Many people who are new to business concentrate all their efforts on sales. After all, without any sales there is no business. But, in their unquenchable thirst for selling, many overlook the collection of the money that all those sales have created. If you are in a pub, a shop or any business that is paid immediately you can stop reading now as this blog is intended solely for those who offer credit to their customers.
In simple terms credit control is just good housekeeping. If you are owed say £20,000 and it is all due to be paid to you on 1st March that means that, all being well, your bank account will swell by £20,000 on that date and you will be able to pay your own bills. But what if it doesn't all arrive on time? If £10,000 is late, that's £10,000 less in your bank and I don't need to explain the effect that could have on your business. You are in business to sell stuff and not to provide overdraft facilities for your clients.
So how do you operate good credit control? Well, a good starting point is to make sure that you don't give credit to customers that can't demonstrate that they have the means to pay. You can check up on them by investing in a subscription to a good credit agency (we used to use www.creditsafe.com). Agencies like this will let you look up the basic details of the customer and have a look at their balance sheets and their suggested credit limit. Make sure that the customer completes and signs an account opening request agreeing to your terms and conditions (check the Internet for example trading terms and edit them to fit what suits you best). When you are happy, set them a realistic credit limit in line with the business you expect.
When you are establishing your terms and conditions try and fit in with the norm for your market. If you are being given thirty days by your suppliers it is reasonable to offer the same. If you offer much longer than you are given, you may well find yourself having to pay for several months worth of supplies before your receipts start to flow.
Once you have given your customers a limit and a number of days credit, the most important thing is to make sure that they stick to both. The best credit control departments will contact their customers a week before the end of a month when sums are about to fall due and check that their books agree and ask when payment will be made. I know that some companies shy away from this thinking that it might appear that they are being too pushy but it prevents any of the "oh we haven't got that invoice can you email a copy?" which can arise after the debt is due. I strongly recommend that you do this check as you will be surprised how many accounts departments will claim missing invoices. If you find it onerous, concentrate on the biggest sums owed to you as these will have far more benefit than chasing lots of small customers (see my blog on the 80/20 rule).
If payments don't arrive on time, start to chase straight away. Every day you ignore a debt will put further pressure on your own finances. Initially make a phone call. Make sure that you get through to the person responsible for paying. Ask them politely when they will be paying and, if this is satisfactory, make a note in your records together with the name of the person you spoke to and put a note in your diary to check that they keep to their word. If they don't do as they said you must phone immediately and ask them why.
If their response to either your first or second call is not satisfactory you must suspend their credit and allow them no further goods. I know that you will be in conflict with your sales team but if a customer can't pay on time and fails to provide a good reason there is no point in selling more to them until you are satisfied that they are able to pay. If your customer fails to respond to a second phone call you should issue a formal demand for payment giving them seven days in which to pay and stating what your next action will be if they fail to do so. I would recommend that the threat should be legal action through the small claims court (www.hmcourts-service.gov.uk) but only make the threat if you are prepared to carry it out. By acting swiftly in stopping credit and taking customers to court you may alienate some customers but when you subsequently receive notice that they have gone into administration or liquidation you will, hopefully, be one of their few suppliers to have escaped unscathed.
A couple of further tips.
1 If a customer claims that a payment is in the post, look out for the envelope and see if it was posted when they claimed it was.
2 Customers often stall by asking for copy invoices. You can preempt this by taking the action suggested above and phoning before the due date but again, if you don't have time, make sure that you phone those who have previously asked for copies as it tends to be habitual.
3 Be polite but firm, if customers become aggressive the odds are that they are unable to pay, after all if they were able to do so there would be no need for them to shout.Remember that you are only asking for what is due to you.
4 If you do have to write an account off as bad think how many sales you would have to make to get that money back and remember that good credit control is the best way to prevent bad debts.
5 If a customer builds up a record of late payment investigate the reasons. If necessary ask their boss if there is a problem. Don't ignore it just because they buy a lot. There may be a legitimate explanation but you need to know what it is.
6 Don't be bullied by big corporations. They often make slow payment a matter of policy and, because they are big, they expect you to bow to them. Treat them just as you would any other customer.
7 When rumours reach you about customers in financial difficulty, ignore them at your peril. Don't spread them any further but contact your customer and tell them what you have heard. Sadly the old saying about no smoke without fire often turns out to be true.
