Non Executive Directors - What you need to know?

As levels of boardroom regulation have increased, more and more businesses are appointing Non Executive Directors (NEDs) to their boards in order to assist the management team with risk management, compliance and governance.

While executive directors help to run a company’s business, NEDs don’t have daily management responsibilities. As a result, they have the time to contribute to the development of the firm’s strategy, monitor the performance of the management team and ensure that appropriate risk management processes are in place.

Whereas executive directors can be too busy with day to day duties, NEDs are there to point out what the management team doesn’t know. They also help to ensure that a small group of individuals can’t dominate the board’s decision-taking.

So where do you find a NED for your board? NEDs tend to be people with extensive managerial experience in areas such as finance, marketing, sales or legal. Many businesses find their NEDs through word of mouth or business contacts. An alternative is to use an executive recruitment agency.

In order to get the most out of having a NED on your board, you should create a clearly defined job description with a strong letter of appointment, setting out exactly what is expected of them.  NEDs should operate at more of a strategic level, challenging executives and providing the board with an independent perspective. It’s not just the business that needs to be careful, as NEDs face considerable personal risks in terms of personal liabilities if a business were to fail. They are as accountable as other directors to the regulators and shareholders of the business.

NEDs are not necessarily as important to the success of a business as a chief executive or management team but they can provide expertise, guidance and perspective which can help to pave the way to success for the firm.

Attack On Self-Employed In Budget 2017!

In his first Budget on 8th March, the new Chancellor Phillip Hammond announced that he would  level the playing field between employees and the self-employed by increasing Class 4 National Insurance Contributions (NICs) from 9% to 10% from 6 April 2018 and then to 11% from 6 April 2019. His justification is that the self-employed are now entitled to more generous state benefits than in the past and thus NIC rate should be increased towards the 12% Class 1 NIC employee rate.
Note that the flat rate Class 2 NIC contributions, currently £2.80 a week, cease on 5 April 2018.

The chancellor stated that only the self-employed with profits in excess of £16,250 will pay more national insurance.

Tax Free Dividend Allowance To Be Reduced To £2,000

The Chancellor also announced measures to limit the rise in tax-driven incorporation. The £5,000 tax free dividend allowance introduced by George Osborne will be reduced to just £2,000 from 6 April 2018. Mr Hammond claimed that many smaller owner-managed businesses have incorporated as limited companies mainly for tax reasons. Typically the director/shareholders of such businesses have paid themselves in dividends and paid less tax than similar unincorporated businesses.

Currently, once the dividend allowance has been used the remaining dividends are taxed at 7.5%, 32.5% and then 38.1% depending upon whether the dividends fall into the basic rate band, higher rate band or the additional rate. There are rumours that these dividend rates may also be increased in future years.

Although the cut in the tax-free dividend allowance is clearly aimed at owner managed companies, it will also impact on those with substantial share portfolios. Mr Hammond reminded us in his speech that the annual ISA investment limit increases to £20,000 from 6 April 2017 and that dividends on shares held within an ISA continue to be tax free.

Start Of Digital Reporting Delayed For Smaller Businesses

The Government is committed to the "Making Tax Digital" (MTD) project which is scheduled to start in April 2018 with the first quarterly updates being submitted by the self-employed and property landlords in July 2018.

Many business owners, professional advisors and the Treasury select committee had

expressed concerns about the timescale for the introduction of MTD. The Chancellor announced that there will be a one year deferral in the start date to 2019 for self-employed businesses and property landlords with gross income below the VAT registration limit.

Contact us if you need more information or business help:
APJ Accountancy | ☎ 020 89310165 | ☏ 07900537459 | ✉ info@apjaccountancy.com

Become A More Effective Manager

In the current economic environment, businesses are demanding more and more of their managers. Here are some tips to help you to become a more effective manager.

The best managers are those that step back and let their team do their job without standing over the shoulders. You can’t do everything yourself. Instead, assign each member of your team personal objectives and empower them to succeed. Give them the opportunity to make decisions; set up regular weekly or bi-weekly catch up meetings, then step back and let them get on with it.

One of the most common complaints from employees is that their managers simply don't talk to them. They communicate when they hand down projects or tasks, but they’re often unreachable day to day. A great manager will always be available when one of their team members has a question or concern, and they will always make an effort to reach out and ensure employees have everything they need to get the job done.

