Biggest fall in business lending in six months

Biggest fall in business lending in six months

Oh dear, SMEs may be excited by the news that we are out of the recession and even on the cusp of another boom era, but they will not be overjoyed to know that the Bank of England report this week says net lending to businesses fell by £3.7bn in November. And this is despite attempts to rebalance loans away from mortgages. Hopes of a balanced economic recovery have been dealt a blow with figures showing a worsening slump in business lending, even as mortgage levels reach their highest level since the financial crisis. The Telegraph story is here.

The continued decline is likely to worry the Bank of England’s Mark Carney, who has attempted to engineer an increase in business lending.

fall in lendingIn November, Mr Carney raised concerns about overheating house prices and attempted to rebalance the BoE’s Funding for Lending Scheme (FLS), which allows banks to borrow at rock-bottom rates if they lend out the money. The BoE was hoping the slump in business lending would abate after five years in the doldrums. He cancelled a key support package for consumer lending and focused it on businesses. But some economists have raised fears that the strengthening UK economy is down to unsustainable rises in consumer spending and house prices.

The BoE’s Trends in Lending survey, as well as separate data from the Council of Mortgage Lenders (CML), showed mortgage activity reaching its highest levels since 2008.

The previous lending report – released in October – indicated that the fall in net business lending – the difference between new loans and repayments – had started to tail off.

Net lending to businesses decreased at a relatively shallow £2.3bn in the three months to the end of August, but latest figures showed a £4.3bn fall in the following period – the three months to the end of November.

In the 11 months from the start of 2013, net business lending was down 3.1% – the same fall as in the respective period in 2012.

This comes despite increasing demand for business loans, according to the BoE’s latest credit conditions research. “The annual rate of growth in the stock of secured lending to individuals in the year to November remained weak,” the Bank said.

Although alternative methods of financing are growing, it said six institutions – Santander, Barclays, HSBC, Lloyds, Nationwide and Royal Bank of Scotland – account for 70pc of business lending.

Despite the economic recovery of last year failing to have an uplifting effect on business loans, economists believe the prospects are better for 2014. The Telegraph article reports that Howard Archer, chief UK and European economist at IHS Global Insight, said: “With the UK sustaining a decent level of economic activity and prospects looking relatively bright, it seems highly likely that business demand for credit will pick up appreciably over the coming months.”

The Online Business Library… why it could make all the difference to your firm

The Online Business Library… why it could make all the difference to your firm

There are probably four ways in which a firm can maintain relationships with its clients and prospects in providing technical and other information in response to a request for information.

obl      1)    The first option is to buy in publications from publishers. The problem with this is that it is a costly thing to do, the information contained in the publications can easily go out of date and it’s a clumsy way of providing information to those who ask for it. What happens in practice is that there are piles of brochures in the corner of an office, gathering dust.

It was a good idea 28 years ago when I launched the CharterGroup partnership because small to medium sized firms couldn’t afford to write or publish their own brochures, so they had to be syndicated and bought in from a group publisher. But today clients and website visitors want more. Storage of paper publications is difficult and they often get thrown away after they’ve been read.

2)    The next option is to subscribe to a digital business library and have hundreds of brochures and publications available via your website 24 hours a day, every day of the year. This has several advantages: because the publications are digital they are up to date and once clients and prospects register on your website they can simply take what they need and when they need it.

Also, the publications cost nothing to distribute via an on-line mailing (I’ve written some words about MailChimp below) and your on-line showcase can include features such as page turning functionality. Even better still is that the actual cost to a firm of a digital library is a fraction of that for printed publications under option 1.

3)    The third option is to do nothing. This option costs nothing. Clients get nothing that they need. Prospective clients avoid firms that do nothing and move to firms that provide details of their services and issue free publications.

4)    The last option is for a firm to write their own publications and then publish either in paper form (as in option 1) or in PDF digital format. The problem with this option is that accountants and lawyers don’t have any time to do this sort of thing. Even when they find a few minutes to do so, the end result isn’t very smart and is often a mis-mash of design and content.

Be honest, which firm are you?

According to research, over a third of small business owners feel isolated when making key business decisions: 43% confess to loneliness when focusing on changing strategy or direction, and another two fifths feel detached over business planning matters. Accountants and Lawyers are uniquely placed to help businesses by providing them with information direct from their website through a digital business library.

When I was in public practice as an accountant, I set about creating a digital business library. It took me about 10 years to get it right. However, it was all worthwhile as Bizezia’s Online Business Library now leads the market with a comprehensive collection of 650+ professionally-written informative publications that you can offer free to your clients direct from your website. The publications cover an extensive range of business topics from tax to marketing. You name it, there’s probably a publication in the library to cover it.

