Feeds:
Posts
Comments

Archive for the ‘Life as an SME’ Category

The election messages continue to dance around reality. I did arithmetic at primary school, but did the politicians?

Here’s my maths. The government spends £400 for every £300 it receives, spending half our national income. If the country earned £800 per annum, the government spends £400, of which £100 is borrowed. Total government debt would be £500, rising by £100 per annum. This is less than six years away from going down the pan like Greece.

If we protect health, the government would have to cut a third of all spending to balance the books. That is an unimaginable level of cuts implying public sector pay falling by a third, which in turn would depress GDP severely making things even more difficult.

If GDP grows, it will be better. But we live in an uncertain world, with huge financial risks still lurking all around. Still all of the talk is about additional spending and what will be protected.

We have a financial crisis worse than anything seen in our lifetimes. Why are the politicians playing dumb and not getting totally real with the electorate. Maybe we still don’t want to hear?

Chris Barling, Actinic

startupdonutbannerbutton728x90

Bookmark and Share
Advertisements

Read Full Post »

I’m not naturally a cynical type of chap, however politics seems to bring a side out of me that I don’t really like.

While trying to decide who to vote for, I find myself muttering phrases such as

“Well, they’ll never actually do that, will they?” This really isn’t like me at all.

Apparently this time we are to be “helped” in our decision by the TV debate. As far as I’m concerned, this X-factor style circus only makes it more likely we’ll end up with a pretty boy/girl with lots of style and little substance.

What I’d like to do is vote for the party whose policies are best aligned with my life and that of my family. I couldn’t give a hedgehog whether the leader smiles or can remember someone’s name, but I do want to know if they know what they’re talking about.

I have a business to run – much like the rest of you. If I spend the required time trawling through all the information that would allow me to decide which party will make my business run better, then somebody else will no doubt be spending that time making their business run better than mine.

So I have to guess, basically. My guess is that Brown is an economist, whilst Cameron and Clegg are basically pop stars in suits. I think that Brown will probably ultimately be seen to have dealt well with the financial upheaval of the past 18 months, and that on that basis he should be retained. That’s enough thinking for me. Back to work.

Ross Campbell, The Exercise Club, Clifton.

startupdonutbannerbutton728x90

Bookmark and Share

Read Full Post »

Everybody knows that if you stand still you are, in reality, going backwards.

My company, a Bristol gym, is fortunate to be in a location that is conveniently close to its target market, which makes advertising virtually unnecessary.

Most readers will be aware of the statistic that most gym members stop going after between one week and three months, after having paid for a year’s membership.

It seemed clear to me from the outset that we ought to focus our time, energy and money on what we offer the member once they have joined, as opposed to the industry model which, as some of you may be aware, is to promote heavily, sign people up and then just ignore them.

We hold about four staff meetings each year. Last Tuesday we spent one and a half hours discussing whether we should alter the number of repetitions (ie complete lifting and lowering of a weight) that we advise members to attempt, on the basis that it might be easier for them to understand what we wanted from them, if we gave a lower figure.

It’s easy to forget how much resistance there can be to change, simply as a gut instinct. I personally find the process draining, possibly because I don’t like to tell my staff what to do, I’d rather work through some questions and examples in the hope that they will feel empowered by their decisions.

In the initial stages, progress is slow, because people have different levels of understanding. But the best bit for me is always the passion they show for their jobs and for our customers – the members. They show this passion by arguing with each other about what’s best. I think this is lovely.

Ross Campbell, The Exercise Club, Clifton.

startupdonutbannerbutton728x90

Bookmark and Share

Read Full Post »

Earlier this year, entrepreneur and founder of The School for Startups, Doug Richard, published his Entrepreneurs’ Manifesto – a “declaration of rights” for small businesses.

The manifesto sets out eight demands to a new government, each of which addresses a different key concern for businesses. In the build-up to the 6 May general election, Donut MD Rory MccGwire is offering his thoughts on the issues raised by Doug Richard.

Scrap Business Link?

