understanding, in detail, why it is being done in the first place.

Analysing what the organisation wants to achieve and testing whether the activity to be outsourced is core to the running of the company will help determine the outcome of the project.

Allan Alter, chief executive of CIO Insight, a business project consultancy, says: “Dealing with the subject of outsourcing is an intricate business with many different strands, meaning those running large and expensive projects must be aware of all interrelated dependencies.”

Whether the selection of the outsource provider falls into the terms of reference of the project or not, involvement with those who will be managing the service after the transfer is paramount at all times.

Part of the project will involve determining how the third party is going to be able to manage the service, so testing must form part of the plan. How this is done will differ by sector and the service being outsourced, but by undertaking this task, confidence can be built from the start that the provider will supply the required service.

P

Project managing the outsourcing of services ensures that you are bringing in the best providers

Managers from the area of the business being outsourced must form a part of the project team to either oversee the implementation of the project or participate in key elements of it, depending on skills and knowledge required Roof window manufacturer Velux implemented a new computer system some years ago but outsourced its management. People were seconded from the various departments that would use the new systems for a period of up to six months.

Laurence Barrett, the company’s IT director, says: “It was a large project to replace our entire IT system, but in hindsight by involving people in the project who were going to use the system, a huge amount of rework was avoided and people took ownership of issues from day one.”

During any contracting process, it is up to the project team to ensure continuity of service and this can be where problems arise. Issues such as data management, integrity and security will need to be taken account of and

dealt with, while business as usual carries on in the background.

Continuity is absolutely essential to any project and when it comes to outsourcing this element becomes non-negotiable. Lack of continuity can be caused by issues as diverse as processes and people. Alter adds: “Companies that decide to outsource some or all of their processes are doing so for a reason.

While this is ongoing, business has to continue as normal, so it is imperative that a contingency plan is put in place to deal with any unforeseen circumstances.”

An element often left to chance is that of stakeholder expectation. This must be balanced against realistic service delivery levels, allowing time for change if business process re-engineering is required.

By having a professional in charge of an outsourcing project, issues ranging from diversity planning and environmental compliance to human resources issues and change management will be properly handled.

Business Matters issue 159 • April 2008 53

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Advice

It’s not wrong to ask for advice anagement, marketing, PR, finance, IT – ask for help in any industry these days and you can be sure there will be consultants queuing up to offer their expertise.

You can’t throw a paperclip without hitting one.

But there’s great debate going on now about the value of employing consultants. “Why do you need to pay someone to tell you how to do your job?” is a common query from the cynical.

It’s a moot point. Nevertheless, it seems organisations have gone consultancy crazy. According to the National Audit Office, the government spent some £2.8 billion on management consultants last year alone.

These figures, when published, provoked an outcry about the spending of public money. But that’s another story.

As a profession, consultancy is soaring in the UK. But who exactly are consultants and why should companies hand over their money for the promise of golden nuggets of insightful advice?

M

The experts Well, these are individuals who are considered to be experts in their fields and boast a telephone directory of contacts they can draw from at any time for support. Confidence and strong interpersonal skills are also prevalent characteristics of this breed. A key reason many organisations look to them is the objectivity they bring by offering an external perspective. Fresh ideas and suggestions for enhancing the business are other enticing factors.

But the question is, how can you guarantee that you are actually buying in the best external help and avoid blowing budgets on someone who simply points out the obvious? Bear in mind that when done properly consultancy can be revolutionary for a business, but it can also be a huge waste of money if it goes wrong.

Make sure you’re not wasting your time and, importantly, the time of your employees. There’s nothing harder to swallow than someone lecturing you on a subject you already know all

about. It’s guaranteed to raise the hackles and make you start thinking about all the other work you could be doing instead.

To avoid this, it’s advisable to track down a consultant who suits your circumstances and has experience of a business of your size, while comprehensively understanding your industry. It’s always worth asking your peers and business colleagues if they can make any recommendations. Check that the consultant holds the right qualifications and is a member of a professional trade or association. Ideally you also want someone with a proven track record of success.

When recruiting a management consultant, the Institute of Management Consultancy, the industry’s professional body, suggests a few tips to follow before committing to anything and gives some pointers to guarantee a happy working relationship.

First, to get the best out of any partnership, clearly define your objectives, then ask the consultant to provide a written proposal for you to consider in response to your needs.

