Hooray! I have at last found those elusive green shoots. There is a landscape gardener based in Guildford who is really busy at the moment. I know this is probably an example of the DIY syndrome which normally occurs in housing recessions i.e. if you can’t move to a new house you do up the old one (although B&Q, Homebase et al should be so lucky), but normally the gardener is one of the first cuts made by a cash strapped household, so maybe these are green shoots that really have taken root. It seems that Barack Obama thinks so as well.
I met the aforesaid landscape gardener at a breakfast seminar entitled “Preparing For The Next Upturn” organised by the Surrey Economic Partnership where the speaker was the ever ebullient Beermat man Mike Southon. His presentation compared the life cycle of an entrepreneurial business with the career of the Beatles, and mixed great music with amusing anecdotal snippets and a great deal of common sense advice. Mike kept the whole audience entertained for more than an hour and I think everybody left the seminar believing that they will get through the current economic downturn, and emerge well equipped to take advantage of the upturn.Maybe we are having a hard day’s night at present but if we can work it out and help each other rather than let it be, perhaps we will see the economy getting better in the end.
Thursday 26 March 2009
Wednesday 18 March 2009
Help from Top to Bottom
Real help for people and businesses is a phrase that is being bandied about an awful lot at the moment, particularly by the Government as it seeks to find ways to support the economy during the present downturn. This help currently includes the various funding schemes that have been put in place such as the Enterprise Finance Guarantee Scheme, business health checks courtesy of Businesslink, skills training for individuals and businesses, and many sources of advice to assist with personal debt, redundancy and getting back to work. Full marks for effort although clearly these are top down initiatives, and it will take time for this help to get through to those who need it and have some real impact on the economy.
However there are also some bottom up initiatives being launched, such as the one that I saw when I visited the Spelthorne offices of the Surrey Chamber of Commerce recently. Known as the Enterprise Zone (or EZone), it is a scheme intended to help new businesses through their start up period, and is designed to be a credible and more professional alternative to a home office. Along with a fully equipped office area with reception and secretarial support, there is also access to business services and advice, and perhaps more importantly the chance to share ideas and get peer support from like minded business people, who have decided for either economic or lifestyle reasons to strike out on their own. In short it is a practical, efficient and effective solution for new businesses looking to get going, and hopefully will quickly generate some benefits for all concerned as well as the economy as a whole. All in all a very good idea, which like all good ideas it just needs a little push, something I am more than happy to do.
However there are also some bottom up initiatives being launched, such as the one that I saw when I visited the Spelthorne offices of the Surrey Chamber of Commerce recently. Known as the Enterprise Zone (or EZone), it is a scheme intended to help new businesses through their start up period, and is designed to be a credible and more professional alternative to a home office. Along with a fully equipped office area with reception and secretarial support, there is also access to business services and advice, and perhaps more importantly the chance to share ideas and get peer support from like minded business people, who have decided for either economic or lifestyle reasons to strike out on their own. In short it is a practical, efficient and effective solution for new businesses looking to get going, and hopefully will quickly generate some benefits for all concerned as well as the economy as a whole. All in all a very good idea, which like all good ideas it just needs a little push, something I am more than happy to do.
Wednesday 4 March 2009
A battle the optimists have to win
We received an e-mail this morning from the Birmingham Chamber of Commerce seeking member views on a new BBC documentary “Recession Britain”. The aim of the programme is focus on one firm that is struggling to survive the recession and how that struggle will impact on their supply chain, particularly the smaller firms that are part of it.
My immediate thought was why don't they follow it up with a programme on businesses that are actually doing well at the moment? There are more of these businesses around than people might think, and such a programme would provide encouragement for struggling and nervous businesses, rather than their proposed programme which will surely just exacerbate the situation.
People are more positive than is generally recognised in the media at present (witness today’s figures on consumer confidence which show an improvement since January), something that was reconfirmed at a breakfast seminar I attended organised by the accountants Smith and Williamson. Two well known names in the entrepreneurial world, Guy Rigby, Head Of Entrepreneurs at SandW and an old friend of Orchard, and Mike Southon, founder of the Beermat series of entrepreneur guides and regular FT columnist, combined in an entertaining double act to emphasise that there are always reasons to be optimistic as long as the basics of good management are adhered to.
Admittedly their optimism was tempered by a more pessimistic (or realistic? - take your pick) view from Mark Garnett, Director of Financial Services at SandW about the state of the British economy and its future prospects. OK we know it is not fun out there, and it seems that the BBC and other media take every opportunity to remind us of this. However we also all know deep down that the current economic battle is one that the optimists have to win.
My immediate thought was why don't they follow it up with a programme on businesses that are actually doing well at the moment? There are more of these businesses around than people might think, and such a programme would provide encouragement for struggling and nervous businesses, rather than their proposed programme which will surely just exacerbate the situation.