In Part 1 of this blog I summarised the recent history of business support in the UK. I concluded that, after 20 years of heavy expenditure, one precious asset that we have is a brand that most business people recognise. Business Link is “the place to go to access whatever help is available”.

I take this view notwithstanding the fact that I’m still hearing the same things now as I’ve heard every single year during that period.

“Business support is too fragmented.” “I don’t know where to go for help.” “It needs to be more practical.” “The advisers need to be people who have run SMEs.” “It must be local.” And meanwhile the civil servants seem as keen as ever to have a service that is “innovative”, a word that is prominent in every tender that comes across my desk at BHP, the company behind the Donut websites.

In his intentionally controversial Entrepreneurs’ Manifesto, Doug Richard proposes scrapping Business Link and moving business support online.

Traditionally, business support has been delivered one-to-one through business advisers and telephone helplines, together with an extensive calendar of training courses and networking events.

But hold on a minute, let’s start by asking what we are trying to achieve. What are the objectives of government business support?

Well, it’s support for businesses of course. There are about four million of them.

Some of them are like Doug Richard and me: successful (OK, he’s a lot more successful than me, I’m the first to admit it), confident, experienced, and so on. Do these individuals seek Business Link’s help on how to start a business, or how to comply with all the regulations surrounding employing someone? Probably not, but we do take advantage of tailored support for ‘high growth’ companies. The UK invests a lot of money helping its most capable businessmen, not least because the next Google, Dyson or Nokia may be among the businesses that they start. I have mixed views on this.

I generally prefer ‘pull’ to ‘push’. So who are the people who actually come looking for help?

In a word, novices. It is people who feel they would like to be self-employed, but want to bounce their idea off someone with some experience who can also tell them how to go about getting started.

One obvious group that springs to mind is women who are returning to work once their children are in full-time education. They have a high propensity to seek help.

Another group who ask for help is people who have never run a business, but suddenly find themselves out of work. (By the way, Tony Robinson, the well-informed boss of SFEDI, the standards-setting body, was quoting a UK statistic that if you’re made redundant at age 45 you only have a 10% chance of getting a new job.)

There are lots of subgroups like this. Some of them get lumped together in reports under the unflattering name of ‘disadvantaged groups’, or ‘the hard to reach’.

Do these guys all use the web for business support? Er, no. The latest research from the Small Business Research Trust reveals the true extent of this non-use.

In 2007, ‘information on websites’ was the most popular form of business advice, having just pushed ‘face-to-face contact with an adviser’ into second place. But the latest data, published in December 2009, puts the business advisers back at the top of the charts. I guess there is simply too much information out there on the web for people to cope with.

BHP’s own user-testing bears this out. Users with a specific business question are unlikely to be able to find the answer online. Their first port of call is businesslink.gov, which is also their best chance of finding the answer. So it should be after the vast sums of money that have been invested in it. Happily, they also find the Donut websites useful for the topics that we cover. And likewise a specialist website such as j4bgrants is a treasure trove for that specific search. But while other small business websites are brilliant in other ways, they don’t always give you direct answers to direct questions.

As the data shows, businesses are once again finding it easier to simply ask someone: a friend, an accountant, an adviser, or whoever.

Business Link, and the plethora of business support organisations that it acts as the signposting for, delivers this face-to-face support. So it’s no good simply scrapping it. The question is, how can we improve it and which organisations should be delivering this one-to-one business support?

I’ve got lots more to say on this fascinating topic. On call centres; on how to objectively establish the success and value of a service; on the psychology of start-ups and micro businesses; on how to make the front line and the back-office of Business Link (etc) hugely more cost-effective; on how to involve the banks (an old idea, but a good one); on how to get the support/messages of 1,001 different public sector organisations out to small and medium-sized enterprises; on how to do public sector procurement without financially damaging so many of the bidders; and, sticking with procurement, on how to tap into the specialisation, experience, passion and sheer hard work of the smaller suppliers more than we do now; and that is just the first list of things that springs to mind…

But let’s see what others have to say first. Comments please!

(By the way, thank you to everyone who commented last week on my business regulations blog, I’ve enjoyed reading them all.)

