THE BRITISH LIBRARY

Innovation and enterprise blog

The British Library Business & IP Centre can help you start, run and grow your business

Introduction

This blog is written by members of the Business & IP Centre team and some of our expert partners and discusses business, innovation and enterprise. Read more

16 July 2014

Book review - Understanding your business finances by Johnny Martin

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Understanding your business financesIt is something of a cliché to say that most new business fail due to cash-flow problems. But it is also a truism.

Johnny Martin has made it his mission to get business startups to understand how their business finances work, or to use his words, “take control of your cash and manage your business with confidence”.

In addition to his monthly workshops in the Business & IP Centre at The British Library he has now published a book. Understanding your business finances is part of the ‘Essential Business workbook’ series published by Cobweb, who also produce the essential Cobra database.

Johnny understands how most people starting a business are intimidated by the financial aspects and often hide their heads in the sand.

“Many people come unstuck when they start a business because they don’t know what the numbers are telling them. Some don’t even have any numbers to work with! Others manage to get through the early days create a really successful business, only to be ripped off by a so-called business partner who is ‘dealing with the money’. (And believe me that happens a lot.)”

Johnny has worked hard to ensure the language, writing style, fonts and page layout of the book are as clear and simple he can, to make this vital knowledge as accessible as possible.

The content is divided into twelve chapters with a worksheet in each one, to turn the theory into practice:

  1. Introducing the three key financial reports - Cash flow forecast - Profit and Loss report - Balance Sheet
  2. Understanding the business model
  3. Forecasting sales - researching your market and competitors - setting your process to make a profit
  4. Getting to breakeven - fixed and variable costs - calculating your breakeven point
  5. The profit and loss report (the P&L)
  6. Introducing VAT
  7. The difference between cash and profit
  8. No one goes bust with money in the bank - monitoring and understanding your cash flow
  9. Balance sheets and accounting principles - understanding the balance sheet
  10. An introduction to financing your business - what type of funding is suitable for your business - sources of business finance
  11. Day-to-day accounting in your business - who can help you with your accounting
  12. Putting all you’ve learned into practice

Johnny_Martin-300pixHHe has also include a ‘Jargon buster’ at the end covering topics from Accrual accounting to Working capital.

I will end this short review with another cliché, this time from the publishing world. ‘Everyone should read this book’. Except in this case it really is true. If everyone starting or running a small business were to read and understand this book, the number of business failures would be significantly reduced. Resulting in a stronger economy and happier entrepreneurs and their families.

“You CAN do this stuff. It’s sill okay to delegate finance to accountants or key members of staff, but don’t abdicate the responsibility completely. No one is going to look after your interests better than you.” Johnny Martin

 

Neil Infield on behalf of Business & IP Centre

15 July 2014

What’s new on... Keynote

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One of the resources we provide here at the  Business & IP Centre is free access to a number of business and intellectual property databases; helping entrepreneurs and businesses to research trends, markets and companies, and to utilise and protect their IP.

If you’ve ever wondered what the market trends are in a particular industry, how to write a business plan, or where to search for trademark registrations, then you can use our databases to find out. The databases are regularly updated and in a monthly blog series, we take a look at what’s new.

This month, we’re looking at the Keynote database. Keynote is a renowned provider of market intelligence, supplying businesses, libraries and academia with market analysis reports for more than 30 years. The database contains more than 1,000 reports covering a variety of industry sectors from IT and computing to food and drink, and is a very useful market research tool for business start-ups and SMEs.

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Combining secondary and exclusive primary research gathered from industry analysts and data from nationally recognised sources, Keynote reports are designed to help users examine markets, assess customer needs, forecast future market demand and trends, identify new growth opportunities or keep a close eye on competitors and industry leaders.

They usually have a UK focus, but many also contain a global perspective chapter. Reports often include PEST (Political, Economical, Social and Technological) or SWOT (Strengths, Weaknesses, Opportunities and Threats) analysis.

Keynote is very easy to search and navigate, and readers can download up to 10% from up to 2 reports per day (limited to once a week from the same report, and no more than 30% of a report in total.)

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There are a number of new reports available on Keynote this July, including benchmarking reports, which profile the main competitors in a specific industry, and market reports, assessments, and updates, which provide detailed analysis of issues and trends within markets.

Those disappointed with England’s recent World Cup fortunes may want to console themselves with a benchmarking report on Championship Football Clubs, whilst food or drink entrepreneurs can research the current state of the coffee shop or beer industries using the market reports and updates.

