Friday, 29 January 2010

It's fun to pay other people in your business

When you're starting a new business, the last thing you want to do is give away money.

Yet one of the secrets of building a business that will last is to make it bigger than yourself. And that means employing other people - either directly, or on a contract basis.

It surprised me what a pleasure it is to pay (or give away money) someone else for helping you to do your job. To expand your small business you will have to use other people sooner or later.

If one task takes you all week, then you can only do one task a week on your own. If you use someone else your business can do two tasks in a week, and you will make money from that, while at the same time paying them.

It's a great pleasure to do that.
1. You make money.
2. Your business grows.
3. You make someone sle happy by paying them.
4. You help to grow the country's economy.

It's good to do all those things, so you'll soon get to enjoy "giving your money away"!

Thursday, 28 January 2010

Businesses not trusted, says Edelman

The global economic crisis has ruined public faith in business leaders. The Edelman Trust Barometer shows that seven out of ten people believe companies will just go back to business as usual after the recession. Banks are particularly distrusted, and chief executives are viewed with suspicion.

Some countries, however, are seeing a rise in business trust, notably the United Stated, Netherlands and Italy.

Commenting on the rise in trust in these countries, Richard Edelman, the chief executive at the PR firm, said: "Trust in business has improved, but the patient has a long road to go for a full recovery.

"The increase in trust in business belies its fragility. There is concern that short-term actions have been taken only as a result of the crisis and that government will need to remain a watchdog. Companies will have to prove the sceptics wrong and show they can achieve both profit and purpose."

The survey results coincided with the start of the World Economic Forum at Davos.

Banks, especially, are struggling to regain trust, according to the survey. That is not surprising, given their role in the economic crash. Yet, they are not the worst regarded sector. Media and insurance companies are even less trusted.

Two sectors stand out as trustworthy. These are non-governmental organisations and campaign groups. In industry, the technology sector is most trusted.

Trust in governments remains fairly stable, especially in the US.

Wednesday, 27 January 2010

Britain crawls out of the recession

Britain has come out its recession, but with GDP growth at a mere 0.1 per cent in quarter 4 2009, it was hardly cause for a fanfare yesterday.

Indeed, the pound fell on the less than remarkable news. Forecasts from economists had been for a 0.4 per cent growth - but their increasingly wayward predictions are making them almost worthless.

Colin Ellis at Daiwa Capital Markets Europe said: "Never has an end to a recession been so underwhelming."

As the pound fell, hopes rose that the UK record-low interest rate of 0.5 per cent would remain in place for some months to come.

Mr Ellis commented: "With the economy still in intensive care, there is a strong case for more support from policy to boost growth and job creation."

Now popular forecasts are that the Bank of England will continue with its quantitative easing programme.

The Office for National Statistics will produce two revisions to the GDP growth figures which could take the figure up or down by 0.1 per cent. Business Secretary Lord Mandelson said last night that he expected the figure to be revised upwards.

Monday, 25 January 2010

Tax system failure proves it IS taxing

There’s an advert of TV at the moment, saying that “tax doesn’t have to be taxing”. Its purpose is to prompt people to return their tax forms or pay their tax bills by 30 January.

And then you read that incorrect tax codes may have been sent out because of a new computer system!

The Chartered Institute of Taxation (CIOT) reckons that taxpayers might have to pay up to £108 a month too much.

HMRC said it had no evidence of the problem being widespread, but advised taxpayers to check carefully.

The CIOT is urging the Revenue to launch an advertising campaign to alert taxpayers to the problem.

Apparently, the problem lies in a new computer system designed to process the collection of income tax via the PAYE system, together with national insurance contributions.

However, the CIOT said the system was not distinguishing between current jobs and old ones, meaning that tax codes were being calculated on the assumption that some people had more than one job. The result is that some people are being taxed too much by their current employer.

It just goes to show what we all already know.

Tax IS taxing.

Friday, 22 January 2010

Business groups call for NI rise to be scrapped

The government has been called upon to scrap next year’s one per cent rise in National Insurance.

Claiming the rise could have an adverse impact on economic recovery, British Chambers of Commerce and the Chartered Institute of Personnel and Development (CIPD) have written a joint letter to Lord Mandelson urging him to cancel the proposed rise in payments by businesses, saying that business will suffer from the financial burden it will cause, and hit any recovery in the job market.

A CIPD survey showed that 10 per cent of businesses felt that the increase would interrupt their recruitment. Worse, just under one in ten said the NI rise would cause them to make job cuts.

The NI rise is designed to help the government plug the whole in its coffers, and the CIPD estimates that it will cost employers £14bn over four years. They say it amount to a tax on jobs, and should be scrapped.

The one per cent rise is the result of two 0.5 per cent rises announced by Chancellor Alistair Darling in separate budgets, in late 2008 and in 2009.

