You may have already heard the saying that “Existing customers are more likely to buy from you then when approaching a new customer.” Well, it’s much more than a saying – it’s a proven fact.
A joint study by BIA/Kelsey and Manta found that existing customers not only spend on average 67% more than new customers during checkout, but retaining the business of an existing customer costs 10 times less than the cost of acquiring new customers.
The report concludes by noting that customer loyalty can bring big benefits to small businesses:
Once businesses truly grasp the impact their customer base has on their long term business viability, they can spend more of their time and budget focused on existing customers, which not only saves them money – it makes for explosive revenue growth.
Because of this, it puzzles me that so many small businesses and even large corporations spend their time and resources it takes to chase down and win over new customers instead of simply looking after their existing ones.
Why Sales Isn’t A Numbers Game!
Have you ever heard the saying, “Sales isn’t a Numbers Game”? If you’ve ever worked in sales, you have undoubtedly heard that saying at least once (or if you worked at a cold call center, once every hour of the work day). But sales aren’t isn’t supposed to be a numbers game. This archaic mentality is what will lead you to spending a whole lot of time and energy trying to convert the nonconvertible.
I don’t know who came up with that saying, but they are dead wrong – and here is why. It is incredibly short sighted to think that sales are a simply game of asking as many people as possible for money, then hoping and praying that eventually someone will cave in and fork over their cash. Having worked in a variety of different industries, I’ve witnessed firsthand that regardless of what industry you work in, the one common denominator that all salespeople should consider is that customers are people – human beings just like you and I – and that they are certainly not numbers to be checked off one-by-one.
The bottom line is that businesses treat their customers as numbers. That is a fact which is one of the biggest problems we have in the world of business today. If the customer were just a number, you would not need to care how they feel, think or talk about your product or service after they bought it. Instead, you would just keep on making money from them without looking after your existing customers.
They Are A People’s Game!
Some businesses offer subscription services, such as mobile phones, online memberships, hosting, and many other products. As a result, they lose their customers within their first 12 months and get bad reviews on customer care, support and even their products. Many companies use ads and marketing strategies to win new customers, then, as soon as they have them, they no longer care about looking after them or following up. It’s as if once the money is in their hands, the customer ceases to exist.
This unsympathetic approach to customer service can often turn fatal for businesses of any size. As a result of their poor customer care and support systems in place, businesses end up losing their customers just as fast as they got them.
Which brings me to the point: that sales aren’t a numbers game, but a people game. When you have a great relationship with your customers, they will always come back to buy more from you, not to mention send more customer referrals your way. The sales revenue, the numbers in your account, and even the success of your business are just a few of the many results of you selling your product. The thing that matters most is to look after your existing customers to the best of your ability. This will not only increase your sales, but also improve your public reputation as a company, which is very important these days in regards to building a long lasting, successful business.
Even before a product can hit the shelves – or even before it’s available in online stores – there are hundreds of hours of market research that takes place. Research on what type of consumer your demographic is made up of, customers like, what is in demand, what customers need, what they do not like about competing products, where do they currently spend their money, and on what?
From the beginning of developing a product or offering a service, all the way up until it is actually sold and starts to generate revenue, and even throughout the entire sales process, every single aspect of a product or service revolves around the actual customers that are buying what you’re selling.
In today’s market, businesses who believe that sales are a numbers game are setting themselves up for failure. Sales is now – and always has been – a people game. It’s a game of winning their trust before they even consider buying from you, a game of demonstrating the value of not just what you’re selling to them, but that you and your sales pitch are valuable enough to take up their time.
You can hire the best product development team to come out with the most effective, aesthetically pleasing, and indestructible product on the planet – but if customers don’t trust the person selling it, they won’t buy it. At the end of the day, all you need to remember is to treat people like people, not a paycheck.
For more information on how you can maximise sales in your business click here.
First impressions are crucial. In the business world, they can make a world of difference in getting a promotion or being the perfect candidate in a job interview. In this post, we’ll highlight a few aspects — from good oral health to dressing for the job you want — that impact your career prospects.
Many different factors influence how successful your career is. Some are out of your hands, whereas others — like how you carry yourself as a professional — are entirely up to you. Granted, this is somewhat of a broad statement, but the reality is there are many things to consider when it comes to how other people perceive you.