Make sure to brief the consultant fully about your requirements and direction. Ask for references and, though it sounds obvious, make sure to follow them up.

Act on the advice Once the work is done and the consultant has delivered a verdict, implement any recommendations they make, but make sure to involve your management at all stages.

Finally, don’t get too dependent. Rumour has it that consultancy can be addictive. You don’t want a workforce that becomes too reliant on advice and loses the ability to think for itself.

Business Matters issue 159 • April 2008 55

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Advice

Making the right financial decisions Paul Morley, looks at getting the financial foundations of your business correct unning any kind of business can be fraught with problems, but one element that is essential to get right from the beginning is finance.

From the novice business start-up owner through to the qualified finance director of a major plc, the notion that cash is king means that a close watch and tight rein needs to be kept on the finances of a company.

The importance of ensuring financial systems and supports are in place is therefore important for any businesses, but particularly those in the SME sector.

There are many interdependent factors when it comes to the financial side of a small business where, because of resource restraints, the business owner may have to take on the role of accountant as well as everything else. Some fairly basic issues, if taken care of properly and at an early enough stage, can make all the difference to the financial wellbeing of a business.

Choosing the right banking partner can have a big impact on time spent dealing with finance issues. It may be tempting to open a business account with the existing bank of the business owner for the sake of convenience, but this is not to be advised. Deals with other banks could be more attractive, offering elements such as lower charges and higher interest rates if the account is in credit.

It is important to have a sound grasp of what banking facilities will be needed when looking at financing a small business. Deciding on whether just a basic account is needed or one which is more complex allowing, for example, electronic access will depend, to a large extent, on the type of business being conducted.

Most banks have a dedicated small business advice team while others offer a telephone helpline but there will be differences in pricing depending on which method is favoured by the business owner.

A business plan will help to provide guidance as to whether finance needs to be raised.

R

Is family the best source of seed capital?

It is important to know, though, whether additional funds are needed due to the business expanding or because things are going badly and the operation is running out of money.

According to smallbusiness.co.uk, there are various sources of finance available, but where to go to depends on whether the business has a track record or is a relatively new concept.

Asking the family According to a survey undertaken by the Federation of Small Businesses, the main sources of finance for small businesses are friends, family or the founders of the firm.

Raising the money personally is a good way of keeping control of the business and ensuring that that there is no third party debt. Most banks will lend money to small businesses on production of business plans but normally only against some form of security.

Other ways of raising funding include using specialist backers or applying for grants from local Business Links initiatives or other local development agencies. The Department of Trade and Industry and the European Union also have various cash schemes in place for small businesses and loans are available from the government-backed Small Business Service,, which can lend as much as ÂŁ250,000, though the terms are stringent. The scheme is aimed at small companies that have not man-

56 For further information on how to advertise Tel: 0870 116 2854

aged to get funding elsewhere, perhaps because of few tangible assets against which money can be borrowed.

Despite funding being in place, it is essential to keep the cash coming in and small businesses sometimes find this a challenge, especially if they rely on a limited number of customers. Some 10,000 UK businesses go bankrupt each year because cash they are owed is paid too late. It is therefore essential, in order to avoid these problems, that payment terms are clearly set out in advance for customers and that adequate credit control procedures are in place should the need arise.

One way for small businesses to bridge the problem of either having to chase debtors or deal with non-payment of invoices is to factor the debt. This allows an organisation to sell its debt to a third party, which pays a portion of the debt in advance of collecting the full amount. This will incur a charge but can mean the difference between long and short-term survival. Using such a service allows a business to have access to cash that would normally be tied up for months and frees time to concentrate on service and sales.

To keep as clear of debt as possible and to maintain a healthy financial state of affairs is difficult, but planning and focusing on this area in advance will help circumvent problems at a later date.

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Recycle your magazine and seven days later it could come back as your newspaper. www.recyclenow.com

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technology

Real printing

Power

Office printing has really come on in leaps and bounds over the past year and with colour laser printers far more affordable Mark Prigg looks at the options available for both the office as well as the home office.

Dell Colour Laser 3110cn

Lexmark C530dn

£270 dell.com

£310 lexmark.com

The Dell CLP 3110cn won't win any design awards, but it's not bad looking -for a printer. It's approximately 400mm by 470mm by 485mm and resembles a fat, half-height dustbin, though its black and gunmetal colour scheme is a definite improvement on the plethora of beige printers we've seen over the years. It's not particularly heavy, but Dell recommends you lift it out of its box with the help of a friend.