8 Always follow up your phone calls. Keep good notes on what has been agreed and always do what you say you will do. Don't be fobbed off by weak excuses.
9 If a customer asks for time to pay, be reasonable and agree to a fair repayment schedule but make sure that the customer sticks to it - you could ask for cheques up front and promise not to pay them in until the agreed time.
10 Finally, always be suspicious of sudden large bursts of buying from previously small accounts - especially if you know that they normally favour one of your competitors. It may be perfectly innocent and reflect your superior products or an extra effort from your sales force but it may also mean that credit has been refused elsewhere so just be on guard.
I hope that this simple few paragraphs have emphasised the importance of keeping on top of what you are owed and has given you a few hints on how to carry out credit control efficiently.
Showing posts with label Small Business Advice. Show all posts
Showing posts with label Small Business Advice. Show all posts
Monday, 21 February 2011
Saturday, 5 February 2011
Small Business Advice Part Four - The Vital Importance Of Your Balance Sheet
Now that's a title to put readers off isn't it? And it's for precisely that reason that so many small businesses fail because, rather than being a boring and necessary evil prepared to keep the tax man at bay and the bank manager happy, a balance sheet is actually a vital business tool that provides the entrepreneur with all the information necessary to carry out regular health checks on his business.
When I was a bank manager a majority of my customers knew absolutely nothing about their balance sheets. For them it was a meaningless jumble of words and figures that their accountant charged them an extortionate fee for once a year and delivered to them about 18 months after the financial year had ended. As such, it was indeed both meaningless and worthless. What's the use of a set of figures that tells you how the business was doing 18 months ago? Now that computer accountancy packages are cheaply and readily available to all, there is nothing to stop business owners from preparing a balance sheet every month in order to keep fully abreast of how things are going. If your doctor offered you a free health check every month you'd jump at the chance. So why not do it for your business?
So what is a balance sheet? Put most simply it is a chart that documents two aspects of your company. These are what you have (your assets) and what you owe (your liabilities). As these two categories rarely equal each other, there is a third balancing item which represents the difference between the two and is your own stake or investment in the business plus any profit or minus any loss that you have made since inception. Hopefully you will see that third item grow as you check your balance sheet every month. It never ceased to amaze me how many of my customers had no idea whatsoever how much profit they were making from week to week or month to month but this simple chart would have placed the figures at their fingertips.
The two major categories on the balance sheet are each split into two. These break down the assets into what are known as fixed assets i.e. things like buildings, desks, cars and machines which, though used daily, don't generate ready cash and current assets which are, for example, cash, money in the bank, sums due to you in the near future and stock. Liabilities are split in a similar way with current and long term liabilities. Your current liabilities are those which will fall due within the next 12 months and may include a bank overdraft, sums outstanding owing to creditors, your next 12 months' mortgage and hire purchase repayments and sums owing for wages and tax. Your long term liabilities are loans, HP and mortgage repayments due in future years.
When you draw up your balance sheet you start with your fixed assets followed by your current assets and liabilities and finally your long term liabilities and your net investment. Here is a basic example for a pub.
Fixed Assets a)
Pub Building, Catering Equipt, Vehicle,Tables Chairs £800,000
Current Assets b)
Drinks £ 30,000
Cash £ 5,000
Food £ 3,000
Total £ 38,000
Current Liabilities c)
Wholesaler £ 40,000
Bank O/D £ 25,000
HP&Mortgage £ 32,000
Tax £ 13,000
Total £110,000
Net Current Assets d) (=b-c) -£72,000
Long Term Liabilities e)
Mortgage -£200,000
Total or balancing figure f) £528,000
Many people would look at this simple balance sheet and say that it was a good and strong one. Certainly the investor has over £500,000 in the business but can you spot the glaring problem facing the proprietor?
From my experience so many business owners would fail to realise that with their current or immediate liabilities far exceeding their cash and current assets they were heading for difficulties in paying their bills. A negative figure in Net Current Assets (d) is usually a precursor for stormy waters ahead. If the owner of this pub had this balance sheet in front of him at the end of month one instead of some 12 months later he would have been totally aware that his business was facing a cash problem long before the bank started bouncing his cheques and the wholesaler stopped his credit. With such a large investment in the business, it would not be too difficult to sort things out. Assuming that the balancing figure f) was growing and the business was profitable, he would be able to take some long term finance to make things stronger. If f) was on the decline he would know that things were grim and be able to try and do something about it quickly to reduce losses. Assuming the business was profitable and he took out finance his balance sheet might then look like this.