Digital publications will allow you to add significant value to the service you offer your clients, and help you build relationships with prospective clients.  The “do nothing” option is awful. Please don’t do it.

Bizezia’s Online Business Library

Bizezia’s Online Business Library is probably the UK’s largest and best known. It features over 650 publications. Every publication is personalised and branded to your firm and available for your clients and prospects to download from your website. These business publications provide valuable information on diverse subjects such as law, finance, marketing and management. The Online Business Library is an impressive knowledge resource. Best of all: It underlines your credentials as a knowledgeable, professional firm. It differentiates your firm from others in your locality. You can find details on how to subscribe here.

You can watch the video about it as well.

MailChimp I mentioned MailChimp above. Perhaps I should explain what it is. MailChimp is a web-based email marketing service. It helps you design email newsletters, share them on social networks, integrate with services you already use, and track your results. Whatever the size of your firm, MailChimp has features and integrations that will suit your email-marketing needs.

You can create signup forms that match your firms’ brand’s look and feel, and send updates, event invitations, announcements, or editorial content. You can use their reports to improve your campaigns and learn more about you’re your clients and prospects (MailChimp call people you email “Subscribers”).

And do you know the best thing of all? MailChimp is free for lists of up to 2,000 subscribers. And the free bit allows you to send out 12,000 emails a month.

Try it here. We use it at Bizezia. More than 5 million people use MailChimp to create, send, and track email newsletters, brochures and other digital communications to customers, clients and prospects. About 6 billion emails are sent out every month.

Don’t be paralysed by numbers

Don’t be paralysed by numbers

paralysed by numbrsThere’s a saying, or rather a comment, I picked up from a very smart Scottish accountant who had become an MBA teacher at a leading US Business School. He said that often, accountants and finance directors suffer from something called analysis paralysis. It’s the state of over-analysing (or over-thinking) a situation so that a decision or action is never taken, in effect paralysing the outcome.

Has that ever happened to you? Or worse still, have you been guilty of doing it yourself.

There’s nothing wrong in analysing numbers provided you measure the result.

With this in mind, I’ve taken look at some of the tools within the Bizezia Calculators and Evaluators product and thought it would be useful for my readers to review what these tools do. The results from these tools should be used as a guide only and clients should consult an experienced or qualified accountant or financial/business adviser before making any decisions.

Borrowing Risk Calculator            

Are you serious about reducing borrowing costs? Would you like to know the ‘secrets’ of how your banker assesses a lending proposal and the business in terms of risk?

The Borrowing Risk Assessment Tool, which is intended for use as a guide only, has been developed as a guide to:

1. Show you what you can do to get a lower rate of interest on borrowings by reducing the risk.
2. Help you to identify your ‘escape routes’ if you hit a financial hole.
3. Help you improve your relationship with your bank.

Business Growth Calculator

Based on the well-known “Four ways to grow a business” popularised by Michael Gerber, Jay Abraham and many others, the Business Growth Calculator is designed to calculate the change to the gross profit of a business arising from altering any or all of:

  • the number of customers
  • the average number of times they purchase
  • the average amount they spend, and/or
  • the average gross profit percentage

Most business owners don’t know the number of customers they have, or the frequency of purchase or the average sale value. The good thing about this tool is that it allows you to try various combinations until you arrive at a total sales value that is correct.

Business Health Calculator

This is the smartest of all the tools. Basically, accountants or their clients, input numbers from the accounts of the business.  The calculator then produces a lengthy series of meaningful ratios, including:

  • Profitability Ratios
  • Liquidity Ratios
  • Operational Ratios
  • Solvency Ratios

Then, the calculator does something quite amazing. It works out something called the Z-Score, which indicates financial health (or sickness) of the business. It also indicates the short-term potential for financial problems at your company. The expert who devised the Z-Score is Professor Edward I. Altman, who is known as the founding father of using statistical techniques to predict company failure.

The Z-score was developed from an analysis of 33 bankrupt manufacturing companies in the US with average assets of $6.4 million. Altman’s system, basically a “bankruptcy indicator,” can be used by stockbrokers trying to determine if a company is a good investment, and also internally, by anyone who wants to take a close look at his or her own company’s financial health.

Accountants can even use it on their own firm’s results.