Wednesday, 20 January 2010

Virtual AGM with no technical hitches on Skype

I am a partner in a virtual business; that is to say that there are three partners: one is in Woking, one in Hemel Hempstead and one in Worcester. We meet once a year for an AGM at Oxford Services by the M40.

With the weather forecast for heavy snow running from approximately Worcester to Woking and bisecting Oxford, we decided that the pragmatic decision was to cancel the meeting. The trouble was, we had already called it off once before, when six inches of snow lay on the ground last week.

Thus, no further delays could be allowed, and we took the decision to hold the meeting "virtually". We have held such virtual meetings before - always on MSN. But that tool is creaky - crashing one partner's system, and throwing out members of a conversation at random being two of the problems.

Being a recent member of the Skype community, I suggested Skype to host our virtual meeting. Despite one of the partners not having Skype, she was able to download and install with ease.

We held a three-hour AGM on Skype without a technical hitch. All we used was the messaging feature; no visuals required - but it all worked perfectly.

Although it is useful to meet in person at least once a year, we are confident that we have a tool that can host our meeting in future. We felt very "green" (environmentally so). As for the weather - who knows what it has been doing along the M40. It sleeted here in Woking during the meeting...

Tuesday, 19 January 2010

Inflation jump catches City by surprise

The Consumer Price Index (CPI), the Government’s preferred measure of inflation, jumped to 2.9 per cent in December.

It was only 1.9 per cent in November, and the increase represents the biggest monthly increase since records began. The City was shocked, as it had expected a leap – but only to 2.6 per cent. It is the highest level since March.

The Retail Price Index (RPI) was also up – to 2.4 per cent, its highest level for over a year. It was up from 0.3 per cent in November – the biggest leap in RPI since 1979.

The jump in CPI came about because of a number of factors that had kept prices down a year before, including a fall in oil prices in December 2008, the cut in VAT to 15 per cent and retail discounting, according to the Office for National Statistics.

Core CPI, excluding food, energy, tobacco and alcohol, was up by 2.8 per cent on the year, and this is the fastest rate of growth since records began in January 1997. RPI includes council tax, mortgage interest payments, buildings insurance and house depreciation – none of which are included in CPI.

Monday, 18 January 2010

UK cities to fare unevenly on emerging from the recession

Some cities in the UK will take years to recover from the recession, a think-tank called Centre for Cities, says.

Cities such as Cambridge and Edinburgh, with highly educated populations, are well-placed for recovery, but some cities, such as Burnley, Stoke-on-Trent and Newport will suffer because people have less qualifications and fewer businesses are stating up there, the report said.

The think-tank claimed that the gap between the top and bottom of the economic rankings has grown during the recession.

Cambridge had the lowest percentage of people claiming jobseeker’s allowance, and Hull had the highest, and the gap between the two has nearly doubled.

According to the study, locations with already robust economies were likely to get stronger, and areas with weak private sectors and poor graduate skills would sink further behind.

"The turnaround of our largest cities will be critical to the national recovery," the report said. "Brighton, Milton Keynes, Reading, Cambridge and Edinburgh have the right ingredients to succeed after the recession has passed.

"They have strong private sectors, high levels of entrepreneurship, highly educated workforces and large shares of knowledge-intensive jobs."

Chief executive of Centre for Cities, Dermot Finch, said: "The next government needs to help these struggling cities fix the basics - like improving schools and public transport - so they can attract new business and jobs."

Friday, 15 January 2010

Bank of Scotland business customers now referred to call centre

Small business clients have criticised the Bank of Scotland for changes in the way it handles corporate customers. Business Relationship Managers were moved out of branches, leaving small businesses to use a call centre.

The FSB spoke of outrage at small businesses being “abandoned” with call centres being bad for customers and bank alike, but the bank claimed that business managers still travelled to meet clients.

Small businesses now have to deal with staff at a call centre in Edinburgh.

Andy Willox, Scottish policy convener of the FSB, criticised the call centre approach He said: "This means that partners, who must take decisions jointly, now need to conduct finance negotiations huddled around a speakerphone.

"Even returning a call is now a touch-tone labyrinth of security questions."

He added: "I find it astonishing that the Bank of Scotland says this is what their small business customers want.

"Our members say the exact opposite. And despite the bank's protestations to the contrary, our members are receiving a drop in service level, without any drop in their bank charges."

A spokesman at the bank said: “We introduced the new system for small and medium-sized enterprises after extensive market research. Since it was introduced we have increased both the amount of lending and the number of SME customers in Scotland.

"In a small number of locations we found that most of the contact between the bank and its customers was sporadic and over the telephone."

The spokesman also said that it was no longer commercially viable to keep all small business meetings as face-to-face with business manager.