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New on Keynote this July:

  • Chemical Distributors Benchmarking Report
  • Cash & Carry Benchmarking Report
  • Refrigeration Equipment Industry Benchmarking report
  • Championship Football Clubs Benchmarking Report
  • Rugby Clubs Benchmarking Report
  • Stationery Manufacturers Benchmarking Report
  • Defence Equipment Market Report
  • Trends in Leisure Activities Market Assessment
  • Jewellery & Watches Market Report
  • Coffee & Sandwich Shops Market Report
  • Breweries & the Beer Market Market Update

Sally Jennings on behalf of the Business & IP Centre

Photo Credit: Joel Olives via Compfight cc Photo Credit: marcp_dmoz via Compfight cc Photo Credit: Linh H. Nguyen via Compfight cc

11 July 2014

How to avoid business failure

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The statistics for small business failure make for grim reading. It’s a fact that fewer than four in ten businesses survive past the first critical three years of trading to become sustainable. That’s a lot of time, money and ruined dreams that could so easily have been avoided.

I’ve worked with many businesses here at the Business & IP Centre from early stage to high growth and have found that there are some key things to do at the early stage that will significantly reduce the odds of failure and even grow to real success. In fact our research has shown that using our resources and networks will reduce the chance of business failure to less than one in ten.

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Firstly, one should remember when starting that the most important asset in the business is you. So it’s vital that you’re realistic with yourself and have your feet firmly on the ground. No matter what type of business you start or invention you want to exploit, it goes without saying that just because it’s your idea, it doesn’t mean it’s a commercial idea and will make you money.

So you need to be vigilant and do everything you possibly can to minimise risk, but how?

There’s no shame in knowing what you don’t know.  As a business owner you will need to wear so many hats and have a wide skill set that it can feel daunting. But being an all-rounder doesn’t mean you have to be brilliant at everything either (not everybody with sales skills makes a good marketer) but you sure need to understand some basic principles and practice for a lot areas.

A keen desire to pick up as much information and advice along the way is crucial. Thankfully you aren’t alone. Many at the Business & IP Centre have benefitted from accessible, down to earth workshops that tell you the most important things you need to know, be it marketing or finance.

You can Get Cashflow Confident or grow your business online with our Marketing Masterclass Perfect for anyone exploring the possibility of a new business is our Start-up Saturday workshop  too.

Workshops are great opportunities to share experience and meet others too. You can start to create your own network of contacts to help you in all the areas you need to know. It may well become your lifeline.

Secondly one should find out as much as you can about the market you’re moving into. Proper research is your gateway to better opportunities. To have a serious business someone needs to buy your dazzling new product or life enhancing service and it sure helps to know whom. Market research does just this by identifying consumer profiles, average spend, size of the market place, threats, opportunities and forecasts. All this is information gold-dust at an early stage that will save you so much time and money in the long run, even if it’s as simple as helping to guide you on the right marketing strategy.

Published content by some of the larger researchers out there is beyond the budget for most early Individual Male Laptop stage businesses. The Business & IP Centre has taken this problem out of the equation by making freely available to its walk in users over £5 million worth of quality research on all major sectors and a good many small ones too.  What’s more our Information Specialists in the Centre will point you in the right direction and show you what you need to know.

And thirdly one should ensure your new venture will need to be as safe from risk as possible. Getting the right legal structure and necessary insurance in place at an early stage will save you huge bills and endless stress later. Understanding what you need to do doesn’t have to be as complicated as it sounds. A database in the Centre called COBRA (Complete Business Reference Advisor) tells you in plain English many of the legalities and insurance issues you’ll need to address among other topics.

One should always consider what Intellectual Property there may be in the business too. Our Intellectual Property workshops and advice help to break down and explain how you can address this important asset in any business.

Group 7So addressing these issues will ensure your first step is a sure one. Of course there’s much more to build on from here but these issues are absolutely fundamental to the viability of any venture.

Finally, I would suggest not throwing all your eggs in one basket. Don’t quit your job just yet especially if you haven’t even had a single sale! It’s good practice to test and refine your proposition with a few customers that helps to prove the concept.

Remember, there’s never a shortage of help and advice to guide you, so help yourself to reduce the odds of failure.

 

Jeremy O’Hare is a Relationship Manager for the British Library’s Innovating for Growth programme.