Rory’s other Have your say! blogs

startupdonutbannerbutton728x90

Bookmark and Share

Read Full Post »

Earlier this year, entrepreneur and founder of The School for Startups, Doug Richard, published his Entrepreneurs’ Manifesto – a “declaration of rights” for small businesses.

The manifesto sets out eight demands to a new government, each of which addresses a different key concern for businesses. In the build-up to the 6 May general election, Donut MD Rory MccGwire is offering his thoughts on the issues raised by Doug Richard.

Scrap Business Link?

In his manifesto, Doug Richard calls on the new government to scrap the Business Link business support service to provide savings and to migrate all government business support services online to promote efficiency.

In the report he wrote for the Conservative party earlier, I think he also recommended using the universities and specialist providers such as the British Library as a replacement business support network on the ground. More recently, Mark Prisk, the Conservative Shadow Minister for Business, has been talking about using the existing network of Enterprise Agencies for this role.

I’m sure Doug is as pleased as I am to see that the government is already going flat out to move the whole business of government online. Thousands of disparate systems and websites are being corralled into three mega websites: businesslink.gov for businesses, direct.gov for individuals, and nhs.uk for health. 

Yes, this is expensive, but what an improvement.

Lots of individuals lack a computer, but most businesses are online and will readily engage with businesslink.gov, as the evidence already shows. We small and medium-sized enterpriseslike being able to do tax returns and company searches etc online; it is a real convenience. We also use the huge library of advice pages. 

So let’s talk about the more contentious idea of scrapping face-to-face business support. But first, a bit of history. 

In the 18 years I’ve run BHP, I’ve seen governments come and go. At every general election, there’s a clamour to change the way government delivers business support. And we do change – all too frequently. 

In the 1970s, we had Enterprise Agencies, which were hailed as fulfilling an important need. 

Then someone said “No let’s have Training and Enterprise Councils”, so we had 82 TECs, with a £1.3bn budget to help SMEs in England and Wales. Scotland decided to have 22 LECs. 

Why 82 TECs? Because support had to be local, as everyone seemed to agree that “a business in Preston has a different set of needs to a business in Portsmouth” (nonsense on the whole, but that’s a topic in itself…). 

Then someone (I won’t mention Tarzan by name, as I’m trying to stay clear of party politics) said “No, these TECs are failing, let’s have a one-stop shop for business support. We’ll call it Business Link”. So we had had 82 Business Links, as local was still flavour of the month, while Wales invented something else new called Business Eye. 

Meanwhile the government had also created a network of nine massive organisations called Regional Development Agencies (in England only), each with a list of tasks and targets that went on for pages and pages. 

At this point someone said “Crikey, this costs a fortune and the quality and type of business support varies far too much, so let’s take the 82 Business Links and make them into nine Business Links”. 

And that’s where we are today. Endless change. If you ran a business like this, you would have gone bust over and over again. The cost of this never-ending change is too much to even contemplate. 

But, finally, we have a brand that, like any commercial brand, has been allowed time to establish itself. Hallelujah. There are even road signs saying Business Link in some towns. 

The question now is what we want the brand to offer, and how business support should be delivered. I’ll deal with that in my next blog. 

Rory’s other Have your say! blogs 

startupdonutbannerbutton728x90

Bookmark and Share

Read Full Post »

Earlier this year, entrepreneur and founder of The School for Startups, Doug Richard, published his Entrepreneurs’ Manifesto – a “declaration of rights” for small businesses.

The manifesto sets out eight demands to a new government, each of which addresses a different key concern for businesses. In the build-up to the 6 May general election, Donut MD Rory MccGwire is offering his thoughts on the issues raised by Doug Richard.

In his manifesto, Doug Richard argues that business regulation should be streamlined so that people can start businesses more quickly and run them more easily. 

I agree. But in order to achieve this, I think the law must make an important distinction between small and large businesses. They have different regulatory requirements. What is fair and suitable for one is often neither fair nor suitable for the other. 

It’s also important to recognise the natural bias in our regulations, a bias that stems from the fact that regulations are always going to favour the people who make them. So our regulatory system is heavily skewed towards the preferences of the government, the public sector, big business and the trade unions. 

