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REDMOND: Go and do wonderful things TOP 10 TIPS... to help your firm grow STEVE MORGAN: You’ve got to work your n*ts off
YOU’RE HIRED!
We talk to Apprentice winner Michelle Dewberry
Going it alone An ECHO supplement
HOW TO SET UP AND RUN A SUCCESSFUL SMALL BUSINESS
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Tuesday, March 16, 2010
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Tuesday, March 16, 2010
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BUSINESS SPECIAL
INTRODUCTION
Contents Pages 4-5: Phil Redmond on social enterprise Pages 6-7: How we got started in business Pages 8-9: Where will the opportunities lie? Page 14: Ten tips from top business leaders Page 15: Back to school for businessman Carl Pages 16-17: What is an entrepreneur? Pages 18-19: Ice work for sculpting team Page 20: Joining the family firm Page 21: ‘The best thing I’ve ever done’ Pages 22-23: How to get cash for your firm
Will 2010 be the year when you take the plunge and become your own boss?
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ELCOME to the Liverpool Echo’s magazine “Going it Alone” – all about setting up your own business and succeeding at it. We draw on the experiences of a score of real life entrepreneurs who tell us the reasons they took the plunge and why they never looked back. As well as sharing the secrets of their success, our case studies also pass on valuable tips from the lessons they have learned from running their own businesses – lessons sometimes learned in the school of hard knocks. By telling us their mistakes, the business owners we profile here can
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help others to avoid the same pitfalls. We look at new businesses that have only been set up recently as well as talk to others that have been going for many years. Many of us dream about starting our own business. It would, after all, be very nice to be the boss, accountable only to yourself. But a lot of us don’t actually take the plunge, daunted by the possibility of failure. Hopefully this magazine can help overcome that by not only showing how others have overcome the obstacles, but also by pointing the way to useful sources of help from business support services. There is no need to struggle alone. And what better time to start a
business than now? A lot of people may find that employers are still wary after the credit crunch and remain reluctant to recruit new staff. But now that the recession is officially over, prospects can only improve for those who choose to follow the likes of Lord Sugar, above, and take their destiny in their own hands. So whatever your skills, whatever line of business you might be thinking of starting, there is bound to be something in this magazine that you can relate to. So please enjoy reading it and if you decide to take the plunge, then the best of luck. ■ By BILL GLEESON
Page 25: How business took over TV Page 27: Tyre giant’s wheel of fortune Pages 28-29: How Steve Morgan made millions Page 30: Get trained for success Editor: Bill Gleeson Design: Alistair Houghton
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PHIL REDMOND TV GREAT: Brookside creator Phil Redmond says many entrepreneurs are driven by ‘simple curiosity’
Redmond: brilliant Mersey TV founder and Capital of Culture boss Phil Redmond, who created Brookside and Hollyoaks, says you could change the world by starting your own social enterprise
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THE REDMOND FILE d as a il Redmond traine ● Kirkby-born Ph before becoming a quantity surveyor er rit television scriptw ll, which l drama Grange Hi oo ● He created sch in 1978 and ran for 30 years C launched on the BB sey ond founded Mer became dm Re 81 ● In 19 mpany co ll wa ild Ch e Th oduction Television. ost successful pr one of the UK’s m companies ated by drama Brookside, cre ● Liverpool-based ced by Mersey TV, launched on Redmond and produ 2003 til Channel 4. It ran un soap d launched teen on ● In 1995 Redm ester-set programme Hollyoaks. The Ch ne of Channel 4’s sto remains a corner schedule 2004, sold was made a CBE in mpany is ● Redmond, who co e Th . 05 20 in ia ed Mersey TV to All3M es tur now called Lime Pic ty ond became depu pany and ● In 2007 Redm Com re ltu Cu ol po er pital of chairman of Liv of Liverpool’s Ca was the architect Culture year
PHIL REDMOND writes in the Daily Post every Friday
T IS now almost four years since I Chaired the Merseyside Entrepreneurship Commission. Another 12 months and we will probably be able to hold a reunion, but how the world has changed since then. We do not need to dwell too much on the crashing, perhaps crushing, realisation that the days of corporate and public largesse are drawing to a close. Well, for most outside the banking sector perhaps. For the region’s economy this is a coin of two sides. On one side, the cheap money that fuelled the building boom may be curtailed, but spin the coin and we find ourselves exactly where we have always been: lagging behind and managing a post-industrial economy. It’s basically what we do. And to some extent, we have been very good at it, with one huge caveat. A very deep public sector pocket. Like a smothering parent, the public sector, in one shape or another, sustains the region’s economy, but like all parents, it is ageing, living on dwindling savings, an inadequate pension, the care home beckons and it is locked in nostalgic ideas of a bygone age. It has been a good parent. It has tried its best wherever it could to make life safer and more secure, but in doing that it has stifled independence and encouraged dependency. Again, we do not need to dwell on this, it is just a fact we have to accept and face the challenge it presents. Either we can simply downsize, tighten our belts and reduce our standard of living to match the dwindling resources of the public sector; or – my option of choice – we can climb out from behind the barricades and metaphorically do as our forefathers did: go down to the riverbank and look out to the world. Then it was learning to sail the oceans, now it is surfing the net but the long-hailed digital future is nearly upon us and with it the opportunity to do what our forefathers did and put good ideas to work. It took one person to think of building a wall to retain water to unload ships 24/7 and it revolutionised the world. It took one person to invent the steam engine. One person to invent the integrated circuit board. One person to invent the search engine that gave the world Google. Just as it was Thomas Newcomen that is credited for inventing the steam engine, it was George Stephenson who made it work. While it was Bob Noyce who gave us the integrated circuit, it was Bill Gates who gave us personal computers. While it was Larry Page and Sergey Brin who gave us Google it was actually a guy called Peter Deutsch at McGill University in Canada that created the search engine. What’s the connection in all this? Social Enterprise. That, while it is often entrepreneurs that go on to become billionaires, equally often the innovators are driven more by a sense of public good or simple curiosity. People who have ideas that they wish to pursue simply for
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Go and do things
BUSINESS SPECIAL 5
Oliver MacPherson and Rob Chaderton.............Eight4Sport WINNING INNINGS: Oliver MacPherson, right, and Rob Chaderton from Eight4 Sport
STARS: The cast of Hollyoaks
their own sake. People who create something buyer with what they need. It is about looking that others can build on. for and spotting opportunities in existing and Bob Noyce, while giving the world Intel developing markets and one of the greatest chips, never achieved the mega-wealth and lessons to come out of the Capital of Culture therefore celebratory status of Gates, Page and Year was the almost insatiable appetite people Brin but is known as the inventor and spiritual have for “doing things”, especially in their own soul of Silicon Valley, even mentoring and local communities. helping Steve Jobs on his way to Apple. Many local talent shows were subsidised by Noyce’s major contribution was in helping to the Culture Company in 2008 but played to establish the egalitarian management style of packed houses. What is the difference between Silicon Valley that created the environment in a hall in Croxteth and ITV’s X-Factor? Both which people were simply encouraged to “go have acts, audiences and judges. The answer is off and do something wonderful”. scale. The model is the same and all it needs is Those of you, no matter how cynical, who someone to pick it up and adapt it. Or, more have heard any of the technocrats speak will importantly, in the post-industrial, have heard echoes of this philosophy in their post-public-sector-dependency economy, utterings, and I make this point because in someone to be encouraged to pick it up? order for us to face the As we edge deeper and challenges that lay ahead we deeper into a digital economy need to fully grasp that it is where the power of local ideas people and their ideas that have is matched by their value in a to be nurtured and promoted. global market, we need to shift For news/sport/life Not public subsidy. our understanding of social text ECHO to 67800 Lord Alan Sugar recently enterprise away from said that people in business something that is charitable in looking for public handouts were usually nature but done in an enterprising way, back to those bankrupt or peddling uncommercial the idea that entrepreneurial endeavour can ideas. He was right. have a great social impact. For instance, the iPhone has a commercial application that Four years ago at the launch of the MEC allows diabetics to more conveniently and Report I said this about Social Enterprise: “In accurately monitor their blood sugar terms of driving forward the economic throughout the day. Such applications can be prosperity and security of Merseyside – the developed in a bedroom but sold in a global promotion of entrepreneurship – the market place. privatisation of social services or charitable Social enterprises are vital in any economy, activity needs to be supported from other not just for the localised goods or services they areas.” can deliver, but through the environment they I still believe that is right because what I create. An environment in which people are was attacking then was the distortion of the seen to be doing things. Where ideas can term Social Enterprise. Then, as perhaps now, it was seen by too many as a way of describing thrive. An environment in which people can be grant aid to community based projects that encouraged to “go off and do wonderful either took people off the dole or filled gaps in things”. service need. However, that is also to distort or Whatever public subsidy is left, it should misinterpret the legacies of Newcomen, Noyce go on encouraging that environment of real or Deutsch. social enterprise. Less time, and cash, in Social Enterprise is important and as we foreign climes chasing super-brands like edge deeper and deeper into a knowledge and Gates, Page and Brin, and more time at culture based economy, it will become more so. home encouraging the people who may one All business is about providing a potential day join them.
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ECHO Our
BUSINESS Story
A PUSH in the right direction from some old friends was all that was needed to get lifestyle gurus Oliver MacPherson and Rod Chaderton’s new sports business off the ground. Mr MacPherson, who comes from South Africa, explained: “I decided the time had come to finally start up a business instead of just continually talking about it. When on a trip back home last Easter my friends asked how my business was going. They’d assumed I had already started, so I thought it was the time to get on with it.” So, with help from business partner Rod Chaderton, from Wirral, Eight4Sport was created. Eight4Sport supports the development of indoor sports, the primary product at this stage being indoor cricket, but with plans on the horizon for the development of a range of other indoor sports. MacPherson said: “The cricket takes the concept of 20/20 cricket, moves it indoors and ‘timebounds’ the game, in other words restricts the length of the game. Our research showed that the vagaries of the British weather coupled with the length of time a game of cricket takes were the prime obstacles stopping people getting involved. We’ve seen the model work very successfully in Australia and South Africa and believe that now is a great time to launch in the UK.” Mr MacPherson has always wanted to run his own business after developing management skills while working for a
larger organisation and so far it’s living up to his expectations. He said: “It is the best decision I have ever taken. Starting any business has its highs and lows, but we’re currently on track to launch in 2010. There is a huge amount of satisfaction in being so close and so involved in something that I believe in.” As Eight4Sport is a new business they have fortunately escaped the credit crunch which has affected so many other businesses locally and nationally. As the first of its kind in the Northern England, He and his partner have big plans for future expansion. Mr MacPherson said: “We think this concept can be transferred to other major towns across the country. We have a unique selling point in that we are transferring an internationally popular team sports game to an environment that is dry and limited to one and a half hours duration. “We think we could even take this idea to Europe and roll it out there.” Starting any new business is not without its pitfalls, but the pair believe the key to success for any new business is playing to your strengths. MacPherson added: “Its a life-changing commitment. “There are always companies and services you can turn to and work with who can make up for those areas you are not strong in. You must be prepared to listen to what they have to say.”
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HOW WE GOT STARTED ECHO My
BUSINESS Story
SUCCESS: Nobles last year completed the £6m redevelopment of All Saints Catholic Primary School, Bootle
Reaping rewards Nobles Construction director John Watson uses his initiative to drive projects forward rather than standing still and waiting for things to happen
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OHN Watson founded Nobles Construction in 1995. Today the £13m turnover firm employs 48 staff. Mr Watson says while the recession was a challenge to most, Everton-based Nobles Construction has seen it as an opportunity. As the UK’s economy hit rock bottom the firm went from strength to strength winning new record contracts and establishing itself as a large independent construction company. The company had originally been part of the Nobles family painting and decorating business, until separating with the formation of Nobles Construction in 1995. Five years later the separation was finalised with a buyout by the management at that time. Mr Watson, 51, was instrumental in establishing it as a standalone company. He says: “From my early days in the industry I enjoyed the decision-making process and sought more responsibility and autonomy. “I didn’t believe in waiting for things to happen and I’d use my own initiative to drive projects, grow contracts and develop opportunities. “By 2000, I was leading a fairly autonomous existence within the larger company and the construction arm was
going from strength to strength. “We were growing quickly, winning more business and building an enviable reputation. “I felt I was playing a lead role in driving the business, yet I was still not in a position I desired and I wanted to reap the rewards I felt my hard work deserved.” Mr Watson was keen to get started. “The decision to buy into Nobles was not a difficult one. At 42 I felt more than ready – in fact my biggest business regret is that I didn’t do it earlier. “That said, I’ve worked at every level in my industry and the experience is probably an underlying factor in our success, in terms of the relationships we have with our clients, suppliers and employees. “The business has grown considerably over the past few years. In 2009, we had our best year to date, despite the collapse of the property market. Make no mistake, our growth rate would have been far greater without the credit crunch, but in difficult times it’s no small feat to say we grew, secured jobs and won new business. “Testament to how far we’ve come as a business is the recent completion of a £6m school project, which we won after tendering against 26 contractors from
across Europe. Not only were we the smallest firm to bid, but a few years ago we wouldn’t have even made the list. “I wouldn’t say we've exceeded all my expectations for the business, but I'm certainly proud of our achievements and excited by what we can do next. “It’s not been plain sailing: two years ago we were winning one in every four bids, now we’re lucky if it’s one in eight. Budgets are being slashed, and we've had to pull away from some jobs simply because the cuts mean it wouldn’t be feasible to make a profit after labour and material costs. “However, we’ve tried to make ourselves as recession proof as possible, by having no bank borrowings and a healthy book of public sector clients to complement our private work. “We also avoided the residential bubble, which has stood us in good stead over the past couple of years. “As we’ve grown we’ve benefited from more structure. I'm surrounded by a good network of people whose strengths lay in different areas to mine. This has helped ease the pressure of running the business and gives each director a clear focus and purpose within the business. “It’s not easy to start a business.” “But if you have confidence, belief in your decision making and a good business idea, my advice would be to bite the bullet and do it. “Granted, we’re in a recession, but there is never a bad time to start a business. “You just need willingness and guts to stand or fall by your decisions.”