Toner can be loaded with ease by opening the front of the unit and installing separate black, cyan, magenta and yellow cartridges. There's a control panel within easy reach at the top of the unit, which includes a two-line LCD display that relays information such as the remaining toner level for each of the four cartridges.

There's a 250-sheet tray at the very bottom of the unit, plus a 150-sheet tray multipurpose tray at the front giving a standard paper handling capacity of 400 sheets. We think this is more than ample for small to mid-sized businesses and solo users, but compulsive tree-murderers can add an extra 550-sheet tray, taking the paper capacity to 950 sheets.

Running costs on the 3110cn are very good. At the time of writing, a standard capacity (5,000 pages) black toner cartridge costs 53, while the three colour cartridges cost 73 and last for 4,000 pages at 5 per cent paper coverage. That's just over 1p per page for black, and almost 2p per page for colour.

Obviously your own mileage will vary, but the printer works with the Color Track 2 tool (included) which can help reduce the total cost of ownership. It gives you the ability to create up to 50 user or department accounts, each of which can be assigned usage limitations. Want to stop the notorious Sally from HR printing her holiday snaps? Just restrict her ability to print in colour.

PROS: Speed; cheap running costs; print quality CONS: Noisy when in use

58 For further information on how to advertise Tel: 0870 116 2854

The Lexmark C530dn is a fast, high-quality colour laser printer that we recommend for any small office or home with high-volume printing needs. For £300, you get a network-ready printer with a built-in duplexer for automatic double-sided printing. If you need increased paper-handling options or more toner cartridge choices, check out the C532n (£340, no duplexer) or the slightly more expensive C532dn (£430).

Lexmark also has taken laudable steps to improve the eco-friendliness of its laser printers -- by reducing power consumption and material waste -- which benefits both your bank balance and the environment, a move we applaud. We're curious to see whether other manufacturers follow suit. The Lexmark C530dn's print speeds and quality are on a par with the more expensive Oki C5500n, which lacks a duplexer, making the C530dn a better buy.

The C530dn comes with a 250-sheet input tray that can expand from A4 to hold legal-size paper, as well as a 100-sheet multipurpose feeder that folds out from the front panel of the paper tray. You don't get any paper expansion options on this model, but it should be sufficient for home users. If you're in a small office environment and need expanded paper handling, the Lexmark C532n model offers the same 250-sheet tray plus an optional 550-sheet drawer, though you lose the multipurpose tray in favour of a single-sheet manual feed slot (for an 800-page max input). The next step up is the C532dn, which offers the 250-sheet tray, the 100-sheet multipurpose feeder, and the optional 550sheet tray, for a total input capacity of 900 pages. The C530 series machines lack straight pass-through printing, a potential problem if you're using paper that has a tendency to jam when curled.

PROS: Fast prints; excellent print quality; built-in duplexer CONS: Colour handling could use some minor improvements

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Te c h n o l o g y

Samsung ML-3051ND £250 samsung.com The Samsung ML-3051ND straddles the gap between an über-expensive office laser printer and a personal laser printer, both in terms of features and price. For around £250, you get a network-ready mono printer with versatile paperhandling options, expandable memory and high-quality prints.

The ML-3051ND model includes a built-in duplexer, but if you don't need that, the ML-3051N is around £50 cheaper. The ML-3051ND is an excellent choice for a small office with high-volume printing needs that doesn't need colour prints.

The Samsung ML-3051ND's boxy grey exterior epitomises the cubefarm aesthetic: it's nothing to write home about, but it gets the job done. The printer sits 399mm wide, 432mm deep and nearly 284mm tall. Hand grips at the base of either side make it easy to move the printer around, though as a networked printer, you probably won't move it frequently.

The ML-3051ND has an impressive array of paper-handling features for such a low price. A 250-sheet paper cassette pulls out from the bottom and can handle A4 and up to legal-size paper. (When using legal-size sheets, the paper cassette will stick out a little from the rear of the printer.) A second 250-sheet paper cassette is available as an option. Folding down a flap on the front of the printer reveals the multipurpose tray, which can hold up to 50 sheets of plain paper. Likewise, you have two options for output: a deep well in the top of the printer serves as the main output, while a door in the rear of the printer covers the straight pass-through output, handy for thicker media such as card stock.

