For most start-ups, bookkeeping might seem like a daunting task. However, when carried out properly, up-to-date financial records can bring about huge benefits to a business.
Apart from ensuring that financial records are correct for the end of the financial year, it can also provide businesses with a realistic and forward-looking view of how the company is performing.
Fortunately, there is technology available to relieve the burden of bookkeeping. And with the right system in place, online accounting systems can enable small business owners to stay on top of their books.
Although some people may be put off by technology, online accounting systems are actually designed to be very simple to use. Financial information can be uploaded automatically through electronic files or even scanned directly into the system. This can dramatically reduce the time it takes to enter data.
The information is stored and analysed in the system and small-business owners can look at key reports (eg outstanding bills, outstanding invoices) anytime, anywhere, from all devices that can launch an internet browser.
Not only are these systems a cost-effective option for businesses, with a pay-as-you-go model, a growing range of customised solutions delivers vertical market specific bookkeeping to add further value.
Don’t throw the book at bookkeeping – business owners should embrace technology and stay on top of the books!
Blog provided by Barbara Kroll, managing director of online accounting services provider Twinfield UK.
When I started my business, the biggest drain on my resources was time. Many people say the flexibility of being your own boss is a major reason why they start up, but budding business owners be warned – it could be a while before that flexibility comes into play.
Of course, initial start-up capital also proved to be quite a shock. No matter how many friends you have giving you advice, nothing quite prepares you for the shock of the amount of capital you need to start up. Thankfully, I was able to sell my car, which gave me a decent amount of capital to begin with.
Now, however, as my business has started to get established, the matter of time has reared its head once more. As such, my current priority is to hire someone who can help me out and give me that flexibility I desire.
One of the primary pieces of advice I’ve been given is to not hold back on employing someone because you fear losing money. This is easier said than done, but I’ve also noted a great way of saving time and money when it comes to future employees.
Not only will employing someone help me save time in the long run (along with sharing the workload), but by engaging with current technology, training and management will also be reasonably straightforward.
With the rise of BYOD (bring your own device), there’s no reason not to apply this to small businesses and start-ups as well. However, one of the best time-savers (and long-term money-savers) is to ensure that everyone in the business is “on the same IT page”.
Investing in the same smartphone as my own means I know what software is available, and I can easily train future employees on how to use the device, along with the many apps installed.
Because Microsoft now offers a mobile version of Office, it’s never been easier to manage a small business. Chances are, until my business fully takes off, employees will work part time, so training them completely on a device used across my company is one of the best time- and money-saving decisions.
I want to understand everything I ask my employees to do. In fact, regardless of the help my friends offer me, it’s been my aim from the start to tackle everything independently, because it’s the best way to tackle the steep learning curve.
Hiring a new employee seems daunting, especially as my business is still in its infancy. However, with the right training across a device and software I understand, I have confidence that it’ll run as smoothly as possible.
Blog supplied by Frederick Miller of Helpingu2save.co.uk.
There are only so many hours in a day and there’s only so much you can charge for your products or services. Once your start-up hits these inherent ceilings, you’re at full capacity in terms of financial return. You’re probably near the end of your tether, too. But there is a way to expand your business beyond this point, without the responsibility of employing staff.
Gone is the need for an endless list of “Stuff I need to do” (aka everything). Instead, have two lists:
Write down what you’re best at. You will be far more productive, with better results, if you only do the stuff that interests you, the things you are best at, the jobs your skills are best suited to – in short, the reasons you started the business in the first place.
Deep down you probably know that while you love analysing customer feedback (List One) or coming up with new product ideas (ditto), you usually put off writing your blog or doing your accounts. Or maybe there is something you put off because you just don’t know how to do it (that new e-commerce part of the site maybe or the wireframes for your new mobile app). Those are the jobs that belong squarely in List Two.
This includes everything else. Whether it’s not the best use of your time or you don’t have the right expertise, be honest with yourself about what would be done better or more quickly by somebody else. As a business owner, knowing when to delegate work can be one of the most difficult decisions. Remember that your time is finite – and probably your most precious resource. Here are five suggestions for jobs you could hand to someone else and get some valuable hours back in the process.
Faffing around with fonts, colours, symbols and swooshes is a) fun and b) a gaping black hole of productivity. Twiddling with our logo or letterhead is what we do when we’re avoiding doing something more difficult and more useful. Better to browse designer’s portfolios to find a design pro who matches your requirements and let them get on with it.