INITIATIVE: John Watson
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‘If the store remains successful now it will flourish further in the coming years when the recession is over’
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IRSTY Doyle is a luxury womenswear and lingerie business based on the upper mall of the Metquarter. Owner Kirsty Doyle founded the business just a few months ago, while the recession was in full flow. She said: “I design all the clothes myself and they are custom-made so they are a perfect fit. “I keep all my fabric sourcing to the UK and my manufacturing is all done in London to keep control of quality throughout all of my products. Ms Doyle says she considers Corinne Roitfield of French Vogue as a role model. “She is classic and fashion forward at the same time,” she said. More locally she admires Justine Mills at Cricket in Cavern Walks. “Going into business has exceeded all my expectations in success, workload and emotions,” said Ms Doyle. “It’s extremely satisfying to see women walk away feeling good and when a customer feels great they look amazing and then they come back again and again.” Ms Doyle says running your own business is both fun and stressful. “Coming up with a creative solution for a customer is exciting and rewarding,” she said. “The deadlines and the stress makes it even more exciting.” Ms Doyle said her biggest mistake was trying to spread herself too thinly. “I tried to take advantage of all the opportunities offered,” she said. “I have learned that it’s really important to keep a clear focus on the objectives of the business and not to lose sight of why you are in business and what you want to achieve. When you are starting out you don’t have lots of staff to delegate to, so managing time is really important. Ms Doyle says the single piece of advice she would offer somebody starting their own business now is: “To go for it and, although you will be offered lots of advice, be true to yourself about what you really want to achieve.” She did take advice from a number of business support agencies, including Train 2000, Stepclever and Work for Yourself, a scheme run by Jet. “If you research business support thoroughly there are many great points of contact and advice in Liverpool,” she said. But ultimately, success comes down to your own drive to stand out from the crowd. She said: “I am here every day, seven days a week, to design outfits with clients and people can tell me exactly what they want from a Kirsty Doyle creation. “I think our USP is around developing relationships with customers so we really understand their personalities, what they love and what will work for them in terms of fashion. “Real thought and passion goes into everything we design and all our customers appreciate the fact that they are buying clothes that reflect who they are. “We offer private shopping parties
Stress makes life more exciting
with gentlemen’s evenings to help men feel comfortable in a womenswear, lingerie store. “We opened the store in the middle of a recession and I believe that if the store remains successful now it will flourish further in the coming years when the recession is
over. People may be cutting back on spending but I think they are just more discerning about what they buy. “An investment piece is always worth the money if it’s genuine quality and will stand the test of time.”
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ECHO My
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FASHION: Kirsty Doyle (main image an d above) in her Metquarter store, Liverpool
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Tuesday, March 16, 2010
OPPORTUNITIES The Mersey Partnership says future growth in our region depends on four key economic and industrial sectors, reports Neil Hodgson
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NWARD investment agency The Mersey Partnership (TMP) believes the city region can prosper in the 21st century by focusing on four key business areas. A TMP report highlights the potential from tourism, superport status, environmental issues and the knowledge economy. TMP chief executive Lorraine Rogers says it is vital to steal a march on our rivals to create viable post-recession jobs and close the region’s historically weak productivity gap with the rest of the UK. She believes that by harnessing public and private sector strengths Merseyside can make headway. “With the potential we have got now, let’s go for it and make very significant progress to get this step change,” she said. “The four areas are at different stages of development and progress, but the potential is very clear and the action plan is very clear.” TMP is working closely with the Northwest Development Agency (NWDA) and Government Office North West on the strategy and Ms Rogers said: “Government has been very positive. Along the way they have seen various drafts of the direction we are going in and their input has been part of this process.” TMP has also been restructured to encourage more private sector participation in driving the strategy and Ms Rogers stressed that private sector involvement is pivotal. Four separate private sector-led committees have been formed which will include a panel of between 40-60 stakeholders for each sector. Ms Rogers said: “The purpose is that there is real ownership of the four areas across the city region and so we can tap into brains, expertise and resources. “They’re genuine collaborative interests and we are there as TMP to support them, but the committees and panels will be in the driving seat.” She said the proposals have met with wide approval at business and government level: “I think everyone has the strong desire to make this step change in growth and I am not hearing any dissenting voices. “Who would stand in the way of job creation? What would be the logic of not supporting four city areas that could create jobs across the city region? “What is behind all of this is jobs, jobs, jobs.” The TMP report predicts that by 2020 the visitor economy could be the driving force of the region’s regeneration, supporting 37,000 jobs – up from 23,000 currently – and attracting £2bn of annual visitor spend, compared with £1.3bn. The spend also creates demand for new and additional services that lead to the creation and growth of small businesses. Liverpool’s reign as European Capital of Culture last year demonstrated the value of appealing to an international tourism market. In the three years leading up to 2008 the value of tourism rose from £1.1bn to £1.3bn and jobs supported by tourism spend were up from
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Where does
STRATEGY: Lorraine Rogers
HIGH-TECH: A researcher at Daresbury Laboratory in Cheshire. The region’s technology sector is seen a critical to its economic future
21,000 to 23,000. The city of Liverpool also leapt from 16th to sixth in the table of the most visited British cities by overseas visitors in the same period. The TMP report says: “That image is one factor that supports inward investment and the growth of the knowledge economy, as well as being good news for tourism in the city and the region more widely.” In the wake of the Capital of Culture the region is updating its tourism strategy based on three key drivers of culture, with a focus on Liverpool’s strengths in heritage, sport and music; Liverpool as a lead destination with an international profile; and conference tourism.
This involves key targets for 2020 of increasing visitor spend by more than 60% to £2.1bn, increasing jobs in tourism by 60% to 37,000 and ensuring the city is always in the top five cities in the UK league tables for overseas visits, short breaks, international conferences and cultural attendances. Work is already underway to support these targets with an expected 64% increase in available hotel rooms in the city centre from 2008 to 2012. Meanwhile, the creation of a “superport” could lead to a further 73m tonnes of cargo being processed in the region. A superport involves physical assets such as Liverpool John
Lennon airport, Mersey Docks – both owned by Peel Holdings – key logistics hubs such as Stobart Group’s £80m road, rail and sea operation at Widnes and Runcorn, rail freight terminals in Knowsley and Garston, as well as road links. The proposed £150m extension of Seaforth container terminal to exploit expansion of the Panama Canal in 2015 and the dredging of New York’s port to handle larger vessels could almost double container traffic from 800,000 units a year to 1.5m units. JLA’s £500m masterplan predicts an uplift in freight of more than 40,000 tonnes to 220,000 tonnes by 2030, representing an 8.3% year-on-year increase.
However, public and private sector partners acknowledge that government input is vital to deliver the necessary foundations for an international superport. TMP’s third focus is the environment and “green” issues are expected to play an increasingly vital role in this new century. By striving to establish Merseyside as a low-carbon economy it is estimated that up to 15,000 environment and technology sector jobs could be created by 2015 as the demand for low carbon products and services mushrooms. The huge worth of tapping into the market is an estimate that the global low carbon sector will be worth £4.3 trillion by 2015.
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the future lie? Liverpool TRADE: The Port of
SPIDER: La Princesse visits Liverpool in 2008. Merseyside’s growing tourism sector, boosted by Capital of Culture year, could offer opportunities to entrepreneurs
POWER: Burbo Bank wind farm
Carbon emissions per head of population on Merseyside are already below the UK average and the region’s low reliance on heavy industry makes its economy less vulnerable. Our abundance of natural assets for energy production, such as wind and tidal power, is also a key incentive for investment in the region. And a thriving environmental technologies sector employing more than 9,000 people and generating wealth in excess of £1.1bn is already established, strengthening the region’s credentials as a strong asset base to build on. Development of such technologies would also lead to opportunities in
professional and financial services as well as highly skilled manufacturing industries. Targets to achieve low carbon status include making the region self-sufficient using renewable energy sources and establishing it as an exporter of energy to realise major revenue streams. Among a raft of opportunities is the option of deriving income from biofuels which can be harvested from remediated brownfield sites such as collieries and capped landfill. Also, a link to the proposed high-speed rail route connecting London with the north would reduce emissions from domestic flights. The status as an industrial “first
mover” would also enhance the region, such as Jaguar Land Rover’s award of the LRX vehicle – the cleanest, greenest in the Land Rover fleet to date – to its Halewood plant. And it is proposed to establish a centre for the Building Research Establishment in the region which would be a focal point for developing low carbon products for the construction industry to reduce carbon emissions from future buildings. Talks are already underway at government level on how to establish the region as a low carbon economy and an action plan is expected to be published in March. Central to that are proposals for a Mersey tidal energy scheme and
using Merseyside as a trial site for the next generation electrical distribution networks which could feed power from renewable energy into the national grid. Finally, developing a renowned knowledge economy on Merseyside would attract investment, ideas and trade – but the region has much ground to make up on its urban competitors. Research in 2008 found the region has a smaller level of knowledge-based operations than similar areas. The involvement of school students and the younger generation is seen as vital to turn this around. To this end the region proposes to prepare a Knowledge Economy Plan
(KEP), with government support. Key assets include the three universities, the Daresbury Science and Innovation Campus and several international centres of excellence, such as Speke’s National Bio-Manufacturing Centre. The existing Knowledge Quarter supports 14,000 jobs and generates £1bn for the economy. As the sole UK city exhibiting at Shanghai’s Expo 2010 the region has an unprecedented opportunity to promote its Knowledge Economy credentials to a global audience. By mid-2011 it is hoped the KEP will have been agreed with the government and the NWDA and will be up and running and ready for evaluation by the end of 2016.
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LEAD
Advertising Feature
HELP: LEAD is a 10-month leadership development programme created with the small business owner in mind
Your business is doing well. But is it time to take the LEAD? E
VEN in difficult economic times, strong leadership can drive business growth and success. Enthuse your people, giving them clear direction, and half the battle for market share is won. As many entrepreneurs know, good leadership doesn’t always come easily. But the good news is that it can be learned. LEAD is being delivered across the North West by 13 different providers, including three within the Greater Merseyside area;
these include No Guru, University of Liverpool and Knowledge Transfer International. It’s not easy for a small business owner to take a step back and look at the bigger picture – the daily pressures of the business often decide the priorities. And yet good
leadership is every bit as important to a small business owner as it is to a director of a large corporate business. LEAD is a 10-month leadership development programme designed by Lancaster University with the small business owner in mind – and it has delivered proven results for previous participants, all of whom run businesses employing 20 staff or fewer. The delegates who took part in its pilot scheme had discovered the truth of the old cliché: “It’s lonely at the
top.” They wanted to grow their businesses but, as proprietors, felt they had no one to whom they could turn for support or to bounce ideas off, and no formal training in leadership. Their passion had got them this far, but now they needed something more. The LEAD programme sees the enterprise and its owner as sides of the same coin and focuses on both personal and business development. And it does so in a practical way – focusing on real issues being faced by participants, rather than
theoretical concepts. And it delivers real results. Ninety per cent of delegates who took part in the pilot programme witnessed an average increase in turnover of £200,000 – accompanied by a similarly impressive uplift in profits. Some expanded into new markets, while others used the lessons and experience they gained from the programme to improve their bottom lines. All delegates left the programme more confident and able, with their eyes fixed firmly on the future. LEAD is a high-value
programme that requires two to three days’ commitment from delegates over each of the 10 months it takes to complete. It is supported by the Northwest Regional Development Agency, meaning that the maximum cost to each participant business is just £2,000. Further funding for delegates may be available through the Business Link Leadership & Management Advisory Service subject to eligibility. You’ve made it to the top. Now it’s time to take the LEAD.
HOW LEAD OPERATES LEAD concentrates on two areas of the business: the business itself and the personal development of the owner-manager. The programme is made up of several elements which run alongside each other throughout the 10 months:
Supported by
● Overnight experiential – the first element of the programme is a two-day group activity with an overnight stay. This helps members of the cohort get to know each other and helps them to start thinking about their current leadership style.
● Masterclasses – 10 masterclasses are split into two themes; business growth and leadership. ● Coaching – a solutions-focused coaching approach changes how delegates work with people both inside and outside of their
organisations. ● Action Learning sets – a group of six or seven delegates who meet to discuss real business issues, resolving them through listening and questioning techniques, designed to establish positive actions.
● Shadowing and exchanges – delegates are partnered for a series of shadowing visits and exchanges. ● On-line forum – delegates share what they have learnt in masterclasses and discuss issues from Action Learning sets.