PROS: Expandable paper-handling options; network ready CONS: Autoduplexing is an optional extra

HP Colour Laserjet 3600n £450 hp.com The £480 price tag on HP's Color LaserJet 3600n (you can find it for less if you shop around online) seems steep for an individual buyer but modest for a small workgroup seeking a network colour laser printer. Unfortunately, its text quality leaves something to be desired and its expandability options are limited. Lexmark's similar C522 sells for around £100 less and provides better text quality, though Lexmark's cost per page is slightly higher than HP's and the difference may add up over time.

The 27kg 3600n is small and has deep handholds, so one person can carry it easily. The printer's front wall folds out to expose the paper path, four integrated toner cartridge/imaging drum units in a vertical rack, and the image-transfer belt clipped inside the front wall itself. The design couldn't make jam-clearing and maintenance any easier. However, the wall and hinges could be sturdier.

The 3600n prints black text at a reasonable 13 pages per minute (ppm) and colour graphics a bit faster, at 13.5ppm. For comparison's sake, the Lexmark C522n prints text at 14.2ppm and graphics at 12.3ppm.

The HP's print quality disappointed us on the important tests. Text looked greyish instead of black, showed some roughness in large point sizes and lost fine strokes. Colour graphics didn't negotiate shading ramps smoothly and produced blocky transitions, though the printer acquitted itself on colour accuracy and detail. Plus it did a great job on greyscale photos, with fine detail and smooth shading.

PROS: Well designed; handles paper well; low cost for consumables CONS: Limited expandability options; text quality is not up to par

Oki C3400n £320 Oki.com Small-office users generally need a printer that is fast, networkable, cost efficient and excellent with text prints. This usually means they are in the market for a laser printer. The Oki C3400n fits the bill, though it's not without its downsides.

The £320 colour laser printer won't break the bank in terms of upfront cost and the cost of mono prints, but the cost of colour prints will eventually add up. Also, the C3400n doesn't include a duplexer and its paper capacity is not expandable -- both features that are common on laser printers. If you need those features, check out the Samsung CLP-510N, but keep in mind you'll get slower print speeds.

In terms of speed and print quality, the Oki C3400n is a speed demon with colour prints. If you're a small-office user looking for a fast performer with good-quality prints, the Oki C3400n is a good choice.

Like most laser printers, the Oki C3400n is large. The grey-and-white unit stands 376mm by 290mm by 480mm, and it weighs a hefty 21kg. Hand wells on three sides make it easy to grip, but its bulky frame makes moving it a two-person job. The printer comes standard with a 200MHz PowerPC processor and 32MB of RAM, though you can upgrade to up to 288MB of RAM. Both Windows and Mac operating systems are supported, and the printer is Ethernet-ready, a boon for a multiuser environment. Duplexing (or double-sided printing), however, is a manual operation on this model, and Oki does not offer an optional duplexing unit for this printer.

In terms of performance, the Oki C3400n impressed us with its fast print speeds. When printing black graphics and black text, it printed just slightly slower than the competition, including the Lexmark C500n and the Samsung CLP-510N -- 16.01ppm and 15.55ppm, respectively. It knocked the competition out of the ring, though, with its zippy colour graphics and colour text speeds PROS: Superspeedy colour prints; excellent quality with black text CONS: Paper capacity is not expandable; no duplexer

Business Matters issue 159 • April 2008 59

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Legal

Money Laundering: A warning for recruiters!

Gareth Kervin, Looks at parts of The Money Laundering Act that you might now know about...

t is common knowledge that The Money Laundering Regulations 2007 came into force on the 15 December 2007. But do you know how they will affect your business or how to comply with the regulations?

The Regulations extend the scope of the money laundering legislation to encompass a wider spectrum of businesses, including recruitment businesses. The regulations will mean that businesses may face potential criminal liabilities for non-compliance.

