RESOURCE CENTRE

Your EnterQuest Bulletin - 16 June 2005

In this week's issue:

• small business survival strategy checklist
  
• retail theatre for the small business
  
• from sole trader to limited company - what to ask your advisers
  
• using PDF documents to secure your work
  
• the Business Rates website reviewed
  

Small business answers

If you have any questions about your business idea, are lacking some basic data about your target market, or simply need help tracking down a grant, subsidy or other source of 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.

Weekly stir

Small business survival strategy checklist

One of the most exciting, but also very frustrating, aspects of running a new business is that just about everything you get involved in is new and results in you doing many things for the first time.

As a result you will occasionally get things wrong, climbing an important learning curve in the process, and sometimes you might also be given completely the wrong advice. This is not only frustrating, but getting off on the wrong foot like this can also be extremely damaging to your chances of success.

However, running a business is remarkably simple if you follow a few guiding principles that apply to every single business that survives its first year and goes on to grow.

So we've prepared a very short survival strategy checklist, which we'd like you to use and assess yourselves against, to help you focus your efforts and see if you're on the right track.

But before we give you the checklist here's what ISN'T on the list and never will be as long as we remain a small business publisher.

1. Fiddling with your business plan for hour after hour, day after day.
2. Applying for grants that you're almost certainly ineligible for anyway.
3. Visiting business advisers who insist that you fill in lots of forms and get you to tick boxes that justify their existence, and don't help you with yours.
4. Writing advertising and sales messages that talk about you, your business and how fantastic you, your business and your products are rather than addressing your customers and their specific needs.
5. Visiting websites, or reading business publications that call your business an "SME" - a term that's used by civil servants and bureaucrats - and that offer no practical advice whatsoever.
6. Spending money on an idea or development you know little or nothing about before you've thoroughly tested the concept first.
7. Selecting a target market that you know you will never be able to reach.

Now we've got that out of the way, and probably stirred up a hornet's nest or two, what are those fundamental strategic operating principles that should be on your survival checklist?

The secret to survival lies in learning how to run and grow your business strategically and effectively over the medium to longer term.

From the following checklist, which of the following business strategies apply to you and your enterprise and which do not?

1. You are continually focused on attracting more new customers.
2. You are striving to increase the average sales amount per customer transaction.
3. You understand the need to get your customers to buy from you more often.
4. You are focused on keeping your customers for life.
5. You have found one thing that your business can do better than anyone else.
6. You recognise that creating an outrageous reputation for outstanding customer service will set you apart from your competitors.
7. You have found a market niche that you are convinced you can continue to serve over the longer term and at a profit… and have the discipline to do it.

How many of these strategic principles currently apply to you, and have you got advisers who also recognise, understand and can help you focus on them?

By focusing on these principles and shifting the strategy you follow, that's if you have one at all, you might just increase your ability and capacity to not only survive, but also develop and grow your business over the longer term.

Marketing tip

Retail theatre for the small business

In the late 1990s, an American company called Maytag pioneered an innovative style of marketing that has been dubbed, as it has caught on, 'retail theatre'. With Maytag, this involved a concept store where customers could test-drive products and services en masse, using detritus from their own lives - for example, they could wash their dirty clothes in the washing machine on display, or use the oven to cook something.

Clearly this concept lends itself rather well to large companies with impressive showroom facilities and lots of resources to devote to the campaign. But there's no reason why the smaller business can't take advantage of the basic idea - that is, the notion that potential customers like to be able to see or feel something in real life before investing in it.

Here are a few easy to implement ideas for adopting 'retail theatre' in your business.

• Aim to provide a pleasant sensory experience. Even the smallest, most basic reception area can be jazzed up with the addition of some soft lighting, pot plants, warm colours in the décor and tactile furnishings in materials like suede and leather.
  
• Go the extra mile. Customers like to feel valued, indulged and exclusive, and they will reward you with their business, so it can be well worth spending a bit extra providing fresh coffee or fruit juice for visitors to your shop, or offering something extra - same-day home delivery, for example.
  
• Help customers visualise. Present your products within a context so that potential buyers will more easily be able to relate this to their lives. This could be something as simple as creating a 'room' to surround a display of kitchen equipment, or a complete 'picnic basket' to advertise a new type of cheese.
  
• Encourage customers to sample. Offering free samples is an age-old method of enticing customers to buy. It may seem wasteful to hand out your precious product for free, but if the customer loves it, it becomes valuable to them and the small sample they have been given will never be enough.
  
• Keep peripheral areas looking smart. Car parks, reception areas, back offices and toilets are all still part of your business premises, and their condition reflects the ethos of your enterprise. Keep everything clean, trim and freshly painted to make sure your stunning shop floor isn't let down by a grimy back room.

Find hundreds more ideas, techniques and tactics for increasing sales and finding new customers in the UK Small Business Marketing Bible.

Legal tip

From sole trader to limited company - what to ask your advisers

At some point, many sole traders ask themselves if they would be better off incorporating - that's to say registering their business as a limited company. Looking at the laws on company formation can sometimes be more confusing than helpful, and each business is unique, so it's always a good idea to talk to a legal adviser or accountant before rushing into a major change.