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Tuesday, March 16, 2010
LEAD
Advertising Feature
Case study: Joints & Points J
OINTS & Points was set up in 1996 by Adrian Mercer, a qualified Chartered Physiotherapist, from a converted bedroom in his own home. The business delivers affordable and effective physiotherapy services to a range of users, and has grown steadily over the years – it now has five branches across Merseyside and employs six staff and 12 clinicians. Despite partaking in numerous clinical and business courses in the past, Adrian knew he needed something different to challenge his learning and help him develop the business and his staff. He said: “LEAD gives you the time and information you need to take a look at your company in a fresh way. It has taught me how to evaluate my own skills, my staff ’s skills and the good and bad points of the business. “These tools give you the best opportunity to develop a realistic business plan – not one just for the bank, but one you can use every day to make your business work harder.” Adrian believes that by
BUSINESS SPECIAL 11
learning from others on the course, the shared experience has given him more confidence in the things he is doing right and the skills and know-how to make things work better that haven’t been so good. He added: “By talking to others who have started and run their own business, the sharing of information is invaluable. It has taught me the benefits of working as a team, trusting staff and delegating roles so that everyone can grow along with the business.” Joints & Points now has clear growth plans for the next five years. They are moving to a new head office in September, and the major challenges will continue to be managing the cash flow, being competitive, and developing into new markets. Adrian concluded: “If you think you haven’t got the time, can’t afford to or the business can’t survive without you – then these are the reasons why LEAD would be so good. Knowing how to sit back, reflect, manage time and ultimately make more money is what the LEAD programme teaches you.”
OWNER managers of businesses with up to 20 employees based in the North West who: ● Want to gain confidence in and improve their leadership skills ● Are looking to develop their business but aren’t sure of what direction to take ● Feel isolated and don’t have a peer support network to turn to for advice ● Spend most of their time working IN the business, not ON it Benefits of LEAD: ● Ninety per cent of delegates who took part in the pilot programme witnessed an average increase in turnover of £200,000. Other benefits include: ● Improved staff productivity and more effective business processes ● Helping delegates manage their business more effectively in this tough economic climate ● Increased confidence, allowing delegates to make the right decisions ● It’s the Board you can’t afford – the support and advice from peers is invaluable
PROGRAMMES
March 29 – No Guru April 27 – University of Liverpool June – Knowledge Transfer International (KTI) September – No Guru October – University of Liverpool CHANGE: Adrian Mercer
GREATER MERSEYSIDE PROVIDERS ● THE University of Liverpool Management School (ULMS) ULMS’s primary research focus is on growing enterprises, supporting innovation and developing communities and regions. In partnership with LJMU, the LEAD programme is seen as an important contributor to this goal. ULMS LEAD delegates will have access to university resources and facilities and will benefit from a tailor-made programme supported by the latest leadership academic research. ● No Guru No Guru & FREEDOM Coaching deliver LEAD under the No Guru banner. The No Guru LEAD programme is all about working with
WHO IS IT AIMED AT?
business leaders in a pragmatic and relevant way, drawing on their own experience and skills in working with diverse groups and individuals. LEAD delegates will feel both supported and challenged and are encouraged at every step to look at where they want themselves (and the business) to be. Its mission is to deliver business growth, breakthrough and world class leadership development through LEAD. Masterclass speakers include Paul McGee, Andy Bounds & Clive Gott. ● Knowledge Transfer International (KTI) KTI is a North West-based innovation and business development company.
The team at KTI all run their own small businesses, so its approach is practical and with a deep understanding of the needs, aspirations and barriers to growth of small businesses. Key members of the team worked on the original LEAD programme, so are ideally placed to guide and assist clients on their LEAD journey. KTI has also assembled a team of truly inspirational speakers, including Rachel Elnaugh of Dragons’ Den fame; Pauline Clare, the UK’s first female chief constable; and Derek Clark, coach of the winning Oxford boat crew. The next cohort will be held at The Heath and will begin at the end of June 2010.
PREVIEW/ DROP IN SESSIONS
March 17-18 – Drop-in coffee morning session, 10am-noon with No Guru, upstairs at Bean – The Meeting Place, 104 Brunswick Park March 25 – Wine & Dine LEAD taster event, University of Liverpool Management School, 5pm-7pm April 26 – Masterclass with Everest mountaineer Sir Chris Bonington – Leading in difficult circumstances, 1pm-5pm (KTI) July 15 – LEAD taster event, University of Liverpool Management School ● For more information, or to book a place at these events, please visit www.businesslinknw.co.uk/lead and click on the Free Taster Events link.
Leading the way to a better understanding Q: What is leadership? A: Often difficult to define, but people generally know when they see great leadership (Barrack Obama’s stirring election victory) and equally, poor leadership (Steve McLaren and his umbrella). There do appear to be some innate qualities of leadership; the ability to communicate well, to inspire others to great results, to connect people to an idea or higher ideal. Managers often ask what the difference between management and leadership is, and while they are interconnected it is clear that management could be described as management of routine and producing consistent results (farmer) and leadership is more about the future, achieving goals and
striving (hunter). Another way is to say if management is about “doing things right” then leadership is about “doing the right thing.” LEAD helps business leaders work through these ideas to get a better sense of themselves as leaders.
Q: Are leaders born or made? A: This has been debated long and hard, and
you will find varying opinions of this. Most recognise that while some individuals display those innate qualities better than others and appear to exhibit a “charisma” characteristic of the truly great leaders, clearly we can all enhance our leadership qualities. The LEAD programme exists because its
organisers believe that small business leaders can improve their own leadership skills dramatically, to produce better business results.
Q: What has leadership got to do with small business? A: Everything. As soon as you have your own people, whether you like it or not, you inherit the mantle of “leader.” People will be looking to you to provide strong direction, provide inspiration and motivation, to be the steady hand on the wheel. If you aren’t doing this then you aren’t leading a business, you’re doing something else. LEAD is designed specifically to address
Have a good business but want a great one? Call 0845 0066888 or visit Businesslinknw.co.uk/lead
this issue and raises the importance of leadership to you and your business.
Q: How will I know if I am leading? A: This will vary from business to business, but perhaps the most obvious way will be through your people. Are they taking more ownership? Do they seem to be more engaged with work, and do they understand the direction you are heading? Is change implemented more quickly and with less pain? Do you feel more like the captain of the ship than the stoker of the boiler? And finally... do they tell you directly? LEAD provides a huge range of tools, skills and ideas to help you discover your inner leader.
12 BUSINESS SPECIAL
Tuesday, March 16, 2010
★★★★
LEAD case study: Document Direct
Advertising Feature
Jayne finds a direct way to increase her business flair
L
IVERPOOL-based Document Direct is a company that provides round-theclock secretarial, typing and document production services, chiefly to legal practices. It was established in October 2005 by Merseyside entrepreneur Martyn Best. Document Direct’s challenges include choosing the most effective technology for the business and recruiting the right secretaries to work autonomously, especially on the night shift. Winning new business is also a constant and unremitting demand. Jayne Smith, operations director at Document Direct, was recruited by Martyn from international law firm DLA Piper in January 2006. Her experience as a legal secretary and IT trainer meant she was well qualified to run Document Direct, and she went on to acquire many more skills.
However, she had no hands-on managerial experience or strategic business training before joining the firm. “I was employed to help develop the business, but before Document Direct I have only ever had an employed position in legal practices and I’ve had no education, formal or informal, in relation to the business world,” explained Jayne. “I remain the company’s only employee but we now have a large team of subcontractor secretaries who work remotely from their own homes from different parts of the UK.” Jayne continued: “It took six months for us to find the right technology on which to base our business. We have now grown steadily – albeit slowly – and have developed our services to make our secretaries available 24 hours a day. After two years we expanded our technology
and moved to hosted systems to offer greater resilience and reliability to our clients. We then developed our own software so that we’re compatible with our clients’ systems and can integrate effectively.” Jayne heard about LEAD from Business Link and asked them for support in helping to obtain a place on the programme. She was impressed by the response. “The people at Business Link were smashing. Nothing was too much trouble, and they ensured the support I needed was available without a hiccup,” said Jayne. She had been encouraged to join the LEAD programme by figures showing that 90% of pilot participants reported an average increase in turnover of some £200,000. “In the beginning I thought I would learn new and exciting skills to help me build my company, and although you are taught
INVALUABLE: LEAD programmes include one-to-one sessions and group training in which participants can share problems and solutions
LEARNING CURVE: Jayne Smith, operations director, Document Direct valuable business performance techniques, the learning process is often quite subtle,” explained Jayne. “It’s been these subtle changes in my attitude that have made such a big difference to me as a business manager. I’m thinking about challenges differently – more objectively and more confidently.” She added: “The one-to-one coaching sessions and masterclasses have helped me enormously, and especially the action learning sets. “These are small teams of six or seven people and involve absolute trust in that you have to bare your soul to the whole group. I soon realised, though, that this was a powerful learning tool, because other people share similar problems to yours and solutions can also be shared.” Jayne added: “The upshot is that my management abilities have been vastly improved and I’m much more confident and much more comfortable as a business leader.” As a result of taking part in the LEAD programme, Jayne has moved Document Direct significantly closer to its goal of becoming the outsourced provider of choice for the UK top 100 law firms and the broader legal services sector. “There has been a marked increase in clients, contacts and inquiries since I started the LEAD programme. Two clients per month are now coming on board, and we are also winning business from competitors, which is
extremely fulfilling,” said Jayne. “I have been on a journey of constant learning and I don’t envisage this learning process will ever end,” she added. “Life isn’t like that, you can’t say ‘stop, I want to get off ’. You have to keep going, face your challenges, find people who can help you and learn new skills, which is what LEAD has enabled me to do.” Jayne’s personal business coach, Lisa Rosetti, has played a major role in helping her to discard limiting or unhelpful beliefs and adopt more positive cando approaches to leadership. “Lisa has taught me a lot about taking on board
leadership attitudes to the challenges that face everyone in business. Now I look at problems that might previously have got me depressed with much more energy and purpose,” said Jayne. A strong example of a practical business challenge Jayne has managed to overcome due to the LEAD programme is making unsolicited sales calls. “I used to get really uptight and anxious about picking up the phone and making a ‘cold’ sales call, because at the front of my mind was the idea that I was
being a nuisance. However, thanks to my one-to-one mentoring sessions with my business coach, Lisa Rosetti, I have changed my attitude completely,” explained Jayne. “Now I make cold calls with the thought that I’m potentially adding value to the business of the person I’m calling. “To help me overcome my nervousness, Lisa gave me a target of getting five negative responses a week. It’s made me much more comfortable about the whole process, and I really don’t mind reaching and exceeding my target.” Recruitment is another key aspect of Jayne’s management technique that has changed for the better after she embarked on the LEAD programme. She said: “I’m very focused on what we do for the client and why we do it, which is now at the forefront of my mind when I’m recruiting secretaries. “The quality of the people we take on has definitely improved due to what I’ve learned from the LEAD programme, which, of course feeds through into greater productivity.” Jayne added: “LEAD widens your perspective of business and your own personal life. “And it’s not just about you as an individual. You can invite members of your team to the masterclasses and have them learn new skills as well. There is so much on offer from the LEAD programme that it is impossible not to learn.” ● Jayne is a delegate of the No Guru LEAD programme.
Tuesday, March 16, 2010
★★★★
LEAD case study: BEE Worldwide
BUSINESS SPECIAL 13
Advertising Feature
Company making a BEE-line for success, thanks to LEAD A
MACCLESFIELD business is set to make a buzz in the international boiler industry, thanks to a little help from LEAD. BEE Worldwide develops energyefficient boilers for the Middle East market. Founded in 2008 by Anders Timms and business partner Mohamad Manavi, the business is set to manufacture its own gas-fired boiler products initially in Iran, where the market for energy-saving products is thriving on the back of a government-backed energy efficiency drive. Anders says the decision to focus on the Iranian market – including local manufacture – was not a straightforward one, given the international tensions. However, after research and encouraging dialogue with British government organisations in Iran and the UK, they made the decision to press ahead. One year into the development, with the first designs on test in Iran, Anders and his team faced a second hurdle when it was discovered that the condensate formed in the boilers was so acidic that it would corrode the aluminium heat exchanger within two or three years. But after a thorough review, and with the designs and specification for the boiler duly amended, the team pushed on. The company has since grown to five people as product development has gathered pace and the business is now geared up to start manufacturing later this year. Anders already had a successful career in the automotive and aerospace sectors behind him when he set up BEE Worldwide. But he readily admits that his experience of running a small business was limited. “Although I had lots of industry and professional experience, it was very different to managing the finances of a small business. It was an area I knew I had to address for BEE Worldwide to succeed,” explained Anders. “In particular, I wasn’t comfortable or confident when it came to the sales side of things – generating leads and closing deals.” Anders decided to take part in the LEAD programme because of its sharp focus on addressing the practical needs of small business leaders. “LEAD addresses a particular sector of the market – five to 20 employees – and this makes it absolutely right for any small business owner. “I felt LEAD represented a superb opportunity to network with, learn from and share experiences with other business leaders in a similar situation to my own,” said Anders. The lead programme is funded by the Northwest Regional Development Agency and after
researching the range of providers delivering the LEAD programme, he chose Liverpool-based NoGuru because he was impressed by its ethos and approach to delivering practical, tangible benefits. “The NoGuru programme is all about working with business leaders in a pragmatic and relevant way, drawing on their own experience and skills in working with diverse groups and individuals,” said Anders. “It’s an approach that makes you feel both supported and challenged, encouraging you to look at where you want yourself and your business to be – and the steps you need to take to get there.” Anders believes he has benefited enormously from the LEAD masterclasses led by recognised experts in their field, such as the sales masterclass led by Andy Bounds, as well as from monthly one-to-one sessions with his business coach. He was also inspired by the supportive, can-do environment of the action learning sets – groups of about six individuals working together to help each other address specific challenges in their businesses. “There's total trust within the group and incredible support on the whole spectrum of business issues. The beauty of it is that even when the course ends, you still have these networks and relationships to turn to for ideas and advice,” said Anders. LEAD has already had a tangible impact on the way Anders manages BEE Worldwide. In February 2010 the company acquired a 20% stake in Grandee Boilers, providing the flexibility of having a UK manufacturing base as well as access to patented technology for an innovative 'dual fuel' oil and electric boiler product called GrandeeHybrid particularly suited to the export market. “From a leadership perspective, I saw and took an opportunity to buy a stake in a UK manufacturing business and also to apply its patented technology to our business model. LEAD played a major role in driving and shaping this process, and giving me the confidence to do the deal,” explained Anders. He says he was inspired, encouraged and supported by the LEAD network, some of whom were already dealing with exports to the Middle East. It was even a colleague in his LEAD group who first suggested exporting oil-fired boilers, as well as gas-fired ones, a suggestion which influenced the acquisition of the stake in Grandee Boilers. As a result of the expansion, Anders has received an inquiry from the Lebanon and is attending a UK Trade & Investment export mission to Vancouver from March 24-26, when he hopes to identify a Canadian trading partner.
