Tag: businessgrowth

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Why do we have an annual price increase?

Once a year we increase our prices across the board. This is in addition to increasing/decreasing prices as clients increase/decrease the services that they need from us. As most of our clients are on annual fixed price agreements that they pay monthly they aren’t affected immediately, others are increased from 1 April.

But why do we have an annual price increase?

We have a fabulous team and I want to make sure that they are rewarded accordingly so we pass on the same increase to them as a pay rise. Our software and other costs increase throughout the year so we need to ensure that we cover these in order to retain our margins and stay in business.

As business advisers we also advise our clients to review their own prices annually.

If costs are tight it can be tempting to cut corners on the necessary work or to take on too many clients in order to cover our fixed costs. The resulting reduction in service would not be in the best interests of our existing clients.

When was the last time you reviewed your prices?

If you’d like more information about how to go about reviewing your prices then have a look at our pricing course.

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How to create a budget for your business

How to create a budget for your business

Businesses and individuals with plans are more likely to achieve those results. But how do you go about it?

  1. Personal objectives – the objectives of owner managed businesses are often a subset of the owner’s personal objectives.
  2. Business objectives – what do you need from the business to meet your personal goals?
  3. What products/services do you have to sell?
  4. Who is your ideal customer?
  5. What do you know about your competition and how you can differentiate yourself from them?
  6. Sales plan – what and how much do you need to sell? Is this realistic?
  7. Investment plan – What investment do you need to make in staff, training, marketing, equipment, and technology
  8. Will this achieve the desired results?
  9. What actions do you need to take (and when) in order to stay on track to meet your goals?

You can do this on your own but, if you’d like more help, then we have a budget workbook and accompanying videos.

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Do you really believe your CSR?

Happy new year! 

Sustainability. Do you do anything about it or just talk about it? 

Current breakfast view is offices that have their lights on 24/7 (even over the Christmas shut down) when nobody is there. I’m far from perfect myself but this seems like an easy action. 

We moved into the centre of Bristol in time for Christmas. This enabled me to make some positive changes. 

I have sold my car! It’s a big lifestyle change and I’ll still need to hire a car sometimes (Enterprise run a car club where we can hire by the hour/mile). Public transport is far from perfect but I’ve always preferred to use it (or to walk/cycle) when possible. That’s now much easier in the city than it was in rural life.  

We also have incredibly fast broadband so, while I can walk/train/bus to more meetings in person, it is also easier to run online meetings. Since covid more people have a suitable set up for this and Minerva Accountants is run remotely (apart from our 90 day planning sessions which are usually in person). I like seeing people face to face but a Zoom/Teams call saves lots of travel time which also increase productivity. 

I know I’ve still a lot to improve as I do like to travel but I’m keen that we shouldn’t miss the easy things. Are there any simple improvements that you can make? 

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How to work faster 

Why do some people work faster than others? Sorry, I have no idea but I did hear of a study that discovered that manual work rates could double between slow and fast workers. The more complex the work, the higher the multiple so that a software engineer might be 16 times faster than a peer.  

When I set up my first accountancy business my plan assumed that everybody worked at the same pace as me. When I started recruiting (good) staff I found that this wasn’t the case and that I was a lot faster than others. I had to adjust my business model accordingly. We still keep approximate timesheets to track individuals’ work rates for planning purposes. 

So how can you help slower workers to speed up? 

  • Have proper processes so that everybody knows the most efficient way to do things 
  • Training and processes help people to get started sooner on each task with less planning time 
  • Help them to find the best time of day and working environment for them to do their ‘deep’ focused work and fit simpler tasks around this 
  • Build in controls and reviews so that faster work doesn’t become sloppy work 

When building your business cost model consider cheaper, slower trainees/junior staff vs more expensive but faster qualified/senior staff. When could you use different staff? 

Plan your work and your resource accordingly. Most of our accounts work is carried out by other members of the team and I only review it. This also means that all year end accounts have the benefit of at least two sets of eyes. BUT if a client needs something quickly, I often do it myself. The costs are passed on to the client if the extra speed is needed because they have delayed. 

Any other ideas on how to speed up work rates? 

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Are you running a profitable business?

Are you sure?

What if you had to replace your own time with a suitable qualified/experienced alternate salary? Would you still be making a profit then?

Whilst I’d like to think that the answer is ‘yes’ there are a few reasons why it might not be the case.

  • You might be prepared to accept a lower ‘salary’ (perhaps a mix of salary and dividends) in exchange for more flexibility or being your own boss. Make sure that you don’t lose more income than you are intending.
  • You might be in a start up or growth phase of your business when you are working longer hours than expected. Make sure that this doesn’t go on too long or you may burn out. If you’ve been in business for over three years and aren’t happy with your profitability per hour then it may be time for some business advice.