Stop and think before reacting. Act based upon sound principles, not emotion (which could be heated at the time). Avoid getting sucked into the emotion of the moment. Try to proactively manage difficult situations so that you address problems before they become bigger issues.

Try to understand things from the point of view of others. Listen more than you speak and try to avoid jumping to conclusions. Take notes – this helps you to listen actively. Note questions as you go along and keep them for the end of the meeting. You may find that your questions are answered by others as the meeting progresses.

Communication is key. Providing feedback helps your team to continually improve. Hold regular meetings with team members to assess projects and check-in with them. Seek mutual benefits in every interaction. Negotiate so that the result offers a win for both or all parties. Seek a cooperative arena, not a competitive one. Win-win situations are mutually beneficial and satisfying.

Make time to sharpen your axe. Take care of yourself and consider your physical, social, emotional, mental and spiritual needs. Making time to rest, recover and refresh will make you more effective and less stressed in the office.

How to Embrace Innovation for your Business?

It seems there is a new way of doing business being created every week. Disruptive, technology driven, new business models are constantly being developed by the likes of Uber, Skype, Amazon and Air BnB.

Your business might hold an established position in the market today but that doesn’t mean that you and your management team can be complacent.

Disruption and commoditisation have impacted most industries and we are now seeing new players coming into traditional markets and establishing a disruptive model and capturing significant market share. This trend is only going to continue.

So what can you do, as the leader of your business, to minimise the impact of a potential disruptive new player entering your market?

It is difficult to constantly create new products or services. However, perhaps you could consider how best to commoditise some of your firm’s existing product or service offerings in order to increase profit margin and efficiency. This could also help you to improve customer experience – by making your services faster, easier to access and so forth.

When it comes to innovation, you don’t have to constantly re-invent the wheel. While creativity is usually associated with thinking outside the box, the fact is that few ideas are 100 percent original. The most brilliant (and often most profitable) business ideas are usually variations of an already existing theme rather than completely new concepts.

Netflix didn’t create a new industry. They just took the business model that had been so successful for Blockbuster Video and created a new way for customers to rent films - online instead of through a video shop. As Steve Jobs once said, “Creativity is just connecting things.” What sets creative people apart is that “they are able to connect experiences they’ve had and synthesize new things.”

If you want to embrace innovation in your business, you need to develop an environment that encourages creativity. Your staff should be empowered to explore new ways of delivering products or services.

Experimentation should be encouraged and your office should have collaborative workspaces in order to allow people to sit down together, work as a team, solve problems collectively and create new solutions.  In addition to this, your business should celebrate innovation through recognising those team members who find new ways of doing things. Whether that is a bonus for implementing a new innovation or perhaps celebrating the delivery of new innovations with a team night out. The key is to encourage your team to be creative, find new and better ways of doing things and keep innovating.

Solving Problems Not Just Symptons

Regardless of the type of business that you manage, problem solving is undoubtedly part of your day job. However are you solving problems or just the symptoms of problems?

No matter how good a manager you are, nor how hard you work, you’ll end up in trouble if you spend your time solving symptoms rather than actual problems. It is often not easy to determine when an issue is in fact a problem that needs to be solved and when it is a symptom of deeper trouble in the business.

What’s the real problem?

A problem is a holistic failure of something you are trying to accomplish. Treating symptoms wastes time, money and resources. In the business world of problems and symptoms, often what you first think is a problem, is really only the symptom – it’s not the real issue. If you focus on that symptom without uncovering the real problem you are wasting your time. You need to discover what’s causing the issue.

To find this out you might need to discuss the issue with different people across your business. Keep in mind the focus of the conversation is to find the root cause of the issue, rather than find “someone to blame”. The goal must be to strengthen the business by eliminating a problem or making a system or process better.

How long has the problem existed?

Problems usually occur in one of three ways; the same old problem, something brand new or the old problem but manifested in a different way. If the problem’s been around for a long time, perhaps there’s a deeper issue embedded within your business. If this is the case you need to deal with the underlying issue.

Does the problem serve a function?

Is the problem worth fixing or is it just a mild annoyance that doesn’t really impact the way the business functions? If it is worth fixing then you should do that as soon as you can realistically do so.

Once you understand the real, underlying, root cause of the issue, you can begin to design a solution. That solution may require rethinking the processes and procedures in your business. It might even entail a reorganisation of aspects of the firm. Whatever the solution you develop, you will need to think through the steps required to successfully implement and evaluate it in order to eliminate the problem.

