Don’t wait for an undiagnosed business pain to make changes to the health of the organisation – prevention is better than cure.

Pain drives many strange decisions – especially in business. Whether it is a distribution process in chaos or customers leaving due to poor service, it often takes a serious issue to drive the UK’s businesses to consider new IT solutions. Yet such a reactive approach does not guarantee a solution that will drive the business forward. Just as a headache may mask another, more serious, problem that needs diagnosis and appropriate treatment, papering over the cracks in distribution with a new, standalone warehouse system is unlikely to be the best solution for the business as a whole.

Buying Technology

Why are businesses buying new technology? In a tight economic climate with fierce competition, it is understandable, although not laudable, that most will require a significant prompt. But what is that prompt? A requirement for a new sales ledger? Or the clear business objective to reduce credit control days?

The approach to the purchase will without doubt dictate the benefit that is attained. Those organisations that have a clear view of business issues that need to be addressed through technology are suffering the same pain as the competition but their attitude to solving, or salving, the problem is very different.

Indeed, it is those organisations that regard IT as a solution rather than a series of isolated products that have an edge. They take a proactive approach to achieving incremental business benefits and demonstrate an understanding of the critical value of IT to the business.

Achieving Benefits

Such a proactive approach requires a shift in mindset. Organisations must move from viewing IT as a necessary evil to a tool that underpins every aspect of the business. CPiO regularly works with companies to understand what is driving their business and how important a clear and coherent IT strategy is to achieving strategic goals.

The proactive use of alerts is a prime example of a simple technology that improves efficiency and effectiveness. Rather than relying on a weekly stock report to ascertain order requirements, alerts can automatically inform the business when minimum stock level has been reached. Taking the process to its logical conclusion: that alert could automatically trigger an order with the relevant supplier.  Not only does such a system minimise the chance of out of stocks, hence improving customer service, but it also frees up staff from time-consuming trawls through stock level reports.

The use of alerts is an example that can be applied across the business and provides a clear demonstration of technology’s ability to enhance the human interaction that remains a key element of business success. This proactive management requires a company to regularly review its requirements and evaluate those needs in light of technology. An audit of systems and business processes enables a company to future proof its investment and accessing the skill gaps in the organisation, leading to a more creative use of IT to solve real business objectives  and not just reduce pain.

Interested in a  free business audit? Pop by our stand at Softworld or drop our customer team an email.

Rebecca Bradley, CPiO

If you’re self employed, then often you’re the salesperson, marketing team, accounts, customer services and do your day to day job role amongst other things such as reception and administration. Sound familiar?

So, it’s difficult amongst all of those things to keep on top of the money coming in and ensure you get paid from your customers. Being able to easily manage your cash flow is a key benefit of our Sage 50 Accounts, and why is that? Well, it’s vital to the success of your business….no income = no business!

Unless your business runs on a cash basis, where you get the money in for goods/services up front, from my experience your invoicing accounts will probably fall into a few different categories;

• Good payers who pay promptly or on time
• People who pay once reminded, as they’ve misplaced the invoice or need a gentle reminder
• And those that you have to chase, and chase, and chase and eventually get the money in

So, here’s a few of my top tips to help towards making sure you get paid for your goods or services.

1. Always get the invoice in as soon as you can, once you have completed the work to a high quality standard.  This will give customers less of an argument for not paying the invoice for poor workmanship.  If this situation does arise, then handle it in a professional manner, the quicker you sort the problem, the quicker you’ll get paid.
2. Include a remittance advice note which makes admin quicker at their end if paying you by cheque.
3. Always send out a reminder once your terms of payment time is reached eg 30, 60, 90 days or calendar monthly, if this is your chosen debtors agreement
4. Remember, larger companies usually pay monthly, so if you missed the first monthly payment with your invoice going onto their system, you may not get paid until their next monthly payment.
5. If things go on too long, don’t be afraid to pick up the phone, send reminders such as a bad debt letter or statement.  Most accounts software these days includes useful tools to help you remind the customer about their payment.
6. If you’re really struggling ask to speak to the main accounts person. Don’t be pushy, rude or abrupt or you’ll probably ruin your best chances of ever getting paid.
7. Do, be persistent in terms of calling / chasing back when you said, but give them reasonable timescales, no need to call back every single day, for example, if they use the old “the cheque’s in the post routine” give it time to come and then call back to advise of none arrival.
8. If you are a Sage 50 Accounts customer make sure you’re using all the cash flow features like creating and printing invoices, debt chasing letters and  reports advising you of who owes you what and how old the debt is.

Hopefully these tips will do the job for you, but not every time, companies do go out of business and this can come as a bit of a blow to a small business relying on money coming in.  However, if you do your best to get paid on time and chase, then generally this should help your situation.