The seemingly simple task of taking a chunk of time off for a family holiday is a struggle for many people running a small business, so it’s hardly surprising that they do not have time to assist in the law-making process. 

Nor do the various small business membership organisations have the power to make much of a difference. Think back to when the government raised CGT by 80 per cent without realising until afterwards that for many small businesses the only “pension” available at retirement is the proceeds of the sale of the business. A £1m threshold was hastily added, but not before it became obvious that the small business lobby groups had not even been consulted on this legislation, let alone listened to. 

Yet it’s small businesses that end up paying the price for so much of the legislation. Take a law requiring organisations to offer wheelchair access to their premises. I’m sure everyone agrees that society wants to help make life less difficult for disabled people. But few people stop to consider who will be forced to pay for the door widening. We all pay for the doors to be widened in the public sector buildings and the corporate buildings, through our taxes, pensions and savings (some of which are invested in listed shares), which seems completely fair. 

But when it comes to all the properties owned by small businesses, it’s the business owner who pays. So if I earn a £20k salary working for the local council or for a big company, I am not affected at all, but if I would have earned £20k from owning a shop, I might be left with just £17k after the adjustments to my shop front. How can that be fair? It’s not. It is merely convenient, both for the lawmakers and for the Treasury. 

It’s the same with employee rights. Nobody questions the need for new parents to spend more time with their children. But who pays? There’s no compensation to any of the small business owners who pick up these costs. In a small business, every member of staff is a key person and losing them, even temporarily, is a considerable blow. Larger businesses have the resources to cushion the blow; small businesses don’t. 

Given that small businesses employ a very considerable proportion of the workforce, I suggest that society ought to compensate small businesses if we all want to have those benefits. If not, you end up with a situation where business owners are terrified of employing women of a certain age. It’s discriminatory, but it happens; the law has massive unintended consequences. 

Sensible regulation is essential to protect customers, employers and employees. But it must recognise the reality of running a small business. 

So much of our business regulation is designed for Hewlett Packard and Rolls Royce, not for “mom and pop” businesses. But, in my view, firms with fewer than five employees should have a completely different set of regulations. If you choose to work for them, perhaps you shouldn’t have quite the same rights as employees in larger companies, simply because these rights amount to robbing Peter (the employer, who is a person) to pay Paul (the employee). But then you would be discriminating against employees of small businesses, which is clearly wrong. 

So the only fair solution is for society (aka the taxpayer) to face up to, and pay for, the cost of implementing all these rights, instead of turning a blind eye while the costs fall onto the shoulders of small business owners. 

Doug Richard is right and all the political parties seem to agree. We need to do something to enable the moms and pops to run their businesses in a more flexible and efficient way. Now let’s see if anyone actually does anything. 

What do you think? 

Rory’s other Have your say! blogs

What do you think about the regulations affecting small businesses? Please leave your comment below.
startupdonutbannerbutton728x90

Bookmark and Share

Read Full Post »

I was up until til 2:30am cooking to fulfil orders and make samples. I am feeling hyper and excited, with that butterflies-in-stomach feeling about what lies ahead and the opportunities that I have. I am equally overwhelmed about what to do next and I’m tired. Whatever I do, it means that I’m not doing something else that is equally important.

The bookkeeper came this morning and we are getting our new system in tip-top condition. It required my attention because we are changing to a new accounting system and I need to know how it works. So I couldn’t make the follow-up sales calls I needed to do, or pay the bills, or organise tasting sessions, etc. I also teach Spanish on a Wednesday and I haven’t prepared yet.

More orders are coming through, but I’m not able to cook tomorrow because I’m at a “Meet the Buyer” event. I hope the buyers do buy! So it looks like another 2:30am bed time tomorrow, as my kids are in a local panto and I won’t miss their debut!

Wish me luck, I’ll keep the coffee flowing…

You can find out more about Marcela on the new interactive business website www.inafishbowl.com

startupdonutbannerbutton728x90

Bookmark and Share

Read Full Post »

Older Posts »