Contact us if you have any questions or need business help:
PJ | ☎ 020 89310165 | ☏ 07900537459 | ✉ info@apjaccountancy.com

Facebook Live

With latest figures showing 1.79 billion monthly active users, Facebook is a social media platform that has immense potential for business users. However, as with any large target audience, getting your message right is key.

Facebook Live is a new video streaming service which enables users to livestream video broadcasts from their mobile phone or other device. While this idea in itself isn’t new, Facebook’s huge audience means many more people can potentially tap in to the videos that you post. In addition, Facebook Live offers features such as the ability to watch again (unlike platforms such as SnapChat).

Facebook Live is designed to be interactive and allows users to comment on videos and share them. For business users, there is great potential here - customers can ask direct questions about the products or services that you feature in your live video, and this allows you to resolve queries. It may also provide valuable insights into what your customers actually want.

The key benefit of Facebook Live is that it offers your business the chance to engage directly with users and offer interesting live footage. The live element means that you can now draw people in as your news is happening. For example, you could stream the live launch of a new product or service to your customers and potential customers around the world.

Using the service is very straightforward. Users go to their Facebook page and when they are ready to start filming simply tap on the live stream icon. As soon as this is done, followers will get a notification, which will immediately request them to engage with the content. You can also write a description of what you’re filming. An important point to remember is that all live videos are archived. This means that if a user misses the video, they can go back, view comments and watch it after you’ve stopped recording. This offers a further extension of the platform for users to share their experiences of your product / service and gives you additional (free) marketing opportunities.

What to consider while scaling up your small business?

Increasing the scale of a business is easier said than done. If your business objective is to scale up, you need to consider the people aspects, strategy and financials.

People make the firm

People determine a company’s success, and hiring the right people is critical. Hiring a team of great people will help to solve most of the problems the business encounters as it increases in scale. As such, you should invest time and money into the hiring process to find the best professionals to take the company to the next level. Screen candidates not only for their skills and knowledge, but also for their personality and how well they fit the mission, values and culture of the firm.

Once you have hired the best team, you need to make sure that you keep them. You and your management team should communicate openly, recognise and reward their achievements, and give them the tools and training they need to succeed.

Follow a simple strategy

In the words of Albert Einstein, “Everything should be made as simple as possible - but not simpler.” Businesses need a strategy to succeed, but it shouldn’t be complicated. The very best strategic plans are 1 page of A4.

The strategy should include the strengths, weaknesses, opportunities and threats of the business, the company’s core values and mission. As the focus is to scale up and grown the firm, the strategy should include high-level goals for each quarter, and year. Once you have finalised the strategy, ensure that you communicate it effectively so that everyone in the firm understands what the objectives of the firm are and what they need to do to achieve the overall goal of growing the business.

Manage risk (and cashflow)

Like anything in life, businesses encounter unexpected storms from time to time. As such, the management team should manage risk effectively in order to ensure that the firm’s growth strategy isn’t derailed by unforeseen market forces.

Cashflow is very important when trying to increase the scale of a business. As such, unnecessary outlay should be avoided. Instead, the firm should focus on building up cash reserves which can be used from time to time to assist the business in achieving its growth strategy.

Contact us if you have any questions or need business help:
PJ | ☎ 020 89310165 | ☏ 07900537459 | ✉ info@apjaccountancy.com

Hiring Multilingual Staff

Are businesses that employ multilingual staff getting ahead of their competitors?

Thanks to technology and globalisation in business, the world has become a much smaller place. Access to international markets is now easier than ever, thanks to ecommerce, the internet, etc.

Big multinational businesses recognise the importance of language skills. McKinsey counts more than 130 languages spoken across its staff, and offers a bursary scheme to those who wish to learn another language before joining the firm. Another example is Unilever, which estimates that up to 80 of their 100 most senior leaders speak at least two languages.

The obvious benefit of hiring multilingual staff is better communication with clients and contacts across the world. Although English has become the international business language, having employees who speak other languages can only be beneficial to an international business. Most people prefer speaking in their native language. If you are contacting other companies to work with, or customers in other jurisdictions, multilingual staff will be able to communicate in their native language, which makes the process easier and makes your firm come across as more professional and gives the impression that you are more of a “global business”.

A report from the European Commission a few years ago stated that “a significant amount of business” was sacrificed because of poor language skills across Europe. The report identified that as much as 11 per cent of small and medium-sized businesses had lost a contract as a result of their poor language skills.

