Friday, 20 July 2018

Tax, lies and stereotypes

Let's start with the stereotypes. Accountants are steady, boring and cautious. Phillip Hammond rather than Bojo. Well, some are but many aren't.

I've been told many times that I'm not a 'typical' accountant because I'm approachable and easy to talk to. I'll take that as a complement but I can do dull, boring and cautious if I need to.

I had an accountant pal who was (and probably still is) charismatic, energetic and persuasive. He is also a risk taker and his cv is a roller coaster of exceptional highs and near catastrophic lows.

He also has a tendency to be 'economical with the actualite'' to use Alan Clarke's phrase. I found this out to my cost which is why he is now an ex pal. I think this expression is particularly apt. Often it's what's not said rather than what's said by an untruthful person that is most deceptive and damaging. 'Risks? You never asked about the risks'

My ex buddy's gambling tendencies mean that he is willing to push the boundaries with tax planning. This, along with his charm and persuasive skills can be attractive to a hard-pressed business owner. Saving a load of tax - what's not to like?

Well, each to their own but when it comes to choosing an accountant I think risk taking, charisma and persuasiveness are overrated. There lies the probability of early and easy wins, followed by inevitable losses and possibly worse.

As an entrepreneur and business owner I am happy to take calculated risks. I don't want my accountant to be a risk taker too so I'll settle for steadiness and caution every time

Saturday, 14 July 2018

Give your business a boost with your own advisory board

It can be lonely being a business owner.

Most of us need an outlet, a sounding board to share the highs and lows with, ask for advice and to provide support. It could be a spouse, a trusted member of the team, an old business pal, a paid advisor - I've offloaded to all of these over the years and continue to do so.

But what if you could have your own informal board of fellow business owners? A group of people who understand the issues and challenges you face, who want you to succeed and are there to help you. Wouldn't that be great?

Well it is. I can say that with confidence because I've had my own informal board for the last few years. We meet every couple of months or so and take it in turn to be the host - providing a meeting space and copious amounts of coffee and biscuits.

We met this week and we were reflecting on the amount of change we have seen in the few years we have been getting together. We have all seen significant change, both in our personal lives and in our businesses. Nothing stands still.

For me, the main purpose of groups like this is to support and challenge. Our group is particularly good at the 'support' bit. I think we are all naturally helpful people so we look for the positive and try to encourage and motivate each other. 

For me that has been brilliant. I have floated a number of what I thought were crazy ideas with the group. They have built on these and offered encouragement and I have gone on to launch them successfully. A couple of examples which spring to mind are starting our own networking group, 'Growth Club' and developing and launching our own printed newsletter, 'Beans Talk'. 

I don't know if my colleagues would agree with me but something we are perhaps not so good at is challenging each other. We do it but our challenges can be subtle and nuanced. I'm sure that some groups are more direct and as a consequence their meetings may be more uncomfortable. It comes down to what works for a particular group. Having a disruptor or two amongst you may add some value but it may mean that a group is short-lived.

So if you get the opportunity to form your own group I would recommend it. A good place to start is to chat with some business colleagues you already know and trust and see how they feel about making a commitment to meet regularly. It could just be one of the best business decisions you make.

Friday, 6 July 2018

It ain't over 'til it's over

Turning 60 this week was something of a milestone. I had a nice relaxing day off work and England rounded things off by beating Colombia on penalties. Not that I could watch the finale, I had to walk around the block and learn the result when I got back. A good ending.

It does make you focus on your mortality. I'm set to draw two occupational pensions this year. So if I had stayed employed that would be it. I could hang up my boots (metaphorically speaking) and like Marlon Brando in the Godfather tend my vegetables and play with my grandchildren. Marlon did become a nicer version of himself in his old age (It's not hard to improve on murder and corruption) but he came to a sticky end in his pepper patch. Although I love my grandchildren, that's not overly appealing.