Below we’ll discuss a few aspects of your appearance and self-maintenance that may be harming your career.
Dressing for the Job You Want
In the digital age, a large percentage of people opt for a freelance career and many SMEs and startups take a casual and less corporate approach to business. It’s safe to say that the stereotypical work clothes of a professional have changed. But, as a general rule of thumb, try aiming to dress slightly smarter than the employees of the business you want to join.
If the job you’re applying for is at a bespoke company where professional clothing is mandatory, your choice of interview attire is a no-brainer. For men, this could be a suit, shirt and tie, or a smart sweater. For women, it depends on your own style — some will prefer a dress whereas others feel more comfortable in a suit.
If the interview is with a startup, small business, or even a large organisation that prefers their employees to wear business-casual clothing, you have more options and room to incorporate some unique fashion choices. Tread lightly with this, as bright colours and flashy items can be distracting. If you want someone to focus on your attributes and skills as an industry professional, a flashy outfit isn’t helpful.
Good Oral Health
Although your physical appearance shouldn’t be a contributing factor when it comes to your career, good oral health and hygiene should be maintained with the correct care and attention. In an age where high-quality dentists and products are available to keep our teeth in good condition, failing to do so can project a lack of discipline or laziness.
Not to mention that damaged or decayed teeth is unsightly for customers and colleagues. If you happen to have an infection it can cause serious health problems and produce fierce bad breath. The latter is especially troublesome for your colleagues and genuinely impacts your success during interviews. Being memorable as the applicant with bad breath isn’t ideal when you want to be remembered for what you bring to their company.
If you’re someone who has missing teeth — whether removed by a dentist, knocked out, or fell out due to decay — there are several solutions that can return your smile to its former glory. If you’re looking for a long-term solution then your best bet is dental implants. This is where a metal root is fused with your jawbone and a prosthetic tooth is attached to the top. If you are self-conscious or suffer from a lack of confidence because of dental health, finding a solution that suits your needs and budget should be a top priority.
Don’t Neglect Personal Hygiene
Maintaining a good level of personal hygiene is not only important to stay healthy, but neglecting to do so demonstrates a lack of discipline and disregard for those around you. Being a bit smelly isn’t an acceptable reason for your employer to dismiss you, but it can significantly impact several aspects of your daily work life.
The importance of good personal hygiene during an interview cannot be stressed enough. There is a vast range of things that can impact your hygiene so it’s crucial to keep it under control. Whether you’re rushing to catch the tube and start to sweat, wake up late and don’t have time to shower or forget to clean the dirt from underneath your fingernails — your interviewer will notice and unfortunately, it will influence their opinion of you.
Everything about your appearance and hygiene gives an interviewer insight on how you perform at work and how well you’re prepared — choose an appropriate outfit, brush your teeth, and don’t forget to use deodorant.
You’ve got a brilliant business idea and you’re raring to get started. So, what’s next? Is there a typical time it takes to develop a business idea and launch it on the world? Is it possible to get your business running in less than a month?
In short, yes. Working from a focused action plan, ensuring you complete all the necessary activities, you can 100% become your own boss in less than a month. Here’s what you need to do.
Estimated time: 3 days
You can’t launch a business without first doing a bit of homework. Your first three days should be spent answering the following key questions:
You don’t need to spend money gathering these insights, much of it is available for free online (competitor websites, TripAdvisor, Google Reviews, Reddit, Facebook) or simply by walking down your local high street, or talking to people. Gather as much insight as you can and get it all down. This will help you build an important picture and tell you if you should go ahead with your business idea.
Hopefully, you can now move forwards with confidence.
Estimated time: 3 days
The next stage is to work out what you’re going to need to get your business up and running. We’re talking the basics here. Given the timeframes, you’re going to need to scale down your ambitions and look to launch something that can be refined once you’re generating income.
Where are you going to run your business?
Running a business from home is clearly a cheaper and easier solution when you’re getting started. But, if you need to find premises, co-working spaces are growing in popularity across the UK.
What equipment are you going to need?