So, if your firm is targeting international business, you should try to recruit employees who are multilingual. They will be able to help your firm to understand how complicated communication between two cultures can be, including knowing which areas require sensitivity and which areas call for being more direct. They will also be able to help your firm to adapt its business development efforts, website, marketing materials, etc. to the target market. These team members can also assist the firm as multilingual proof readers, in order to ensure quality and consistency of external communications in your target markets.

Wearable technology - What you need to know!

Wearable technology is one of the biggest trends in IT and tech at the moment. The consumer market has embraced wearables such as smart watches and virtual reality headsets. However most businesses are still developing their strategies for making the most of the wearable technology trend.

While attention to wearables is widespread, adoption is not. From Google to Fitbit, Jawbone and Apple, wearables are garnering plenty of interest. Some early adopters in businesses are using the Apple Watch or Samsung Gear to monitor emails or manage their calendar while on the go. Others are using it to remind them to move about or to walk around the office throughout the day in order to burn a few calories.

Wearables are far from ubiquitous in the workplace just yet though. While the technology has developed quickly, businesses remain hesitant to integrate the devices into their everyday operations.

One of the reasons for businesses to consider adopting wearable tech is its ability to streamline normal business operations and improve a company's productivity. Whether it's a pair of smart glasses that help to guide a warehouse employee along the most efficient route or sensors that help employees more quickly reference needed information to complete a task, wearables allow businesses to improve efficiency in task management.

On the health and wellness side of things, many companies are now offering employees fitness trackers, coupled with incentive programmes, to encourage healthier lifestyles both in and out of the workplace. Healthier employees are often more productive and less frequently absent, and can save their employers on health care costs. For example, Fitbit offers a corporate wellness program to partner with companies trying to promote employee well-being.

Wearable tech is also changing how consumers interact with businesses. Some firms are exploring wearables in the form of targeted advertising and simplified payment services through the use of "near-field communication" (NFC) chips. This encourages improved communication with customers and also makes consumer data easier for businesses to gather.

Should Your Business Build A Mobile App

The biggest and best businesses all seem to offer a mobile app of some sort. Whether booking a taxi, checking into a flight or checking your bank balance, it seems that the smartphone is now the “Swiss army knife” that everyone uses to do pretty much everything. So does this mean that you need to build an app for your business?

The first thing you need to think about before committing to building an app is what your needs are. Do you need an app to help you with marketing, sales or customer services? How would an app add value for your customers and streamline processes for your business? You don’t need to be a programmer to create an app as there are plenty of agencies and online DIY tools that you can use to create one. Here are a few things to think about before you decide whether or not to develop an app for your business:

Marketing

Your app reflects your firm’s brand, and that icon on a mobile device that is frequently looked at will help to build recognition of your brand. You can also use an app as a marketing tool to create “push notices” that deliver information about your business and its products or services to customers. For example, you could use an app to push special offers, updates, or announcements to your customers.

Accessibility

Do you want to create an app simply to make your business accessible to your customers 24/7? Apps make it easy to engage with your business because customers don’t have to switch devices. When your business crosses their mind, they simply tap the app on their smartphone.

Sales 

Could your business use an app to sell more products or services to your customers? Again, this depends on the type of business that you operate. For example, if you run a coffee shop, perhaps you could replace loyalty cards with an app. Alternatively you could allow your regular customers to place orders for future products or services directly from an app. This would speed up the sales process for your customers and also help to generate loyalty from customers who may keep coming back to buy more because it is so easy to do so using an app.

Customer service

Do you want to put your products or services at your customer’s fingertips? You could create an app that allows your customers to engage with you and your business in a matter of seconds. You could offer product support, help desk services, market updates or even a booking service, depending on the type of business that you operate.

Millennials vs Generation Z: What Businesses Need to Know!

Generation Z (Gen Z) is a demographic group born after 1995. The oldest members of Gen Z are turning 21 this year, which means that some have already graduated from University. Gen Z is a much smaller demographic cohort than Gen Y (also known as millennials).

It would be easy to assume that Gen Z are just an exaggerated version of the generation that came before them, spending even more of their lives on social media, doing even more of their shopping online, and demonstrating an ever-greater collaborative nature. But Gen Z grew up in a starkly different historical context than millennials, which has given them a distinct outlook on the world.