One of the plusses about running your own business is that you have choices.You can sell up and retire. You can carry on with 50 or 60 hour weeks and hope you keep your health and energy levels. Or you can keep going but change how you work and what you do. Maybe do less of everything but more of the things that you like and are good at. This last option appeals to me most.

My favourite quote about retirement comes from an unlikely source. Ex US President, Richard Nixon may not be everyone's idea of a role model. Sure, he had his faults but a strong work ethic and sense of duty (occasionally flawed) were part of his make up. His view on retirement was, 'To me, the unhappiest people in the world are those in the watering places, the international watering places like..uhhh..the south coast of France and Newport and Palm Springs and Palm Beach; going to parties every night, playing golf every afternoon, then bridge. Drinking too much, talking too much, thinking too little. Retired. No purpose.' The Palm Springs set may disagree. Pottering about in the sun sounds fun but I think the novelty would soon wear thin. So I'm with Richard on this

Then there is Stephen Hawking who says, 'Work gives you meaning and purpose and life is empty without it'. People find meaning and purpose in different things. To Stephen it was understanding the universe. Most of us have more modest ambitions. For me, being 60 changes very little. I still find purpose, great enjoyment and satisfaction in running a business. If that changes I may try something else but for now its business, more or less, as usual...

Saturday, 2 June 2018

5 reasons why you should find out more about selling your business (even if you have no plans to sell)

Many business owners don't give much thought to selling their business until something happens which brings it into play - illness, family crisis, divorce, economic downturn, increased competition etc. The problem is it's then often too late to get the best price for the business. At worst it become a fire sale with years of commitment and hard work sold for a pittance

It doesn't have to be like this. I think every business owner should have a strategy or strategies (there may be a number of options) for exiting from their business in a planned way.

Here are 5 reasons why you should put some serious thought and research into selling your business, before you are ready to sell

1. Avoid a fire sale

I know, I'm repeating myself. But you get the point. If you wait until you need to sell, it is probably too late to get a good price

2. Your exit plan will determine how you shape your business

When you have done your research and thought about a possible method and timing of sale this is likely to influence how you develop your business in the following years. For example you might need to systemise or simplify your business to make it more attractive to a buyer or make it less dependent on you as a the business owner.

3. It leads you to the next stage in your life

For many, selling the business will be the step before retirement. For others, it may be the opportunity to start a new venture in a completely different field. Knowing what you may get from your exit and the timing can help you plan ahead

4. It's a big motivator

If you know what your exit looks like, that brings some clarity to what you need to do to get there. Having that goal of a big pot of gold and freedom 5 or 10 years in the future can be a huge motivator and drive you on in your business.

5. Team development

Your exit plan may highlight that you need to develop key members of your team or recruit key personnel to make your business more saleable

So thinking about your exit in advance is important and worth investing some time in. The payback in terms of the knowledge and benefits gained should be very significant indeed

We are very lucky and honoured to have business sales specialist and author Gary Morley presenting at Knowledge Bites for Base52 on Thursday 21 June. It costs a fiver  and includes a buffet lunch. As a business owner it could just be the best value couple of hours you are likely to find anywhere

Sunday, 27 May 2018

Are you super successful, getting by or struggling?

Business guru and entrepreneur Nigel Botterill often quotes statistics that only 5% of businesses are 'super successful' or doing very well, 15% are doing ok and a massive 80% are just 'getting by' or struggling.

Not a great advert for the joys of running your own business. I have no hard evidence for the validity of the statistics but leaving aside 'one person' service businesses (which tend to do well), the figures kind of ring true.

So what sets the top 5% apart? Why are they able to thrive in challenging times whilst the majority are not doing so well?

I've had a good think about the successful businesses I've worked with over the last 15 years and these are some of the attributes they show:

1. Review and adapting to change

The best businesses are continuously reviewing their effectiveness and adapting to changing circumstances. They hate complacency and being comfortable and are always striving to get better

2. Focus

They have a core offering which is the essence of their business. Most of the business resources are deployed into making this core offering as attractive as possible. They might diversify but not at the expense of the core business.