OPTIMISTIC: Anders Timms, founder, BEE Worldwide The most noticeable change Anders has experienced as a result of his involvement in LEAD is the development of leadership attitudes that he knows will produce positive results. He said: “My anxiety around sales lead generation and closing sales has been dealt with via the action learning sets, and I have fundamentally changed my attitude. “Previously I had difficulties, but talking to my peers on the course, understanding how they approached similar situations, and with the benefit of expert advice from my coach, I’ve changed my whole approach.” He has already recommended the LEAD course to other business owners: “LEAD offers excellent value for money and the practical benefits are huge. The cost for the whole programme is similar to what you would pay for a one or two-day course in the private sector,” added Anders. “I can’t wait to put my learning into action with BEE Worldwide, as the company continues to grow and LEAD continues to drive my own personal development.” ● Anders is a delegate on the No Guru LEAD programme.
LEAD gives people the opportunity to network with, learn from and share experiences with other business leaders
14 BUSINESS SPECIAL
Tuesday, March 16, 2010
★★★★
TIPS FROM THE TOP
How to succeed
Entrepreneurs give their tips on how to survive the tricky start-up phase and grow your business
MENTOR: Matt Newing
I
T IS very easy to set up a small business, but it can be exceptionally difficult to set up a successful one. It is often quoted that 80% of businesses fail in the first five years and while that figure is misleading – it is nearer the mark to say that four out of five no longer exist, which can mean businesses have been bought out or merged – there is no doubt that the failure rate of start-ups is high, in good times and bad. And while some business failures are the result of the vicissitudes of business life, we asked some successful entrepreneurs for their top 10 tips on how to improve the chance of being successful. First, prepare carefully. While a good foundation doesn’t ensure success, it is nearly impossible to build a successful business on shaky foundations. Ian Tomlinson, founder of Knowsley e-commerce firm Cybertill, said: “Establish a strong vision, mission and values before you even start to think about the business plan. “They become your shield for going into battle and are the standard that you stand behind when communication to the world. “Then work out how much funding you think you will need – and double it.” Being realistic, even pessimistic, about what is achievable is one way to try and make sure the cash doesn’t run out. Elite Telecom founder Matt Newing said: “Always underforecast in your cash flows on the sales you think you will actually achieve and over budget on projected expenses. “Cash is as critical as it gets. Cash is king in any business or, as one bank manager said to me in the early days, ‘Matt, cash is god’. “Cash in a business does the same function as blood in our bodies. The real sales cycle always takes longer than you think, especially from the start of a new prospect to actually having their cash in your bank.” Terry Barton founded St Helens-based security firm Kingdom Security in 1993, but maintains that start-up mentality when it comes to finances. He said: “We have run things tight, we have kept things financially conservative so we are financially quite strong as a company. “Spend when it’s necessary and don’t spend if it’s not necessary.” Alex Stone, the man behind £6m-turnover websites thebikeinsurer.com and thevaninsurer.com, says you need to focus on your balance sheet’s bottom line and not its top line. “Think profit, not turnover,” he said. “Any monkey can sell a tonne of stuff and generate turnover. “But if it doesn’t make you any
Top tips 1. Cash is king 2. Only spend when necessary 3.Think profit, not turnover 4. Understand what your business is for 5. Set yourself targets 6. Under-forecast sales, over-estimate expenses 7. Customers are your business 8. Employ the right people 9. Don’t take no for an answer Ian Tomlinson profit, there's no point in doing it. “Don’t let your ego rule your head – sell lower volume for bigger margin until the stage comes when you can sell big volume and healthy margin. “A busy fool is just that, a fool.” Before you can think about profit, you need to think about sales – and that means only one thing. “Customers, customers, customers,” said Matt Johnson, chairman of web design and application development agency Mando Group. “They are the lifeblood of every business.” The firm was founded in 1997 by Matt and his business partner Ian Finch after they graduated from Liverpool John Moores and now employs about 50 staff. “Don’t ever stop thinking about
Matt Johnson your customers,” he said. “The key is to treat every meeting like a first date and to know your customers as well as they know themselves. “Set yourself daily sales targets and don’t give up keep knocking on doors.” Persistence is also important in not being knocked off course by pessimists and doomsayers. Jennifer Lawrence launched coffee shop chain BeOffee in 2007 with her two business partners. The first shop, in Widnes, has been followed by shops in Warrington and Birkenhead – ventures which wouldn’t have happened if they had listened to the advice being offered. She said: “As an entrepreneur you have to believe in yourself and challenge what you are told. “The phrase you will hear most is ‘you can’t do that’.
nJennifer Lawrence “You hear it from the banks, landlords, business support agencies, suppliers – everyone. “They tell you it can’t be done when they either mean you are creating more work for them or that no-one else has done it that way before.” Allan Gauld, who set up Newton-le-Willows communications networks firm Intrinsic Technology in 1999, agrees that tenacity is important. “Never take no for an answer,” he said. “There’s always a way of finding the right answer. “When we were growing the business, we needed to be persistent to get some of the deals – which are still with us today. “For example, we were involved with a company in London who were going to award us a contract
10. Get a mentor but we were probably guilty of talking to the wrong person in that company. “We got wind that it was going to one of our competitors, so we went down and spoke to the chief executive. “We walked out from the meeting with a one-year deal. We now have had that for eight years.” Successful entrepreneurs all have that glint in their eye, but it can hide the wading-through-mud struggle of running a business. So perhaps there’s room for tip number 11 – make sure you enjoy the good days. One very successful businessman talking privately described the first year of his new venture in rueful, realistic terms. “The good days are great”, he said. “The rest are just crap.”
★★★★
Tuesday, March 16, 2010
BUSINESS SPECIAL 15
HOW I GOT STARTED
Overseas ambition ECHO My
BUSINESS
EDUCATION: Carl Gilbertson, managing director of MGL
Story
M
GL is a Liverpoolbased company which provides support services, primarily around ICT to schools and SMEs across the North West. Though the original intention of the business was to provide schools with the necessary consultancy required to implement technology effectively, this has grown and now MGL provides technical support, training, web design and hardware solutions. Carl Gilbertson is MGL’s managing director. He said: “The decision to run my own business came partly of necessity but mainly out of opportunity. “The project team which established MGL had a number of years of experience in education and felt that there was real gap for an organisation which provided an holistic approach for schools wishing to adopt ICT. “Each school needs a different solution but the corporate world was, and continues to be, only interested in a one-size-fits-all approach. We wanted to help schools ensure that they were making not only the right investment decisions but also
‘Businesses don’t run on Excel spreadsheets – they are all about people and relationships’ maximising the benefits of these investments by managing and maintaining the technology and at the same time ensuring that staff and children were confident users. “The decision to start the business came when we started speaking to potential clients. They suggested that what we were talking about would add value to them and that they’d be prepared to pay for these services. At that point we started laying the groundwork and looking at the finances necessary to make the venture sustainable. “I was 21 at the time and across the group which started the business there was a real sense of confidence in one another and in the direction of the market in general.” The company now has offices in Liverpool, Manchester, Ellesmere Port, Chester and Bolton. Mr Gilbertson said: “The growth in the business has been beyond all of our reasonable expectations and the fact that the company continues to prosper after 10 years is a source of pride and satisfaction. Strangely, some of the most satisfying things tend to come from the weird and
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wonderful experiences that you can’t predict or prepare for. You have to react and try your very best to get them right. “Almost without fail they seem like career breakers at the time but in hindsight it plays back like an episode of ‘The Office’. “Of course, it hasn’t all been plain sailing. After our initial growth phase, we suffered the natural temptation to try to grow too big, too quickly. This meant that we focused too much on the future rather than thinking about the here and now and became too distant from what we were good at which was listening to our clients. It took a lot of effort to re-establish ourselves and, although, it’s almost impossible to calculate, I’m sure it cost us an awful lot of money too. “Running your own business is both stressful and exciting in equal measure. Every Sunday night feels like the night before you go to ‘Big School’. You never know what to expect or what might be waiting for you but because the stakes are higher and you know that people’s livelihoods depend upon it sometimes the excitement can easily blur with anxiety or stress.
FASCINATION: Warren Buffett “My single piece of advice to somebody starting their own business would be: don’t panic. “Out of all the business plans that have ever been written, only about 1% have followed the pattern outlined in black and white. Businesses don’t run on Excel spreadsheets – they are all about people and relationships. If you know how your client relationships should work and that there is a market there in the first place, things will probably work out. “Our involvement with the public
ADMIRATION: Walt Disney sector means that we perhaps have been fortunate to not be as badly affected by the recession as other industries. Regardless of the economic climate we are always looking at ways in which we use our resources more efficiently. “We’re confident that the portfolio of services and products we provide most certainly has application in other sectors and whilst we still have room to grow within the North West, we believe we have the potential to scale both nationally and internationally.”
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16 BUSINESS SPECIAL
Tuesday, March 16, 2010
★★★★
ANATOMY OF AN ENTREPRENEUR
What does it take to start a business? By Tom Cannon, Professor of Strategic Development at the University of Liverpool
I
T WAS George W Bush who allegedly said that the French will never be truly enterprising because they don’t have a word for entrepreneur. Unwittingly, he highlighted the problems associated with a concept that we have taken and adapted. At its most basic an entrepreneur is someone who undertakes – not, of course, in the hearse, coffin and funeral sense, albeit many undertakers show the type of enterprise and innovation that we now associate with entrepreneurs. By using this notion of someone who undertakes, we get to the heart of the concept. Entrepreneurs are people who, faced with problems or challenges, decide to tackle them rather than wait for someone else tackle them. Kitty Wilkinson didn’t wait for the government to provide hot water so the poor could wash themselves and their clothes in the great cholera epidemic of the 1830s in Liverpool. She had a boiler and a wash-room, charged families a penny per week and saw death rates shrink. The same was true of Anita Roddick, who didn’t wait for someone else to tackle animal testing. One of her favourite sayings was that there are three types of people: those who watch things happen, those who make things happen and those who wonder what happened – and we can all choose which type to be. Beyond this simple starting point, there is a vast academic literature and an even greater volume of claims and counter claims about what makes some people entrepreneurs and others not. There are important social and cultural forces. People with a background in enterprise and small business are more likely to be entrepreneurial. If your mum or dad, brother or sister, or other relative or friend had their own business – almost regardless of size – it helps. We can see this locally in some of Merseyside’s greatest success stories like Home Bargains with Tom and Joe Morris, Steve Morgan of Redrow, Peter Johnson of Park Group and Everton owner Bill Kenwright. In this way, Liverpool is unlike many other parts of Britain with low rates of business ownership. The economies of Tyneside, Glasgow, and South Wales were dominated by
IMPRESARIO: Everton owner Bill Kenwright at Goodison Park large firms – our local economy was, until quite recently, not so dominated. There is also something deeply personal about wanting to succeed. David McClelland, a leading thinker on the issue, believed entrepreneurs had a powerful, need for achievement. They want greater responsibility, they take risks, work hard and innovate. In this country, we are unique in regarding entrepreneurs as idiot savants. For some budding entrepreneurs in Britain, education is seen as a liability, not an asset. Examine the data from the USA, the rest of Europe and Asia and a close relationship emerges between entrepreneurship, entrepreneurial success and educational attainment. Even in Britain the relationship stands. Accepting this is crucial to local and
national prosperity in the emerging knowledge economy. We need our university graduates to create ventures that build wealth rather than work in areas that consume wealth, such as the professions or the public sector. The entrepreneurial challenge is equally important for other non-traditional groups, notably women. In the most dynamic economies, women are leading the way in numbers and performance, while the link between educational attainment and success is even greater. The evidence is growing that the world is experiencing a new, third Industrial Revolution. During these times of change, entrepreneurs accept the challenges, take the risks and shape the future. Locally, this capability used to exist in abundance; the challenge now is to recreate that abundance.