Millennials invented Facebook, shopped from their smartphones, and moved from satellite TV to Netflix. Gen Z, meanwhile, doesn't remember life without these basics of 21st century life. Millennials came of age during a time of economic expansion and were shocked to find a diminished, difficult job market after university; whereas Gen Z sees a tough job market as the norm. They are a generation that has been shaped by the recession and are prepared to fight hard to create a stable future for themselves.

Market research has shown that compared to any generation before them, Gen Z is less trusting of brands. They have grown up in an era where information is always available via the internet, social media, etc. They can research products and brands and see other users' reviews of them online.
Gen Z are financially cautious.

They grew up hearing horror stories about how many millennials ended up living at home after university, sitting on a mountain of debt, so they tend to save more and spend less than millennials. In a recent study, 89% said they remain optimistic about their futures, which is higher than any other generation on record.

So what should you be aware of when you are thinking about hiring Gen Z employees? Gen Z wants to do work that makes a difference and has a positive impact on the world. But they’re also more concerned about job security than the generation just before them.

They were at a very impressionable age during the financial crisis. This implies Gen Z would rather develop a career in one place than hop from employer to employer.

What Can We Learn From Disruptive Innovation?

Disruptive innovation is a term, created by Clayton Christensen, to describe a new invention or product that alters its market. It typically refers to innovation that results in changes on a large scale. For example, the digital camera which replaced Kodak's traditional film cameras or digital streaming services which have effectively replaced CDs as the primary way to consume and listen to music.

With each innovation, there is risk taken on by the firm that introduces it and there is disruption faced by the users. The businesses that promote the new product or service innovation face uncertainty in not knowing if it will succeed since they are challenging an established market. They are introducing an alternative, which, if it catches on, will mean that users have to adjust and accept a new way of doing things.

 

So, what can we learn from disruptive innovators which we can then apply to our own businesses? For a start, not all innovation has to be on a large-scale; small changes can make all the difference. For example, process innovation could have a positive impact on the profitability and efficiency of your business. Aim to create a benefit to your business; e.g. to reduce the time it takes to produce a product or service or a new, more efficient way of delivering your end product or service to your customers.

 

As with any innovative development, your employees will probably see a disruption to their day job. Perhaps they have to learn a new way of doing things or even learn how to use a completely new system. The business is taking a risk in changing what has always worked and the employees may be unsure as to how the changes will impact them. They will need time to become accustomed to new ways of working and this could create a degree of disruption across the firm. 

 

That said, with appropriate training and change management processes, you should be able to ensure that your new innovations are adopted quickly and with minimum fuss. And as with any change in business, success is all about planning.

 

3 Tips for Better Talent Management!

The "war on talent" seems to be raging on. Large businesses are competing to recruit the best graduates straight from university and many firms are prepared to pay well for the most experienced candidates. As a result, all businesses need to manage the talent they already have.

Talent management is often considered to be an HR matter but the management team in any business should be involved in managing the firm’s most valuable resource – its people. Start by identifying the high potential people in your firm and work towards developing them and retaining them in the business.

Talent Development

Create a strategy to hire the best people and nurture them throughout their careers. Managers should set the tone and work to develop employee’s skills and knowledge to help them to realise their potential in the firm. Your firm’s talent development programme should include theory and practice as well as coaching and mentoring sessions for your high potential employees. If your team feels like they have an opportunity to develop at their current firm, they are less likely to look for opportunities elsewhere.

Learn from Others 

Consider what talent management looks like at other firms within your industry sector. What do the biggest international firms do well and what could you offer to your team members that would differentiate your firm from the competition? Even if you run a smaller business, you can learn from the market leaders and implement some of their ideas.

Recognition and Reward

Consider the skills, knowledge and performance of employees and identify those who are high performers and/or exhibit leadership potential. Formal performance appraisals should happen at least annually and “top talent” within the business should be sufficiently challenged with objectives which will encourage them to perform, while retaining their commitment to the firm. The appraisal process should be transparent in order to avoid any potential conflict between employees.

Continuous Professional Development

Good businesses tend to promote a culture of life long learning. All members of your team should be offered access to and encouraged to take part in training courses, development opportunities, etc. Investment in continuous professional development should be viewed by the firm as an investment in the future of the business as today’s “top talent” are the business leaders of tomorrow.

4 Advantages of Being a Sustainable Business!

The “green agenda” has moved to the forefront of the modern business world. Society is experiencing an increasing shift in focus to sustainable business and environmental responsibility.