Melanie Dawson, Small Business Team

Getting started

Novelist Mark Twain said “The secret of getting ahead is getting started” and never is this truer than in business. By starting out from an informed position, prepared for every eventuality, you can dramatically increase your chances of success. Strong business plans operate to long-term goals, not quick fixes. So, when Lord Sugar made his final, suspense-filled decisions, he was selecting an individual with a credible, well thought through plan that would hold water in a changing business world.

Work to your strengths

One candidate described his business plan as “amazingly brilliant.” While the plan may have shown creative flair, the judges were looking for something more meaningful – a practical, considered approach. Another stumbling block highlighted in The Apprentice was that candidates failed to stick to what they knew. If you have experience in a particular area, or specialised knowledge of a subject, use it! Work to your strengths wherever possible. One candidate who bucked this trend was Susan Ma who, as well as proving herself capable of picking out winning products and grasping complex concepts, also stuck with what she knew for her business plan. Multi-millionaire businessman Lord Sugar admired Susan’s approach and expressed disappointment that another candidate, Helen Milligan, who had experience in the baked goods sector, had written a business plan that strayed so far from her field of expertise.

Writing a business plan

Our Sage Planning for Business software will help guide you through the trickier areas of creating a winning business plan. But if you’re currently putting together your own business plan, here are a few vital points to help you get started.

• The audience – who are you speaking to? Whether you’re communicating with the bank, investors, potential partners or buyers, you need to consider the language they’re accustomed to reading, the information that will hold most significance and the details that could sway their decisions.
• The executive summary – this should be a concise, easy-to-digest overview of your plan.
• Your business, its products and services – don’t forget the basics. Spell out exactly what your business will offer.
• Your markets and competitors – use this area to show that you’ve conducted thorough research. A strong understanding of your markets and competitors will make your plan far more viable.
• Marketing and sales – a key planning area. However outstanding your products and services are, you need to communicate clearly how you’re going sell and promote them.
• Financial forecasts – this section will be the bottom line for your audience so invest some time in getting it right.
• Presenting your business plan- keep it short and to the point, have a trusted acquaintance read it through and avoid distracting design features.

Jason Sullock, Small Business Team

Jon Martingale, Sage Accountants' Division

From 1 June, HMRC has been trialling a ‘single compliance process’ for enquiries across a range of taxes. Most people will not be aware of what ‘single compliance process’ is, so firstly, let me explain what this process is and what it could mean.

The single compliance process is a framework within which HMRC will undertake the majority of future enquiries. The framework uses five process stages (planning, contact, process, resolution and closing) common to most enquiries. Any enquiry will have a set level of intensity dependent on the risks identified. The level of intensity will determine how long the enquiry will last, ranging from 1.5 to 8 days.

The trial will run for 6 months in the following locations:

• Reading/Slough
• Newcastle
• Warrington
• York
• Exeter
• London Euston
• Southampton
• Cardiff
• Belfast
• Edinburgh
• Dundee

During the trial period, the business records of up to 1,200 small and medium businesses will be checked during meetings on business premises. If the trial is successful, the new process will be rolled out nationally from January 2012.

The new process and checks will help HMRC identify mistakes in paperwork and records. If any errors or high risks are detected as part of a check, this will lead to a tax investigation and a fine of up to £3000. If an investigation is undertaken, HMRC will check all areas of compliance – e.g. VAT, income tax, corporation tax and PAYE – as they will work on an assumption that if an error has been made in one area, then errors are likely to have been made in other areas.

HMRC claim that analysis has highlighted how poor record-keeping can lead to underpayment of tax. Once the process is rolled out, up to 50,000 SMEs will be checked each year and HMRC expects to collect an additional £150m a year in tax.

VAT registration

In addition, HMRC have also recently announced a summer campaign on VAT registration. Businesses with an annual turnover at, or close to, the VAT threshold of £73,000 will be checked for VAT registration. It will be important to ensure that businesses who have reached the threshold are VAT registered before any amnesty runs out.

How can Sage accountants help their clients?

It is important that all businesses maintain accurate and complete records moving forward. Sage offers a range of solutions to assist; including Sage 50 Accounts and Sage 50 Payroll, as well as our latest online accounting software – Sage One

Sage One Accounts is an online accounting service for small business owners who want greater control of their finances, but don’t have an accounting background or time for software training. Sage One can automatically calculate VAT based on the information entered by the user, and once it has worked this out will automatically submit the VAT return online in a few clicks. This will allow VAT returns to be submitted to HMRC accurately, efficiently and on time. This can be demonstrated easily to a tax investigator at any PC with an internet connection.