People are more positive than is generally recognised in the media at present (witness today’s figures on consumer confidence which show an improvement since January), something that was reconfirmed at a breakfast seminar I attended organised by the accountants Smith and Williamson. Two well known names in the entrepreneurial world, Guy Rigby, Head Of Entrepreneurs at SandW and an old friend of Orchard, and Mike Southon, founder of the Beermat series of entrepreneur guides and regular FT columnist, combined in an entertaining double act to emphasise that there are always reasons to be optimistic as long as the basics of good management are adhered to.
Admittedly their optimism was tempered by a more pessimistic (or realistic? - take your pick) view from Mark Garnett, Director of Financial Services at SandW about the state of the British economy and its future prospects. OK we know it is not fun out there, and it seems that the BBC and other media take every opportunity to remind us of this. However we also all know deep down that the current economic battle is one that the optimists have to win.
Tuesday 3 March 2009
Look after your suppliers? No really - look after your suppliers….
The announcement that Zavvi, the music, games and DVD retailer is to close down for good, has brought home a salient point about the recession that often gets overlooked in those “top tips on surviving the recession” listings.
Nearly everybody will suggest that you imagine a scenario when one of your top customers goes bust, but very little emphasis is put on the situation when one of your main suppliers goes the same way. Yet that is precisely what has happened in this case, where the key supplier in question was Entertainment UK, which was a casualty of the Woolworths demise. Not only did Zavvi lose its key supplier at a time when it desperately needed stock i.e. the run up to Christmas, but more importantly it lost valuable credit facilities, which could not be replaced as new suppliers demanded immediate payment.
A salutary lesson for everybody - when your key supplier goes down not only do you lose products that you need for your business, you potentially lose a valuable source of finance. One to add to those key financial relationships that have to be managed.
Nearly everybody will suggest that you imagine a scenario when one of your top customers goes bust, but very little emphasis is put on the situation when one of your main suppliers goes the same way. Yet that is precisely what has happened in this case, where the key supplier in question was Entertainment UK, which was a casualty of the Woolworths demise. Not only did Zavvi lose its key supplier at a time when it desperately needed stock i.e. the run up to Christmas, but more importantly it lost valuable credit facilities, which could not be replaced as new suppliers demanded immediate payment.
A salutary lesson for everybody - when your key supplier goes down not only do you lose products that you need for your business, you potentially lose a valuable source of finance. One to add to those key financial relationships that have to be managed.
Look after your suppliers? No really - look after your suppliers….
The announcement that Zavvi, the music, games and DVD retailer is to close down for good, has brought home a salient point about the recession that often gets overlooked in those “top tips on surviving the recession” listings.
Nearly everybody will suggest that you imagine a scenario when one of your top customers goes bust, but very little emphasis is put on the situation when one of your main suppliers goes the same way. Yet that is precisely what has happened in this case, where the key supplier in question was Entertainment UK, which was a casualty of the Woolworths demise. Not only did Zavvi lose its key supplier at a time when it desperately needed stock i.e. the run up to Christmas, but more importantly it lost valuable credit facilities, which could not be replaced as new suppliers demanded immediate payment.
A salutary lesson for everybody - when your key supplier goes down not only do you lose products that you need for your business, you potentially lose a valuable source of finance. One to add to those key financial relationships that have to be managed.
Nearly everybody will suggest that you imagine a scenario when one of your top customers goes bust, but very little emphasis is put on the situation when one of your main suppliers goes the same way. Yet that is precisely what has happened in this case, where the key supplier in question was Entertainment UK, which was a casualty of the Woolworths demise. Not only did Zavvi lose its key supplier at a time when it desperately needed stock i.e. the run up to Christmas, but more importantly it lost valuable credit facilities, which could not be replaced as new suppliers demanded immediate payment.
A salutary lesson for everybody - when your key supplier goes down not only do you lose products that you need for your business, you potentially lose a valuable source of finance. One to add to those key financial relationships that have to be managed.
What do you mean you’ve never had it so bad?
Thursday 26 Feb 09 - Just come back from an excellent breakfast presentation at Clydesdale Bank given by NAB (their parent company) head of markets strategy Nick Parsons, a man well known to Sky News viewers.
Nick is someone who seems to have developed a habit of getting it right when it comes to economic forecasting, so when he says that 2009 is going to be horrible and that recovery won’t start until 2010 you tend to take a bit of notice. He sees the UK economy declining by about 2.6% in 2009, with growth returning in 2010 at about 1.4%. His long term view is that the normal annual growth trend will settle at about 2%. Not brilliant but still enough encouragement for businesses, while still remaining cautious, to start focusing on how to get the best of the upturn when it arrives.
By the way, if you think it is bad for us over borrowed consumption obsessed Brits, have a glance at the poor Germans and Japanese, those nations that actually still make things (as opposed to money) and still put their euros and yen aside for a rainy day. Their export driven economies have fallen off a cliff over the past few months and their pain in 2009 is likely to be greater than that of the UK. Maybe there is a moral there somewhere, although it gets confused when you look at the two economies that are going to expand more that 5% in 2009, China and India. Learning to export may still have its advantages so UK companies should take note and start looking at how they can.