For businesses, embracing sustainability includes encouraging active preservation of the environment and communities, while also promising attractive cost savings. Many firms have made considerable savings through implementing sustainability programs across their value chains.

1. Reducing Operational Costs

Low-cost initiatives can have a profound impact on reducing energy consumption. Legislation in the form of tax incentives is also encouraging businesses to implement sustainable practices. This includes property tax exemptions, income tax credits or easier access to financing and government grants. To qualify for these programmes, businesses must either install certain equipment, implement pollution control mechanisms or utilise environmentally friendly materials, recycled components etc.

2. Strengthening Brands

With the increasing global concern about the environment, businesses can now leverage their sustainability and related achievements, investments, and skills, to strengthen their value and reputation. Conversely, those businesses that fail to resonate with what consumers and stakeholders deem to be important could see a detrimental impact on their brands.

3. Improving Employee Recruitment and Retention

The next generation of professionals (millennials) are more environmentally aware and focused on sustainability. They are attracted to businesses that are socially responsible, and want to work for companies with a positive impact on the world around them. Therefore, building your firm's brand around sustainability will help you to attract the best new generation recruits.

4. Enhancing Innovation

Building a more sustainable business encourages your people to become more innovative. This focus on innovation encourages the development of new products or services and new ways of doing business.  Nike, who used plastic bottles from landfills in Japan to manufacture soccer jerseys, being a great example.

-PJ 
☎ 020 89310165 | ☏ 07900537459 | ✉ info@apjaccountancy.com

Reporting To HMRC Every Quarter To Go Ahead In 2018!

The Government and HMRC remain committed to the "Making Tax Digital" project with more information being sent online to HM Revenue and Customs (HMRC) by employers, pension funds, banks and other institutions.

The next big step will be the introduction of quarterly reporting of income and expenditure by businesses and landlords from 2018. HMRC are currently consulting on a number of proposals to make radical changes to facilitate the introduction of the new regime. We accountants have serious concerns about the timescale; HMRC say “you will not need an accountant to fill out the information on the new system.” They are expecting businesses to use new Apps on their Smart phones and Tablets to transmit their data to HMRC.

OVERVIEW OF MAIN PROPOSALS

Small businesses and landlords will be encouraged to prepare their accounts on a cash basis with the threshold for using the basis significantly increased.

The current basis period rules for unincorporated businesses to be reformed.

A new voluntary Pay As You Go (PAYG) system to be introduced to help businesses budget for their tax payments.

EXTENDING THE CASH BASIS

About 1 million small businesses currently prepare their accounts on a cash basis. The present threshold for using the cash basis is the VAT registration limit £83,000 and HMRC are consulting on the limit being significantly increased, possibly double the VAT threshold of £166,000, the current limit for leaving the scheme.

WHAT IS THE CASH BASIS?

The current cash basis for preparing accounts was introduced as a simplification measure from 6 April 2013. Using the cash basis means that businesses merely need to calculate their profits based on receipts and payments.
There are no adjustments at the end of each period for accrued expenses and amounts prepaid, and no adjustment for stock or bad debts at the end of the period.
Another simplification is that the cost of equipment bought for the business, except for motor cars, can be deducted directly in arriving at the profit without the need for a capital allowances claim. One disadvantage of the current cash basis rules is that interest on money borrowed to finance the business is limited to £500 a year and a similar restriction is likely to be incorporated into the new rules.

PROPOSALS TO SIMPLIFY BASIS PERIODS

The current basis period rules are complex, and many unincorporated business owners find them difficult to comprehend.  Where the business makes up accounts to a date other than 5 April the accounts and profits have to be made to “fit” into the tax year. There are particular problems at the commencement of trading as some of the initial profits are taxed twice and the “overlap” profits are then deducted on cessation.

One proposal is for businesses to prepare accounts for a period that aligns with the tax year (6 April - 5 April) or even prepare accounts for shorter periods such as each quarter to align with their VAT quarters and submissions to HMRC.

PAY AS YOU GO

Another complication of the current self-assessment regime is that where tax has not been collected under PAYE or at source, primarily on self-employed profits and rental income, the taxpayer is required to make payments on account.

These payments on account are due on 31 January and 31 July based on 50% of the outstanding liability for the previous tax year with a balancing payment the following 31 January.