Sage one also offers an ‘Accountant Edition’ to make the process of accountants working with clients seamless and effortless. Accountants simply connect with their clients and access live financial information immediately. This means that the accountant can offer advice and guidance to clients to ensure that they are prepared for any HMRC checks.

Sage One Accountants Edition is available for free to all Sage Accountants Club members*, and you can sign up for a free trial or webex session by visiting www.sageone.com

Jon Martingale, Sage Product Manager

*Standard access fee for Sage One Accountant Edition is £250 per annum. Sage Accountants’ Club members who subscribe to Sage One by purchasing credits for Sage One Cashbook or Sage One Accounts get access for free.

Ok, I’m not one to blow my own trumpet but…..“flawless,”  “amazingly inspiring,” “excellent can’t wait for the next one!”  is some of the feedback we received after the first ever Sage World last year. And we’re not just picking the best quotes, the stats back it up too, 93% of Sage World attendees loved it.

Still not convinced? Check out the guest blog The Best Business Event? from one of last year’s attendees Wildfire Digital Media. They loved it too and we didn’t even pay them to say so.

[End of trumpet blowing.]

What is Sage World?

Well, if you went last year you’ll know Sage World was a different kind of event, an immersive two day experience for the UK’s small businesses. Inspirational keynotes, practical hands on seminars and that priceless one to one time with our technical experts brought everything a small business needed to one place.

We’re in the process of finalising the programme for this year’s Sage World but we guarantee it’s going to be good and even better than last year.

When and where is it?

You’ll only have to wait a little longer for the next one as Sage World is back for another year, taking place at a fantastic new venue EventCity in Manchester on the 12^th and 13^th of October.

The best part?

It’s completely free and we’ll even throw in some lunch (not literally, that could get a bit messy).

How do I get a free ticket?

So, to make sure you don’t miss out, book your free place now at www.sageworld2011.co.uk

Nicole Matues, Sage World Team

Want to get your hands on an Amazon Kindle? Well to celebrate the launch of our latest business software, Sage Instant Accounts 2011, we have three Kindles to give away!

Win an Amazon Kindle

Simply email us your top business tip in 50 words or less, and the top 50 will be entered into a draw to win one of the three Kindles (check out the t&Cs).

As well as standing a chance of winning a Kindle, we’re going to collate the top 50 tips into a lovely guide so other businesses can benefit from your advice – you’ll also get a bit of promotion for your business.

What are you waiting for? Email us your top tip, name, position and business address now at instant.accounts2011@sage.com

Jack Ford, Small Business Team

Scientia potentia est otherwise known as ‘knowledge is power’ to those of us more familiar with the English dialect! We’re not actually power crazy here at Sage but we are always looking to improve and a little knowledge goes a long way (to coin another phrase).

We’re running a survey…and you could win some Amazon vouchers!

That’s why I’m putting out this short and sweet appeal to anyone who owns a small business to spare 10 minutes to take part in a short survey we’re running here.

Oh and you can also boost your own power (spending power that is) with the Amazon vouchers available in our prize draw for those of you who take part.

To take part just go to our Small Business Survey by 28 February 2011.

Thanks

Geoff Phillips, Small Business Team

Well, if you’ve not given it too much thought so far you’re not alone. We surveyed 1500 of our customers and we found that nearly one in five small businesses are not ready for the increase.

So, what else did our survey find? Well, while 68% of small businesses are anticipating the effect of the VAT rise, a substantial 11% have yet to contemplate the impending changes, and a further 7% have expressed concern about their lack of preparation.

Suzanne Wardingham, our VAT Specialist, has outlined a number of measures that small businesses can take in order to ensure they are best prepared in January:

Getting prepared

We’ve set up a website to help our customers navigate the VAT change and find  details on what the changes mean for our software. http://www.sage.co.uk/legislationchanges

Pass on the costs?

In the past couple of years we’ve already had two changes to the standard rate of VAT, so making the change is not as much of a daunting task as it used to be for some businesses. As before, small businesses will have to decide whether they want to pass the costs on to their customers.

VAT return

As the VAT increase takes place on the 4^th January rather than the 1^st this time, there will be some businesses that have to complete a VAT return incorporating both standard rates of VAT. Where this is the case, we strongly recommend that the business owners seek advice from either their accountant or HMRC if they are unsure.

Ask your accountant

It’s likely that accountants will be busy with clients’ self-assessment returns towards the end of the year, so consult with them early on to understand how the change will impact day-to-day transactions.

Special dispensations?

Exploring whether there are any special dispensations for your business to help you manage the change more efficiently. Last time retailers received a two-week grace period to re-price stock on the shelves.

Be good to your customers

If possible invoice them before the increase so they will not incur the higher VAT rate and will appreciate the gesture.

Cath Sheldon, PR Team