Good businesses communicate – regularly. But when you’re short on time, generating engaging, fresh, on-brand, unique, SEO-rich content for that weekly blog, e-shot or customer newsletter can feel like a millstone round your neck. Hiring a freelance writer to create your copy is easy: just give them a few topics to work from and enough information to help them capture your voice. Bingo! A 500-word blog post. No more trying to be pithy and punchy in your kitchen at 2am.
If your website is your main customer-facing platform, you need web analytics to make sure it’s doing the best job possible. But it’s way too easy to get sucked in. Nicotine, alcohol, Candy Crush… compared to the addictive and hypnotic glow of the Google Analytics dashboard, they got nothing. Outsource it, read the top-line report and free yourself from this time-zapping peril. Similarly, buying and optimising keywords on Google, Bing and Yahoo has become a complicated science with ever-morphing algorithms. Get an SEO expert to keep an eye on your clicks and conversion rates for you.
Managing a social media campaign is a 24-hour, rapid-response activity, and as the leader of your business, you just don’t have the availability. By all means, check in on Twitter, Facebook and LinkedIn every now and then, but delegate the day-to-day campaign stuff to a freelancer who can dedicate himself or herself to making your business a social media success.
How many hours a week do you spend on basic admin tasks such as data entry, research, database management, transcribing, planning events or organising travel? It’s blatant misuse of your most valuable business resource (yes, that’s you!). You’ll find thousands of freelance virtual assistants online with a good broadband connection and a typing speed way faster than yours. Get one.
• Blog supplied by Hayley Conick, Country Manager for Elance UK & Ireland, which enables small businesses to find freelances.
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Sophi Tranchell, managing director of Divine Chocolate, shares her tips for starting a social enterprise that will not only survive, but also prosper in a global market.
When we originally pitched our concept of a delicious fair trade chocolate owned in part by Ghanaian cocoa producers, many people told us it was a wonderful idea but unlikely to ‘have commercial legs’.
Luckily we persevered and set about challenging the commonly held misconceptions about social enterprises – that they are socially responsible, but not commercially viable. Years later, I’m enormously proud to say that we’ve not only achieved our original goals, but have moved many steps further.
Starting a social enterprise is now favoured by about 15% of the UK’s small firms and as a nation we’re leading the way in supporting better prices, decent working conditions, local sustainability and fair terms of trade for producers in the developing world.
These principles formed the bedrock of Divine’s original mission, in partnership with 80,000 cocoa farmers in Ghana, who have benefitted not only from the fair trade premium on sale of their beans, but also their 45% share of Divine’s distributed profits and 2% of its annual turnover.
With the right plan and confidence that things can change, many businesses can fly as a social enterprise. It’s important to articulate and reinforce your mission statement in everything you do. The central purpose of your organisation needs to be at the core of all your business materials, internal and external conversations and any media or advertising work you do. By doing this, your staff, suppliers and customers will better understand and appreciate the ethos of the company, which will provide a sound platform for growth.
Getting the right financial support is another key factor in creating a successful social enterprise. You must bring in people and organisations that share your mission and values. We attracted investment from Body Shop, Christian Aid and Comic Relief. We also secured a £400,000 loan guarantee from the Department for International Development. Do as much research as possible into all potential avenues for funding and take opportunities that come your way – but make sure they complement your business philosophy.
Also take advantage of the range of support that is available from both the public and private sector. Currently I’m involved in the ‘Business is GREAT Britain’ campaign, which aims to build confidence among small businesses and encourage them to plan, hire and export.
One element of support my business got involved with was the Knowledge Transfer Partnerships scheme, which gives businesses access to expertise within UK universities. Liverpool John Moores University helped us with our new product development. We were also able to access export markets through attending UK Trade & Investment food trade fairs. This has been incredibly valuable for us and has helped us to enhance the skills and reach of our business.
If, like us, you have plans for global expansion, you must do your homework on your product(s) and territories in which you plan to sell. Make sure your product is a ‘good fit’ for all of the markets you’re looking to enter.
We were conscious that tastes vary from country to country, so we needed to consider if our product would sell well in places where dairy is not commonly eaten, for example. You’ve also got to think about whether your product is named appropriately. On a practical level, we had to consider whether our product was suitable for hotter climates – and how this impacted on countries we would export to.
Finally, people are what really makes social enterprises successful. You need employees with knowledge, energy and – above all – passion. Passion and vision are two things you’ll need as leader of your social enterprise, however, you can’t just rely on these alone. You’ll also need the right mix of business skills, and with planning, advice from third parties and a strong team around you, you’ll be better placed to succeed. A social enterprise may exist to benefit the world around it, but it is still a business that needs a sound strategy if it is to succeed.