Thursday, 14 January 2010

Business looking up for 2010

I hope everyone else is having the same experience as we are with our business so far in 2010. At ( we have had an increase in requests for work in these first couple of weeks, which is a boost for us in difficult economic times.

Don't get me wrong. It's not easy, and where we've increased the amount of work coming in, we could still do with more!

However, it's been busy enough for us to have to review our plans for 2010. Previously, we were looking at a 20-30% increase in turnover, but now we're more optimistic about a 40% increase.

Much of the success in 2010 depends on a new venture, clearercvs (, but we are hopeful that this will go well this year, and our plans only include a slow start with this venture, anyway. We first put plans in place for this new venture in August 2009, and we had a six-month plan with a target of going live on 1 February 2010. I'm delighted to say that I'm still confident we will meet that deadline.

Having work in IT for many years and see so many projects miss their target dates, I am keen to prove that IT projects (and this is essentially one of those) can meet their deadlines and come in on budget too.

Wednesday, 13 January 2010

Contingency planning required for snow

With the snow and ice continuing to keep Britain in their frosty grip, business leaders have urged the Government to convene a special conference to review bad-weather contingency planning.

With Britain at a “standstill”, the Federation of Small Business (FSB) estimated that the bad weather had cost the UK economy around £600 million a day, as staff struggled to get to work.

There should, say the FSB, be discussions between local authorities, transport and salt mining companies, schools and businesses to find solutions in periods of bad weather.

The FSB says that many small firms have been forced to close, have lost business or seen their supplies run out because of transportation problems, as many roads have been unusable. School closures have meant parents have had to stay at home to look after their children.

We Brits never seem to learn lessons from bad weather, and we haven’t done so, even with last February’s snow still in the mind.

The FSB urged the Government to put an emergency grant scheme in place for small firms adversely affected by the snow, together with mandatory guidelines for local authorities regarding salt, and increase the nation’s salt supplies.

Tuesday, 12 January 2010

Postal service appears to be frozen

The snow is turning to slush, the kids are back at school, the thermometer has gone upward past 0 degrees, the buses are running, office workers are back in the office, yet ...

... we have had no postal delivery for a week.

I run a business from home here in Surrey, and normally get three or four pieces of post a day. But, for a week ... nothing.

It really is quite ridiculous.

What is it? Health and safety? Too cold? Can't be bothered?

For those of us who are trying to generate some income - for ourselves, and for others who work for us, it is frustrating to see a supposed general national service simply not operating because of the snow on the ground.

Come on. Get a grip. Literally.

Monday, 11 January 2010

Budget shops have a sparkling Christmas

Figures tell us that budget retailers had a bumper Christmas as shoppers sought out bargains.

Poundland, which sells all items for £1, reported that sales over the festive period rose by 4.4 per cent.

Former Sainsbury's executive Jim McCarthy runs the 254-store chain. He said: "The increase in shoppers over Christmas 2009 is yet more proof that Poundland continues to offer both quality and value. We are confident that sales will continue to reflect this customer trend throughout 2010 and beyond."

So-called "rent-to-own" retailer, Brighthouse, which sells furniture, electrical equipment and kitchen appliances to customers on low incomes, has seen a 9 per cent rise in sales in the 13 weeks to Christmas Eve.

Chief executive Le McKee said: "Both customer footfall and trading in the run-up to Christmas have been strong and we have delivered improved revenue and customer numbers. Consumer electricals have been popular and we have also seen significant demand for furniture and domestic appliance."

Budget fashion chain Peacocks also reported strong Christmas trading.

Maybe the message is clear to all businesses: if you want to sell well, then make sure you're offering a bargain.

Friday, 8 January 2010

FSB complains that school closures cost work days

Head teachers have come under fire from business leaders, who say many schools have been close too readily because of the snow.

The Federation of Small Businesses (FSB) says that many work days are being lost as schools close, and they have called on the government and head teachers to create a code for school closures.

Head teachers hit back, saying that schools were closed on the basis of local issues alone.

Spokesman for the FSB, Stephen Alambritis, told BBC Radio’s Today programme: “There is concern that the vast majority of absences from work is simply because parents have to stay at home to look after the children.

“We appreciate that, but we do have a worry that head teachers and the Department for Children, Schools and Families and the Association of Directors of Children's Services haven't really sat down and thought through a code of practice to make sure wherever possible that it's only in exceptional circumstances that the school is closed.

"We all know that the vast majority of children are within a small catchment area to attend school and so there is a concern that head teachers may be closing schools unnecessarily."

John Dunford, general secretary of the Association of School and College Leaders, said decisions were made based on a “whole range” of local information. "It can be a very difficult and a very local decision; that's why it's right that head teachers should make these decisions," he said.