"Trust or Company Service Providers" ("TCSPs") are now specifically included in the Regulations as a relevant business. A TCSP can include any firm or sole practitioner who are "acting or arranging for another person to act" as a director or secretary of a company or as a partner of a partnership or a similar legal position. HM Revenue & Customs' (HMRC) guidance specifically include recruitment agents and management agencies, involved with the appointment of directors, shadow directors or company secretaries, under the definition. In addition, recruitment businesses that provide payroll services could be caught under the definition of an "Accountancy Service Provider" (under which "Payroll Agents" are specifically referred to in HMRC Guidance) or "High Value

I

Dealer" if the agency is receiving high value payments to fund payments to the employee or to pay tax or NICs on the client's behalf.

Requirements As a direct result of the Regulations certain recruitment businesses will be required to be supervised by HMRC. This will involve: • being registered with HMRC before the 1 April 2008.

• paying an annual fee based on the number of business premises.

• an ongoing reporting obligation.

• implemention comprehensive anti-money laundering systembs (to prevent and report).

• appointing a money laundering reporting officer and to apply for a "fit and proper test".

Regulation 18 of the Conduct of Employment Agencies and Employment Businesses Regulations 2003 ("CEAEB") already provides that the identity of hirer/employer must be verified prior to introduction of a work seeker and under regulation 19 the identity of the work seeker should be obtained. The Regulations extend this requirement by placing an obligation on the agency or business to ensure the hirer/employer is not in severe financial difficulties or engaged in immoral legal

60 For further information on how to advertise Tel: 0870 116 2854

practices. Furthermore, the Regulations will impose more severe criminal responsibility upon the specific individuals who fail to comply with its strict requirements. Such criminal liability may include imprisonment.

The CEAEB already impose criminal liability upon businesses for certain and specific offences including charging fees to workers, failure to secure the proper conduct of an employment business, making false records or failure to comply with a prohibition order. Any person found guilty of these offences is liable on summary conviction to a fine up to £5,000 for each offence.

Prevent misuse The Government's intention in extending the money laundering provisions is to prevent the misuse of corporate entities. It is hoped that the monitoring of TCSPs so tightly will ensure those running such businesses are fit and proper and avoid improper use.

Whatever the intention, it is clear that the impact on recruitment agencies and employment businesses will be significant.

To contact Gareth, please email: gkervin@kingsleynapley.co.uk or call 020 7814 1200

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Legal

No need for alarm with new fire regulations S

ince October 2006, a new fire safety regime has been in place in England and Wales, replacing the previous legislation which required some properties to have fire certificates.

Fire certificates are no longer valid. Those with obligations under the new regime must decide for themselves, through a selfassessment process, what the fire risks at their premises are and what measures they must take to minimise those risks.

Although the new regime has been in force for 18 months, many businesses have not got to grips with their fire safety obligations.

The law The new regime is wider in scope than the old fire certificate regime - it applies to all nondomestic premises, including external paths and driveways.

(Fire certificates only tended to apply to certain premises, such as hotels, factories, offices and shops.)

The duty to comply with the new regime is placed, primarily, on the “responsible person”, which will usually be the employer.

Where there is no employer, the responsible person will be the person who has control of the premises for the purpose of a trade, business, or undertaking. If the premises are empty, the responsible person will be the owner.

There is a second category of person with obligations under the new regime; this is only likely to apply to businesses that, for example, maintain fire safety equipment or maintain or repair premises on behalf of others.

It is possible that one property

Oliver Ennis looks at the fire safety rules and regulations to ensure that you do not fall foul of the law. could have more than one person with duties under the legislation.

This is most likely to be the case in commercial properties with more than one tenant. Where this is the case, all those with duties must co-operate with each other.

The main duties are: • to take general fire safety precautions; • to carry out a risk assessment and to keep this under review; and • to provide information and safety training to employees.

The duties under the new regime are owed to those lawfully on the premises and those at risk from a fire on the premises.

Failure to comply with the new regime is a criminal offence.

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Conclusion SMEs must carry out a risk assessment, implement its findings and keep it under review. The Department for Communities and Local Government’s web site contains useful property-specific guidance on carrying out risk assessments and general fire safety precautions. Following the recent publication of new Government guidance on enforcement, local fire authorities may well start to look more closely at compliance, so SMEs be warned!

For further information, Oliver can be contacted at: 01603 693214 and oliver.ennis@mills-reeve.com

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Business Matters issue 159 • April 2008 61

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Perks

Haozhan

Haozhan is a pleasant restaurant staffed by nice waiters, with an interesting menu of wellprepared dishes.