Nick is someone who seems to have developed a habit of getting it right when it comes to economic forecasting, so when he says that 2009 is going to be horrible and that recovery won’t start until 2010 you tend to take a bit of notice. He sees the UK economy declining by about 2.6% in 2009, with growth returning in 2010 at about 1.4%. His long term view is that the normal annual growth trend will settle at about 2%. Not brilliant but still enough encouragement for businesses, while still remaining cautious, to start focusing on how to get the best of the upturn when it arrives.
By the way, if you think it is bad for us over borrowed consumption obsessed Brits, have a glance at the poor Germans and Japanese, those nations that actually still make things (as opposed to money) and still put their euros and yen aside for a rainy day. Their export driven economies have fallen off a cliff over the past few months and their pain in 2009 is likely to be greater than that of the UK. Maybe there is a moral there somewhere, although it gets confused when you look at the two economies that are going to expand more that 5% in 2009, China and India. Learning to export may still have its advantages so UK companies should take note and start looking at how they can.
Is it a bird? Is it a plane? It’s SuperFD!
Wednesday 18 Feb 09 - Forget your Brad Pitts and George Clooneys. Don’t even mention Barack Obama. The new superheroes for our time are going to be Finance Directors. For from being fazed by the biggest economic downturn since the 1990/1980s/ 1970s/1930s/ever (take your pick), these normally meek and mild creatures say they are in a confident mood and ready to fight the recession.
According to a wide ranging survey from Financial Director magazine , 2009 is likely to be the “Year of the FD”. Already, say FDs, along with collecting cash and providing reliable and timely financial information, their boardroom colleagues are putting pressure on them to look for cost cuts with prime targets being staff and travel and expenditure. However they also have half an eye on the eventual upturn, with many of them saying maintaining staff morale and confidence was at the forefront of their minds.
Other issues that emerged from the survey included the fact that wholesale changes in banking relationships had yet to take place, that the downturn had forced a majority of their businesses to change their overall strategy, and the a fair number of FDs would like the government to “stop tinkering” with the economy and let nature take its course. Interestingly 68% had found something positive about the current climate (although precisely what was not revealed!).
Meanwhile another snippet from the same magazine listed the qualities that those that aspire to be FDs are going to need if they are going to achieve their goal. Polling around 4,000 companies, Professor Colin Coulson-Thomas found that they would need to exhibit “integrity, determination, independence, objectivity, balance, commitment, individuality, sensitivity, strategic and ethical awareness and a sense of accountability and responsibility.” Wow! Is that all? However he also said that “being able to explain financial forecasts and results was more important than any of the other traits.” Oh that’s all right then. For a moment we were all off down to the fancy dress shop to get our outfits before stepping off into a phone box and flying off to our next client appointments……
According to a wide ranging survey from Financial Director magazine , 2009 is likely to be the “Year of the FD”. Already, say FDs, along with collecting cash and providing reliable and timely financial information, their boardroom colleagues are putting pressure on them to look for cost cuts with prime targets being staff and travel and expenditure. However they also have half an eye on the eventual upturn, with many of them saying maintaining staff morale and confidence was at the forefront of their minds.
Other issues that emerged from the survey included the fact that wholesale changes in banking relationships had yet to take place, that the downturn had forced a majority of their businesses to change their overall strategy, and the a fair number of FDs would like the government to “stop tinkering” with the economy and let nature take its course. Interestingly 68% had found something positive about the current climate (although precisely what was not revealed!).
Meanwhile another snippet from the same magazine listed the qualities that those that aspire to be FDs are going to need if they are going to achieve their goal. Polling around 4,000 companies, Professor Colin Coulson-Thomas found that they would need to exhibit “integrity, determination, independence, objectivity, balance, commitment, individuality, sensitivity, strategic and ethical awareness and a sense of accountability and responsibility.” Wow! Is that all? However he also said that “being able to explain financial forecasts and results was more important than any of the other traits.” Oh that’s all right then. For a moment we were all off down to the fancy dress shop to get our outfits before stepping off into a phone box and flying off to our next client appointments……
AIM and PLUS - The future beckons…
Monday 9 Feb 09- As 2009 continues to battle its way through snow, ice and the morass of gloomy economic statistics, two key elements of London’s financial infrastructure for smaller entities AIM and PLUS are both looking ahead off of the back of two contrasting 2008s.
For AIM the year ended on a somewhat low note with new admissions down on previous years and questions being raised about the suitability of the market for small cap shares. For PLUS based on 2008 the future looks extremely rosy, with admissions at a record level and their share trading platform going from strength to strength.
PLUS are old friends of ours and last year we ran two successful seminars with them and Orange Corporate Finance in Cambridge and Guildford . There is no doubt that PLUS is now a very serious option for companies seeking their first float and looking to raise funds for expansion.
But we support AIM too, and have viewed with interest a recent survey by top accountancy firm Mazars. The survey canvassed the opinions of both AIM quoted companies and a wide range of professional advisors and concluded that, whilst AIM had been tremendously successful in raising over £34 billion for companies from all around the world since its formation in June 1995, the market could provide more liquidity for companies if the market listed fewer but higher quality companies. With nearly 1,600 companies listed on AIM, over 60% of the AIM companies and advisors who responded to the survey said the sheer numbers of companies made it hard for individual businesses to raise their profiles and attract investors.