A spokesman for the Department for Children, Schools and Families said: "These are never easy decisions, but we cannot and should not dictate closures from Whitehall when we don't know local circumstances. We trust heads to make the right decision for their school."

Thank goodness for that. The last thing we need is more government intervention.

Thursday, 7 January 2010

Services sector figures look good

Britain's services sector continued its recovery in December with new business on the increase for the eight month in a row. This is good news for Britain as the services sector dominates business in the country.

The Purchasing Managers' Index (PMI) was up from 56.6 in November to 56.8 (anything above 50 is an increase in activity). The new business measure was up from 56.8 to 57 - its steepest rise since September 2007.

Chief executive of the Chartered Institute of Purchasing & Supply (CIPS), David Noble, said: "Last year saw the UK service sector at an extraordinary rate and end 2009 on a high. This was on the back of stronger economic activity, new business wins - especially among larger companies - and growing client confidence."

However, the figures came with the news that the sector continued to shed jobs, albeit at the slowest pace for 16 months.

It should mean that the recession ended in the fourth quarter in the UK. Vicky Redwood at Capital Economics, said: "Even if the surveys prove a bit optimistic, it looks a safe bet that the recession ended at the end of last year."

Wednesday, 6 January 2010

Mandelson justifies delay in spending cuts

Lord Mandelson today defended the delay in cutting the country’s huge deficit.

Mandelson used a speech to attempt to back up the Government’s business credentials prior to the general election in May. He said: “Only by growing our economy can decent jobs be created, living standards protected, and the winners’ circle expanded outward to those on low and middle incomes."

Government spending, he said, was providing vital demand when private sector activity was low.

"Pull away that prop for the economy and you reduce the tax take, push up spending on unemployment and make the deficit worse. This is the paradox of government thrift. We learnt it in the 1930s.” (Actually, quite evidently, we didn't!)

He went on to say: "Let me say this quite bluntly. For the past decade we allowed ourselves to become over-dependent on the City and financial services for growth and our tax revenues."

It is interesting that he feels that his party, who were a big cause of the problem (as admitted above), will also have the solution.

Why is it that the Government told banks to lend more responsibly – implying that we all need to borrow more carefully – yet they feel the best way out of a huge deficit is to continue spending more?

If we rack up the full amount on our credit cards, is it sensible that we don’t bother to pay it off, but continue to borrow more?

Lord Mandelson also said that the new 50 per cent income tax for top earners "is justified in the quite exceptional circumstances we face". Yet, the top earners may well leave the country, ‘reducing the tax take’ (see para 4).

He also suggested there should be a new culture of long-termism in business managers.

Yet many recent strategies by the Government smack of short-termism … or electioneering.

Tuesday, 5 January 2010

Record new business start-ups in 2009

The year 2009 saw a large number of new businesses set up despite the recession.

There were 476,000 new businesses set up in the first ten months of the year, and the total for the year may well beat the total of 525,000 in 2008.

There was also a lower rate of business failure than expected, meaning that Britain will probably end 2009 with 90,000 more businesses than at the end of 2008. That will mean the third consecutive year of record new business star-ups, fuelled by a rise of self-employed and the ease of sarting up new ventures.

Steve Cooper, managing director of Barclays Local Business division, commented: "The UK small and medium enterprise stats have been more resilient that we thought they would be. And it's starting to bounce back."

Since June, he added, small business have been generating more profits than the previous months, following 16 months of falls.

Economists at Barclays believe that new businesses have been formed to generate an income, but also as a lifestyle choice.

Mr Cooper said: "You could argue that those that are starting up now have thought through their proposition less thoroughly."

Whether that is the case or not, we should wish all new businesses well for their owners' futures, their employees' future, as well as for the well-being of the country.

Monday, 4 January 2010

Women to outnumber men in work within four years

The Conservative-leaning Policy Exchange says that women at work will outnumber men in four years.

The think tank says that men have been hit harder by the recession, creating a "Full Monty" effect.

The proportion of men of working age who have jobs has fallen from 92 per cent in 1971 to 75 per cent now. For women the percentage has increased from 56 per cent to 60 per cent.

The recession has hit men harder than women, with the number of men in work falling since June 2009, whereas the number of women in work has increased.

Director of Policy Exchange, Neil O'Brien, said: "We are having Full Monty-style recession, with women faring much better than men."

The Full Monty was a 1997 film telling the story of how out of work men turned to stripping to earn money.

Men in traditional manufacturing industries have undoubtedly suffered from the decline in manufacturing in the UK since the 1970s. The sector has fallen by an average of 1.2 per cent in every year in the last decade.

It is time for men to change tack and take hold of their own professional lives. Men need to move into sectors where the jobs are, and get on their metaphorical bikes.