At Haozhan, whose chef, Chee Loong Cheong, used to work at Hakkasan the menu doesn't just tour the predictable Cantonese staples but flirts with the occasional Japanese or Thai flavour. It even looks different: instead of going for decor reminiscent of your auntie's in Penge, like all the others on the strip, this one is modern with lots of clean lines, the walls fitted with mirrors and jade-green panels. And, whisper it, the waiters smile.

The kitchen has a particular talent for deep frying, to produce items that are crisp but greaseless. A starter of crispy quail with chilli and salt, a dish familiar to me from Hakkasan's sister restaurant Yautatcha but available here at two-thirds of the price, brought two whole birds in a light, crisp batter sprinkled with aromatics which managed not to overwhelm the gaminess of the birds. Curry soft-shell crab sounded distinctly worrying (which was why we ordered it) but happily wasn't, the delicate creatures gently battered and sprinkled with shards of a fiery spice mix. My companion and I were divided over the spare ribs with a coffee sauce, which is to say he thought them odd in a bad way and I thought them odd in a good way.

Yes, there was a bitterness to the sweet glaze on the thick meaty ribs, but also a certain fragrance which reminded me of rosemary.

We agreed about the star dish, the silver cod with a dry XO sauce of minced prawns and chillies. The generous slabs of fish had first been sealed off, but so sensitively that as you cut through the outer skin, the huge flakes of pearly fish fell apart. The XO part of this plateful simply cut through the richness. I would come here for this dish alone.

Some other things didn't startle, such as underpowered scallops with macadamia nuts and stir-fried vegetables including a surfeit of out-of-season asparagus. The latter also turned up in a dish of Szechuan vegetables, which was more notable for the strands of silky tofu. Haozhan makes its own tofu, and there's a whole list of dishes using it which we should have tried but didn't.

EOS: the real business

FIRST IMPRESSIONS I arrived at London Stansted at 0820 for my 1030 departure.

The check-in area for Eos is at the far left end of the departures terminal. Security formalities were swiftly dealt with, and an invitation for fast-track and the Eos lounge was presented to me.

Fast-track at Stansted involves being escorted to the head of the security line, which is either wonderful or embarrassing, depending on your personality.

Flights on this route depart London Stansted at 1030 and arrive New York JFK at 1329. Eastbound flights depart JFK at 1905 and arrive Stansted the next morning at 0730.

The lounge Located next to gate 7, has comfortable armchairs, a selection of hot and cold drinks and sandwiches and a view down to the aircraft.

The seat Boarding was on time. The plane has a fresh interior in shades of grey, black and white.

The “suite” seat has a 198cm, fully reclining seat with cashmere blankets and Tempur-Pedic pillows. It is clear that a lot

62 For further information on how to advertise Tel: 0870 116 2854

of time, attention and money has been spent.

The layout of the seats resembles that of British Airways, except that all seats face forward in a staggered formation and all have aisle access. The seat was good for sleep – being wide and comfortable – and for work, with a wide, firm table that adjusts both forward and back, which is good if you want to use the keyboard of a laptop or write notes. I was impressed by the power supply, which requires nothing more than a US adaptor and kept my computer fully charged for the whole journey, meaning on this daylight flight I could complete a day’s work.

There is a good-sized seat opposite for a colleague to join you for meetings, and even a seatbelt for their safety.

In-flight entertainment came courtesy of a personal DVD player and excellent BOSE noise-reducing headphones. The choice of movies was limited but adequate.

THE FLIGHT The meal service throughout was faultless, as was the

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Perks

VW Tiguan

Dean Woodward, Contract Services Manager, DaimlerChrysler Fleet Management gets his hands on the keys to the new Tiguan WHAT IS IT? Tiguan is the new compact SUV from Volkswagen. Baby brother to the Touareg, it is lighter on your pocket and slightly kinder to the planet. The Tiguan’s presence sent trembles down the chassis of rivals Freelander and X-Trail, combining German quality with the desirability of a compact SUV.

The EOS Suite

SIGNIFICANT OTHERS ARE: • LandRover Freelander II • Nissan X-Trail • Toyota RAV4 • Vauxhall Antara • Honda CRV

overall service on board. There was an immediate offer of water, orange juice or a cocktail of champagne mixed with campari and lime. The meal choices were good, with the main course options being fillet of beef with grilled polenta and green beans rolled in bacon, Skipper DO & CO (fillet of salmon, fillet of sole, prawn), and asparagus risotto with homemade parmesan crackers. For wine you could choose between three reds and two whites as well as Lanson Black Label Brut Champagne, along with a listed selection of spirits, liqueurs and both regular and decaffeinated coffee and tea.