HOME BARGAINS: Joe Morris
DRIVE: Body Shop founder Dame Anita Roddick
BUSINESS SPECIAL 17
Tuesday, March 16, 2010
★★★★
Gary Lloyd..............................................................IFS Contractors FM
ECHO My
BUSINESS Story
GARY LLOYD runs IFS Contractors FM, which provides maintenance and facilities management services to retailers and commercial property owners. Based in Bootle, it has contracts with companies including the Co-op, Somerfield and TJ Hughes. Originally part of IFS Contractors, which had been running for 25 years, Mr Lloyd last year took the opportunity to purchase the former company's maintenance division after the parent firm entered administration. He said: "There are a number of reasons that made me want to run my own business. I have always been goal-orientated, right from being an apprentice through qualifying as an electrician and later becoming a company director. “Every time I reached the next level my sight would be on the one above. Eventually the only thing left was to own a business and be my own boss. "When you're working for somebody else, it can be frustrating and unrewarding at times, whereas now I can focus on the goals that really matter. I've worked at every level in my industry and that experience serves you well - you don't need to be a born entrepreneur to run a successful business. "The decision to work for myself came about by chance rather than by design. I was in charge of the maintenance division when the whole of IFS went into administration. It was what I had worked for my entire career, so I grabbed it with both hands and bought it from the administrators. It was a difficult time, but also an opportunity for me to 'step up'. It
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TACKLING PROBLEMS: Kitty Wilkinson
PARK LIFE: Peter Johnson
Local Coffee Shop rated in the Best 50 Coffee Shops in the UK*
the meeting place
NEW START: Gary Lloyd was a massive challenge and I had to persuade our existing clients to continue working with the new company. I'm happy to say that a good track record stood for something and they backed what we were trying to do. "I have found my work very satisfying. Our expectations are realistic and hopefully achievable, considering the current economic market. It can be exciting when you know the service you provide has delivered and exceeded expectations but I would be fooling myself if I said running your own business was not stressful. The constant need to hit turnover targets drives your focus to find new business whenever possible while securing your existing work. "Having a good strong team around you helps manage any stress. “If I have made a mistake it has been that we have delivered too much to clients relative to the financial reward we were getting. “Payment is always a tough issue for small businesses and I have often been too trusting. "Anyone thinking of starting their own business needs to ensure they have good prospects for orders to come in. “Without a promising pipeline of business from the off you will always struggle to cover your overheads. "We've never relied on the bank, Business Link or outside investors - we didn't want to dilute our control and were dubious about the assistance a bank could offer. “Ultimately our business model is sustainable; it's not about taking risks for risk's sake.”
Also on the menu at bean - the meeting place:
• • • • •
Comfortable lounge area and seating Meeting room hire and business lunch options Fresh deli sandwiches and homemade soups Free car parking and close to city centre New “bean catering” menu for business lunches and event catering
Call 0151 707 2299 or visit www.beancoffee.co.uk • bean the meeting place is located at 104 Tower Street, Century Buildings, Brunswick Business Park, L3 4BJ * The Independent, February 26th 2010
18 BUSINESS SPECIAL
Tuesday, March 16, 2010
★★★★
HOW WE GOT STARTED ‘We were both only 24 and we were tired of just being talented hands – we wanted to use our brains as well’
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LACIAL ART owners Mat Chaloner and Mat Foster both had long-standing ambitions to run their own businesses in the creative sector. What the pair discovered is that it can be very hard work, but there are also plenty of sources of help and funding available to anybody with a good idea. After leaving university the plan was to make it with model making and special effects down in London. Mr Foster said: “We did gain lots of knowledge and experience within the effects industry, but somehow we managed to slide into ice sculpting along the way – something neither of us had ever even considered before.” After three “amazing” years in London, both of were beginning to chomp at the bit. Mr Chaloner said: “We wanted more responsibility. We wanted to be involved in the design process as well as the creation. We wanted to experiment and try new ideas. “We were both only 24, much younger than everyone else we worked with, but we were tired of just being talented hands, we wanted to use our brains as well.” Their business, Glacial Art, is a specialist ice sculpting firm. Mr Foster said: “During the almost four years we have had our own business, we have designed and created ice sculptures for clients such as Jaguar, Reebok and Gucci. “We did an ice sculpture for the MTV music awards, we have done sculptures for footballers’ weddings and birthdays and we actually got to hang out with Quentin Tarantino when we did a sculpture for his premier of Death Proof in the Fact cinema here in Liverpool. Last Christmas we did lots of live ice sculpting in city centres around the country.” Mr Chaloner says the experience of running a business lived up to expectations. He said: “I don’t think either of us thought we would accomplish so much so fast. Liverpool has been a great city for us to set up base and call home. Everyone has helped us, encouraged us and given us the support we need. I think a lot of people are looking at us as local artists now, and that feels great, Liverpool has such a rich creative community.” As exciting as it may be, it is also stressful running your own show. Foster said: “Having our own business is the most stressful thing we have ever experienced. It’s not like we have a product on the shelf that we can sell, pop in a bag and hand over the counter. Everything we create is different depending on what our clients want. And it’s made from ice. “When you have your own business and it’s your own name that is attached to everything you create, you soon become a perfectionist and put everything you have into each sculpture. “Nothing leaves our doors that we are not proud to show off. This means that we have a lot of late, cold and wet nights making sure everything is up to the high standard we put on ourselves.
The cold hard TOP BIRD: An ice sculpture for Capital of Culture year
ECHO Our
BUSINESS Story
COLD WORK: Mat Foster working on a sculpture at the International Ice Sculptures Festival in Latvia
“Having our own business is also amazingly exciting and rewarding. “The cheques obviously have to keep going in the bank so we can run our business and pay ourselves a wage, but it’s the reactions our work gets that keeps us going and drives us to try harder and push the boundaries of what we can do with our ice.” And it hasn’t always been plain sailing. Mistakes have been made along the way. Mr Chaloner said: “I think our biggest mistake when we first set our business up, was to try and go national straight away. We didn’t think we could get enough local business to keep us going. How many people actually buy an ice sculpture in their lives? So we hit
the biggest event shows in the country at the NEC, Birmingham, and Earls Court, London. It did bring in lots of business, but we spent the first year on the road, delivering sculptures all over the country, sleeping in the back of our van and basically having no life. “Over the years our marketing has been directed closer and closer to home and we have found that there is actually a lot of business for us in the North West. We still go all over the UK and Ireland, our reputation is growing and the demand for our work in increasing rapidly every year, but the North West is definitely our target market now. If we had realised this from the beginning, that first year wouldn’t have been so exhausting.
“The second major lesson we have learned in business is not to try and do things on the cheap. If it’s cheap, it’s cheap for a reason. Spend a little extra – get the right equipment or the right people. It’s always, always, always worth it in the long run.” Mr Foster says the single most important piece of advice he would offer somebody starting their own business is to make sure you are prepared for some hard work. He said: “Nothing you have ever done before can prepare you for how hard you will have to work. On top of that hard work is the stress. The bills have to be paid. The loan repayments have to go through. You have to be able to feed yourself. I had many, many sleepless nights when we first set up.
SHOWBIZ: A Glacial Art sculpture of an MTV European Music Award. The awards were held in Liverpool in 2008
“It only takes one bad month to bring all those worries crashing back in. “Mat and I are very lucky that we are such good friends. I think this is probably the main factor in the success of Glacial Art. We pull each other through the hard times. “If your thinking of going into business with someone else, make sure it is someone you can count on 100%. “If anyone has ever told you having your own business is easy, they were lying.” When pair first came to Liverpool with their dream of setting up an ice sculpting business, they knew that they only had about a third of the capital needed. They went to have a talk with an accountant regarding business plans, profit and
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Tuesday, March 16, 2010
BUSINESS SPECIAL 19
facts of business CUT ABOVE: Mat Foster, right, and Mat Chaloner, who own Glacial Art, with an ice sculpture of the Champions League trophy
loss forecasts and balance sheets and discovered another nightmare for anyone thinking of setting up their own business. “You have a lot of work to do before you can go to a bank and ask for a loan,” said Mr Chaloner. “On that first day our accountant probably made the most important phone call regarding the set up of Glacial Art. I would strongly advise anyone else to do the same. “He called a Government-funded agency called Blue Orchid based in the Cotton Exchange in town. There I met Ron Ives who spent the next five weeks going over every aspect of our business and helping us form a watertight business plan to take to the banks. “HSBC called me up the day after
our first meeting and said that they would be happy to loan us half of what we are looking for and that Merseyside Special Investment Fund would like to loan us the other half. From our accountant to Blue Orchid to HSBC to MSIF, everyone helped us and believed in us and got us here today. All the team at MSIF were great. Kathryn Burkhill at Liverpool Vision has also been amazing with her help, encouragement and support. “When you need help with your business, Liverpool has some fantastic people who are ready and able to help.” What separates Glacial from other Ice sculpting businesses? Mr Foster said: “When you order an ice sculpture, you are
commissioning a piece of art. Sculptures are only as good as the sculptor who carved them, no matter what price you were charged. “We are both pretty damn good sculptors now. Matty C won First place in a European Ice Sculpting competition this year in Latvia and he taught me everything he knows. “Every time I think I’m closing the gap, he pulls something else out of the bag. “We love what we do. We are getting better and better at what we do and we are constantly driving each other on to take our designs and craftsmanship to another level.” Another big problem has been coping with the recession. “Lots of large and exciting projects we had quoted for were
cancelled last year due to the recession,” said Mr Foster. “Everyone was pulling budgets, and ice sculptures certainly were not on anyone’s lists of necessities. But in saying that, we have still been increasing our workload every year. We are pretty much fully booked between now and Christmas. “So even though we could see work falling away because of the recession, we can also see Glacial Art continuing to grow through out these hard times.” Mr Foster says there are big plans for the years ahead. “We have ambitious plans for Glacial Art,” he said. “It’s just so hard to find the time to implement them. “Time is always in short supply
when you run your own business. “We are in the process of taking on an apprentice which will ultimately give me and Mat more time to concentrate on developing marketing and services. “Getting the community involved in some projects is high on our priority for 2010. If we are lucky enough to get some snow this year, keep your ears open for some exciting events for the kids around the city. “And of course there are more European and world ice sculpting championships for us to compete in. “We are all ready to return to Latvia and defend our first place title. “Being recognised as artists is much more important to us than being known as successful businessmen.”
20 BUSINESS SPECIAL
Tuesday, March 16, 2010
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HOW WE GOT STARTED
A family affair
Managing director of medical supplies firm says succession planning is crucial to ensure firms keep growing
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AYS Medical has been trading for over 35 years and provides first aid medical supplies and health and safety training to public and private sector organisations in the UK and overseas. Customers include blue chip businesses in many sectors such as leisure and food manufacturing as well as GP surgeries, schools and prisons. The company also specialises in biohazard decontamination products and training and has recently launched an infection control range called ResponseBeta. Liverpool-born managing director Ben Ludzker joined the family firm a little over five years ago. He said: “I always knew I was going to go into the family business. It was never a matter of discussion, just a question of when. “I felt proud and fortunate to be in that position and never felt any sense of obligation. If you are born into a successful family business then you have
ECHO My
BUSINESS Story
FIRST AID: Ben Ludzker of Kays Medical at his company’s Everton office
an opportunity that many people don’t have and I didn’t want to waste it. “When I first came to work at Kays Medical I spent time in each department getting to know how all the systems worked before progressing to director level and then managing director. It is certainly a very steep learning curve and it is vital to understand every aspect of how the business works. I think it would be very difficult to introduce change if you can’t relate to and understand completely the processes and people within the organisation. “We pride ourselves on providing a highly efficient but friendly service, and on the continuity and reliability of our supply. Our experienced and knowledgeable team offers a high level of support before and after a purchase, something our customers have come to expect when they deal with Kays Medical. “Much of our business is generated from repeat custom and our growth figures are proof of the consistency
and quality of service we provide.” Mr Ludzker says he finds running a business to be demanding yet satisfying. He said: “As a business owner you feel a great sense of responsibility towards your workforce. How effectively you manage the business and how successful it is impacts on the lives of the people who work for you. There is also pressure to succeed. Although I didn’t set up the company, it’s important to be as entrepreneurial as the original founders. “My parents worked hard building up Kays and I am focused and determined when it comes to developing it further and honouring their legacy. I have very high standards and try to pass these onto the workforce. I have to be careful to avoid the trap of micro-management, though, and instead try to think of the long-term strategies and learn to take a step back, which can be difficult sometimes. “Achieving a work/life balance is also a challenge and, like many business owners, I often work long hours. I have to force
myself to go home or to the gym otherwise I would be in the office all night. “The most important piece of advice I would give anyone moving into a family business is to think about succession issues. Many businesses don’t plan ahead and sometimes there isn’t a next of kin to pass the business on to. In other instances sons and daughters don’t have the necessary skills to run the business on their own. “So it’s critical that enough time is given to working out how the next generation is going to become equipped to take the business forward. “Before the new generation takes over a plan must be agreed relating to strategic decision-making. It’s important to make decisions collaboratively and decide at what point decisions become the sole responsibility of the successor. Whilst this process can be reviewed, rules must be in place from the outset as lack of planning can have a major impact on future success.”