This can make budgeting cash flow for the self-employed and landlords difficult for some to manage.
The government is proposing to introduce a new voluntary Pay as You Go (PAYG) system for the self-employed and landlords to make payments towards their income tax, national insurance and VAT liabilities monthly with a reconciliation at the end of the year.

Many of these proposals may have significant implications for your business. We will update you on further details once we see the outcome of the various consultations. We can then discuss how we can assist you with your quarterly obligations.

Contact us for more:
PJ | ☎ 020 89310165 | ☏ 07900537459 | ✉ info@apjaccountancy.com

Importance of Gaining a Competitive Edge!

Competition is a fact of life. The best businesses set the pace and aren't afraid to go their own way. How do you and your firm respond to competition? Are you leaders, differentiators or do you follow the pack?

If you want to move ahead of your competitors, you need to change how your business positions itself within its sector of the market. After all, doing the same thing over and over again and expecting a different result is a definition of madness.

Being in business is about running your own race and doing it your way. Have a plan and execute it the way you want and at the pace you want to. Running after the competition is no good if they are running in the wrong direction.

Many businesses struggle to identify their competitive advantage and even those that do manage to define it, tend to be ineffective at communicating that advantage. Consider what it is that makes your business unique. What is it that sets your business apart from the competition?

Identify, clarify, and communicate to your prospects and customers why they should buy from you instead of from someone else. Some firms will focus on being the highest quality provider, others will choose to offer the better service or the lowest price.

If you don’t focus on your competitive advantage and communicate that to your clients and targets, you could lose customers. If you don’t try to differentiate your firm, they could mistake your competitors as being the same as you.

Tell your clients why you are different and what that difference means to them. Create a marketing message which explains the benefit that using your firm provides. It is important to “sell the benefit” of the service rather than to sell the service based on its features.

7 Tips to Manage Difficult Workplace Conversation!

Very often the only thing that is more stressful than having a difficult conversation in the workplace is the anticipation of that conversation.

Whether it’s a performance appraisal or a sales meeting to close a deal, here are a few tips to help you to manage difficult conversations:

1. Be prepared 

Spend some time considering what you want to achieve by having the conversation. Write down the key points you want to raise and list any further points in order of importance. What would your ideal outcome be for each point? If you would like the other person’s input, or if you have a proposal for a solution of your own, write these down next to each point. Picture yourself confidently raising the issues on your list and explaining your ideas for possible solutions.

2. Put yourself in their shoes

How would you receive this information? Anticipating their response will help you to consider carefully how you communicate and your body language.  This will enable you to be more prepared for their response, including the possibility of an emotional response.

3. Time and place 

Choose a time and place when you will both feel comfortable, will not be pushed for time and should avoid being interrupted. If necessary, reassure the person you're talking to that the conversation is confidential.

4. Stay focused on solutions 

It is better to ask “how can we do better next time?” than “why did it go wrong?” We cannot change the past but we can explore and identify the best way to learn from mistakes and move forward.

5. Don't skirt around the issue 

Be polite but stick to the preparation you did in advance of the conversation. Stay in control. If you find your tonality changing, either speeding up and getting louder (getting frustrated) or slowing and getting quieter (losing confidence), adjust your posture. Whether you are sitting or standing, change your physiology to be more relaxed or more assertive and your tone of voice and choice of words will follow suit.

6. Have a time frame in mind before you start talking

If it becomes clear that the conversation is going to take longer, don't be tempted to rush things through or run over time. The last thing you both want is to feel exhausted by the conversation and to make a poor decision. Instead, agree to meet again to continue the conversation at a suitable time.

Contact us if you need business help:
PJ | ☎ 020 89310165 | ☏ 07900537459 | ✉ info@apjaccountancy.com

What's your Business's Unique Selling Point?

Most good marketing campaigns will focus on communicating a firm’s Unique Selling Point (USP). In today’s crowded market, customers have more choice than ever before. This increase in competition makes finding, defining and communicating your USP more important than ever before.

So what is your firm’s USP? Do you offer the faster or better or cheaper product or service? Maybe your people are regarded as the best or most efficient? What is it that is truly unique about your business?

When it comes to your product or service, you will know how it works and so you should understand exactly what it is that you do cheaper/ better / faster than your competitors. The problem is that your customers are trying to decide between choosing your product / service or one from your competitor. They don't know as much about your product line as you do. Getting them to choose your firm can therefore be a real challenge.

