RESOURCE CENTRE

Your EnterQuest Bulletin - 12 July 2005

In this week's issue:

• six reasons why a few small businesses win but most do not
  
• six ways to make your small business newsworthy
  
• understanding customs duty and VAT
  
• silencing a noisy computer
  
• the Home Office website reviewed
  

Small business answers

If you have any questions about your business idea or target market, or need help tracking down a grant, subsidy or business support in your local area, then send an e-mail with your query to the EnterQuest information team and we'll do our best to help.

Send your question to enterquest@cobwebinfo.com.

To access over 800 factsheets, guides and small business reports, go to www.scavenger.net.

Weekly stir

Six reasons why a few small businesses win but most do not

The small business world is insane. Totally insane.

Why? Because it continually attracts people into it with no marketing savvy at all, smart a*ses who just talk about "business" but are incapable of doing it, along with complete idiots who allow money to be sucked out of their business from day one until it is bled dry, which usually isn't very long after they start up.

Shocked? Well don't be, because around 80% of newly started small firms perish within a year of starting up.

But they don't have to. With the right preparation, approach and common sense steps most people who start up can stay in business and experience some success.

In fact some of them can, and eventually do, go on to beat the stuffing out of their competitors altogether.

So what is it that these savvy business people have that the smart a*ses don't?

Here are six factors we consistently see that separate the small business winners from the losers.

1) They are obsessed with their customers

Successful business owners think about their customers and THINK LIKE their customers all of the time. They see their product or service through their customers' eyes, and never let up finding new ways to improve their customers' lives, jobs or experiences while doing business with them. Losers don't do this and tend to look at their product from one angle only. Their own.

2) They love their product but don't get too attached to it

By this we mean you should of course be fanatical about your product or service, but that you should also continually be on the lookout for other profitable sales opportunities. If you're in a fairly narrow or niche market, then find something else that will sell to your target customers. Niche marketing is great but only having one great product might just result in you being a one-hit wonder.

3) They do the unorthodox

In an increasingly competitive world the consumer has more and more choice, and therefore more and more reasons not to buy from you. So with very little to differentiate one similar product from the next, the winning small business is the one that does the unusual, finds some extra value or something more than is expected in their market. Or they find a cleverer, more innovative way to do their marketing, or a level of customer service that no-one else can beat. Differentiate or die, as they say.

4) They are obsessed with quality

Businesses that consistently succeed will recognise that the standards to beat in their market are the ones that are being set by their rivals. As a result, they continually look for ways to raise their standards of workmanship, customer service or marketing to new or previously unachieved levels. In other words they try to achieve a level of quality that will ensure it is them and not their competitors that are setting the standards for everyone else to beat.

5) They are action-oriented

Businesses that achieve their objectives don't sit around all day dreaming, or planning and dithering over their ideas. They get their finger out and try to make it happen before someone else beats them to it. The small business world is very fast moving, with lightning quick changes in market needs, trends, tastes and fashions. Stand still for too long and you'll get left behind, and might never catch up.

6) They have very clear objectives

More than anything else, this is what probably separates the winners from the losers. The winners are absolutely clear about who their target audience is, their strategy for reaching them, and what they will do next if the strategy doesn't work. They know exactly what they are doing most, if not all, of the time. Losers don't.

Used in combination, of course, these factors can help create a formidable small business in any marketplace. But far too many new businesses have few, and sometimes none, of these factors in their armoury. Smart a*se business owners are blind to all of this, and are more likely to fluff and bluff their way through things.

However, if you recognise that you have some of these qualities already, and can work on the rest, then you have a real chance of making it happen in your small firm.

Marketing tip

1) Do a customer survey and include controversial questions. Write articles and news releases about the results of the survey, and distribute these to local newspapers, magazines and e-zines.

2) Create a top ten list about something in your business. If you're a beautician, write an article entitled, 'Top ten most popular hairstyles for women'. Top ten lists are very popular in lifestyle magazines and as news snippets in papers and on web portals.

3) Tie your business in with holidays or special days. For example, tell the media how your massage therapy business helps to reduce stress during the Christmas season and provides gift certificates for welcome relief.

4) Tie your business into something that took place in the past. Go to your local library and find articles from 50 years ago that may somehow tie into the product or service you provide.

5) Be first. Be the first to offer a 200% double-your-money-back guarantee. Be the first to offer an on-site car wash with every sale. Be the first to give your employees ownership in your business. Think of something at which you can claim to be the first.

6) Sponsor a local community service project. For example, if you're a dry cleaner, clean the clothes of all the visitors to the local food shelter. If you're a fast food retailer, hold a free lunch day for children under six.

Legal tip

Understanding customs duty and VAT

Using eBay and other online shopping sites is increasingly common among businesses not only looking to sell, but also to cut their costs by sourcing equipment and goods as cheaply as possible. Sometimes, this takes them abroad, to websites and suppliers in other countries which advertise lower prices.

Her Majesty's Revenue and Customs (HMRC - formerly known as Inland Revenue) is taking an interest in this burgeoning international trade, fearful that it might be losing out on import duty or VAT. So here's a practical guide about how you can keep straight with the tax man when importing small amounts of goods.

Firstly, if you are importing from countries inside the European Union (EU), you don't have to pay duty or VAT on most goods, with the notable exceptions of tobacco and alcohol. (Note that other restrictions on things like meat, cars and plants may apply as well as duties).

But if the goods come from outside the EU, in many cases you need to take into account customs duty and VAT. Packages with a low value may escape duty, however:

• Small packages worth up to £18 (€22) are exempt from VAT and customs duties. The sender should include a form on the outside indicating their value, which should be provided by their post office or courier service.
  