London needs both AIM and PLUS to give growing companies the best chance to continue to grow by issuing shares to a wider pool of investors. The challenge for both markets remains the need to create sufficient opportunity and liquidity to ensure that there is actually a market for those shares. Equally there is a responsibility for advisors to work closely with their clients in selecting the market that best suits them clients and give them the best opportunity to be successful. If this can be achieved then both markets can confidently move forward in the future, thus providing a much needed boost to our battered economy.
For AIM the year ended on a somewhat low note with new admissions down on previous years and questions being raised about the suitability of the market for small cap shares. For PLUS based on 2008 the future looks extremely rosy, with admissions at a record level and their share trading platform going from strength to strength.
PLUS are old friends of ours and last year we ran two successful seminars with them and Orange Corporate Finance in Cambridge and Guildford . There is no doubt that PLUS is now a very serious option for companies seeking their first float and looking to raise funds for expansion.
But we support AIM too, and have viewed with interest a recent survey by top accountancy firm Mazars. The survey canvassed the opinions of both AIM quoted companies and a wide range of professional advisors and concluded that, whilst AIM had been tremendously successful in raising over £34 billion for companies from all around the world since its formation in June 1995, the market could provide more liquidity for companies if the market listed fewer but higher quality companies. With nearly 1,600 companies listed on AIM, over 60% of the AIM companies and advisors who responded to the survey said the sheer numbers of companies made it hard for individual businesses to raise their profiles and attract investors.
London needs both AIM and PLUS to give growing companies the best chance to continue to grow by issuing shares to a wider pool of investors. The challenge for both markets remains the need to create sufficient opportunity and liquidity to ensure that there is actually a market for those shares. Equally there is a responsibility for advisors to work closely with their clients in selecting the market that best suits them clients and give them the best opportunity to be successful. If this can be achieved then both markets can confidently move forward in the future, thus providing a much needed boost to our battered economy.
I've got the brains, you've got the looks....
Wednesday 21 Jan 09 - Back in the 80s the Pet Shop Boys banged on that "There's a lot of opportunities, if you know when to take them, if there aren't, you can make them".
It is easy to think at the moment that opportunities are in short supply but talking to Henry Camilleri of independent financial advisors Camilleri Associates this morning at a breakfast seminar organised by Clydesdale Bank, it was interesting to hear that he has used the current wave of redundancies by major insurance and investment firms to increase his network of experienced financial advisors. As he said, the chance to bring on board some highly talented people that would not normally be available to him was too good to pass up, and has enabled him to add some weight to the strategy that he has set out for himself to improve his business in 2009. This was one of the points we made in our recent SMART presentation so it was good to hear of a practical example.
The topic today’s seminar was 'Doing business in a slowing economy' with Terry Irwin of TCii Strategic and Management Consultants, a common enough theme perhaps, but the point that companies need to get back to the basics of financial management in order to survive and thrive in the current market bears repeating again and again. Our hosts Clydesdale Bank also made this point in relation to the fact that their parent company National Australia Bank is currently one of the few banks that is relatively unscathed by the current banking turmoil. Terry Irwin believes that we should hit the bottom of this recession during 2009, with some small signs of recovery starting at the end of 2009 or beginning of 2010. Given the speed that the economy is unravelling, I would agree with his assessment about reaching the bottom, but would suggest that businesses adopt the advice of the Pet Shop Boys regarding opportunities in order to plot their own course to recovery outside of any general economic improvement. Henry’s actions above are good start along this road.
It is easy to think at the moment that opportunities are in short supply but talking to Henry Camilleri of independent financial advisors Camilleri Associates this morning at a breakfast seminar organised by Clydesdale Bank, it was interesting to hear that he has used the current wave of redundancies by major insurance and investment firms to increase his network of experienced financial advisors. As he said, the chance to bring on board some highly talented people that would not normally be available to him was too good to pass up, and has enabled him to add some weight to the strategy that he has set out for himself to improve his business in 2009. This was one of the points we made in our recent SMART presentation so it was good to hear of a practical example.
The topic today’s seminar was 'Doing business in a slowing economy' with Terry Irwin of TCii Strategic and Management Consultants, a common enough theme perhaps, but the point that companies need to get back to the basics of financial management in order to survive and thrive in the current market bears repeating again and again. Our hosts Clydesdale Bank also made this point in relation to the fact that their parent company National Australia Bank is currently one of the few banks that is relatively unscathed by the current banking turmoil. Terry Irwin believes that we should hit the bottom of this recession during 2009, with some small signs of recovery starting at the end of 2009 or beginning of 2010. Given the speed that the economy is unravelling, I would agree with his assessment about reaching the bottom, but would suggest that businesses adopt the advice of the Pet Shop Boys regarding opportunities in order to plot their own course to recovery outside of any general economic improvement. Henry’s actions above are good start along this road.
Green shoots or just some moss?