The problem with most marketing campaigns that focus on a USP is that they try to communicate the “what” rather than the “why”. Most businesses will talk about what it is that they do. They probably won’t talk about why it is that they do it. However to really stand out, you need to differentiate your firm. Maybe you should think about using the “why” as your USP.

This is a point that is well made by Simon Sinek in his famous Ted Talk. Sinek, a bestselling author, set out to discover why companies like Apple have been able to achieve such huge success, while others with the same resources have failed.

He outlined how Apple focuses on “Why” rather than “What”. What is it that Apple makes? They make electronics. They make tablets, laptops, desktops, portable music players and watches that have a nice design. They make nice software. That isn’t any different to any other electronics manufacturer. However, Apple builds its core marketing message on “Why”.

The core marketing message from Apple would likely be something along the lines of “With everything we do, we aim to challenge the status quo. We aim to think differently. Our products are user friendly, beautifully designed, and easy to use. We just happen to make great computers.”

Taking this as an example you can create a USP and associated marketing message for your business which communicates “Why” it is that you do what you do and how this is of benefit to your customers (and potential customers).

4 simple & easy tips for Change Management!

In light of the recent Brexit decision, one thing is inevitable in business in the coming months and years and that is change.

Whichever way you decided to vote, the result of the referendum means that you and your business must be prepared to change and adapt to a new business environment.

Here are a few change management tips for your business:

Create a plan and set realistic goals

People tend to resist change so create a plan that outlines each step of the change process, the key stakeholders, the timeline and the deliverables. Ask different staff members from across the business to feed into this plan. Someone might have a great idea to contribute to the plan – sometimes all you need to do is ask.

Communicate

Communicate your vision clearly to your team. Identify what it is that you are trying to achieve through the change process. What is in it for your team? The best managers can explain this in a way that inspires the team to get involved and move forward with the plan.

Maintaining momentum

Your employees may agree with your vision initially, but they're likely to become frustrated or disillusioned along the way, especially if they don't see immediate progress. Find ways to keep the conversation going through short town hall meetings, staff surveys and casual conversation. Ask the team for their honest feedback regularly and be willing to listen. Be honest about what you don't know, and commit to updating employees when those details are finalised.

Get the team on board

Getting the senior management team on board is relatively easy. They should be able to see “what’s in it for them.” However to succeed in managing change in your business you need to get your middle management and your junior staff members on board too. Ask representatives from different groups across your business to get involved, share their views and take ownership of different aspects of the change process.

How to Reduce Business Costs to Increase Profits?

Competition in business is more intense than ever before, with tough economic conditions in most sectors and rival firms battling harder than ever for market share. There are new threats from online providers, new business models and global competitors. As a result, increasing profit levels is quite a challenge. If you can’t increase your sales volumes, consider how to reduce costs in order to increase profits.

Build a culture of cost saving

Everyone can and should take some level of responsibility for the costs related to their work. One way is to involve more people in the budgeting process. All employees could be partially accountable for the costs that affect them.

Negotiate with your suppliers

Renegotiating contracts with suppliers may bring surprising results. Every service provider will be keen to retain your business. As such, they may be open to renegotiating contracts. If you are in a position to negotiate a volume discount in return for another 6 to 12 months of loyalty, you may be able to benefit from some substantial savings.

Decrease waste

Depending on your business, this could be wasted materials, time, effort, money or team members. Everyone in your business should learn to identify and take steps to reduce or eliminate waste. Decrease waste further by “going green” to reduce utility bills by becoming more energy efficient.

Decrease stock levels

Stock is a dead cost and soaks up cash. Decreasing stock levels may require the streamlining of some of your business systems but it may produce some significant cost savings. If you carry excess stock / inventory you should be able to free up some cash flow in the business by reducing stock levels.

Overtime

Overtime is expensive, but a little preplanning of your work schedules will go a long way to helping reduce overtime costs. If you have more demand than you can handle, it might be cheaper to outsource some of the extra capacity.

Reduce debtor’s days

Cash flow tied up on the debtor’s ledger is effectively costing the business money. Reducing the average time it takes to collect outstanding debts from say, 60 to 30 days, can increase cash flow, reducing the need for expensive overdrafts and bank credit.

Check whether you are making these financial and marketing mistakes that costs you hundreds, or EVEN thousands of Pounds. Click to Download the book below!

Contact us if you need help to increase your business profits:

PJ | ☎ 020 89310165 | ☏ 07900537459 | ✉ info@apjaccountancy.com