  
• Gifts worth up to £36 are also exempt, and must also be declared as such in a form attached to the parcel.
  
  
• Goods that turn out to be damaged or otherwise not as you expected and have to be returned also escape duty.
  
  

Import duty and VAT will be payable on everything else valued over these thresholds, and can sometimes be prohibitively expensive (it varies according to the country of origin and the type of goods). These taxes are payable to whoever will deliver your goods - the Royal Mail or one of the courier services, for example.

If you're planning to import on a larger scale, you should get in touch with HMRC, which will help you go into things in more detail. And the UK Red Tape BUSTER offers hundreds more factsheets, scenarios and frequently asked questions covering all aspects of small business law.

IT tip

Silencing a noisy computer

Many people get used to the noise from their computers, but that doesn't mean it's a good thing. After all, the difference between a noisy and a quiet computer could be the difference in how much work you get done.

Most noise from PCs comes from the two fans used to cool down the microchips inside - one's an extractor fan designed to take hot air out of your PC, and the other is smaller and sits over your computer's microchip to cool it down. The noise itself comes from several things - the air passing the fan blades, the ball bearings on which the fan rotates, the air getting whisked into your computer through the nearby grill and any other tiny gap in the casing, and general vibration.

With this in mind, the following is a mixture of high-tech tips for reducing noise, and somewhat more basic ideas that are equally effective.

• One first and obvious step to take is to make sure your PC isn't on your desk - if possible, place it below your desk, where it will still be properly ventilated but where noise will be reduced.
  
  
• Putting your computer on a soft surface such as carpet will reduce vibration. If you have hard wooden floors, think about putting something soft between the casing and the floor.
  
  
• Keep the fan clean - most fans tend to accumulate dust and they run more smoothly if you regularly dust them or even use a small battery-driven vacuum available from computer supplies shops.
  
  
• Your computer's fans will make most noise just before they fail - unusual vibration or a whirring noise may be a sign that you should change your fan (which is easier than you might think - just ask your computer supplies shop for advice, or see this guide).
  
  
• Larger fans are usually quieter than smaller ones, since they can turn more slowly but still have the same cooling effect. Try replacing your current fan with something bigger, or a fan specially designed for quietness.
  
  
• Finally, check for loose screws and tighten them up, and ensure the outside of your PC is fitted snugly. Aluminium or alloy casings are particularly susceptible to vibrations and any looseness will translate to extra noise.
  

New business idea

Each week we provide you with summaries of some popular or emerging business ideas in the UK.

Here is this week's idea:

• Hotdog and Burger Stand

Just one word

Regularly improving your vocabulary is not just about learning a new word and its meaning. It will improve your general knowledge and make you feel and act smarter in all sorts of personal and business situations.

Do you know the difference between the commonly confused words 'continual' and 'continuous'? Which of the following definitions applies to which word?

a) something that occurs very frequently
b) something that happens without a break

Answer at the end of the Bulletin.

Website review

The Home Office (www.homeoffice.gov.uk)

This is the site where you can find out about the UK Government's initiatives and policies on crime and policing, including issues such as Internet crime and business fraud, as well as details about employing foreign workers.

• Navigation - the homepage is clearly presented and easy to follow. A simple approach and some useful links make this a generally good effort.
  
  
  

• Accessibility - access keys are given, and accompanied by instructions for users of Netscape and Mac computers, which is better than most other Government sites we've reviewed. There is a link to help with PDFs and one to a screen reader - but surprisingly, given the content of the site, no foreign language options are available.
  
  
  
  
• Content - there are some gems on this site, including crime prevention tips for businesses, statistics so you can check the level of crime in your area, and useful information about initiatives and ongoing endeavours to tackle retail crime, fraud and Internet crime.
  
  
  
  
• Relevance - the publications are plentiful and up-to-date, with useful items such as best practice guidelines for employers on issues such as racial equality regularly updated to take account of new statistics and legal changes. Other news stories are fresh and well-written.
  
  

A solid score of 15 for the Home Office - adding a few minority ethnic languages to its content, particularly since much of it concerns immigration and foreign workers in the UK, would boost this score.

Our rating - 15/20

Did you know?

For every £1 spent on consumer direct mail, £14 is generated in sales

Get this and the other key statistics and facts on the use of direct mail in the UK from the Direct Mail Information Service. It has published a factfile which provides information about the usage, volume, cost and effectiveness of direct mail in 2004.

Worth a visit

Who's who of podcasting

Podcast.net is a directory of podcasts by topic, which can be searched by keyword, host, episode, location or title. For example, if you pick the topic of 'business and money', you can choose from 191 podcasters, including sub-categories such as travel, marketing, small business and motivation.

Competitions online

ContestHound.com is a comprehensive directory of contests, competitions and sweepstakes run by businesses and organisations around the world. It's got some good marketing ideas for business owners looking to add an interactive flavour to their websites or mailshots, and even offers an RSS feed so you can have new competition ideas e-mailed to you.

Free tool for banishing metadata

UK software firm Workshare has released a new piece of freeware, available to users of Microsoft Office, which aims to minimise the risk of embarrassment or financial liability that can be caused by unknowingly including 'metadata' in Microsoft Word documents. Metadata is literally 'data about data' - information included within documents that gives details that you don't necessarily want others to see, such as changes that have been made to costings in a proposal document, for example. The tool audits your documents continuously to identify metadata and provides instructions for how to get rid of it.

Worth a read

Part of a useful series of short, snapshot books looking at how you can address key business problems in 30 minutes or less, this book focuses on improving your networking skills, and looks at issues such as boosting your confidence and attracting new business. Check out:

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Good luck

The EnterQuest Team

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