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Archive for March, 2014

What is in a name?

Most business owners are aware of “branding” as it applies to the business name but many service based businesses do not appreciate how important it is to name services.

If you offer a service, like Sackmans Accountants North London, you have four key issues to address:

  • A service cannot be seen, heard or touched
  • The benefits of a service are sometimes only felt days, weeks, months or even years later
  • Prospects think that all services providers are the same and focus on price
  • Prospects find it difficult to assess the benefit before they buy the service


These issues often prevent people buying the service to spending more than the lowest price. However, packaging can help and here is a three step process how to do it with your service.

First, you need to name the service. There are different ways to go about this including thinking about key benefits and outcomes the customer gets.

At Sackmans we have a business advisory side of service but rather than just calling it “business advice” we have name it “On-Track“.

Naming your service is a key part of your differentiation strategy which is vital if you want to stand out from the competition and help people focus on the value rather than just the cost.

Next, you need a process. This could be a step by step process, flow charge or a checklist. For On-Track we have the Triple R process – Review, Recommend and Results.

The first thing we do in On-Track is help business owners Review their personal and business plans. When they have this so they know bother their long-term goals and what to do tomorrow we Review their progress.

The Review is a monthly or quarterly meeting where we look at the financials like sales, profits and cashflow but we really focus on the key drivers.

The Recommend phase is where we suggest ways business owners can improve their results. This can be explicit advice based on our own experience or what other business owners have done. Or, it can be recommending some third party.

Results is the final part. This is where we calculate the outcome of the work and report to the client.

When you have the name and the process you can start to create collateral. Perhaps a service sheet and/or a diagram of the process.

How much is fraud costing you?

A recent Portsmouth University study indicates that the National Health Service in the UK is losing a staggering £5bn to fraud each year – approximately 7% of healthcare budget. Could your business be losing money today because of fraud?

As a business owner you can look to prevent fraud with vetting employees, implementing an anti-fraud policy and running fraud awareness training sessions. But, what are you doing to detect fraud that is happening?

If fraud is happening in your business the longer it takes you to spot it the higher the price. There is no guaranteed way to spot fraud but here are 7 steps to help you.

Step 1 – Understand your exposure
An assessment would look at internal and external threats although internet should get more focus because this is where the greatest risk is. However, technology is only increasing the external risk with cyber crime.

Step 2 – Be aware of signs
The key signs include people living beyond their means or experiencing financial difficulties as well as close association with suppliers or customers and/or having excessive control issues.

Step 3 – Engage your people
Most frauds are detected by tip-off so the best way to protect your business is for your employees to act as a fraud detection team.

This starts with the directors publicising an anti-fraud policy. Next, the key individuals in the fight against fraud need to be clear on their personal objectives and anti-fraud responsibilities.  The business must support the fight with anti-fraud training for both managers and staff.

Step 4 – Effective reporting
Make sure you have a fraud hotline which employees trust.

To increase the chance the hotline is used, make sure the whistle-blower’s identity will remain confidential. And, it is vital that employees believe that you will take action following the disclosure.

So, you need to have an effective investigation process which keeps the whistleblower informed of progress.

Step 5 – Carry out checks
This is where managers play an important role and there are two things they should focus on; transactions just below control levels/limits and expense claims with subsistence and travel.

Step 6 – Use data mining tools
Rather than rely on manual checks, data mining software and high life anomalies, trends and risk indicators.

Step 7 – Take action when fraud is detected
The anti-fraud policy should make it clear that fraud will not be ignored, anything unusual or reported will be investigated and there will be consequences.

Consequences would include dismissal and the fraud being reported to the Police with a request for prosecution.

It is recommended that reporting to the Police be automatic and without regard to any brand damage with stories appearing in the media. This is because most employees who commit fraud are first time offenders and the threat of jail is a key lever for protection.

Fraud, by its very nature, can be difficult to detect and the 7 steps are not a guarantee that you will not stop it or catch it. But, they do send a message to employees and give the directors and managers a framework to work within.

LivePlan review

I look for systems to help me deliver On Track as cost effectively as possible.

I recently had a look at LivePlan the business planning tool because it now links to Xero accounting. This means you can create financial forecasts in LivePlan and it will pull data from Xero so you can compare results to budget.

LivePlan has a section to include milestones. You can use this to break down your business development into baby steps. And, we can help hold you accountable.

You can use LivePlan to raise finance my publishing and online one-page pitch and sending this to potential lenders/investors.

This level of financial management is normally only available to larger business, however, Xero enables a start-up and small businesses to be highly effective with financial management.

Most people think business planning is something you do once at the beginning of a business, however, this should be something you do every month or at least every quarter.

Maybe you should have a full strategic review once every three years where you go away for a day or two and think. But, every month you should be working ON the business thinking about things like product development, pricing, customer experience, your Website, recruitment, people performance, profitability and liquidity.

LivePlan is a easy to use system that enables you to record your thoughts and share them online. Although it is easy to use it is comprehensive. Before you get the financial section  you need to consider up to 38 questions including:

  • Competitors
  • Technology
  • Intellectual property
  • Product/service development
  • Market trends
  • Key customers
  • Pricing
  • Marketing activities
  • Sales channels
  • Your exit strategy


If you have not reviewed your strategy or you don’t have a plan for the next 12 months then I recommend you consider using LivePlan. We can assist you setting up and provide support putting the financials together.

I am happy to fix up an On Track review

Pension changes

Most budget changes are small tweaks to the system and not worth writing about. However, the changes to the pension rules are different.

From April 2015 you will be able to get at all your pension fund. Beforehand you could only take out 25% tax free; you had to buy an annuity (right to income) with the rest.

As well as annuity rates being low, the main issue was that when you died the money used to buy the annuity was lost to the pension company.

The changes mean that you can now pull out all your pension savings, subject to having at least £12,000 of pension income (including your state pension). Yes, you will have to pay tax at the level you would pay tax if you earned extra money but keep in mind:

  • Money invested in a pension is tax deductible
  • Grow in a pension is tax free


I will be offering all clients a personal financial review where I produce a personal cashflow forecast. This is an ideal opportunity to consider setting up a pension or contributing some extra savings.

Remember that it is possible to control your pension fund via a Self Invested Personal Pension (SIPP). This means it is possible to lend your own company money from your pension fund, or even purchase an asset and lease it to your own company.

There are costs and risks but there are with anything. Whether you should do anything depends on your personal cashflow forecast. If everything looks good then you should look to product and reduce risks.

However, if things are not going to plan it could be worth considering taking some pension savings and investing in your own business.