3. Business owner freedom

The business owner is released from some of the 'day to day' grind and is able to focus on customer care and team and business development

4. Processes and roles

The business has clear processes and routines for sales and marketing, production and finance and job roles are also clear. Basic stuff gets done well, over and over again.

5. Pricing

Getting this right is key. Price too low and your business will never make money. There will be a constant battle to cover overheads and manage cashflow. An uncomfortable place to be. Price too high and the business will stagnate. Hit the sweet spot where your pricing matches the value the customer receives and gives you a respectable profit and you are on a good path.

That's probably it in a nutshell.

Having a great product or service helps as does finding an attractive market niche. Even in a more competitive space, if you follow the above steps you are more likely to end up in the top 20% and move closer to super success

Friday, 27 April 2018

5 tips for small businesses to survive and thrive in tough economic times

The UK has just announced that growth in the first quarter fell to only 0.1%. Construction and retail sectors were hit particularly hard with the bad weather having a significant impact. Consumer confidence remains low with high inflation and slow wage growth being contributing factors

So how do small businesses cope in these challenging times? How can they keep stable and even grow when the overall economy is underperforming?

Here are 5 tips for staying on course:

1. Pay attention to the financials

This is a time to put additional care into financial management. Ensure that you have a regular routine for record keeping and reviewing business profits. Use forecasting to look ahead and ensure that your finances are stable for three, six and twelve months into the future.

2. Stick to the knitting

This is not the time for being distracted by exciting and speculative new ventures unless you have significant reserves or adequate financing in place. Focussing on the fundamentals of your core business - looking after customers, ensuring operations are efficient and effective and that current trading is profitable will pay off in the long run

3. Keep creditors informed

If cashflow is tight it is important to keep creditors informed and work with them rather than lying low and hoping things improve. If your suppliers know that you have a plan and are intending to settle with them when you can, they are more likely to stay supportive than if you keep them in the dark or break promises

4. Talk to your bank

If your business is going through a difficult period, talking to your bank at an early stage is a good idea. It is possible that a refinancing package or extended overdraft taken at the right time could make the difference between fire fighting and a more managed recovery

5. Don't stop marketing

When finances are tight the temptation is to cut back on all discretionary spending, including marketing. That could be a mistake because when the upturn happens you will not be in the best place to take advantage. It is a good idea to review your marketing however and concentrate on the activities which are delivering tangible results.

There are no guarantees for survival and growth for any business. In tough times, doing the basics well and following these tips should help.

If we can help at Base52, please get in touch

Saturday, 14 April 2018

Don't get mad - do something positive

I've recently finished reading 'How to be human'. It's written by the very clever people at New Scientist magazine and is full of facts about how our bodies and minds work and what makes us special.

As a life-long runner I was delighted to learn that we were 'born to run'. It seems that humans are built for long distance running. We have apparently evolved this way to help us hunt and 'run down' prey to exhaustion and also forage over a wide area.

I learnt there is no such thing as a 'sugar rush' and the secret to long life is a combination of exercise, diet, managing stress and good genes. We can do something about the first 3 things but not the last unfortunately.

I also learnt a bit about emotions. I hadn't realised that there are 6 basic emotions - happiness, sadness, fear, anger, surprise and disgust. There are also secondary emotions like curiosity and confusion. A fascinating fact is that all these emotions illicit different facial responses which studies suggest are innate rather than being learned. So when we are curious our heads tilt to one side and the muscles in our forehead and around our eyes contract. Useful information for poker players but they probably know this already.

So what about using emotions as a force for good and for pursuing our goals?  On the face of it anger is a destructive emotion but there is evidence that it can also be beneficial and energising. To be a catalyst for positive change, anger needs to be channelled in the right way.

There is a very famous saying from Aristotle about anger, 'Anybody can become angry - that is easy, but to be angry with the right person and to the right degree and at the right time and for the right purpose, and in the right way - that is not within everybody's power and is not easy'