Having a decent computer or laptop is nigh-on essential these days, but, if you’re working from home, you’ll also want to spend money on creating a suitable office environment. Clean space, clean mind, and all that. The rest will clearly depend on the type of business you’re setting up. For example, a street food business will need cooking equipment, whilst a plumbing business will need a van.
What suppliers are you going to need?
Most businesses will need suppliers of some kind. That can include manufacturers, distributers, and importers. Even if you don’t sell anything physical, you’re still going to need to have in place service providers for things like IT, electricity, energy, and website hosting. And, don’t forget, insurance.
Estimated time: 5 days
You can now start piecing together your business plan. This is a crucial document that will provide an overview of your business idea and vision, the research and planning you’ve done in the last week, before moving on to your financial models (pricing and legal structure etc) and marketing plans (more on that in a moment).
Whilst it’s easy to be overawed by this task, it’s important to note that your business plan is a working document; something that will evolve over time. Don’t worry about it being perfect at this stage.
What it should do, though, is give you an idea of the finances you’re going to need for launch and your day-to-day operations. Are you going to fund the business yourself? Through friends and family? Through the bank? Or, perhaps, through alternative funding routes such as crowdfunding? Whatever you do, don’t dive in until you’ve weighed up all the options.
Estimated time: 5 days
It’s important to leave some money left over for promoting your business. After all, you’re going to struggle to bring in money if people don’t know your business exists.
However, it’s definitely wise to keep your promotional expenditure to a modest level. It’s all too easy to flutter away your limited funds on ineffective tactics and strategies.
So, what are the things you should definitely have in place?
Your business name, logo, website and social media pages are all pretty much essential, and should cost little to set up, although, you might want to recruit a freelancer to help you on some aspects.
Once they’re in place you can start to think about your marketing tactics and draw out a plan. The research work you did right at the beginning should play a key role in shaping who, what and how you want to promote your business. Tried and tested cost-effective tactics include Google AdWords, Facebook ads, and email marketing – but there’s no harm in also printing some business cards.
Readying for launch
Estimated time: 3 days
Before you launch your business on the world there are a number of admin-based tasks you’ll need to do. These include:
That’s it! Well, at least these are the basics to getting your business launched. Clearly you could spend much longer planning and preparing your business, but then you might risk losing your momentum. Plus, the insights you’ll gather once you’re up and running are often the most
What makes an effective project team? That will be an effective project manager.
The definition of a project is that it is a temporary endeavour, undertaken to create a product, service or result. That is very different to managing day-to-day operations, and it requires a person with unique qualities and traits to see it through.
Many project managers are born into the role – they are natural leaders who have a knack for getting stuff done. For others, the role is taught over time, with years of learning and experience moulding them into the project managers of today. Whatever the case, it is vital for project managers to possess and/or develop the following 10 qualities and traits:
1. Leadership skills
There is more than one of these. Good project managers are effective communicators, are honest people and are great at building relationships. Loyalty, decisiveness and charisma are also key factors that make a strong leader.
Although it is sometimes listed as a leadership skill, the ability to motivate people is much more about psychology. It comes naturally to the best project managers who have an uncanny ability to motivate the seemingly unmotivated. However, there are a number of tools and techniques that project managers can adopt to assist them with motivating others, such as SMART goal setting, celebration of success and others.
An effective project manager never puts the team down. Criticism should be constructive and helpful. The approach to correcting individual wrongs should be a private one; good project managers never ‘tell off’ or belittle people in front of others. They command respect by showing it and help people flourish.
4. Organised and efficient
The best project managers have their project management process down to an artform. They have excellent organisational skills and know where to assign people to get the most out of them. They are able to find efficient solutions to complex issues and know when to cut their losses or abandon a fool’s errand.
5. Problem solver
A spanner can be thrown into the works on any project, and project managers make their name by solving these issues. The ability to solve problems effectively is very important because it enables the project manager to properly direct the team and remove potential obstacles to their performance.
Project managers exist to achieve the required deliverables by the scope of projects, so they should instinctively be results-driven. The most important thing for a project manager is to see a project through and deliver the required results. However, it is equally important for project managers not to be task-driven and obsessed with to-do lists, as this may never lead to the required results.