MODELS AND ENGINES COMPRISE OF: • 1.4 litre TSI petrol and 2.0 litre diesel engines • Trim levels – S, SE, Sport and Escape

ARRIVAL We arrived 10 minutes late but quickly cleared immigration

HANDLING / PERFORMANCE Initially with a choice of two engines, the 1.4 petrol engine is both supercharged and turbocharged; a formula already proven in the Golf and Jetta. Handling is more akin to a car than a top heavy 4x4. In standard driving conditions the front wheels enjoy 90% of the power but, when required, the Haldex unit transfers more power to the rear, providing a sense of vehicle ESP and driver assurance.

VERDICT There’s no doubt this is a wonderful on-board experience. Stansted is a great alternative to the nightmares that are Heathrow and Gatwick.

Eos should be applauded for its daring and innovative approach. The rest of the airline industry will be watching with interest.

VEHICLE APPRAISAL STYLING A scaled-down Touareg with boxed wheel arches. Tiguan’s styling doesn’t set the world on fire but has acceptance from its VW brethren. “Wheels maketh the car” and the 18’’ sierra alloys on the sport variant win hands down. The Tiguan looks best in silver or black; it seems less distinguished in red or blue.

INTERIOR Solid feeling, firm ride with robust components built to last; this prevails where other manufacturers have failed. The flexible rear seat slides back and forth and can accommodate either heavy shopping or hitchhiking basketball players.

SUMMARY A new kid on the block that could soon be considered as one of the best in class. Watch out for the XC60 though, its coming soon.

Business Matters issue 159 • April 2008 63

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Books

The business

book shelf A Friend in Every City

BlackBerry: A Cultural Icon The BlackBerry has emerged virtually overnight as one of the most popular and necessary pieces of extended technology in the world.

The idea for the BlackBerry came to inventor Mike Lazaridis late one night when he realized how helpful it would be for people to be able to check their office e-mail whenever and wherever they happened to be: at home, travelling on business, or attending a hockey game. In 1997 his firm, Research in Motion (RIM), was just another small, high-tech hopeful with an annual revenue of $13.5 million and 180 employees making two-way pagers. The January 1999 launch of the BlackBerry has for ever changed the firm.

Today, there are 3,500 employees - including 1,000 engineers - and an annual revenue of US$1.35 billion.

Much more than a book about business, "The BlackBerry: From Cult Object to Cultural Revolution" is a biography of a unique cultural icon.

64 For further information on how to advertise Tel: 0870 116 2854

A Friend in Every City is an inspirational and practical guide to the art and science of networking.

Networking is the key skill for the 21st century worker.

As birth rates go down, life expectancy goes up and the business world continues to downsize to a core of permanent workers, more of us will find the 21st century a tough place to make a living. More of us will find ourselves working as freelancers or as part of ‘fractional teams’ that come together for a project and then disband. Fewer of us will retire on a pension – choosing instead to work on a portfolio of projects.

A Friend in Every City looks first at the forces shaping the new ways of working, then at how online networks, such as LinkedIn, Open BC, Ryze and Ecademy, are evolving to provide support for them. The authors look at how an individual worker can leverage these changes to their best effect.

Networks can provide us with support in all aspects of our lives. A good network will sustain us through bad times as well as good, providing emotional support as well as referrals. Contacts become connections, connections become advocates and advocates become friends.

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Books

Business Wise

Doing the Business

If you are starting a business, or considering doing so, BusinessWise is the book for you.

A collaboration amongst over 20 business experts, this book looks at the whole process of setting up a new business with success in mind. It covers a wide range of topics including business set up and vision, marketing (including using the internet), selling, finance, working in and managing teams, working from home and beating procrastination, networking internationally, getting the right message out in the right language, health and fitness and collaboration.

The authors, all life members of the network Ecademy.com, are experts in their subject area and have shared many tips and ideas here that they would normally only reveal in training sessions or paid consultancy.

This book's author David L. Steward's ethical lessons are admirable. He divides his advice into weekly units, making it easy to apply.