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Tuesday, March 16, 2010
BUSINESS SPECIAL 21
‘The best thing I’ve ever done’ ECHO My
BUSINESS Story
DRIVEN: Liam Hanlon of the Forshaw Group
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F YOU’VE ever suffered a major house disaster such as fire or flooding, then you may be familiar with Liam Hanlon’s Forshaw Group. It specialises in the restoration of both commercial and residential property that has been damaged by fire or flood. It counts among its clients some of the country’s largest insurance and loss adjustment companies. While it is the insurance companies that Forshaw works for directly, it is acutely aware that it are restoring somebody’s home or their business premises which is a fundamental part of their livelihood. It can be a fine balancing act to ensure it is working to the direction of the client but keeping the owner informed and happy too. Mr Hanlon said: “We offer complete claim management and strive to keep all parties in touch with the status of the job. We achieve this through our bespoke IT systems. “We have invested heavily in staff development and infrastructure in recent years and earlier this year we opened a new facility in Speke which enables us to expand our operations further. As part of this investment we’ve brought in new IT technology which allows us to track items removed from properties through the restoration process.
Merseyside’s Forshaw Group works with insurance giants to repair properties hit by fire or flood “Nothing goes missing and nothing gets lost. It is a seamless system and the very best around. “I came into this business in 1993 after speaking with my business partner and great friend Rick Forshaw. “I’d spent much of my time in the building industry and wanted a new challenge. It seemed like a daunting step at the time but, looking back, it’s the best thing I’ve ever done. “Looking back at what the company was like then, and comparing it to how professional and advanced we now, are shows what a remarkable journey we’ve been on. It is only in retrospect that you can witness the massive changes we’ve made as during the implementation of the changes, you inevitably end up focused on the job in hand. “The trick is to keep your eye on the bigger picture and to not get sidetracked with the often frustrating details which can get in the way. “It has been hugely satisfying watching your decisions change the direction of the company in a positive manner. “It takes nerve, trust and determination. Yes, it can be stressful but maintaining focus on
MEET THE TEAM: Rick Forshaw, David Howarth of Yorkshire Bank, Liam Hanlon and Lynne Forshaw the central objectives is the key factor. “To anybody thinking of making the jump into running your own business, my advice would be to expect to work a lot of hours and be prepared to live with setbacks as well as events which move you forward. “It helps not to take things
personally and maintain interests outside of work to make sure you get some release. Having a trusted business partner who you can go to for advice or just to bounce ideas off is invaluable too. To put it simply: work hard and remain focused. “We are fairing reasonably well through the recession as we have built out reputation over the years
which has enabled us to expand into different geographical areas. “We feel there are still some tough times ahead but we approach the next twelve months with optimism and the drive to succeed. “We’ll look for further opportunities to expand in the medium term future but the short term for us is about consolidating our position and incorporating our new operation in Speke fully into the business. “We can sometimes make poor decisions in business that cost heavily on investment, resource and profit, but this is how we learn and develop as people within the business. Our mistakes and failures often produce the key to success. Having a good business model, being operated by a competent team backed with quality training and investment towards steady long term growth has been instrumental in avoiding some of the earlier mistakes we have experienced. “The business has been supported through various funding agencies for IT and training. “Our strong relationship with the Yorkshire Bank has enabled an overdraft facility to support our growth cash flow issues. “It has been a great experience.”
22 BUSINESS SPECIAL
Tuesday, March 16, 2010
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FUNDING
How to find the cash to get started Bank loans for start-up firms have been hard to come by since the credit crunch, but there are alternatives. Tony McDonough reports
CASHFLOW: It is possible to get hold of start-up capital despite the recession
HELPING HAND: Gaynor Dykes is the Access to Finance manager
U
K BANKS continue to insist “we’re open for business”, but the perception is that access to affordable debt finance is still severely restricted. Through its quantitative easing programme, the Bank of England has pumped £200bn in the British economy to boost money supply and stimulate lending. However, a recent survey published by the British Chambers of Commerce (BCC) found that 33% of companies reported that accessing finance had been more difficult over the three months to November last year. This compares with the same question asked in June, when 20% of businesses believed access to finance had worsened. And the number of firms reporting an improved access to finance situation fell – dropping from 6% in June, to just 3% in the latest survey. David Frost, director general of the BCC, said: “It is clear that the huge sums that have been injected into the financial system by quantitative easing are still not reaching small and medium-sized businesses in anything like the scale required for business to invest for future success.” So, if you’re looking for investment, what are the alternatives? Accountant Howard Hackney has been advising small and family-owned businesses for more than 30 years. For most of that period he worked for Grant Thornton, but in 2008 he left the firm and branched out on his own to form Howard Hackney LLP. He said: “The banks are talking a good game, but the reality is still very different. They remain cautious about lending to firms, and firms in turn are cautious about taking on borrowing. “There are a number of finance options that small firms can consider. The first and most obvious one is, of course, using your own money. Friends and family may be prepared to lend to you, but I’m very cautious about advising that because there are dangers. “People can very easily fall out. “One area worth looking at is angel finance. Angels are wealthy individuals with money to invest in companies in return for an equity stake. They can also be on hand to offer good advice. “There are thousands of angels across the UK and, unlike private equity, their
investment can be open-ended. They will usually look to acquire an equity stake of at least 25% and will want a proper shareholders agreement in place. “Angel funding will usually start at around £100,000, going up to £1m. “Private equity funds will usually start from around £250,000. They will look to cover their fixed costs and look to exit the business in three to five years.” Last month the Northwest Development Agency (NWDA) invited fund managers to bid to run the £184m Venture Capital and Loan Fund, more than £70m of which will be allocated to Merseyside. That is scheduled to be up and running by the summer. The NWDA’s Finance for Business website (www. nwdabusinessfinance.co.uk) also lists a number of options, including business angels and private equity funds. Other options include the Loan Fund, which provides loans of £50,000 to £250,000
available for “innovative, viable small and medium-sized enterprises” seeking debt finance. Small Loans for Business provides loans of between £3,000 and £50,000 to new and growing businesses, charities and social enterprises. There are also different types of grants available, including those covering research and development and capital investment for projects that aim to reduce CO² emissions. The Government has recently launched its £75m Capital for Enterprise Fund to invest in businesses who are looking to fund business development by selling debt in exchange for an equity stake. The fund will provide equity of between £250,000 and £2m. Business Link Northwest has also launched its Access to Finance service. This offers free advice and support from advisers to help businesses and entrepreneurs understand the options available for accessing the finance required for business
start-up, development and expansion. Since its launch in March last year, it claims to have helped secure more than £40m of finance for 300 businesses and supported over 1,400 companies so far this year. The funding has been used for working capital, new equipment, premises, product development and finance restructuring. Again, Business Link claims this has led to the creation of 1,300 new jobs and helped to safeguard more than 3,500 jobs in the region. Gaynor Dykes, Access to Finance manager, said: “We have helped many businesses access funding vital to their success which, in turn, will support the growth of the regional economy. “Calls to our telephone service show finance is still a key issue for companies, and businesses often need specialist advice to help them tackle complex finance needs. “This guidance, along with one-to-one coaching, enables the companies we work with to develop funding propositions and
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BUSINESS SPECIAL 23
Tuesday, March 16, 2010
¢ In association with
rensburgsheppards.co.uk
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FTSE-100
5602
t 4.4
THE FTSE 100 Index held firm above the key 5600 level yesterday as it marked one year since the lows of the devastating financial crisis. But the pound tumbled following figures showing UK exports slumped in January. Meanwhile, on Wall Street, the Dow Jones Index yesterday rose 11.86, or 0.1%, to 10,564.38. The S&P 500 index rose 1.95, or 0.2%, to 1,140.45, and the Nasdaq rose 8.47, or 0.4%, to 2,340.68.
MARKET REPORT: PAGE 13
inside
JLA now ranked in to p 10 of British airports by Neil
Hodgson the recession, Liverpool managed to LDP BUSINESS STAFF across the UK are still reverse 18 months of experiencing a passenger losses neil.hodgson@liverpool.com decline in business, with an 8.2% and 6.6% is a reflection of improvement in the confidence we and LIVERPOOL John Lennon the final two months our airline cusof 2009. Airport has tomers have in making broken into the top 10 This boosted its annual of busiest UK Liverpool one passenger of the country’s top airports for the first total to 4.8m, compared airports. time. with East Midlands’ 4.65m passengers “To break into the top New statistics from web-based avi10 for the first . time is a tremendou ation intelligence specialist JLA owner Peel Airports s achievement for anna.aero is deall involved at the airport.” (Airline Network News lighted with progress. & Analysis) showed that Liverpool In In 1997, 1997, JLA when flew to just three schedPeel acquired JLA, it leapfrogged uled destinations. Now East Midlands airport occupied 18th position it into 10th spot in the list of the through a range of airlineoffers 75 during 2009, due to a UK’s busiest airports. late recovery in including the two biggest, operators passenger volumes. Mark Whitworth, Peel Ryanair and Airports Easyjet, who last year chief executive, said: While most UK airports dealt a blow to “To see the airexperienced JLA’s closest rival, East a decline in passenger port start to grow its business once numbers due to Midlands, when it ceased operations again, at a time when many others there. Peel said it sees passenger growth
Airbus could lose huge US Air Force deal
continuing at JLA and is currently working on a £12m expansion of security and passenger facilities at the site to cope with increased However, parent group throughput. Peel Holdings is currently in prolonged negotiations with Vancouver vices over the possible Airport Sersale jority stake in its airports of a madivision. Also, Peel last week broke cover to reveal itself as part of a consortium bidding for Forth Ports and lieved a sale of its airport it is beyield up to £200m towards assets could the estimated £612m offer for the Forth Ports business.
Firm buys 500-tonne machine
BILLIONS of pounds worth of work could slip away from Airbus’ Broughton plant. PAGE 2
Johnson revival
PROFITS double at Johnson Service Group.
PAGE 5
Clever steps
A SCHEME for start-up firms is to win £7m cash injection. PAGE 7
From left, Ian Walkden
and Amanda Miller
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A WIDNES-BASED excavation and demolition company is eyeing new markets after purchasing a new sand-washing machine capable of processing – 100 tonnes of waste material every hour. Grundy & Co Excavation has purchased the £1.6m 500-tonne machine, after securing £1m of asset finance from Yorkshire Bank. It came in 12 parts from Ireland and Italy, and acts as a washing facility for waste from building sites. It separates the spoil into clay, two grades of sand, and four sizes of stone.
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16-PAGE BUSINESS SUPPLEMENT EVERY WEDNESDAY INSIDE THE
ALL THE LATEST BUSINESS NEWS Our award-winning team bringsyou the region’s best businesscoverage in printand online PROFILES AND ANALYSIS In-depth interviews every week with the region’s top entrepreneurs and business leaders TRADING GOSSIP Our light-hearted look at what life is really like in the Merseyside business world pitch their plans to potential investors.” Go back a couple of years and the private equity sector was getting a bad press. Its practitioners were accused of being tax-avoiding get-rich-quick merchants who would bleed businesses dry before swiftly moving on. This image was generated by one or two high-profile deals, but the day-to-day reality is somewhat different. At a regional level, private equity funds provide vital funding and business expertise for small firms, helping them to grow and create employment. One such fund is Aquarius Equity Partners, which late last year achieved the first round of fundraising –on its third fund, the Aquarius Origin Fund. The firm refuses to say how much the first round has raised, but its eventual target is £7.5m. The fund is targeting innovative, high-growth potential companies, particularly those with valuable intellectual
property, based predominantly in the north of England. It is funded by high net-worth individuals and has already made its first investment into a North West drug development company, Conformetrix. Liverpool-born founder and chairman of Aquarius Equity Partners, Steve Sealey, said: “It proves to me that there is an appetite from private investors to become involved in the asset class of venture capital.” Also recently launched by the partners of Warrington corporate finance firm, Dow Schofield Watts (DSW), is the PHD Equity Partners Fund. It raised just under £5m and has already made two investments. DSW partner Andy Dodd said: “Our sweet spot for the level of investment is between £250,000 and £750,000, and we will consider investing more than that. “The fund is opportunistic and we are prepared to look at all sectors. But the business case has got to stand up. There are a lot of potential deals to be done out there.”
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24 BUSINESS SPECIAL
Tuesday, March 16, 2010
★★★★
HOW WE GOT STARTED Karen Chadwick...................Apex Nursing & Care Services
NATIONAL AMBITIONS: Karen Chadwick
ECHO My
BUSINESS Story
APEX Nursing & Care Services was set up by Karen Chadwick to provide temporary and permanent staffing to the healthcare industry, including general and mental health hospitals. Founded in 1992 Apex had a turnover of £12m last year, a figure expected to rise to £14m this year. It has 2,500 permanent and temporary workers on its books. Ms Chadwick said: “After working within the care industry for many years, and seeing various levels of service, I wanted to create a quality service which ensured agency personnel were given adequate development opportunities and recognition for the roles they play in delivering care provision. “At the time of starting the business I was working all hours and making no progress financially or in terms of personal development. “Finally, I decided it was time I did something and realised I had the elements to create a business. “I knew how care homes worked, had experience as a carer and had a few connections. I also cared passionately about providing quality care. “As a result, I launched Apex Nursing & Care Services, which provides temporary and permanent staff to the healthcare industry. All of our offices, including the Liverpool office, can be contacted 24 hours a day, 365 days a year. “Our policy is to meet and exceed the requirements of our clients by tailoring our services to suit those needs and by employing the most conscientious staff to maintain our insistence on excellence. “We offer all staff free training and development, from established packages and courses to bespoke training modules, for all types of courses from professional to NVQs to organisational development.