This is perhaps the most important quality of project managers. Their experience, knowledge and know-how has to be evident to the team for them to have any confidence in the project manager. However, it is not just a matter of confidence and trust, the project manager must actually know what they are doing, why, where, when and how.
There are a number of Project Management certifications that enable current and aspiring Project Managers to gain the relevant knowledge and skills required for effective project management. Project Managers need to be constantly refreshing their knowledge to ensure it is up-to-date and they remain knowledgeable.
Examples of popular project management certifications include: PRINCE2®, APM PFQ (Project Fundamentals Qualification), APM PMQ (Project Management Qualification), PMI CAPM® (Certified Associate in Project Management) and PMI PMP® (Project Management Professional).
Good project managers are not robots. Being empathetic, understanding and caring for the people in a team is a big part of motivating them. Often, it can be the case that some people in a team feel as though they are undervalued. Good project managers truly listen to their team members, are compassionate and if required take actions to change perceptions or provide the necessary support to individuals.
Competence in project management is a big word. Competent managers not just know what they are doing, but can effectively balance competing project constraints and skilfully manage any of the risks, issues and challenges that arise during the project lifecycle. Competent Project Managers never appear out of their depth or out of touch.
10. Calm under pressure
Project Management is often associated with high-pressure environments. Project Managers need to be able to stay calm under pressure and get through it. Many people panic in a high-pressure environment, but the best project managers thrive in them. They see through the pressure and deliver results by keeping calm.
Nobody is born an expert, though some people may demonstrate some or all of the above qualities and traits intuitively. You may develop these qualities by continuously learning and practising them. There are a number of resources available for studying them, however, practical application of the learning is your key to success.
PRINCE2® is a registered trademark of AXELOS Limited, used under permission of AXELOS Limited. All rights reserved. | CAPM®, PMI® and PMP® are registered trademarks of the Project Management Institute, Inc. All rights reserved. | APM is a trademark of the Association for Project Management.
While House of Fraser flirted with a total collapse, several town centres were preparing for large empty spaces to be left by the 169-year-old department store. House of Fraser took its website offline on Wednesday 15th August 2018 after their warehouse operator XPO Logistics stopped processing orders because they were owed £30million. This meant cancelling all online orders and refunding customers who were unsurprisingly left feeling less than satisfied; not a great time for them to be reversing sales.
But, how did that happen? How can powerful retail chains such as House of Fraser, Woolworths and BHS, who had built up stability and reputation for over a century, fall from such grace? Why couldn’t they move with the times?
By exploring several possibilities, we have identified three reasons for the near collapse of House of Fraser and extrapolated learning points for smaller retailers to ensure they too don’t fall foul of the same fate.
Why Did HoF Fail While Rivals Maintained Success?
There’s no doubt the department store model still works so why did House of Fraser fail to thrive? Richard Hyman, who has analysed the retail industry for 35 years, predicted a year in advance that 2018 would bring retail distress, particularly for companies that don’t understand their core customer. Could that be it?
Speaking of the HoF situation, he outlined the key sticking points for the department store were: lack of investment, declining relevance with shoppers, a lack of brand differentiation and a failure to focus on the store's core customer. By stocking a whopping 677 third-party brands, House of Fraser’s own identity became lost along with its relevance in the marketplace. Mr Hyman indicated that almost all of their successful multi-brand stockist competitors had, in addition to the external brands they carried, a strong private or own-brand label which he describes as ‘enormously valuable’ when it comes to differentiating a brand. He said, “House of Fraser doesn't have anything that nobody else has got,”; the first important takeaway for other retailers.
Furthermore, they faced fierce competition online where customers can find the same or similar items for a better price with other retailers. This is the second key insight for businesses to acknowledge.
The bottom line is retail brands need a dominating difference to thrive and safeguard their survival by ensuring that consumers come to them for their products first. In comparison, Amazon has become the biggest convenience store, Primark is a high street footfall magnet due to its low prices, John Lewis creates a trustful reputation through first-rate service, and Selfridges offers a unique shopping environment.
Aaron Shields is a strategy director at Fitch, a leading brand and retail consultancy. He commented on those stores saying, “Having a look at this list, it’s easy to see that Fraser’s house of brands approach needs a refreshed retail proposition to survive.”