But what should you ask them about, and how can you make the most of the time you spend with your adviser (which, after all, can be expensive)? Here are some suggestions:

• What are the general advantages? Your adviser will probably explain how incorporation offers reduced personal financial risk, how it's easier to bring new investors into the business, and how it will help give the impression of a solid established business.
• How would incorporation affect your tax situation? The answer will depend on how many shareholders and employees the company has, how the profits are distributed, and who will receive salaries and be liable for National Insurance contributions. Get advice that applies to your specific situation.
• How much will it cost? Incorporation itself doesn't cost a lot, but you'll need to think about hidden extras such as changing your letterheads to include your registered company number and the practicalities of holding compulsory meetings of your company members.
• Finally, you should ask if there are any good reasons why you should not convert your business into a limited company. Incorporation isn't for everyone. Some businesses manage perfectly well as sole traders since they thrive on their reputations for delivering a small-scale personal service. They don't need to make large investments and they only employ extra staff as the need arises.

The UK Red Tape BUSTER offers plenty more advice on becoming a limited company, as well as hundreds of factsheets, scenarios, and FAQs.

IT tip

Using PDF documents to secure your work

Question: Which of the following does the acronym PDF stand for?

a) Private Download Format
b) Portable Document Format
c) Personal Delivery of Files
d) Pixellated Dynamic Fonts

Scroll to the bottom of this article for the answer.

The 'PDF' file format was developed as a way of making sure a document could be read exactly as the author wanted. Nowadays it's still as useful as ever because you can be sure that in a PDF format colours, fonts and unusual characters will all be the same as in your original document. It also allows you to secure a document, making it harder to change, copy, or even open except by password.

Why might you want to do all that? One reason is that businesses use PDFs for copyrighted material. The format can make it less easy (although not impossible!) to copy and use it elsewhere without permission.

Making a document hard to change is useful too, especially if your reputation rests on providing accurate information. A catalogue, legal document or important newsletter is often widely circulated and can accidentally be altered in many formats; in PDF, you can be reasonably sure the wording will stay the same wherever it goes.

So many businesses use PDFs for documents they provide to the public by e-mail or on their websites, such as catalogues, newsletters, press releases and white papers.

Making a PDF is easy, but you'll need to download the right software. As well as the original (but quite expensive) package called Adobe Acrobat, there are several freeware and free trial PDF makers, including PrimoPDF's free PDF creator, and Click to Convert.

And the answer to the question is b). PDF stands for Portable Document Format.

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:

• Handbag Hire

Just one word

Regularly improving your vocabulary is not just about learning new words and their 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 what a Community Interest Company is?

a) a company that must retain its profits or invest them in something which will benefit the community
b) a company which doesn't use money, but uses tokens or vouchers instead
c) the name for the new European Community company legal status
d) a community-based savings bank

Answer at the end of the Bulletin.

Website review

My Business Rates (www.mybusinessrates.gov.uk)

This website was launched last year to make the system of working out and paying business rates easier for small businesses to understand.

• Navigation - the homepage has a sensible layout, with areas for small businesses and for specific topics related to business rates clearly marked. The toolbar with frequently asked questions and a glossary of rates-related jargon is also a useful addition to the page.
  
  
  

• Accessibility - there are plenty of options here, including access keys, choices for different browsers and tips on how to increase text size. You can even rate the accessibility options on a scale of one to five, and the site's content is available in ten languages other than English.
  
  
  
  
• Content - the step-by-step information on how business rates work, how they're calculated, how they affect start up businesses and what impact they have on businesses run from home is extremely practical and easy to follow. The tool for estimating your rates bill is also helpful.
  
  
  
  
• Relevance - the site lacks a news section, although the homepage does contain links to the Valuation Office Agency and the Office of the Deputy Prime Minister sites, both of which feature their own topical news.
  
  

A solid score of 15 for this new site, which we think is an extremely useful tool for businesses trying to understand the baffling system of business rates.

Our rating - 15/20

Did you know?

Without making a great fuss about it, the Google search engine has recently added several new features you might find useful. Many of them are listed and explained in the Google help section but it's now also possible to design your own Google page so that it combines the features you're interested in. You can create a page with news, weather, and an RSS feed of local classifieds, for example. Only basic options are available at the moment, but the service is likely to expand in the coming weeks and months.

Worth a visit

Keeping you on the map

Mappy is one of the best of the many map sites out there at the moment. It's particularly useful for planning an itinerary, since you can enter an address and a destination and Mappy will plan out a route map, giving estimated times and distances as well as alternative routes. The site works equally well for trips abroad to destinations such as France or Italy and will even calculate the cost of fuel and tolls.

Oscars for the wild web

If you're looking for ideas or design inspiration for your website, the 2005 Webby Awards have just been announced. Regarded as the Oscars of the web world, a list of all the winners in categories ranging from food to business is online at the Webby Awards site.

Snappy keywords

Snap is a search engine with a difference. Rather than taking you to websites, it will tell you about the search terms you use. Your search is ranked for popularity (useful for choosing website keywords), and Snap will suggest similar terms as well as telling you how popular they are. This is an excellent site for people who really care about the content of their websites.

Worth a read

Focusing on the surprises, shocks and pitfalls most commonly faced by small business owners, this book takes you step-by-step through the difficult situations you are likely to encounter and provides practical guidance on solving these problems. Issues covered include the resignation of a valued employee, accidents in the workplace, customer complaints, invoicing errors and failed inspections. Check out:

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Good luck

The EnterQuest Team

This information is meant as a starting point only. Whilst all reasonable efforts have been made, the publisher makes no warranties that the information is accurate and up-to-date and will not be responsible for any errors or omissions in the information nor any consequences of any errors or omissions. Professional advice should be sought where appropriate.