“We also offer the only agency-led preceptorship programme. This provides essential training for newly qualified nurses. By working closely with NHS trusts, we offer the next step in their career progression, helping them to make the transition to qualified nurses. “It has been a phenomenal journey exceeding way beyond my original expectations. We are one of the largest independent care agencies in the UK, despite being predominantly based in the North West and Midlands. “One of the most satisfying aspects of the business has been witnessing the company’s growth thrive despite having had no formal business education. “While it has been extremely rewarding, it does come with pressures and demands that need to be constantly addressed. A lot of our business is short notice emergency cover with vulnerable clients, whose needs are so variable and diverse that we need to make sure we get it right every time. “My only business mistake has been to trust the wrong people and believe everyone is as enthusiastic and conscientious as me about the care industry. I also have a perfectionist mentality which led to my not looking after my health and putting work before everything else. I have learnt there has to be a balance. “At the start I received funding from a government initiative run by the local TECs that was then known as the Enterprise Allowance Scheme. I was given support from business advisors and a £40-a-week allowance. In recognition of me being one of their significant achievers, I was later invited to join the Board of the Manchester TEC for a period of time as a non-executive director.”
Sean Millar and Sheila Benson .................................The Side Door AMBITION and hard work have been the driving forces behind one of Liverpool’s most successful restaurant business partnerships – Sheila Benson and Sean Millar. Owners of the highly accredited bistro restaurant on Hope Street, The Side Door, Ms Benson and Mr Millar have become renowned throughout the city and beyond for their commitment to fine cuisine in a relaxed setting. That reputation is helping them ride out the current economic recession. Since their college days, the two have worked in the restaurant industry, learning from their early employers and mentors and gathering essential skills that would one day enable them to realise their dreams of owning their own business. Sheila said: “There wasn’t actually what you would call a ‘light bulb moment’ when we decided to work for ourselves rather than for someone. We met while we both employed by somebody else and soon realised that we had a shared ambition and vision and this was our perfect business partnership.” Their first “inn of happiness” together was the Other Place restaurant in South Liverpool’s gourmet haven, Allerton Road. After the success of that venture they soon opened up a deli a few doors down from their now thriving restaurant, but as other bistros and restaurants starting to spring up, Sheila and Sean decided to move. Liverpool’s theatre district became their new home with the opening of The Side Door. That new eaterie is in the heart of another of the city’s culinary hotspots, Hope Street, close to the Royal Liverpool Philharmonic Orchestra’s concert hall. “Being successful in this business is about having confidence in your product and being situated in the right location,” said Sheila. “We
ECHO Our
BUSINESS Story
FOOD VIEWS: Sean Millar runs The Side Door restaurant in Hope Street with Sheila Benson also pride ourselves on having a friendly, informal restaurant with emphasis on good service and locally sourced produce. “Our fish is delivered daily from Fleetwood and our vegetables come from the fertile fields of Lancashire. “It is surprising to many just what excellent produce is available right on our doorstep. Sourcing our restaurant food locally not only ensures freshness and quality for our customers, but also helps support the regional economy.” No business has escaped the effects the current economic recession and The Side
Door is no exception. But although some of their competitors are struggling Sheila and Sean’s business is holding its own and still recording a profit, albeit a lower one. Sheila said: “Our main commercial mistake was that we did not buy our own building sooner, but this is a mistake that we have rectified and have bought premises in Woolton Road, Allerton, where we are opening our new restaurant venture this coming spring. “We believe that the way in which we operate our business with a hands-on style has been instrumental to our success and has certainly ensured we knew exactly where we
were positioned when the downturn hit.” Sheila explained that it was “fairly unusual” in the restaurant business to have partners so actively engaged with the day-to day-running of the business as in our case with one of us in the kitchen as chef and the other as ‘front of house’. “Of course working in the way that we do can be very stressful during busy sessions, but it is also exciting and rewarding,” she said. “Owning and working in our own business is utterly satisfying, if exhausting, and I would say that it has lived up to all my early expectation and beyond.”
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The reality of business on the box Alistair Houghton speaks to The Apprentice winner Michelle Dewberry, who says business TV shows have encouraged people to become entrepreneurs
O
NLY a few short years ago, any television executive declaring that business was television gold would have been laughed out of the Groucho Club. But, as The Apprentice winner Michelle Dewberry points out, enterprise and pitching for venture capital have become prime-time TV fare. In early 2005, Dragons’ Den made its first appearance on British television. Its recipe of fearsome investors judging nervous entrepreneurs achieved the impossible and made venture capital sexy. Just weeks after Dragons’ Den was first broadcast, The Apprentice hit UK screens. The BBC show sees a group of thrusting young men and women competing for a £100,000-a-year job with Sir – now Lord – Alan Sugar. Each week a contestant is sent packing by Lord Sugar with his much-imitated catchphrase “You’re Fired” – though each series winner is instead told “You’re Hired!” Hull-born Michelle won the second series in 2006. She has since left Lord Sugar’s employment and last year set up Chiconomise, a money-saving website for women dedicated to finding the best deals in fashion and lifestyle. Michelle is still proud of her Apprentice victory and hopes other young people watching the show will become entrepreneurs themselves. “Anything that showcases entrepreneurship or business as a career option has got to be encouraged,” she said. “One great thing about The Apprentice is that it’s got quite a
HIRED OR FIRED: Lord Sugar THEY’RE IN: The investors from BBC show Dragons’ Den
young audience. As a result I talk to a lot of schoolkids and they now see business as a tangible and realistic career option. “They see Lord Sugar, for example, with all his money, and they think ‘I could do that’.” Michelle’s story is an inspirational one. After leaving school in Hull at 16, she moved into the telecoms industry and swiftly rose into management, finally becoming a self-employed consultant at just 24. While her victory on The Apprentice still opens doors for her, Michelle is focused solely on the future and on the success of Chiconomise. Setting up a business in a recession would worry some people, but Michelle saw a great opportunity. “Chiconomise is all about saving people money,” she said. “There’s no better time to do that than during a recession. “In a recession, people like me and my friends are wary about spending money but we want to look good. The recession actually prompted this business.” Michelle has never regretted her decision to go into business, and says she would encourage people to try self-employment for themselves. She said: “In life, you can always find excuses not to do something, whether that’s setting up a business, having babies or going on holiday. “I meet a lot of people older than me who say the regret not taking the decision to do their own thing. “The worst thing would be if it didn’t work – but you can go back to what you were doing before. If that happens it’s a lot better for your CV and you’ll get a lot more experience that wasn’t there before.” The Apprentice may seem to make overnight sensations of its stars but, like Michelle, most contestants already have years of experience behind them. Remember, she says, that every business needs time to grow. “Don’t expect everything overnight,” she said. “Building up a business takes time. Don’t become disheartened because something doesn’t happen instantly.” ● Visit www.chiconomise.com
Tuesday, March 16, 2010
BUSINESS SPECIAL 25
BUSINESS ON TV SUCCESS: Michelle Dewberry won The Apprentice in 2006
26 BUSINESS SPECIAL
Tuesday, March 16, 2010
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HOW WE GOT STARTED ECHO My
BUSINESS Story
WHY TRADE WITH CHINA? UK TRADE & Investment explains why China, with an economy the size of Japan’s, has become an attractive market for UK exporters: CHINA has undergone a massive transformation over the last 25 years. In 1978, when economic reforms began, China was primarily an agrarian
economy with virtually no private sector to speak of. In the intervening time, China has become the manufacturing workshop of the world, lifted two thirds of its people out of poverty and in the last decade, the country has built enough roads to loop round the equator
EASTERN PROMISE: The skyline of Pudong in Shanghai
16 times. This rapid rate of development is creating wide-ranging opportunities for business throughout China in sectors as diverse as energy, sustainable and environmental technologies, advanced engineering, healthcare and financial services.
China connections
International trade expert leaves Chamber to found new consultancy helping UK firms win business in the Far East
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UST over a year ago, Chinese business expert Dr Kegang Wu resigned from a senior managerial post at Liverpool Chamber of Commerce. He had been director of the Chamber’s highly praised ChinaLink offshoot, building close links between the world’s most populated country and Merseyside. He could have walked into many highly-paid jobs, not just in the UK but, with his expertise, anywhere in the world. Instead he decided to become self-employed, becoming managing director of his own company, ChinaDirect UK. It is a Liverpool-based consultancy and interim project management service specialising in helping UK clients develop business in China. Dr Wu became known in Liverpool over the last decade by many businesses and organisations as Mr China. He was credited with playing an instrumental role in establishing the LiverpoolShanghai twinning 10 years ago. Dr Wu said: “It was a natural step. I devoted 10 years to handling thousands of enquiries and advising hundreds of companies about the Chinese market in a
not-for-profit organisation. “The most satisfactory experience for me was when I succeeded in helping to conclude a contract negotiation, secure a multi-million pound deal, develop a new project, forge a new partnership, find a new customer or supplier, set up a new joint-venture or a new inward investment, or help turn the fortunes of a troubled business around through international trade. “I wanted to focus more on making projects happen, either for clients or for myself.” Dr Wu didn’t see the timing of his business launch, at the peak of the credit crunch, as a problem because “I knew that real expertise about China market is in short supply in the UK, especially those able to combine business operational experience, in-depth market knowledge, and business contacts in both China and UK. “Demand for a specialist China service will only increase as more firms battle to get out of recession,” he predicts with enthusiasm and confidence. “I knew the unique selling point of the new service and had three business plans very much worked out at the outset.” It is still early days and Dr Wu
has yet to file his first year accounts, but he is sure the bottom line will be in the black. Judging from the smiles on his face, he isn’t in a hurry to activate his “Plan B” or “Plan C” although he insists that any one who wants to start their own business should have more than just one business plan. He has been retained as Chief China Adviser for the British Chambers of Commerce to set up a large-scale programme involving 15 Chinese cities and provinces, including Shanghai, and the whole of the UK. Dr Wu recently advised a top design company to clinch a multi-million pound contract in an important Chinese infrastructure project. He has also helped a client – a Chinese company, that invested in the UK – to overcome some procedural obstacles. “Over the last 10 years I paid more than 60 business visits to China, but this year alone I have visited eight different Chinese cities,” he said. “Recession is a challenge as well as an opportunity. “The China market is emerging from the global recession with a lot of credibility and promising opportunities. I am receiving
enquires from both UK firms who want to develop business in China and Chinese firms who want to develop business in the UK. The Chinese word ‘crisis’ consists of two characters: risk and opportunity, which says it all”. Interestingly, Dr Wu is not afraid of returning to employment. He said: “The criterion for me is that any change should be an exciting one that is both rewarding personally and for my client, or employer in case of employment. “In my previous jobs, I ran the business division and organisation in a way that was as dedicated and professional as though it was my own business. Now I deal with all clients as if they were my employer.” Dr Wu is passionate about promoting Liverpool and British business interests abroad and helping UK firms in China. He has been invited to speak about the Chinese market in a number of prestigious forms in Barcelona, Beijing, Shanghai, and Xiamen. Twice last year, and this year, he was a keynote speaker and chair of the UK seminar at the China Outbound Investment Conference. He addressed hundreds of prospective Chinese investors at the
FOCUS: Dr Kegang Wu event, which is sponsored by the Chinese Ministry of Commerce and its national chamber. He has delivered talks on China to a score of chambers and trade associations in the UK. A simple Google search with his name in Chinese brings up hundreds of web pages covering his full speeches and interviews in the last year. Looking into the future, he is excited with opportunities ahead. “My plan B and plan C are as exciting as my plan A, if not more so,” he hinted, with a confident smile.
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‘Bring in a team at an early stage’
Tuesday, March 16, 2010
BUSINESS SPECIAL 27
INITIATIVE: Mike Welch of Blackcircles.com
Tyre firm founder Mike Welch says entrepreneurs need a strong support network for their business
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IKE Welch, founder and managing director of online tyre retailer Blackcircles.com, says a great team is essential to business success. Mr Welch left Woodchurch High school at 16 to work for a local tyre fitting company. “All I remember is hating the freezing cold during the winter, the constant cuts and bruises and the lack of prospects,” he said. “ Whenever I tried to show initiative, my boss always ignored me. “I was working all hours to impress him, negotiating the lowest price with suppliers. He told me I was wasting my time and I just knew this wasn’t the way to do business and that I could do it better.” So it wasn’t long before Mr Welch launched his first tyre business, using just a £500 grant from The Prince’s Trust, a room in his parents’ house and a mobile phone. “I was selling tyres by mail order through the Liverpool Echo and various other retail magazines,” he said. “My relative success put me on the radar of Kwik Fit. I was head-hunted and given the opportunity to move to Edinburgh and work as their New Business and e-Commerce Manager, learning from
the likes of the company’s founder Sir Tom Farmer.” However, at 23, Mr Welch was asked by his boss where he wanted to go next in his career. “I responded that I wanted to be chief executive,” he said. “When he told me I’d have to wait 30 years, I decided to leave and launch Blackcircles.com, much to the disbelief of my girlfriend at the time.” With half a month’s wages to his name, he set up Blackcircles.com in Peebles, Scotland. The business operates by allowing customers to buy their tyres online or over the phone and have them fitted at one of more than a thousand independent garages nationwide, with savings of up to 40% compared to high street tyre retailers. The business has grown considerably since then. “I can honestly say that I’ve never looked back,” he said. “We have just launched a vehicle servicing arm in partnership with Unipart and are rolling out mail-order tyre services across Europe.” “It’s exciting and stressful all at the same time. I’ve been at this for what seems like so long, I’ve barely had any time out in eight years and even taking time for a holiday or long weekend break leaves me feeling guilty. “As time moves on, though, I find
ECHO My
BUSINESS Story
myself becoming aware that there’s an important balancing act to be had between being financially secure and getting the most out of your life. “I guess there’s always a danger of getting bored, but I think the key is diversifying enough to keep things interesting for yourself while continuing to deliver value to your core proposition.” The one piece of advice Mr Welch
would give to someone starting up on their own is to acknowledge your own weaknesses. Typical entrepreneurs get excited and tend to flit, he says, so you need a support network that complements your strengths. “Bring that team in early on when the business is still young,” he said. Throughout the recession, Mr Welch’s attitude has been to tackle the downturn head-on and emerge
stronger as the recovery begins to take hold. This has been characterised by increased customer numbers, a significant increase in turnover and the expansion of the garage network. Mr Welch said: “In a tough climate brand loyalty is the first thing that goes out of the window, which makes it essential for businesses to respond to customers’ changing habits.”
