Managing your cashflow

I recently visited a growing IT business in the M5 corridor – that hot bed of entrepreneurial  IT businesses.

During my conversation the MD described how they had grown from the original 2 partners in a small office in Hounslow to their present stunning barn conversion on the outskirts of Reading with some 8 staff onsite and a further 3 programmers working from their homes at far flung locations as far away as Scotland and Lincolnshire.
 They had started by providing programming and general web support for local businesses but progress was slow.  However, they were asked to develop a specialist wireless interface for a client.  They had to go through a steep learning curve to deliver this project and on successful completion they realised this could be useful to other clients.  More particularly it could be developed into a specialist niche market product.  The beauty of this would be that it would have world wide potential and move them in a direction that not only interested them but would given them a platform for growth.

Getting gold in 2012

A Government Minister has described 2012 as the most important year since 1908, it will change the financial landscape in this country forever. No, not the Olympics, but “Personal Accounts” the Governments latest attempt to get the British Public to plan for their retirement after the ill-fated Stakeholder Pension Schemes and 2012 is currently pencilled in for the launch of these schemes.

Every Cloud…

Commercial bank managers have long complained that it is much easier for clients to get unsecured loans personally, where no evidence is required as to how the loan will be repaid, than it to get unsecured loans for a business, no matter how good the business plan.

As set out in previous articles, if you do have to provide a personal guarantee, make sure it is not secured against your home. This way if the business goes belly up, and the guarantee is called in, you have a strong position and will in all probability keep your home, if you go about things carefully.

If the loan is secured against your property and the business fails, its hard to increase the mortgage, as your income has gone, and you stand every change of losing your home. 

Of course many businesses are mostly conducted as sole traders where there is no legal separation between business assets and personal assets and by the largest sector is Buy to Lets (BTL).

U-turn over plans to phase out cheque payments forced

The Forum of Private Business (FPB) is welcoming the Payments Council’s new National Payments Plan, announced this week, in which it agrees not to phase out cheque payments until adequate alternatives are in place. Research carried out by the FPB at the end of last year revealed that most of the smaller businesses surveyed want market forces to determine when they should switch payment methods.

It’s all about margins

I see a lot of businesses that are very busy but they just aren’t making any money.   Let me give you a recent  example of a small telemarketing company that carries out business to business marketing.
This story is a classic story of a couple of guys who had worked in the industry for many years deciding to set themselves up independently.  They rented an office, recruited a few telesales staff and set about building the business.

Be healthy,wealthy and wise

In a competitive world where costs are key to success, employee retention plays a vital part. Long serving employees save on recruitment costs and the training of new staff. Due to the public perception of the state of the NHS, an employee benefit package that contains Private Medical Insurance can be more attractive to new and existing employees.

Peparing your business for sale

Any item for sale benefits from quality presentation, whether it be a bottle of perfume or a three piece lounge suite. Businesses are no different.  An owner manager who allows him or herself time to gift wrap their company and put on a big bow for good measure will reap substantial rewards.
Undertaking the “wrapping and packing” takes time – anything up to three years – but it is time that is so so well spent.

Credit squeeze forces cuts to secured lending

Banks and building societies are reporting an expected cut in the amount of secured lending they will offer after the Bank of England admitted the credit squeeze is set to intensify.

The credit crunch is forcing some lenders to take fewer risks whilst at the same time, the cost of borrowing on the money markets remains high. As a result, SMEs could find it difficult to secure traditional loans or receive overdraft facilities from their bank.

Spring Clean your Finances

With spring time now officially upon us and a new tax year started, there has never been a better time for small businesses to spend some time spring-cleaning their finances to help get their firms into ship shape condition for a successful 2008.

Business borrowing is getting personal

Insolvency practitioners are warning that banks are forcing entrepreneurs and family-run firms to take second mortgages on their homes and offer personal guarantees before agreeing to provide business loans.

Many banks also charged penal rates of interest or refused to extend loans to small businesses unless they agreed to offer their personal assets as security, and in particular their main home.

Blood on the trading floor

Remember the boom in stockmarket flotations, at the end of the last century and the start of this one? That was the time when companies came to the stockmarket for its IPO – Initial Public Offering – armed with a prospectus, a narrative, a prominent bank to manage the offering, and a cabal of venture capitalists hidden off-stage, sniggering, rubbing their hands, and revving the engine of their getaway vehicle. For civilians and non-City people, in a week dominated by all-too-credible stories about economic cataclysm and global recession, that may seem a long time ago. The biggest IPO in history, for instance – what and when was that? AT&T in 2000? Google in 2004?