At this point we would ask an independent retailer, what sets you apart? Do you carry lines that no-one else in your area does? If not, then do you have a price advantage? You must ensure that you provide your consumers with a reason to keep choosing you.
Fixing the Revolving C-Suite
Richard Lim, Chief Executive at consultancy firm Retail Economics, says most department stores are incredibly expensive to operate, especially so over the last few years due to rising business rates and rents, as well as the National Living Wage.
For House of Fraser, however, its main problems haven’t actually been attributed to staff pay but how several of their management, executive and senior marketing positions have changed, resulting in a lack of consistency for the brand. This is the third thing smaller retailers should be aware of.
Due to their leadership insecurity, House of Fraser’s sales productivity was weak. Management were focused on a settling their core team at a time when their core team should have been addressing issues 1 and 2.
While independent retailers may not have to grapple with a board of executives and multiple department heads, their core team is just as important. Building trust around a brand and relationships with customers often relies on patrons making regular contact with the same employees.
Time spent curating the right team will pay dividends in the long term as, for independent retailers, too much hiring and firing could be of detriment to sales. It’s not best use of the owner’s time and could damage the long-term brand message which would be inconsistent under a number of consecutive staffs.
Other Solutions for Small Retailers
We know that to survive in a difficult and overcrowded market, retailers need to build their brand by understanding exactly who their customer is and enhance that relationship but there are other ways to work smart and aid your cash flow while you are establishing those things.
Small retailers can struggle with recording a high volume of transactions in real time and that can cause an admin headache with a ripple effect but nowadays there are solutions available to relieve owners of unnecessary data entry. However, organised figures are more than just business eutopia.
If a retail business is struggling financially, up to date figures and organised admin will alleviate the burden accompanied with turning the business around. Being organised and efficient with general administration while armed with financial foresight will mean the business can easily apply for financial assistance which could prevent it struggling into a place of no return.
With up-to-date figures, a business consultant can make recommendations to owners and advise on any planned investment or expansion. In particular, they can focus on whether the business can afford to make an expansion in the market or adopt another financial strategy.
Another piece of guidance that advisors might give to independent retailers is get rid of, or make better use of, unneeded basements and top floors to reduce the rents paid to landlords. Additionally, marketing plans and annual goals can help to keep an indy on track.
This article was written by Cottons Chartered Accountants London. With their base in Shoreditch Cottons specialise in working with independent brands and retailers installing admin solutions to cut back on bookkeeping time and, by preparing useful end of year and management accounts.
When you’re setting up a business, or moving into a new office, there are a dozens of things to sort out. Putting a sign up above the door is a moment that few small business owners forget – but what other information do you need to display to staff and customers? John Davies, Managing Director from custom signage, graphics and visual communication specialist, FASTSIGNS, has these tips to help you meet your legal requirements.
Get your name out there
People need to know the location of your company, each of your registered addresses must have a sign with your company name on it unless it is also a place of residence.
This sign should have clear characters that can be easily understood and visible at all times, not just during business hours. If you are sharing the site or building with more than six other companies, the company name has to be shown for at least 15 seconds every three minutes if it is not permanently displayed.
Keeping your team safe and healthy
The health and safety of your employees is of paramount importance; this means ensuring they are aware of potential risks and your obligations to them as employees. Whether you employ one person or a team, you must ensure the health and safety law poster is able to be viewed by everyone, either displayed on the wall or as a pocket card handed out to staff members.
Employees need to know who to turn to in an emergency, so make sure you display a sign with a full list of first aiders’ names and indicates where the first aid kits are stored.
To help your employees understand the level of insurance cover your business has, you’re required to either display or share The Employer’s Liability Insurance Certificate. Failure to do so and you could be liable for a £1,000 fine, so it’s essential that you get this right.
Should a fire break out in the building, you’ll need to make sure people know where to go and where the fire fighting equipment is.
Clear signage of fire action notices (preferably next to all fire alarms) should tell people who to call if they see a blaze, what escape routes to take and where the assembly point is once they have left the building. It’s also important to point out the location of each fire alarm.