Fixed Assets a)
Net Current Assets d) (b-c) +£80,000
Long Term Liabilities e)
Mortgage -£352,000
Total or balancing figure f) £528,000
When I was a bank manager a majority of my customers knew absolutely nothing about their balance sheets. For them it was a meaningless jumble of words and figures that their accountant charged them an extortionate fee for once a year and delivered to them about 18 months after the financial year had ended. As such, it was indeed both meaningless and worthless. What's the use of a set of figures that tells you how the business was doing 18 months ago? Now that computer accountancy packages are cheaply and readily available to all, there is nothing to stop business owners from preparing a balance sheet every month in order to keep fully abreast of how things are going. If your doctor offered you a free health check every month you'd jump at the chance. So why not do it for your business?
So what is a balance sheet? Put most simply it is a chart that documents two aspects of your company. These are what you have (your assets) and what you owe (your liabilities). As these two categories rarely equal each other, there is a third balancing item which represents the difference between the two and is your own stake or investment in the business plus any profit or minus any loss that you have made since inception. Hopefully you will see that third item grow as you check your balance sheet every month. It never ceased to amaze me how many of my customers had no idea whatsoever how much profit they were making from week to week or month to month but this simple chart would have placed the figures at their fingertips.
The two major categories on the balance sheet are each split into two. These break down the assets into what are known as fixed assets i.e. things like buildings, desks, cars and machines which, though used daily, don't generate ready cash and current assets which are, for example, cash, money in the bank, sums due to you in the near future and stock. Liabilities are split in a similar way with current and long term liabilities. Your current liabilities are those which will fall due within the next 12 months and may include a bank overdraft, sums outstanding owing to creditors, your next 12 months' mortgage and hire purchase repayments and sums owing for wages and tax. Your long term liabilities are loans, HP and mortgage repayments due in future years.
When you draw up your balance sheet you start with your fixed assets followed by your current assets and liabilities and finally your long term liabilities and your net investment. Here is a basic example for a pub.
Fixed Assets a)
Pub Building, Catering Equipt, Vehicle,Tables Chairs £800,000
Current Assets b)
Drinks £ 30,000
Cash £ 5,000
Food £ 3,000
Total £ 38,000
Current Liabilities c)
Wholesaler £ 40,000
Bank O/D £ 25,000
HP&Mortgage £ 32,000
Tax £ 13,000
Total £110,000
Net Current Assets d) (=b-c) -£72,000
Long Term Liabilities e)
Mortgage -£200,000
Total or balancing figure f) £528,000
Many people would look at this simple balance sheet and say that it was a good and strong one. Certainly the investor has over £500,000 in the business but can you spot the glaring problem facing the proprietor?
From my experience so many business owners would fail to realise that with their current or immediate liabilities far exceeding their cash and current assets they were heading for difficulties in paying their bills. A negative figure in Net Current Assets (d) is usually a precursor for stormy waters ahead. If the owner of this pub had this balance sheet in front of him at the end of month one instead of some 12 months later he would have been totally aware that his business was facing a cash problem long before the bank started bouncing his cheques and the wholesaler stopped his credit. With such a large investment in the business, it would not be too difficult to sort things out. Assuming that the balancing figure f) was growing and the business was profitable, he would be able to take some long term finance to make things stronger. If f) was on the decline he would know that things were grim and be able to try and do something about it quickly to reduce losses. Assuming the business was profitable and he took out finance his balance sheet might then look like this.
Fixed Assets a)
Pub Building, Catering Equipt, Vehicle,Tables Chairs £800,000
Current Assets b)
Drinks £ 30,000
Cash and bank £150,000
Food £ 3,000
Total £183,000
Current Liabilities c)
Wholesaler £ 40,000
Current Assets b)
Drinks £ 30,000
Cash and bank £150,000
Food £ 3,000
Total £183,000
Current Liabilities c)
Wholesaler £ 40,000
Bank O/D £ 0
HP&Mortgage £ 50,000
Tax £ 13,000
Total £ 103,000
HP&Mortgage £ 50,000
Tax £ 13,000
Total £ 103,000
Net Current Assets d) (b-c) +£80,000
Long Term Liabilities e)
Mortgage -£352,000
Total or balancing figure f) £528,000
As you can see, the investment or balancing figure remains exactly the same but now the publican has more than ample cash available to meet his bills having increased the mortgage on the property and he is in a far better position and may for example be able to use his cash to negotiate better deals with suppliers.