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HOW I GOT STARTED Jamie Anderson and Mark Kershaw.................Pickled Walnut
ECHO Our
BUSINESS Story
NUTS ABOUT FOOD: Jamie Anderson and Mark Kershaw of Pickled Walnut
You have work like Steve Morgan says the first commandment of running your own business is ‘thou shalt be lucky’. He also has an aversion to debt, as Liverpool Echo Business Editor Bill Gleeson reports
H
OUSEBUILDING entrepreneur Steve Morgan vividly recollects the day he started his own business. The country was in a mess and the omens weren’t good
TOP caterers Jamie Anderson and Mark Kershaw have followed their own advice for the past four years and seen their bespoke service grow – forcing them to move to both larger premises and employ more staff. Jamie said: “Before starting out on my own I worked for a very successful company. I saw what they did right and what they did wrong, and I believed we could do better than them. “I was also working very long hours and didn’t feel I was reaching my full potential, so I formed a partnership with Mark.” Jamie and Mark received funding from both their bank and the Merseyside Special Investment Fund (MSIF) to help set up their business, Pickled Walnut. Jamie added: “It is a very satisfying business, although like everyone else we have been on a bit of a rollercoaster with the recession. “But we always stick to our business mantra for clients which is ‘come and speak to us first and we will give you a better price’. I would say our business is both exciting and stressful in equal measure.” Pickled Walnut has provided bespoke catering services for a whole variety of high-profile receptions throughout Merseyside including the International Tennis Tournament at Calderstones Park, gala dinners at St Georges Hall, The Anglican Cathedral and local functions both for corporate and private. Celebrities. the Royal Family and sports stars have all sampled Pickled Walnut’s food all of which is locally sourced. “To be successful we believe that providing a bespoke service tailored to each client’s individual needs, is vital – and
our food standards must be as high as our work ethic,” said Jamie. “Put simply – it’s about high-quality local food served by local people. “Examples of our locally-supplied ingredients include Southport potted shrimp, free range corn fed Goosnargh chicken, Bowland lamb and Formby asparagus. Using local ingredients reduces the delivery miles considerably, making it more cost-effective and better for the environment.” Repeat business and word of mouth referrals are crucial in the catering business. Pickled Walnut enjoys repeat business with an impressive 95% of its corporate customers returning for a second time, something Jamie feels has been crucial in helping the company cope with the recession. He said: “We are coping well with the recession and it’s not only our established customers that are helping us do this, but we are finding that a lot of the bigger companies who might previously have used another larger catering company are looking elsewhere in terms of cost and value. Our market place position means we are better placed to attract this new business.” As managing director, Jamie is all too aware of the pitfalls you can encounter when running your business. He said: “We all make mistakes and mine is that I am too hard on myself and don’t always go with the flow. “We ensure all our employees are aware of the company’s ethics and all share with us our environmentally-friendly attitude. It is important for the entire team to make an effort.“
at all. “It was the 4th of November, 1974,” he recalls. “It was in the middle of the three day week, the miners’ strikes and hyperinflation. “It was born out of necessity. I was working as a site manager for a Liverpool company, Wellington Civil Engineering. They were stuck with fixed price contracts at a time of hyper-inflation and they decided to close the business. “That very day, they were awarded a new contract to put the sewers in a village outside Wrexham so I said I would do it as a sub-contractor. “It was worth £25,000. It was for new mains sewers to replace the old septic tanks in Penley. “The first commandment of going into business is ‘thou shalt be lucky’. “Some people think they don’t need it, but they do. The thing is to seize it when it happens. “I was only 21 at the time. It was quite a ballsy thing to do! “I was young and confident and decided I would act first and think about it later. “I made a £5,000 profit and used it to buy a JCB, and went on to do other sewage schemes. “I worked as a sub-contractor for two years for Wellington on sewage contracts and at the same time did work for others – Northern Dairies and Conwy Council – again as a sub-contractor, on roads and sewers. The homes business came much later.” It was hard work laying sewers, but there was one perk. “Tomato seeds are not digested. Sewage is
GROWING BUSINESS: Steve Morgan, front centre, with the Redrow football team in the early1990s
the best fertiliser in the world. They grow like hell!” Despite his luck, Mr Morgan doesn’t make light of the risk he took. “I gave up a good job. I was earning £1,500 a year. That was good money in those days. I did have a mortgage, but I had every confidence it would work. “I worked my nuts off. “I would work through all the daylight hours and then under torchlight, seven days a week. “I would work 12 hours on site and then come home and do the paperwork and the ordering. I would work 100-hour weeks flat out. “If you are not prepared to work like hell, you shouldn’t think about going into business.” In 1978, Redrow moved into building homes for local authorities. Then, just a year later, Margaret Thatcher put the axe into public spending and particularly council house building. Recalls Mr Morgan: “By 1980/81, all council house work was coming to an end, so for a short time I was cursing her. She was taking our work away. “But we used the experience we had to move into private housing. It turned out to be a blessing in disguise. “We bought land and built the houses very quickly, like lightning. Because we built them quick, we could build them cheap. Because we built them cheap, we could sell them cheap. The likes of Barratt and Wimpey could not live with us. “We had queues for our houses. There was one time when there were traffic jams and the police had to come along and direct the traffic. “We sold 125 homes at Greasby in Wirral in a weekend in 1982. That was the start of Redrow Homes.” Mr Morgan has one big business anxiety. He doesn’t like debt. “Redrow never borrowed a penny to start with,” he said. “That first £5,000 was sufficient working capital. By the time we got into private house building we had £200,000 in the bank and we could buy the land with cash. We could build four-bed houses in eight weeks, so by the time we were paying for materials, we were getting cash in. We were in and out of Greasby in 12 months. We were on a very steep learning curve.” But the policy on debt changed in 1987 with the acquisition of Wellmar Homes, a move that doubled the size of the business. Redrow paid £10m of borrowed money for it. “We paid that money down very quickly,” said Mr Morgan. “It was a sleepy business. We built our houses very quickly, in 10 to 12 weeks. Wellmar took 25 weeks to build theirs. We speeded them up and we got our cash in much more quickly.” But debt remained an anxiety for Mr Morgan. “Turnover is vanity, profit is sanity, and cash is king,” he said. “Look after your cash. Do not get into serious debt. I couldn’t sleep at night with serious debt.
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Tuesday, March 16, 2010
BUSINESS SPECIAL 29
STEVE MORGAN
to be prepared to hell to be a success! BACK IN CHARGE: Steve Morgan regained control of Redrow in 2009
THE MORGAN FILE erpool an OND from Liv ● Qualified with 72 Polytechnic in 19 ess in sub contracting busin n ow his d ● Starte 1974, aged 21 1978, uilding business in ● Began houseb uses for local authorities ho building council r and calls a her comes to powe w diverts atc Th ret ● Marga dro Re . on constructi halt to council house ing ild to private house bu 87 for mar homes in 19 ● Acquires Well £10m 1994. the stock market in ● Lists Redrow on sale of his shares in 2000 the m Earns £240m fro ile in Jersey itain from tax ex ● Returns to Br Club in y Liverpool Football ● Attempts to bu by Tom Hicks and George it 2007, but beaten to instead Gilllett. Buys Wolves returned to drow shares and in 2009 ● Buys back Re an m air ch as d ar the company’s bo d the vement in profits an pro im an rts ● Repo s job w ne 00 creation of 1,0 losses mpany reported ● Last month, co Revenues up 25% at . down 81% to £8m £187m
“When you buy a company worth more than your own business, it’s hairy. But Wellmar was the best acquisition that I ever did. “They did a lot of things better than we did – their scheduling and landscaping were second to none. “We discovered we could charge more for houses with better landscaping on site. If you put more landscaping in, you will get a better price. It was a useful lesson.” Having previously floated Redrow on the stock market, and pocketing £400m from the deal, Mr Morgan took back control last year after returning from tax exile in Jersey. He said: “Redrow had lost its way. It needed a new direction. “The economy in 2008 was not good to house builders. My view was that the housing market would turn in 2009. But, he added:“The debt was horrendous.
It stood at £270m back in February 2009.” Mr Morgan says that, since buying back into the business, he has revolutionised the product, making his homes more characterful, and has paid down considerable amounts of that debt. Today he says: “The business is in a completely different place.” Mr Morgan tried, but failed, to buy Liverpool Football Club. Instead he bought Wolverhampton Wanderers and helped guide them to Premier League status. He also runs the Morgan Foundation, a charitable body that seeks to encourage voluntary organisations to be social enterprises capable of standing on their own two feet. The foundation runs awards to recognise the efforts of the voluntary sector. “Its about helping them to stop using the begging bowl,” he said.
HELPING HAND: Steve Morgan, second left, supports new businesses through his Morgan Foundation
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TRAINING
Learn to take control of your future The recession has forced more people than ever to think about starting their own business and there are experts out there to help you avoid mistakes STARTING a business is much more than just having a big idea, warn the experts. However, with guidance and planning, potential entrepreneurs can avoid the basic pitfalls. Ambitious Minds was established last year by three specialists in financial and business education. Ian Cornelius, Sean McGuire and Andrew Berkley were senior managers with global education provider Kaplan before leaving to start their own business. “The first thing is to identify your values and how they define your attitude to taking risks,” said Ian. “These could be four achievements which make you happy. Ask why they are important. “Working for yourself means work and home life become intertwined. “You don’t lead a double life at work and home. Work becomes your life, by sharing business ideas and problems with family and friends. “Ask yourself what your ambitions are? Are you a risk character or a risk-averse one? “On a tougher level, are you an ‘intrapreneur’, rather than an entrepreneur? “This means you could be better suited within employment and being creative in a salaried job. “Some people don’t want to deal with the detritus of administration. “They could struggle to cope with
no support from human resources or IT departments. “The lack of stability could overwhelm someone not getting a salary at the end of the month.” Ian suggest that new entrepreneurs should do as much preparation as you can before leaving employment. He suggest they should also take advantage of company training courses, mentoring, networking and build resources. “You must ask why people would want to buy from you,” said Ian. “There’s lots of competition, so what are your unique propositions?” Going it alone also means small advertising and promotion budgets. “Cute entrepreneurs now join networking sites like LinkedIn, Facebook and Twitter,” says Ian. “This way, they can promote themselves for almost no cash at all.” But if virtual marketing is not for you, then find a networking group which mirrors your values, for breakfast meetings and talks. “What you find is not only potential customers, but potential business partners,” says Ian. “For example, networking group 4N provides a friendly, constructive environment. “Soon you build up a network of potential clients, customers, good value suppliers and people you
AMBITION: Ian Cornelius, left, and Sean McGuire
might want to do business with. “This also avoids the possibility of loneliness which can hit people hard when they start working alone.” Some bodies focus on particular sectors of business start-up. Train 2000’s Enterprise Enablers have helped thousands of women set up and expand their businesses across Merseyside over 10 years. Maggie O’Carroll, executive director of Train 2000, based in The Strand, Liverpool, gives the following advice to women. “Take advantage of cash grants on offer. We can signpost women to the right place to find free business grants and loans,” she said. “Tap into supportive business networks that can help and grow your business.” The Federation of Small Businesses, Liverpool Vision and Knowsley Borough Council have extensive portfolios of services. “Do market research into your chosen business area,” said Maggie. Speak to people working in the same lines of business and find how you can offer something different. “Make sure you have sufficient capital to start your business.” One of the key reasons for failure is undercapitalisation. “Build your formal and informal support networks early to fill gaps in knowledge and experience.” Do create a detailed business plan first and don’t commit to lease or legal agreements until you have researched your business proposal. “Many of our entrepreneurs come from non-business backgrounds, but have passion and drive to be their own boss,” said Maggie.
THINKING AHEAD: Maggie O'Carroll of Train2000
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Uniquely you
I want a bank that works as hard for me as I do for my clients.
UniquelyCoutts
For over 300 years our founding principle has been to understand our clients and their needs. This will never change. To find out more about Coutts visit www.coutts.com/liverpool Tel: 0151 236 1086
Tuesday, March 16, 2010
BUSINESS SPECIAL 31
32 BUSINESS SPECIAL
Tuesday, March 16, 2010
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Over £100m of overseas business won by North West companies working with UKTI between April and December 2009.
Want to grow your business globally? Visit www.uktradeinvest.gov.uk/ukti/north_west or telephone 0845 603 7053