Friday 16 Jan 09 - Speaking with a local bank manager from HSBC yesterday at the Hounslow Chamber of Commerce lunch, he said he was amazed at resilience of the economy in his area and at the number of new business accounts that were being opened. Indeed according to an article in Business Matters magazine owning a business is good for your health. That is of course as long as you avoid February which according to Paul King of Ark Commercial Finance is statistically the peak month when businesses run out of cash and fail.
Meanwhile a new survey from the Forum of Private Businesses reported that a third of members surveyed actively sought finance during the last quarter but in spite of the government bank bailouts and active lobbying by the SME business community almost half had their applications partially or completely rejected. It is against statistics like this that success of the new Government loan scheme that was announced yesterday will need to be measured.
Of course new money, however it arrives, is to be welcomed, but the challenge for SMEs is going to be to understand and manage the processes that will need to be gone through in order to get that money. It will be still be necessary to produce credible business plans to support applications, and to provide lenders, even those with the comfort of a government guarantee, with evidence that proper financial control, cash management and reporting systems are in place. They are just not going to give the money away, but if the right approach is taken there is a good chance of success. Assuming of course you survive February…….
Meanwhile a new survey from the Forum of Private Businesses reported that a third of members surveyed actively sought finance during the last quarter but in spite of the government bank bailouts and active lobbying by the SME business community almost half had their applications partially or completely rejected. It is against statistics like this that success of the new Government loan scheme that was announced yesterday will need to be measured.
Of course new money, however it arrives, is to be welcomed, but the challenge for SMEs is going to be to understand and manage the processes that will need to be gone through in order to get that money. It will be still be necessary to produce credible business plans to support applications, and to provide lenders, even those with the comfort of a government guarantee, with evidence that proper financial control, cash management and reporting systems are in place. They are just not going to give the money away, but if the right approach is taken there is a good chance of success. Assuming of course you survive February…….
Enterprise zone strikes a chord
Tuesday 6 Jan 09 - Leafing through last Sunday’s Mail on Sunday newspaper I was interested to see how many articles on pages 66-67, the “Enterprise Zone” struck a real chord with what we are looking to achieve in 2009.
Pride of place went to our good friends at BCMS Corporate who had their “refreshingly different approach to selling companies” and their current successes in what conventional thinking would have you believe was a difficult climate for buying and selling businesses featured in this article. A very SMART business in our view.
Not so encouraging however was the news that 38% of small businesses do not expect to survive 2009 because of the downturn. Commenting on the survey carried out by Financial Mail and its sister site thisismoney.co.uk, Nick Palin from the Forum of Private Businesses said that he believed that the survival of many businesses will depend on the banks, who he maintains “are often still bracketing all small firms as high risk despite pressure from the Government and the small business lobby.” Banking relationships are crucial and are something that we will be covering in a presentation to Surrey Chamber of Commerce members on 3rd February in Shepperton (booking details).
Interestingly though, according to a report on a survey by Tenon Recovery, businesses that have been trading for between five and nine years are most likely to benefit from opportunities in the downturn. 37% of companies in this category say the economic downturn has provided opportunities for their business, including “taking clients from competitors, purchasing assets and stocks at a good price and increasing their client and customer base compared with only 29% overall”.
The basic message from these Mail on Sunday articles remains that existing SMART companies will continue to prosper, but equally it is not too late for companies to get themselves SMART to give themselves every chance of not only surviving but thriving.
Pride of place went to our good friends at BCMS Corporate who had their “refreshingly different approach to selling companies” and their current successes in what conventional thinking would have you believe was a difficult climate for buying and selling businesses featured in this article. A very SMART business in our view.
Not so encouraging however was the news that 38% of small businesses do not expect to survive 2009 because of the downturn. Commenting on the survey carried out by Financial Mail and its sister site thisismoney.co.uk, Nick Palin from the Forum of Private Businesses said that he believed that the survival of many businesses will depend on the banks, who he maintains “are often still bracketing all small firms as high risk despite pressure from the Government and the small business lobby.” Banking relationships are crucial and are something that we will be covering in a presentation to Surrey Chamber of Commerce members on 3rd February in Shepperton (booking details).
Interestingly though, according to a report on a survey by Tenon Recovery, businesses that have been trading for between five and nine years are most likely to benefit from opportunities in the downturn. 37% of companies in this category say the economic downturn has provided opportunities for their business, including “taking clients from competitors, purchasing assets and stocks at a good price and increasing their client and customer base compared with only 29% overall”.
The basic message from these Mail on Sunday articles remains that existing SMART companies will continue to prosper, but equally it is not too late for companies to get themselves SMART to give themselves every chance of not only surviving but thriving.
The wonder of a Woolworths administration
Wednesday 24 Dec 08 - It maybe just me but there is something about the current Woolworths administration that leaves a very nasty taste in the mouth. Maybe it is the cynical timing i.e. maximum stock and creditors leading up to the maximum cash generating period ensuring maximum return to secured creditors, the somewhat cavalier treatment of staff , the vulture like circling by major retail chains looking at taking on the prime store sites or the general fact that this has all the appearance of a liquidation rather than administration.