So the two vital things to look at on your monthly balance sheet are d) your net current assets - you want to see this figure healthily positive so that you know that you can meet your immediate bills- and f) your balancing figure - you want to see this increasing to show that the business is profitable. If it is not you can investigate why and do something about it rather than wait for things to collapse.
I know that your accountant will provide you with plenty more than just a balance sheet in your annual set of accounts and I will cover the other sections in a future blog but so many owners of small businesses fail to grasp the importance of this vital tool as a quick health check and I hope that this simplification might clarify for you what many see as the accountant's black art.
Tuesday, 25 January 2011
Small Business Advice Part Three - Using The 80/20 Rule
Continuing with my occasional and sporadic forays into the world of business advice I want to devote today's blog to the 80/20 rule or the Pareto Principle. Put very loosely, the rule states that 20% of one thing can account for 80% of another. For example 20% of your customers might provide 80% of your sales or 20% of your stock items represent 80% of its total value. The figures 80 and 20 aren't cast in tablets of stone and, covering two different categories, they needn't add up to 100 - for example you might find that 10% of your staff take 80% of your sick leave but it's a simple theory and one that can pay dividends if you make it work for you.
This chart that I found courtesy of UNB.ca pretty well sums it up.
Whilst the obvious uses, such as those sketched out above, are extremely worthwhile and can help you to concentrate your efforts by targeting that important 20%, the area where I found it most beneficial to apply the rule was in organising my working day and my workload.
Throughout my career I knew managers who were always burning the midnight oil, late with reports and struggling to get minor tasks done on time. Their workload seemed interminable and their desks groaned under paperwork. It usually started with a big and time consuming job which they threw themselves into with enthusiasm forsaking everything else until that big job was finally done and dusted. Whilst this may sound very creditable, in carrying out that major opus, they most probably overlooked making a number of simple decisions which, though small in themselves, delayed the rest of the business, left colleagues twiddling their thumbs and brought inefficiencies to the company.
Ideally you should start with a clear desk if at all possible. Most days you will be faced with a number of jobs to do. 20% of them will most likely account for 80% of your time. Identify those 20% big or time consuming jobs and schedule them for later in the day. If you aren't sure about the complexity of any particular task always assume it to be in the difficult category and, if it's a meeting, always try and schedule it for the afternoon when the time available is finite (morning meetings tend to stretch interminably). Get the other 80% of jobs out of the way as quickly as you can. It sounds almost patronisingly simple but you would be surprised how many tiny jobs get pushed to the bottom of the work pile because managers are too busy with other more important things. The difficulty here is that, whilst those tiny things appear to be trivial, there are lots of them and it is highly likely that their delay will impact on the rest of the staff and the business.
It's a very small and extremely simple tip but I can't overemphasise how important it is. I guarantee that, if you get into the habit of always applying this very simple principle, your workload will be much easier to cope with and that big report that you need to prepare for the bank or for your shareholders will be completed without interruption and the worry that everything else is falling behind.
And don't forget the impact this will have on that work life balance that I mentioned in Part One of this series.
This chart that I found courtesy of UNB.ca pretty well sums it up.
Whilst the obvious uses, such as those sketched out above, are extremely worthwhile and can help you to concentrate your efforts by targeting that important 20%, the area where I found it most beneficial to apply the rule was in organising my working day and my workload.
Throughout my career I knew managers who were always burning the midnight oil, late with reports and struggling to get minor tasks done on time. Their workload seemed interminable and their desks groaned under paperwork. It usually started with a big and time consuming job which they threw themselves into with enthusiasm forsaking everything else until that big job was finally done and dusted. Whilst this may sound very creditable, in carrying out that major opus, they most probably overlooked making a number of simple decisions which, though small in themselves, delayed the rest of the business, left colleagues twiddling their thumbs and brought inefficiencies to the company.