(This also reflects the book's roots in a weekly church-based study group). However, though Steward sees his lessons as straightforward, many readers might find his logic a little challenging. For example, he draws the lesson of niche marketing from Matthew 6:24, "No man can serve two masters." This makes interesting sense at first. However, while his later expansion into a second niche may offer a good business example. We recommend his warm, inspirational guidebook to spiritually inclined readers who are interested in using their beliefs to reinforce ethical business practices.

The Entrepreneur's Guide to a Good Night's Sleep Successful entrepreneur Michael Bell shows how to set up and run a successful business without losing sleep, in this new book.

Michael Bell began his working life as a motor mechanic with the Kennings Motor Group, switching to sales before joining the Financial Services industry in 1977. He became a top sales producer and manager in record time. After one other move to a major insurer, he started his own company, Results Financial, in 1998 as CEO and sole owner.

Since then the company has gone from success to success, and Bell launched a new enterprise "Chef Results", which is also trading profitably.

The secrets of entrepreneurial success are not that difficult to grasp. The key, says Bell, is to plan and run the business from the start as though you are preparing it for sale - in much the same way that builders build a great new house.

Plan it properly, get everything right FIRST TIME, and make sure everyone is motivated to deliver the results. Don't cut corners on quality, and make sure that passion and enthusiasm ooze from every pore of the business.

Business Matters issue 159 â&#x20AC;˘ April 2008 65

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Getting to know you...

Wendy Bartlett We talk to Wendy Bartlett, Managing Director of leading catering company bartlett mitchell about how he has grown his business and the future ahead...

What do you currently do?

I started my working life as a kitchen hand.

Today, I’m the MD of bartlett mitchell, an award-winning contract catering business. We supply top-quality food to corporate clients, ranging from staff dining services to fine dining restaurants at blue-chip companies. Our clients are all based within a hour-and-a-half of our office near Heathrow Airport, which allows us to spend more time with our team and customers, and less time travelling. bartlett mitchell has 420 staff, and a turnover of £14 million.

Who is your inspiration in business?

William Baxter, my former boss at a catering company called Sutcliffe’s. He left to start his own business, Baxter & Platts, which was very successful - he told me that I should do the same. He insisted that I was more than capable. I wasn’t ambitious at all, so it never occurred to me before. When I discussed it with my friend Ian Mitchell, he was keen too. I will be forever thankful. I took the plunge and cofounded bartlett mitchell aged 40, the same year that I divorced after 19 years of marriage, moved house and found that life had truly begun.

instincts. Our FD has overhauled our financial strategy and processes, making me extremely confident about the company’s future.

we continue to work hard to maintain our personal touch – in catering, you are only as good as your last meal.

Do you have any business regrets?

What advice would you give to someone looking to start up their own business today?

Who do you admire?

People with drive and determination, who always seek to do better. Day to day, I am surrounded by such people. Our creative director, David James, is like that: he hunts for new culinary ideas, and I am often gobsmacked by his findings. Our chairman, Ian Mitchell, was 50 when he gave up a very comfortable position to come and found bartlett mitchell with me – his faith was, and is, admirable.

Looking back are there things that you would have done differently?

I should have recruited a financial director earlier than I did. Our FD, who came to us two years ago, is worth her weight in gold! Looking back I realise that we could have made better decisions, based on information rather than gut

No. The next challenge is always looming on the horizon , but there is no point being a captain in a calm sea. bartlett mitchell was founded as a lifestyle business, so that everyone in our team could indulge their passions for great food. That hasn’t changed. Despite the company’s demands, I have a great life: I am always having new experiences. We stay focused on our core business, because it is what we know – and enjoy - best.

How do you see your business/business in general going over the next 12 months?

We are on target to boost our turnover to £20 million by 2010. Although we are growing,

66 For further information on how to advertise Tel: 0870 116 2854

Don’t let yourself become “lonely at the top”. It is easy to fall into this trap, particularly if you feel that you have few people to whom you can turn for advice and support. My own solution was to join the chief executives’ organisation Vistage International, which has nearly 700 members around the UK. My fellow group members are fellow bosses from noncompeting sectors, and we meet monthly to act as one another’s non-executive directors. I have thrashed out lots of ideas this way, and have been helped to make invaluable contacts, such as our new HR advisor. I encourage all my business friends to join.

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