29/11/2011 by Geoff.

A blight on most British businesses is that it is difficult and expensive to secure loans.An alternative, but a well kept secret, is a loan from the European Investment Bank (EIB) which is distributed by Lloyd TSB, Barclays, Santander and the Royal Bank of Scotland. Typically the cost will be 0.7% less than a normal business loan. Loans from the EIB are not very well promoted so you have to ask. The other catch is that money may not always be available since banks have to apply for money in tranches. To be eligible for an EIB loan, firms must have fewer than 250 employees and use the loan to invest in growing the business e.g. buying plant, taking out a patent or investing in research and development.

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29/11/2011 by Geoff.

Slow payment or none payment are the scourge of small businesses. If you’re worried about your exposure there are four options:

·         Don’t trade

·         Advanced payment

·         Trade on different terms

·         Credit insurance

The latter option has improved recently but is still very sensitive to the state of the financial markets and insolvencies. Recently more user friendly policies have been introduced along with other features to help small firms. The major credit insurers are Atradius, Euler Hermes and Coface.

As with all things that affect cash flow firms should beware of complacency.

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21/11/2011 by Geoff.

With the reduction in the Annual Investment Allowance from £100,000 to £25,000 coming in to force with effect from 1 April 2012 for companies and 6 April 2012 for sole traders and partnerships, it is important to plan your capital expenditure to ensure maximum tax relief is received as soon as possible.

If you are planning on purchasing any large capital items, to ensure the full tax relief will be available take advice giving the expected date of purchase and the amount it will cost.

As always we would recommend you buy before the end of your accounting period to ensure that the tax relief can be claimed as early as possible but if you are buying in the accounts year that straddles the end of the tax year, a higher Annual Investment Allowance can be claimed if you purchase before the 31 March 2012.

Simone Greasley

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21/11/2011 by Geoff.

Many small companies concentrate on growth but forget to keep an eye on costs (overheads) where even small changes can be effective. Remember that a cost cutting exercise can produce fast results. Some guidelines to help are:

·         Create a cost conscious culture – celebrate successes

·         Develop in-depth knowledge of the markets where you buy

·         Check what rival suppliers are offering

·         Train staff in how to get the best prices in different situations and provide them with the right tools

·         Review accounts monthly (not once a year) and stay in control

If everybody is looking out for ways to save money then you avoid the us and them syndrome, and the view that all the penny-pinching is just for the Owner’s benefit.

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16/11/2011 by Geoff.

Where an older spouse is currently claiming a dependency increase in their state pension, and for a wife or husband who has not yet reached retirement age, they will be advised to review the claim when the younger spouse reaches retirement age.Issues to be considered include:

• The younger spouse’s own state pension, even if funded by the other spouse’s contributions (in which case it is known as a Category B pension), would create income for the younger spouse that may be covered by their personal allowance, so tax free.
• A continuing claim for the adult dependency allowance will likely be taxable when received by the older claimant, perhaps at higher rates.
• The present adult dependency allowance is £58.80 per week, the full Category B state pension that the younger spouse may be able to claim is now £61.20 per week.

Note: The adult dependency increase is not available for new pensions from April 2010 and will cease for existing claims by 5 April 2020 at the latest.

Simone Greasley

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16/11/2011 by Geoff.

Many self-employed traders have suffered losses in recent years as the effects of the banking crisis and recession have slowed economic activity. Some of these business people will have taken on other, perhaps unrelated, part-time jobs to supplement their income?

Sound familiar?

If you have found yourself in this position be aware that HMRC may challenge your ability to set off losses. For instance:

1. Losses will only be made available for sideways relief against other earnings when you can demonstrate that a trade is conducted on a commercial basis with a view to making profits.
2. HMRC can use present powers to restrict loss relief claims if the trader does not spend at least 10 hours a week working in the business – this restriction normally applies to losses in excess of £25,000.

Simone Greasley

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09/11/2011 by Geoff.

We’ve just helped a client with the decision most small start ups face – move or not to move.Whatever the circumstances moving into larger premises is going to affect the bottom line of your business. It’s important you have a good handle on the one off costs and running costs.There are a number of options available:

·         Serviced space – more expensive and they can be subject to extra costs. It also might prevent you expressing you brand.

·         Buying space – ties up capital but can give you your own shop window. Mortgages may be close to rental charges.

·         Rent space with licences – cheap set up and easy get out. Landlord retains right of access.

·         Rent space with a commercial lease agreement – greater security but more responsibility.

Whatever option you choose location and flexibility should be high on your shopping list.

Above all ensure you get what your business needs and might need.

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09/11/2011 by Geoff.

Many budding entrepreneurs have good ideas but do not have the skills or ideas to take it forward - it comes to nothing.The key issue here is to decide what type of prototype you need and if you need help. You might be able to knock something up yourself but eventually you will need some engineering or design expertise if you are to keep production costs realistic.This might sound expensive but many inventors use Universities and there are grants out there (the Grant for Research and Development scheme, administered by the Technology Strategy Board, funds simple prototypes).Other than knowing when to look for help we recommend taking the project forward in stages, weighing up risks and investing accordingly.Oh and don’t forget to check there is a market for your idea.

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01/11/2011 by Geoff.

One of the dilemmas a business faces is were to sell or display their products or services. This will normally involve a significant investment even if it’s web based.

There is an increasing trend where this is not the case. POP-UP SHOPS.

This is where a smaller business uses space (lower cost) in an existing larger environment. They also provide a low cost way to try out new products and get customer feedback.  These larger environments might be:

• Market halls
• Empty retail premises
• Non-traditional venues

It provides a potential win-win but don’t forget to make sure your product or service is good and your target market is going to be there.

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01/11/2011 by Geoff.

On 1 October 2011 the national minimum wage increase takes effect. The new hourly rates are as follows:

*This applies to apprentices under 19, or 19 and over in the first year of their apprenticeship.

Simone Greasley

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