Ideally you should start with a clear desk if at all possible. Most days you will be faced with a number of jobs to do. 20% of them will most likely account for 80% of your time. Identify those 20% big or time consuming jobs and schedule them for later in the day. If you aren't sure about the complexity of any particular task always assume it to be in the difficult category and, if it's a meeting, always try and schedule it for the afternoon when the time available is finite (morning meetings tend to stretch interminably). Get the other 80% of jobs out of the way as quickly as you can. It sounds almost patronisingly simple but you would be surprised how many tiny jobs get pushed to the bottom of the work pile because managers are too busy with other more important things. The difficulty here is that, whilst those tiny things appear to be trivial, there are lots of them and it is highly likely that their delay will impact on the rest of the staff and the business.
It's a very small and extremely simple tip but I can't overemphasise how important it is. I guarantee that, if you get into the habit of always applying this very simple principle, your workload will be much easier to cope with and that big report that you need to prepare for the bank or for your shareholders will be completed without interruption and the worry that everything else is falling behind.
And don't forget the impact this will have on that work life balance that I mentioned in Part One of this series.
Wednesday, 5 January 2011
Small Business Advice Part Two - The Golden Rule
Continuing my occasional foray into the world of the entrepreneurial guru I'm devoting my second business advice blog to the golden rule or the simple idiom "Do as you would be done by".
Although the first recorded example of this phrase in those exact words is attributed to the Earl of Chesterfield in 1747, the philosophy behind it dates back centuries and is included in Jesus' words from the Sermon On The Mount - "all things that whatsoever ye would that men should do to you, do ye even so to them" and there are variants in the teachings of Confucius and in many other world religions.
For any maxim to be around for centuries it has to have some worth but I never fail to be surprised by how few people apply it and how few appreciate its relevance in business. Think about virtually everything you do in business and think about how it applies.
Those customers are rubbish aren't they? They never pay on time. How often is that said in a typical accounts office on any given day? But ask yourselves "do we pay on time?". If the answer is no then there is little point in moaning about the customers. Start to pay on time, break the circle of slow payment and you will build up respect from your suppliers and with that respect you will get priority treatment. It's the end of the month, your supplier is running late with deliveries, who is going to get the favours? The one who treats him the best.
Payment is just one small area where "do as you would be done by" is an important message to have on board. Here's another genuine scenario. Several years ago an important supplier forgot to invoice us with a very large invoice. It wasn't on their statement and we could quite easily have ignored it and made ourselves a nice extra profit for the month. But if the boot had been on the other foot and we had made a similar mistake we could have lost a significant sum,so, as soon as we realised what had happened, we did the right thing and told the supplier. The result was that we cemented an already good relationship to an even better one and gained our supplier's total respect. Their managing director recently told me that he believed that less than 10% of his customers would have spilled the beans. Which shows that the golden rule is not one that is followed by many businesses.
The rule applies when dealing with complaints. Put yourself in the complainant's shoes. He's just bought your product. He was really looking forward to receiving it but it has arrived damaged. It's not your fault (bloody carriers) but that's no consolation to him. Ask yourself what is the very best that you would expect if you were the customer and try and fulfill those expectations even if you are gong to be out of pocket. Ok it's sometimes impossible but if you can be seen to have pulled out as many stops as you could, your reputation will go from strength to strength.
You might think that by banging on about this aspect of a business I'm being a bit wet and that real business is for those Dragon's Den types with their very tough exteriors (although in reality they would not have made their fortunes without treating people with respect). But it is a very important aspect and if you get it right at the outset your business will thrive. I said earlier that it affect all areas and that includes how you treat your staff, your customers and your suppliers. Think about the most respected brand on the high street John Lewis. Think of their customer service and their staff share schemes and you'll get the idea. I'm sure there are thousands of very successful businesses that care for their shareholders only but applying the golden rule will provide far more personal satisfaction.
Before making any decisions, stand back for a second, think of how you would react if you were on the receiving end of that decision and make the right choice accordingly. Start putting it into action soon and I guarantee that you will see positive results.
Although the first recorded example of this phrase in those exact words is attributed to the Earl of Chesterfield in 1747, the philosophy behind it dates back centuries and is included in Jesus' words from the Sermon On The Mount - "all things that whatsoever ye would that men should do to you, do ye even so to them" and there are variants in the teachings of Confucius and in many other world religions.