Whatever it is I think there may be grounds for an official enquiry into the whole process, from examining in particular the behaviour of the secured creditors and the administrators, to seeing if there are ways during an administration to better serve the unsecured creditors, employees, the economy and the wider community. Maybe Woolworths was an idea who time had been and gone, and that this was a mercy killing, but if that is the case I think it deserved to die with a lot more dignity that it has.
Whatever it is I think there may be grounds for an official enquiry into the whole process, from examining in particular the behaviour of the secured creditors and the administrators, to seeing if there are ways during an administration to better serve the unsecured creditors, employees, the economy and the wider community. Maybe Woolworths was an idea who time had been and gone, and that this was a mercy killing, but if that is the case I think it deserved to die with a lot more dignity that it has.
2012 and all that
Friday 19 Dec 08 - There may be doubts as to whether the Chancellor’s VAT stimulus is the best way to get the economy going, given its consumer focus rather than business one, but there is another massive injection of cash taking place targeted directly at businesses that should have them salivating.
I refer of course to the 2012 London Olympics. To investigate these opportunities further a couple of us pitched up to a briefing held at Lords Cricket Ground (it’s a tough life etc…..) run by the London Business Network. There we listened to speakers from the London 2012 Forum, UKTI and even the British Columbia Ministry of Technology (I am sure I don’t need to tell you that the 2010 Winter Olympics are taking place in Vancouver).
Case studies were also presented and it was worth noting that it is not just businesses that are involved in construction and sports services that will benefit. Examples were given of small local florists and catering companies who have also won contracts.
One other point that emerged from the Lords briefing was that Olympic and sporting opportunities should persist long after the flame has been put out on the London games due to the transferable skills that will be gained in the infrastructure and support industries. There are world and regional championships being held on a frequent basis that could provide business opportunities for those that keep their eye on the ball.
I am sure that SMART businesses have already registered with the opportunities website but for those that have not quite got round to doing so the link is below.
London 2012 Opportunities
I refer of course to the 2012 London Olympics. To investigate these opportunities further a couple of us pitched up to a briefing held at Lords Cricket Ground (it’s a tough life etc…..) run by the London Business Network. There we listened to speakers from the London 2012 Forum, UKTI and even the British Columbia Ministry of Technology (I am sure I don’t need to tell you that the 2010 Winter Olympics are taking place in Vancouver).
Case studies were also presented and it was worth noting that it is not just businesses that are involved in construction and sports services that will benefit. Examples were given of small local florists and catering companies who have also won contracts.
One other point that emerged from the Lords briefing was that Olympic and sporting opportunities should persist long after the flame has been put out on the London games due to the transferable skills that will be gained in the infrastructure and support industries. There are world and regional championships being held on a frequent basis that could provide business opportunities for those that keep their eye on the ball.
I am sure that SMART businesses have already registered with the opportunities website but for those that have not quite got round to doing so the link is below.
London 2012 Opportunities
Haslemere - The revolution happened here (honest)
Friday 28 Nov 08 - Back on the road again!The genteel Surrey town of Haslemere may not on the face of it seem the most obvious place for a revolution, but that may be about to change. The 21 businesses that were represented at the lunchtime Peal Networking Club event showed increasing belligerence as they castigated the media for focussing on the negative aspects of the current situation and not acknowledging the many businesses who are still doing very well. Perhaps that is the answer - a bottom up revolt - maybe it will have more effect on boosting the economy that any top down Government action. Power to the people, as John Lennon used to say.
Earlier at the IOD West Surrey branch breakfast we were all encouraged to think of skills that we had developed in 2008 and what we would be aiming to improve in 2009. My offering was working on my running skills to enable me to complete my first half marathon, a choice I justified when questioned by saying that it was an ideal way of pushing me beyond my comfort zone, improving my strategic planning (getting through 13.1 miles required a systematic approach in terms of running speed and time goals) and gaining the focus and determination to achieve a seemingly impossible target, all skills that could greatly assist my clients.
Suitably inspired my colleagues then decided that in 2009 they were going to focus on improving their juggling skills, unleashing their inner cartoonist and becoming the best know left handed bass guitarist since Paul McCartney. All in the best interests of our clients you understand………
Earlier at the IOD West Surrey branch breakfast we were all encouraged to think of skills that we had developed in 2008 and what we would be aiming to improve in 2009. My offering was working on my running skills to enable me to complete my first half marathon, a choice I justified when questioned by saying that it was an ideal way of pushing me beyond my comfort zone, improving my strategic planning (getting through 13.1 miles required a systematic approach in terms of running speed and time goals) and gaining the focus and determination to achieve a seemingly impossible target, all skills that could greatly assist my clients.