If your workplace is small and the fire escape route is ‘obvious’, such as the front door to a shop, then you won’t necessarily need fire escape signs. For larger and more complex buildings, you will need to make sure that the fire escape routes are clearly highlighted with directional and wayfinding signage. Alongside this, all fire doors should be labeled with instructions on how to use them.
Assembly points, fire fighting equipment instructions, no smoking and warning signs should also be displayed throughout the building.
Protecting people’s data
Under the new General Data Protection Regulation (GDPR), images that identify someone count as capturing personal data – which means you have to inform anyone on your premises about CCTV monitoring. Most businesses have legitimate reasons for using CCTV, such as security, but you’ll still need to be open and transparent.
Make sure you have a sign that tells people why you are capturing their data, where they are being monitored, and the steps they can take to find out more information.
For more details on FASTSIGNS and its full range of business services click here.
Productivity is vital for the success and longevity of a business. Unfortunately, employees will struggle to be productive and stay on track if they’re distracted. In this post, we’ll take a look at a few common workplace distractions — from employees experiencing personal issues, such as divorce, to the overuse of social media — and how to fix them.
Although technology has become one of the most essential resources in the business world, the efficiency and hard work of employees is still very much the bread and butter of any company. It’s for this reason that it’s vital to make sure that your team is focused, productive and motivated on a daily basis — all of which can prove to be a problem if your employees are regularly distracted.
There is a wide range of things that distract employees, and many are specific to the industry or sector they work in, but, in this post, we’ll be discussing the issues that are commonplace in many businesses.
The Internet and Social Media
Let’s start with the big one! While there’s no doubt that the internet is a godsend for modern companies — especially those in eCommerce and marketing — it can also be a huge distraction for employees. The majority of companies — if not all — use computers in some way, and when employees have access to online shopping, blogs and YouTube, they can quickly find themselves in a rabbit hole — and work takes the back seat.
Not only does endless scrolling through timelines and feeds destroy productivity, but many also use social media to chat with their friends. This becomes a bigger issue with smartphones making internet and social media access so simple — more than half of people (52%) now use a mobile device to access the internet.
The problem for many employers is that they can’t take away internet access, as this will hinder their team’s ability to work. However, time-tracking and productivity apps, such as Hubstaff, monitor employee activity and time spent working. If your staff have to turn off their timer to use social media, they simply won’t get paid — it’s an effective deterrent.
No matter how professional or motivated an employee is, personal problems can severely impact their ability to work efficiently. The death of a family member or friend, as well as stressful situations like money problems, are issues that can’t be fixed overnight. If an employee is clearly struggling, it’s crucial that they take the necessary time off work, with the reassurance that it won’t affect their position at the company.
One of — if not the most — common personal problems that affects the workplace is divorce. The breakdown of any relationship can be stressful, but this is amplified when the division of marital assets comes into play, and it’s easy to see why a person’s career can take a big hit. During this time, an employee's most valuable ally will be their family lawyer, however, you can add yourself to that list by providing assistance and support.
Compared to the two previous points, this may seem trivial. However, when employees go outside to smoke a cigarette and have a quick chat, it takes time out of their working day and interrupts everyone else. It may only seem like a five or ten-minute break, but, over long periods, this adds up, culminating in a shocking amount of time being wasted.
Nicotine is very addictive, and preventing smokers from popping out for a cigarette could actually make productivity worse — your employees will feel grouchy and morale could plummet. Some employers have tackled the issue by allowing their employees to use e-cigarettes at work. If you have been keeping up with vaping news as of late, you will be aware that the NHS has included e-cigarettes as a healthier alternative in its quit smoking campaign.
Although meetings are undoubtedly useful for relaying information, some companies fall into the habit of holding meetings out routine, rather than necessity. Team or company-wide meetings not only take time out of everyone’s day, but, in many cases, the discussion point could just as easily be sent by email.
If you’ve noticed that meetings tend to kill productivity in the workplace, it’s crucial to fix the problem. Raising topics in a memo not only saves time, but it also provides you and your team with a written record that can be referred to. For items that must be discussed in person, an alternative is to host concise one-on-one catch-ups with employees to discuss the points relevant to them. While you’re hosting a meeting with one employee, the rest can crack on with what they’re supposed to be doing — work.