For any maxim to be around for centuries it has to have some worth but I never fail to be surprised by how few people apply it and how few appreciate its relevance in business. Think about virtually everything you do in business and think about how it applies.
Those customers are rubbish aren't they? They never pay on time. How often is that said in a typical accounts office on any given day? But ask yourselves "do we pay on time?". If the answer is no then there is little point in moaning about the customers. Start to pay on time, break the circle of slow payment and you will build up respect from your suppliers and with that respect you will get priority treatment. It's the end of the month, your supplier is running late with deliveries, who is going to get the favours? The one who treats him the best.
Payment is just one small area where "do as you would be done by" is an important message to have on board. Here's another genuine scenario. Several years ago an important supplier forgot to invoice us with a very large invoice. It wasn't on their statement and we could quite easily have ignored it and made ourselves a nice extra profit for the month. But if the boot had been on the other foot and we had made a similar mistake we could have lost a significant sum,so, as soon as we realised what had happened, we did the right thing and told the supplier. The result was that we cemented an already good relationship to an even better one and gained our supplier's total respect. Their managing director recently told me that he believed that less than 10% of his customers would have spilled the beans. Which shows that the golden rule is not one that is followed by many businesses.
The rule applies when dealing with complaints. Put yourself in the complainant's shoes. He's just bought your product. He was really looking forward to receiving it but it has arrived damaged. It's not your fault (bloody carriers) but that's no consolation to him. Ask yourself what is the very best that you would expect if you were the customer and try and fulfill those expectations even if you are gong to be out of pocket. Ok it's sometimes impossible but if you can be seen to have pulled out as many stops as you could, your reputation will go from strength to strength.
You might think that by banging on about this aspect of a business I'm being a bit wet and that real business is for those Dragon's Den types with their very tough exteriors (although in reality they would not have made their fortunes without treating people with respect). But it is a very important aspect and if you get it right at the outset your business will thrive. I said earlier that it affect all areas and that includes how you treat your staff, your customers and your suppliers. Think about the most respected brand on the high street John Lewis. Think of their customer service and their staff share schemes and you'll get the idea. I'm sure there are thousands of very successful businesses that care for their shareholders only but applying the golden rule will provide far more personal satisfaction.
Before making any decisions, stand back for a second, think of how you would react if you were on the receiving end of that decision and make the right choice accordingly. Start putting it into action soon and I guarantee that you will see positive results.
Tuesday, 21 December 2010
Small Business Advice Part One - Work Life Balance
You know how all those business self help books are often based on one simple idea repeated over and over again? When I was young The One Minute Manager was all the rage amongst my colleagues who were bowled over by what was a very good statement of the bleedin obvious spread into twenty of more chapters. I imagine that anybody who had to read a book to tell them how to manage their time efficiently was never going to become leader of the board. I hope to periodically offer similar pearls of wisdom here but I feel that, whilst every football team needs at least one star player, no team has ever won anything with only one man and no one idea is going to make you successful in business.
So, in no particular order, I am going to cover topics that have influenced my career and played an important part in giving me a modicum of success. One of those closest to my heart is striking the right work/life balance.
Over the past thirty or more years I have seen more and more emphasis placed on working hours. Today, many business people seem to wear their excruciatingly long working days as some sort of badge of honour. "I was in the office until midnight". "Got a breakfast meeting at 7" "I don't have time for lunch " are all spoken as if they prove a dedication to the job in hand whereas, in my humble opinion, they are an admission of failure. By that I don't mean that all those hard working people are failing in their jobs but they are failing in their LIVES.
Unless you are particularly religious you've only got three score years and ten (or maybe four score nowadays) on this mortal coil and there's not much point reflecting in your dotage on sixty and seventy hour weeks. If you are single and you love work then go for it, if that is what you enjoy, but remember that you may not always be single and once your have created a working environment it is going to be very difficult to put things into reverse. But if you are not single remember that you have a partner and maybe children. Your son is not going to be chosen as an angel in the school nativity every year and a video is no substitute for your being there. Whilst the kids might appreciate their new XBox and the two weeks in Florida (despite you spending the whole time on your Blackberry or laptop)they would much rather you took them to the park after tea a couple of nights a week. Likewise your partner might appreciate the luxuries that your endeavours provide but a shared night in front of the telly could be just as welcome.
