With insolvencies rising at their fastest rate for 18 years, these are good times for one group in the economy – the turnaround investor.
The chancellor introduced a boost to credit insurance and extended the scheme that allows businesses to offset tax incurred in boom times against leaner years
It’s a special occasion and you’ve decided to spend your hard-earned cash on a hot air balloon ride for you and your true love. As you float through the sky without a care in the world, you feel calm, entirely protected by the glorified wicker basket which holds you aloft. It’s a picture of romantic bliss, complete with chocolates, strawberries and a bottle of Dom Pérignon chilling in a bucket for later. But whatever you do, don’t look down!
To say that the markets have been turbulent in 2008 would be a complete understatement and the prospects for 2009 seem much the same. My prognosis is that while the markets may drop further, though providing a three to five year horizon is anticipated, this will look a good time to invest in hindsight.
I recently visited a growing IT business in the M5 corridor – that hot bed of entrepreneurial IT businesses.
A Government Minister has described 2012 as the most important year since 1908, it will change the financial landscape in this country forever. No, not the Olympics, but “Personal Accounts” the Governments latest attempt to get the British Public to plan for their retirement after the ill-fated Stakeholder Pension Schemes and 2012 is currently pencilled in for the launch of these schemes.
Commercial bank managers have long complained that it is much easier for clients to get unsecured loans personally, where no evidence is required as to how the loan will be repaid, than it to get unsecured loans for a business, no matter how good the business plan.
As set out in previous articles, if you do have to provide a personal guarantee, make sure it is not secured against your home. This way if the business goes belly up, and the guarantee is called in, you have a strong position and will in all probability keep your home, if you go about things carefully.
If the loan is secured against your property and the business fails, its hard to increase the mortgage, as your income has gone, and you stand every change of losing your home.
Of course many businesses are mostly conducted as sole traders where there is no legal separation between business assets and personal assets and by the largest sector is Buy to Lets (BTL).
The Forum of Private Business (FPB) is welcoming the Payments Council’s new National Payments Plan, announced this week, in which it agrees not to phase out cheque payments until adequate alternatives are in place. Research carried out by the FPB at the end of last year revealed that most of the smaller businesses surveyed want market forces to determine when they should switch payment methods.
I see a lot of businesses that are very busy but they just aren’t making any money. Let me give you a recent example of a small telemarketing company that carries out business to business marketing.
This story is a classic story of a couple of guys who had worked in the industry for many years deciding to set themselves up independently. They rented an office, recruited a few telesales staff and set about building the business.
In a competitive world where costs are key to success, employee retention plays a vital part. Long serving employees save on recruitment costs and the training of new staff. Due to the public perception of the state of the NHS, an employee benefit package that contains Private Medical Insurance can be more attractive to new and existing employees.
Any item for sale benefits from quality presentation, whether it be a bottle of perfume or a three piece lounge suite. Businesses are no different. An owner manager who allows him or herself time to gift wrap their company and put on a big bow for good measure will reap substantial rewards.
Undertaking the “wrapping and packing” takes time – anything up to three years – but it is time that is so so well spent.
Banks and building societies are reporting an expected cut in the amount of secured lending they will offer after the Bank of England admitted the credit squeeze is set to intensify.
The credit crunch is forcing some lenders to take fewer risks whilst at the same time, the cost of borrowing on the money markets remains high. As a result, SMEs could find it difficult to secure traditional loans or receive overdraft facilities from their bank.