The current business world is more advanced, progressive and creative than ever. Today’s generation is in tune with technology, the internet and many other aspects of modern life, so it’s safe to say that hiring an apprentice is an enormous benefit to small business owners looking to succeed in the digital age.
Apprentices have been a valuable asset to companies for hundreds of years — apprenticeships not only give a young person a step onto the career ladder, but they also provide businesses with a young person who possesses enthusiasm and eagerness to succeed. For small business owners, this can be a unique and effective way to improve their company.
In this post, we’ll highlight a few of the advantages of taking on an apprentice and how they can impact the everyday and long-term success of a business.
Apprentices Are Known to Increase Productivity
While there’s a lot to be said about the importance of technology, marketing and establishing a brand — the attitude and quality of employees are key aspects of running a business that should never be underestimated. Productivity is a vital trait of any successful workforce, and it just so happens that taking on an apprentice can be a great way to improve the motivation and output of your employees.
Research by the Department of Education has revealed that 75% of small business owners who hired apprentices enjoyed a noticeable boost in productivity. This means that, along with having a new, enthusiastic member on your team, by hiring an apprentice, you will be positively impacting your entire company.
A New Face Is Always Good for Morale
Low morale is something that affects every business from time to time. And while some business owners attempt to resolve the issue with team-building activities and incentive schemes, others have managed to improve workplace morale by introducing a fresh face to the office.
As someone who is about to embark on a new and exciting career, an apprentice will cultivate an attitude of motivation and eagerness to succeed, with their infectious excitement for the job. Taking on an apprentice also creates mentoring opportunities and can open the door for current employees to move into more senior roles.
Adept Use of Technology
In an era when technology is very much a cornerstone of modern society, young people who are comfortable and skilled with using computers and other forms of tech are an enormous asset to any business. Today’s apprentices were born and raised in the digital age, which means this generation has the key skills they need to prosper in the professional realm.
For businesses, hiring an apprentice who is adept and highly skilled at using technology — often more so than experienced professionals — is hugely advantageous. This means they require less tech-related basic training, have the ability to use computers and other devices efficiently, and can be a genuine asset to a wide range of industries from the get go.
Paul Fegan is the Managing Director of Capital City College Training — London’s largest provider of further education — which has trained over 2,000 apprentices on behalf of more than 1,000 employers.
Acquiring finance for commercial ventures traditionally involved asking a handful of benefactors for substantial investment, a practice favouring those with business experience. These days, modern technology allows individuals with lucrative ideas to bypass the antiquated process and pitch their products directly to the public. Crowdfunding is emerging as a viable way for small businesses to raise funds from a large number of people, all typically contributing small amounts online, to take their concepts from the drawing board to reality. This growing trend has created a wave of online platforms which allow entrepreneurs to exchange pledges with rewards or equity in their business.
In a process that only requires a few clicks to complete, it’s not hard to see why so many businesses in the early stages of funding are opting for a quicker and more convenient method of obtaining capital. Despite all of its redeeming qualities, crowdfunding still has some understated drawbacks - so is it really worth the hype?
Emergent technologies have provided marketers with new options on various platforms to produce outcomes that are entirely customer driven. This is probably why crowdfunding as a marketing exercise is becoming increasingly popular amongst multinational conglomerates as well as startups and small businesses.
Crowdfunding can extend a business’s visibility past specialist angel investors, to a wider community of influencers and enthusiasts where these funding campaigns can be used as novel marketing tools. These platforms are an ideal way of obtaining market validation and further information about a business’s potential consumers. It has modernised the traditional focus group with real time feedback from a larger and more representative demographic, providing more reliable indications of market activity.
Crowdfunding allows customers to become part of the development of a brand, instead of passively consuming an online advertisement. This marketing technology encourages activity and revolves around engagement, which in turn creates stronger bonds between businesses and their donors. Making this process public creates brand advocates who can generate organic discourse and shares on external social media platforms.
While a great method of raising necessary funds for business ventures, equity crowdfunding divvies
ownership to a multitude of small investors. Depending on the campaign and its donors, a portion of largely inexperienced shareholders are then given authority over decision-making. This means that businesses using this method of financing have several shareholders to consult, satisfy and pay, placing a higher amount of pressure on accountants.