At the beginning of the year, the government announced a 15-month, £30m small business growth scheme. Qualifying small businesses can register for up to £2,000 of funding support for:
Small businesses must match the government’s funding and those that are selected randomly must work with the Cabinet Office's Behavioural Insights Team, which has been tasked with finding out how the funding helps businesses that receive it.
To qualify the small businesses must:
The Prime Minister’s enterprise adviser, Lord Young, heads up the fund and principally it’s meant to help businesses conduct research before launching a new product or entering a new market.
All services must be bought from approved advisers (there are more than 3,160 of them) through Enterprise Nation. As of 6 March 2014, Enterprise Nation reported that more than 1,400 businesses had applied for funding, and 598 vouchers had been allocated, with a value of more than £1m. Here’s the breakdown of the types of strategic advice small businesses have invested in so far:
With the scheme due to run for 15 months, I’d advise small businesses to apply – but be aware that you have to pay fees upfront before reclaiming money from the government. Find out more about the scheme here.
Slightly more than three years ago, Tony Curtis' business idea for heated sports gloves was given short shrift on TV's Dragons' Den. Those Dragons must be fuming now, because Alago Heated Gloves is a hugely successful business, with thousands of its products warming the hands of gardeners, cyclists, kayakers, tennis players, horse riders and players at many premier sports clubs. Stick that in your pipe and smoke it, Duncan Bannatyne.
Determination, bad luck and a radical approach to funding have all played a part in Tony’s remarkable business journey. Recalling how he came up with the idea, he says: "It started seven years ago when I was watching my 12-year-old son playing rugby. It was a freezing day and no one could catch the ball – no one wanted to. He ran off the pitch at the end with blue hands and shoved them up my jumper for warmth. Once I'd got over the shock I thought, he needs heated gloves.
"That was my ‘light bulb moment’. I searched online to try to find heated gloves but nothing was suitable. Everything I saw had big bulky battery packs, electric cables – useless for sport.
"So I thought I'd have a go at inventing something and spent six months playing around with gloves, silicon tubing, a meat syringe and some heat packs at home. After destroying several kitchen appliances along the way, I came up with something that I thought would work. I took it to a brilliant design company and we went forward to prototyping. That's when it started costing money."
So how did he cover those costs? "I had a day job, but needed more money. I didn't think about investment, I found another way. I bought a camera and taught myself photography. I opened up a spare-time photography business, doing portraits, weddings, event, etc. I did that for four years, that’s how I paid for product development."
What customers did he have when launching his business? Tony answers: "Our mitts were bought by junior and mini rugby clubs throughout the country. Gradually, our full-length gloves were picked up by professional clubs, then we got emails from salmon fishermen, helicopter pilots, classic car drivers, obstacle race runners – you name it."
Was there a breakthrough moment? "We were asked onto Radio 4 for a five-minute interview with Liza Tarbuck. Within 30 minutes our website crashed due to demand,” Tony remembers. “Many people asked whether our gloves could be used for other purposes than just rugby, which was a crucial moment. Overnight we changed our website, product names, packaging – everything. We changed 'Rugby Mitts' to 'Classic Mitts', changed the descriptions, positioning, etc. Looking back, it was such an obvious thing to do - but we hadn't seen it."
What advice does Tony offer to those with a great business idea but no start-up capital? "It's all about paying for prototype manufacturing and product development. I needed money, so I went on Dragons' Den a few years ago, but they just didn't get it. Of course, now I look back and I'm glad I didn’t give up part ownership of my business in return for their investment.
“For years I had no luck with the banks or other lenders either, so I had to do something radical. I discovered that I could move my pension fund into a self-invested vehicle and invested that money into my business. This was a new idea then, and some told me it was risky, but if you think about it, your pension is already being invested in someone's business. Why not invest in your own business? It certainly keeps me focussed and motivated!"
Tony says he now makes 95% of his sales through his website and the remainder through Amazon. “We don't advertise,” he adds. “When we launched our cycling gloves I bought cheap train tickets to major cities such as London, Newcastle and Manchester and spent days putting credit card-sized leaflets onto bicycles I came across in the street. I must have walked for hundreds of miles with a heavy backpack stuffed with leaflets. As a result, we sold three-quarters of our stock on pre-order before the product was even in our warehouse!"
Alago Heated Gloves has taken a standard product, adapted it intelligently to a niche requirement and delivered very high levels of customer service to make a successful business. It is currently partnering with the University of West England on some very smart (but ‘hush-hush’) new applications of its technology. Alago's innovations have already caught the attention of Lockheed, the British Army and a major car manufacturer, all of which have signed development deals.