Think about it. You run a business and you earn a reasonable income. But you are working sixty hours or more plus your lunch breaks and all that time answering your emails in the evenings. Are you earning that much? You might be better of in a 9-5 job and have no pressure. By deciding at the outset on what is a reasonable working week and sticking to it I believe that you will have a far happier working life than if you become a business obsessed workaholic with a one track mind. Of course there are times when you have to deviate from the chosen hours. You may want to launch a new product or attend a trade fair and in those exceptional times you should throw yourself into it wholeheartedly. I managed to work for over forty years and typically averaged about 35 hours a week. I saw plenty of the kids, never checked my business calls or email on holiday and it didn't cause me a problem. If you are successful you will employ others and if you lead by example on your own working hours you will find that your staff will be far happier with theirs. If you doubt me, just give it a try and see how much your life improves.
I'll be posting another small business advice topic after Christmas but in the meantime here's a nativity for the digital age.
So, in no particular order, I am going to cover topics that have influenced my career and played an important part in giving me a modicum of success. One of those closest to my heart is striking the right work/life balance.
Over the past thirty or more years I have seen more and more emphasis placed on working hours. Today, many business people seem to wear their excruciatingly long working days as some sort of badge of honour. "I was in the office until midnight". "Got a breakfast meeting at 7" "I don't have time for lunch " are all spoken as if they prove a dedication to the job in hand whereas, in my humble opinion, they are an admission of failure. By that I don't mean that all those hard working people are failing in their jobs but they are failing in their LIVES.
Unless you are particularly religious you've only got three score years and ten (or maybe four score nowadays) on this mortal coil and there's not much point reflecting in your dotage on sixty and seventy hour weeks. If you are single and you love work then go for it, if that is what you enjoy, but remember that you may not always be single and once your have created a working environment it is going to be very difficult to put things into reverse. But if you are not single remember that you have a partner and maybe children. Your son is not going to be chosen as an angel in the school nativity every year and a video is no substitute for your being there. Whilst the kids might appreciate their new XBox and the two weeks in Florida (despite you spending the whole time on your Blackberry or laptop)they would much rather you took them to the park after tea a couple of nights a week. Likewise your partner might appreciate the luxuries that your endeavours provide but a shared night in front of the telly could be just as welcome.
Think about it. You run a business and you earn a reasonable income. But you are working sixty hours or more plus your lunch breaks and all that time answering your emails in the evenings. Are you earning that much? You might be better of in a 9-5 job and have no pressure. By deciding at the outset on what is a reasonable working week and sticking to it I believe that you will have a far happier working life than if you become a business obsessed workaholic with a one track mind. Of course there are times when you have to deviate from the chosen hours. You may want to launch a new product or attend a trade fair and in those exceptional times you should throw yourself into it wholeheartedly. I managed to work for over forty years and typically averaged about 35 hours a week. I saw plenty of the kids, never checked my business calls or email on holiday and it didn't cause me a problem. If you are successful you will employ others and if you lead by example on your own working hours you will find that your staff will be far happier with theirs. If you doubt me, just give it a try and see how much your life improves.
I'll be posting another small business advice topic after Christmas but in the meantime here's a nativity for the digital age.
Monday, 20 December 2010
NHS Hip Replacement. Stitches Out
The District Nurse managed to brave the sub zero temperatures and ice rink of a road to arrive on time this morning and remove my stitches. There's something quite cathartic about this. It gives me a feeling of completion and, although my pain has been minimal for the last few days, my wound suddenly feels even less tight and more relaxed. The DN tells me that it should leave very little by way of a scar despite my thigh looking at the moment like a joint on a butcher's slab. All I need to do now is carry on with the exercises and getting as much practice at walking as possible.
Unfortunately that walking is going to be restricted to indoors. This is the heaviest snowfall we have seen since we moved here in 1989 and, as beautiful as it looks, it is creating a lot of headaches. There's so much snow on the roof that the gutters have pulled away and a few roof tiles seem to have dislodged. Poor Marion has dug the car out of the snow and taken it for a hair raising drive to the petrol station but the biggest worry is the Christmas plans. Our son Paul and his wife Josephine are due to drive up on Boxing day and we are booked into a very nice hotel in St Andrews on 29th to see daughter Sarah. Unless things improve rapidly both these rare chances to see the kids may be lost - very sad.