I see far too many business owners (including accountants!) earning less than minimum wage. You may be doing something you love but you also deserve to earn a living from your work.

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Tax tip

Furnished holiday lets 

Back on 6 March the Conservative Spring Budget announced the FHL (Furnished Holiday Lettings) scheme but failed to included it in the Finance Act. 

On 29 July the new Labour government confirmed that they would proceed with this by publishing a policy paper and draft legislation. This is still not law but likely to become so. The key points are: 

  • Withdrawing capital gains tax relief on gains from trading assets 
  • Withdrawing corporation tax capital allowances  and allowing replacement of domestic items relief 
  • Restricting finance charges and interest to basic rate of income tax 
  • No longer including FHL income when calculating relevant earnings for pension relief 

There is anti-forestalling legislation to prevent advance action between 6 March 2024 and the effective date on 2025. This means that it is probably too late to take any action to mitigate the tax impact but please talk to us if you are affected. 

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What do you value?

Struggling to write this today as I hide in a café in the village while a house clearance company dispose of 14 years of my life.

But I’m a natural optimist (and the future is looking very good once I’ve waved goodbye to the memories here) so it’s easy to see the silver linings.

I’ve always believed that people are more important than things and so it was a no-brainer that I would choose to run my first business on just 25 hours per week so that I could spend time around my kids as they were growing up. I also worked from home until the team grew beyond 5 people and we had to take on external offices in the next town.

Working on limited hours meant that I soon became an acknowledged expert on how to run my business as efficiently as possible and it’s something that I love to share with accounts and business clients through coaching and courses. Which is how my second business was born.

Seeing my possessions go out of the door (some to new homes via a charity, and some to the dump) is hard but they are just objects compared to the family, friends, staff, and clients who ate around my dining table or shared their dreams in my offices.

What are your most precious memories? Does your business allow you to do what you want to do?

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What recruitment crisis? 

On the one hand I hear people (accountants and other businesses) complaining about the lack of suitable recruits, on the other hand I see my kids’ clever school leaver friends working hard in short term jobs because they can’t find apprenticeships to launch their careers. 

I don’t know about other industries but in accountancy we have created our own crisis. We have a shortage of qualified, experienced accountants today because firms cut back on their training budgets a few years ago.  

Personally, I like taking on trainees as I can train them to do things the way I think they should be done. No ‘bad’ habits to unlearn from previous workplaces. And they’re usually pretty tech savvy to cope with our modern processes. 

In a relatively short time, you’ll have a fabulous employee, an excellent return for your investment of time and money, AND you’ll have made a positive contribution to somebody’s life (all my previous trainees are now in management positions and some on the cusp of partnership). For us their full-time availability during college holidays balances the additional time off required by our part timers who require additional time off with family at this time. 

If you’re really struggling the apprentice minimum wage is peanuts but hopefully you can afford a little more. 

So here are just a couple you might like to have working for you in the Bristol/Somerset area. 

One talented photographer looking for something that uses their analytical skills.* Currently doing pub work. 

One interested in tech/business looking for cyber security or similar. Currently stacking shelves. 

*I’m currently looking for 21 new clients to cover one trainee salary. Happy to accept referrals for coaching and/or company accounts. If you can offer a suitable job before I can then there are plenty more school leavers for me to recruit (I just happen to know these two) 

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Doing business on Deep Space 9 

I’m a bit of a scifi geek and I love the Quark character who owns the bar in Deep Space 9. He has some great business traits. And some bad ones! 

The good news is that Quark tracks his KPIs (on an hourly basis which is probably overkill!).  

In Season 2 Episode 10* Quark has enlisted a musician to draw more visitors to the bar BUT the musician is so good that nobody is actually drinking or buying food. He talks about his indicators which feed into his projections which in turn lead to profits.  

In one of my businesses I track speaking events because the more I speak, the more enquiries I get for coaching and courses. In another I track networking and ‘coffee’ meetings as relationship building leads to more referrals. 

What lead indicators do you track in your business that you know will lead to more profits in time? 

*in case you want an excuse to watch it  

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The problem of growing too fast

It sounds as though it’s a nice problem to have but many small businesses fail at this stage

  • Overtrading – lack of cash to cover your higher costs while you wait to collect those higher debts. Clamp down on your credit control to ensure that you have sufficient working capital
  • Lack of systems – don’t reinvent the wheel but create a system for anything that you’re likely to do more than once. I’m running a live webinar for accountants on Tuesday 16th so email us for the link
  • Unable to find the right people – you will probably need more staff but you may also need different staff for a scaleup rather than a start up. If you prefer to do the work then you could employ a manager to run your business. I like to train my own team as we work very differently to many traditional accountants but you will have more choice in recruits if you offer REAL flexibility on hours and location.

What have you found helpful as you grew your business?

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