Equity crowdfunding has a lot of complex rules and regulations which must be adhered to. Ensuring that your campaign follows the regulator’s guidelines requires further expenditure by the business; companies need expertise from the accountant and more time spent on administrative tasks. The Financial Conduct Authority specifies how the company selling shares will be committed to some level of disclosure, meaning that every shareholder is entitled to the same level of transparency regarding financial documentation. Therefore, successful crowdfunding campaigns could actually create a considerable amount of admin for the beneficiaries and their accountants.
Similarly to other sensitive online documents and data, crowdfunding platforms are subject to targeted threats such as hackers and malware used to compromise valuable data which could also lead to potential loss of investments. This vulnerability within online crowdfunding services makes it more difficult for accountants to track cashflow and then consequently harder to budget and forecast.
What’s Best for Your Business?
Crowdfunding is still a relatively new platform but success stories have emerged across multiple industries. It can be the most viable source of funding for entrepreneurs and new businesses. However, it’s worth knowing the risks involved if it doesn’t go well. Each company’s campaign is different but a successful crowdfunding campaign requires a comprehensive planning stage where businesses carry out enough preparation. If you need any financial advice for a new business venture then contact experts at Cottons Accountants to make the process safer, simpler and suited to your needs.
The advent of digital media has brought challenges and opportunity in equal measure. As we continue to make technological advancements, the way we conduct business must develop accordingly.
However, it appears that HM Revenue & Customs have left a lot to be desired when it comes to digital business management with a system of taxation described by many business owners as ‘outdated’.
So with the amount of uncollected tax due to taxpayer error, as well as flawed protocol, now in excess of £8bn per year which costs Britain's public and its businesses respectively, it was time to take action.
In a bid to make the process of paying taxes more accessible and efficient the Government announced the 'Making Tax Digital’ initiative as part of their 2015 Autumn Statement.
The announcement also outlined their plans to ‘transform’ the tax system and scrap tax returns by 2020.
Although unprecedented in the UK, digital tax systems have been already been effectively implemented in countries such as Australia, Brazil and Estonia.
There are plenty of benefits to digital record-keeping, for instance taxpayers using an online tax account are able to get a clearer picture of their tax affairs in real time. Digital tax management also reduces hassle, making it possible for anybody with internet access to remotely monitor their taxes allowing business owners to budget more accurately and save time by placing all of their taxes in one place.
Furthermore, as the digital system requires more regular updates, more taxpayers will be able to use the cash basis of accounting meaning that expenses up to the sum of £166,000 will be deductible. In addition, business will be able to use spreadsheets and cloud accounting services such as Xero to support their digital reports which is guaranteed to expedite the process of paying tax.
Financial Secretary to the Treasury, David Gauke, later highlighted more benefits of a digital switchover, adding that introducing digital record keeping and quarterly updates for businesses will eradicate around 10% of taxpayer error.
Making Tax Digital: The Timetable
MTD is set to be introduced in phases, giving all business owners and landlords at least two years to make the adjustments required to manage their taxes using the new digital service.
The new scheme is due to roll out for Income Tax and Class 4 NI contributions from April 2018. Pensioners and people in full-time employment will be required to use the digital accounts if they earn a secondary income of £10,000 or more from property or self-employment
The proposed changes are due to take action for VAT purposes from 2019 onwards.
Is it for Everyone?
Businesses must make an annual turnover that exceeds the VAT threshold, currently set at £85,000 to qualify for digital VAT record keeping. This means that businesses and landlords with a turnover below the VAT threshold will be able to choose when to make the switch to the new digital system.
As VAT already requires a quarterly update, this won’t be a major adjustment and taxpayers will not need to report to HMRC more frequently than they already do.
'Smaller' businesses turning over £10,000 or less will be exempt from the change in legislation, but will be allowed to submit reports and quarterly updates on a voluntary basis.
Changes to the submission of Corporation Tax obligations will come into effect in April of the following year. Most British businesses will then be required to keep digital records and update HMRC on their income and expenditure every quarter.
If you need assistance with Making Tax Digital and how to integrate digital systems into your business then talk to an accountant.
This article was written by Cottons Chartered Accountants, small business accountants and audit specialists.