Suitably inspired my colleagues then decided that in 2009 they were going to focus on improving their juggling skills, unleashing their inner cartoonist and becoming the best know left handed bass guitarist since Paul McCartney. All in the best interests of our clients you understand………
What the VAT reduction means for small businesses
Wednesday 26 Nov 08 - This is a newsclip from the BBC website which shows very clearly what the VAT reduction currently means for small businesses.
http://news.bbc.co.uk/1/hi/business/7757966.stm
It should be required viewing for all Ministers, MPs and civil servants as to what happens in the real world!
http://news.bbc.co.uk/1/hi/business/7757966.stm
It should be required viewing for all Ministers, MPs and civil servants as to what happens in the real world!
So Alastair has spoken
Tuesday 25 Nov 08 - So Alastair has spoken. I am not going to go into the economic or political significance of his “mini budget” beyond noting that he appears to have taken a sizeable gamble, which if it fails could lead to considerable difficulties for the UK economy in the future. However there are a number of measures which will directly impact on our clients, both present and future, some of which are discussed below.
Firstly credit where credit is due. There are many things that will benefit small and medium sized business, as long as they actually do what they say on the tin. These include the small business finance scheme, the loan guarantee facility for small businesses who export, the possibility of negotiating flexible payment of tax liabilities in cases of hardship, empty property relief and the ability to carry back some business losses for up to three years. The delay in the increase in the rate of small business corporation tax and the deferring of proposals to tackle so called income shifting are also very welcome. We at Orchard will certainly be looking at how our clients can benefit from these measures.
Regarding the centrepiece of the Pre-Budget Report (PBR), the temporary reduction in the rate of VAT is particularly good news for those that cannot recover input tax such as charities, public sector bodies, health and education, and er banks and insurance companies. For other businesses there will be the administrative hassles of changing systems, prices and catalogues, especially in retail which is in the middle of its busiest period and where there is already selective discounting taking place. Indeed if I were a SMART retailer, rather than cutting prices across the board, I would the use the VAT cut both on targeted price reductions i.e. as part of the price element of my marketing mix and to squirrel some cash away.
However all businesses, particularly those working in the business to business sector will need to be mindful of the cash flow impact of the VAT reduction - firms that had budgeted VAT at 17.5% should now adjust their cash receipts downwards to reflect the new rate of 15%. This could be a useful argument to deploy if you are looking to agree a payment plan for taxes with HMRC.
The main sting in the tail going forward is the increase in NI rates for both employers and employees, which represent an extra cost and cash burden. However the impact of this could be mitigated by looking at flexible remuneration ideas such as share schemes and salary sacrifice options.
My view remains that it is confidence and job insecurity rather than cash that is the main break on people spending and it is not clear whether the measures outlined in the PBR will have an impact in this area. Clearly I hope for the sake of UK plc there is some positive benefit from all of this but I remain to be convinced. Meanwhile I would continue to urge businesses to follow the basic principles of financial management and look for the opportunities that are always going to be there for SMART businesses.
Firstly credit where credit is due. There are many things that will benefit small and medium sized business, as long as they actually do what they say on the tin. These include the small business finance scheme, the loan guarantee facility for small businesses who export, the possibility of negotiating flexible payment of tax liabilities in cases of hardship, empty property relief and the ability to carry back some business losses for up to three years. The delay in the increase in the rate of small business corporation tax and the deferring of proposals to tackle so called income shifting are also very welcome. We at Orchard will certainly be looking at how our clients can benefit from these measures.
Regarding the centrepiece of the Pre-Budget Report (PBR), the temporary reduction in the rate of VAT is particularly good news for those that cannot recover input tax such as charities, public sector bodies, health and education, and er banks and insurance companies. For other businesses there will be the administrative hassles of changing systems, prices and catalogues, especially in retail which is in the middle of its busiest period and where there is already selective discounting taking place. Indeed if I were a SMART retailer, rather than cutting prices across the board, I would the use the VAT cut both on targeted price reductions i.e. as part of the price element of my marketing mix and to squirrel some cash away.
However all businesses, particularly those working in the business to business sector will need to be mindful of the cash flow impact of the VAT reduction - firms that had budgeted VAT at 17.5% should now adjust their cash receipts downwards to reflect the new rate of 15%. This could be a useful argument to deploy if you are looking to agree a payment plan for taxes with HMRC.
The main sting in the tail going forward is the increase in NI rates for both employers and employees, which represent an extra cost and cash burden. However the impact of this could be mitigated by looking at flexible remuneration ideas such as share schemes and salary sacrifice options.
My view remains that it is confidence and job insecurity rather than cash that is the main break on people spending and it is not clear whether the measures outlined in the PBR will have an impact in this area. Clearly I hope for the sake of UK plc there is some positive benefit from all of this but I remain to be convinced. Meanwhile I would continue to urge businesses to follow the basic principles of financial management and look for the opportunities that are always going to be there for SMART businesses.
Antony on the road (6)
Sunday 22 Nov 08 - It seems that a reduction in VAT has emerged as the favourite for the main weapon to be used by the Government to stimulate the economy. (http://news.bbc.co.uk/1/hi/uk_politics/7744273.stm) I am a little sceptical as to how effective this is going to be as retailers are already falling over themselves to cut prices and tempt people to spend. I still think that lack of confidence driven by fear of unemployment will be the main reason for people not spending and unless firms boost cash flow by keeping the benefit of this VAT cut to themselves (for which they will be castigated by all and sundry) I can't see the cut doing much to address this. Let's see what tomorrow will bring.