My reading blitz continues unabated. I've been getting through almost a novel a day since the operation but this latest offering Parrot and Olivier in America presented the biggest challenge so far and there was no way that I was going to get through this epic in 24 hours. Shortlisted for the 2010 Man Booker prize, Peter Carey's picaresque tale of an English servant and his French aristocratic master is a masterpiece of literary descriptions and I know that I should gush about it if I have a scrap of intellect within me but, whilst I can appreciate Carey's silver (nay golden) tongue, I can't say that I enjoyed the book like I did Like Bees To Honey and Started Early Took My Dog. I finished it in a little over two days and am pleased that I have read it but I can't say that it is particularly entertaining reading - more an opportunity to worship at the feet of a master wordsmith in the sure knowledge that I will never come close to writing anything of this magnitude.
If you know me or you've read my blogs before you'll know that I am fascinated by the latest technology. I stumbled across this the other day. It's a Thing O Matic by Maker Bot and is described as a 3D printer. You program the machine with a 3d CAD image and it will "print" the image in plastic. Although the resultant plastic figures are fairly small, with some imagination I can see endless possibilities for this equipment. For example when I was working we often had to have expensive models of small plastic components made to see if the ideas would work. With one of these we could have saved a small fortune. I'm not buying one at the moment but this is an area of technology to watch.
Now that I have retired I wonder if anyone out there would be interested in some business advice. If you want to be another Peter Jones or Alan Sugar then stop reading now but, having run a British manufacturing company and managed to sell it as a going concern and retire at a respectable fifty seven, some of my ideas may (just may) be of use to others starting out in their own business or maybe finding things hard in the current climate. I'm going to start a series of nuggets of advice tomorrow. I'm starting with one that's closest to my heart - getting the right work/life balance.
Until then I'll leave you with a lesson on how not to get your automatic car back on the road in these conditions.
Unfortunately that walking is going to be restricted to indoors. This is the heaviest snowfall we have seen since we moved here in 1989 and, as beautiful as it looks, it is creating a lot of headaches. There's so much snow on the roof that the gutters have pulled away and a few roof tiles seem to have dislodged. Poor Marion has dug the car out of the snow and taken it for a hair raising drive to the petrol station but the biggest worry is the Christmas plans. Our son Paul and his wife Josephine are due to drive up on Boxing day and we are booked into a very nice hotel in St Andrews on 29th to see daughter Sarah. Unless things improve rapidly both these rare chances to see the kids may be lost - very sad.
My reading blitz continues unabated. I've been getting through almost a novel a day since the operation but this latest offering Parrot and Olivier in America presented the biggest challenge so far and there was no way that I was going to get through this epic in 24 hours. Shortlisted for the 2010 Man Booker prize, Peter Carey's picaresque tale of an English servant and his French aristocratic master is a masterpiece of literary descriptions and I know that I should gush about it if I have a scrap of intellect within me but, whilst I can appreciate Carey's silver (nay golden) tongue, I can't say that I enjoyed the book like I did Like Bees To Honey and Started Early Took My Dog. I finished it in a little over two days and am pleased that I have read it but I can't say that it is particularly entertaining reading - more an opportunity to worship at the feet of a master wordsmith in the sure knowledge that I will never come close to writing anything of this magnitude.
If you know me or you've read my blogs before you'll know that I am fascinated by the latest technology. I stumbled across this the other day. It's a Thing O Matic by Maker Bot and is described as a 3D printer. You program the machine with a 3d CAD image and it will "print" the image in plastic. Although the resultant plastic figures are fairly small, with some imagination I can see endless possibilities for this equipment. For example when I was working we often had to have expensive models of small plastic components made to see if the ideas would work. With one of these we could have saved a small fortune. I'm not buying one at the moment but this is an area of technology to watch.
Now that I have retired I wonder if anyone out there would be interested in some business advice. If you want to be another Peter Jones or Alan Sugar then stop reading now but, having run a British manufacturing company and managed to sell it as a going concern and retire at a respectable fifty seven, some of my ideas may (just may) be of use to others starting out in their own business or maybe finding things hard in the current climate. I'm going to start a series of nuggets of advice tomorrow. I'm starting with one that's closest to my heart - getting the right work/life balance.
Until then I'll leave you with a lesson on how not to get your automatic car back on the road in these conditions.
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