Antony on the road (5)
Friday 21 Nov 08 - No events to attend today so a good chance to catch up with paperwork and the latest thinking of the media pundits on Monday’s pre budget statement. (No mention of client work I hear you say - well the reality is that client work is a priority whatever else I do and therefore continues to be dealt with expeditiously regardless of the other things that I do). Most seem to agree that it was the right thing although more and more were realising that it would require significant tax increases further down the line. (http://news.bbc.co.uk/1/hi/uk_politics/7741397.stm) Most of the suggestions (leaks?) coming out so far indicate that the Government is looking to put money in the hands of consumers to encourage them to spend. Maybe this is the answer although my own view is that it is lack of confidence and job security rather than lack of money that is stopping people spending. I would have though that a package of measures to help business cash flow and encourage job conservation would be cheaper and much more effective but I guess I am only an accountant so what do I know?
Antony on the road (4)
Thursday 20 Nov 08 - My turn to be star attraction this morning, turning up bright and early at Ashford Manor Golf Club in Surrey to give a seminar to the Surrey Chambers of Commerce (http://www.surrey-chambers.co.uk/) on how to survive and thrive in the current economic climate. The seminar is based on our Orchard SMART programme which has been specifically devised for the current situation and which aims to focus clients on looking for opportunities whilst ensuring that they tighten up on the basics financial control and management. In addition to finance, the programme also addresses sales, marketing and people issues and it intended to help business for whom financial management was not so important in the good time but is now essential in the current climate.More details can be found on the Orchard website (http://www.orchardgrowth.com/downloads.php) but what was encouraging was the positive attitude of many of the businesses there to the current situation and the belief that they could be SMART enough to survive and thrive.
Antony on the road (3)
Wednesday 19 Nov 08 - Attended a Tax briefing on investigations with Baker Tilly (http://www.bakertilly.co.uk/)in Guildford which among other things concentrated on the new penalty regime and appeals process.My head was buzzing as they rattled through a number of changes seemingly designed to simplify and improve matters, but given the number of issues that are yet to be clarified by HMRC would appear to mean that a considerable about of bedding in is going to be required.I freely admit that I am glad that I don’t do tax. Obviously I am aware of the major issues affecting businesses and am able to manage tax advisors on behalf of clients but I don’t provide advice or deal directly with HMRC on a day to day basis. Our tax system is in dire need of simplification, not least in that it would provide some certainty to taxpayers, advisors and HMRC frontline staff themselves. However given the need that the Government has for cash I can’t see it happening for some time to come.However it was great opportunity to catch up with a number of small practitioners, all of whom were sceptical that Alastair Darling would be able to do much to get his billions through quickly enough to make a difference in the short term.
Antony on the road (2)
Tuesday 18 Nov 09 - Breakfast courtesy of the Thames Valley Economic Partnership (http://www.businessinberkshire.co.uk/tvep/index.html) where the keynote speakers were John Whitely, the Bank of England’s agent for central and southern England, and Willie Walsh, chief executive of British Airways.John Whitely gave a very downbeat assessment of the current situation, backed up a formidable array of alarming looking graphs, and concluded that there was a “very high degree of uncertainty in unprecedented times”.Willie Walsh was Willie Walsh and said exactly what you would expect him to say (http://www.thamesvalley.co.uk/public_panel/economic_outlook.php)regarding BA’s response to the economic downturn and the requirement for a third runway at Heathrow.Fair play then to the guy from Imago (http://www.imagogroupplc.com/3D%20Telepresence/3DTelePresence.htm), a business that provide 3D telepresence facilities who stood up and proudly pointed out that they were over 100% ahead of their budget in the first few months of their business year. Clearly a SMART business and a good riposte to all the gloom and doom that had otherwise prevailed during the morning.
Monday 2 March 2009
Antony on the road "so you don't have to
Monday 17 Nov 08 - In the week before the all important pre-budget announcement that promises to pump billions into the economy, Orchard Principal Antony Doggwiler has been out and about at various business events gauging the mood and uncovering what is really happening in the business world. Remember he does all this so that you don’t have to.MondayUp in Coventry today manning our stand at TechnologyWorld 08, an exhibition organised by UKTI (https://www.uktradeinvest.gov.uk/) targeted at growth technology firms, both from the UK and overseas. Exhibitions are a good example of Forrest Gump’s assertion that life is like a box of chocolates in that you never what you are going to get in terms of visitors to the stand and any business opportunities that might arise. However we had many visitors to our stand and met some very interesting businesses. We also took the opportunity to talk to a number of UKTI advisors about our cost effective offering for companies setting up businesses in the UK.Talking of chocolates, Ash’s bright idea of putting chocolates on the stand meant an increasing stream of visitors during the afternoon as energy levels flagged, such that we were soon badging ourselves “The Official Chocolate Suppliers to TechnologyWorld08”. All good fun and an event I think we would do again.
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