Altman’s Z-score calculates five ratios: return on total assets, sales to total assets, equity to debt, working capital to total assets, and retained earnings to total assets. These ratios are then multiplied by a predetermined weight factor, and the results are added together. The final number, the Z-score, yields a number between -4 and +8. Financially-sound companies show Z-scores above 2.99, while those scoring below 1.81 are in fiscal danger, maybe even heading toward bankruptcy. Scores that fall between these ends indicate potential trouble. In Altman’s initial study of 33 bankrupt companies, Z-scores for 95 % of these companies pointed to trouble or imminent bankruptcy.

In the hands of a smart accountant looking for new work from prospects, this tool could be dynamite in getting new business.

Customer Value Calculator
The Customer Value Calculator considers the effects on sales (over a 5 or 10 year period) of altering the rate of retention of customers and the referrals that customers give to other potential customers.

Business Parameters:
1.  % Retained customers that give referrals
2.  Number of referrals per customer
3.  % Referrals that become customers
4.  % Customer Retention Rate

Risk Exposure Calculator

Analysing data risk exposures enables you to estimate the degree of risk. Results fall into one of these categories:

· Very Little Risk: You either don’t have very much critical data on your computers, or your backup plan is probably adequate. Consider using a remote backup service to supplement your backups.

· Slight Risk:  If you experience a non-catastrophic loss of data, you will probably be able to recover it. Generally, you are doing a good job with your backup plan, but you should consider improving.

·Moderate Risk:  A loss of data from your hard disk drives may not be recoverable. Your backup plan is not adequate and you are at risk of losing data critical to the operation of your daily business.

·High Risk: Any major data loss would be catastrophic, and would probably not be recoverable. Your business is at risk of failure if you lose data.

·Extremely High Risk: Your backup plan isn’t protecting your data. You could experience an un-recoverable catastrophic data loss at any time which could cause the business to fail.

Grading High Book / Market Stocks

This tool is rather smart too. It’s based on the work of Joseph Piotroski, an Accounting Professor at the University of Chicago who reasoned that because value stocks are troubled companies by definition, many are financially distressed and won’t have the financial resources to recover. Pondering on whether he could improve the performance of a value portfolio by throwing out the financially weakest stocks, he devised a simple nine-criterion stock-scoring system for evaluating a stock’s financial strength that could be determined using data solely from financial statements. One point was awarded for each test that a stock passed. Piotroski classed any stocks that scored eight or nine points as being the strongest stocks. His findings were that these strong stocks as a group outperformed a portfolio of all value stocks by 7.5% annually over a 20-year test period. Piotroski also found that weak stocks, scoring two points or fewer, were five times more likely to either go bankrupt or delist due to financial problems.
The evaluator goes through these stages:

·  Net Income: Positive net income – Net income, the bottom line after-tax profits, is the simplest measure of profitability. Score 1 if the latest year’s net income is positive; otherwise, a zero.

·  Operating Cash Flow: Cash flow is arguably a better profitability measure than net income. Cash flow measures the money that actually moved into or out of a company’s bank account; Score 1 point if the latest year’s operating cash flow is positive, otherwise, a zero.

·  Return On Assets (ROA): Earnings quality – Many experts compare net income to operating cash flow to detect potential accounting manipulations. Cash flow normally exceeds net income because depreciation and other non-cash expenses reduce income, but not cash flow; Score 1 point if the latest year’s operating cash flow exceeds the current year’s net income, otherwise, a zero.

·  Quality of Earnings: Warns of Accounting Tricks. Score 1 if last year’s operating cash flow exceeds net income, otherwise, a zero.

·  Long-Term Debt (LTD) vs. Assets: Is Debt decreasing? Score 1 if the ratio of long-term debt to assets is down from the year-ago value, otherwise, a zero. (If LTD is zero but assets are increasing, score 1 anyway.)

·  Current Ratio (CR):  Measures increasing working capital. Score 1 if CR has increased from the prior year, otherwise, a zero.

·  Shares Outstanding: A Measure of potential dilution. Score 1 if the number of shares outstanding is no greater than the year-ago figure, otherwise, a zero.

·  Gross Margin (GM): A measure of improving competitive position. Score 1 if full-year GM exceeds the prior-year GM, otherwise, a zero.

·  Asset Turnover: Measures productivity. Score 1 if the percentage increase in sales exceeds the percentage increase in total assets, otherwise, a zero.

Overall, it’s a pretty impressive list, I think you’ll agree. All these tools and about 50 more can be available to accountants, clients and prospects. They sit on the accountants’ website and are available 24-hours a day, 365 days a year and are accessible from anywhere in the world with an internet connection, on a PC, Mac, iPhone, Smartphone, Android or whatever fancy equipment may be used.  There is no set-up fee for these tools, just an easy, affordable payment option with a minimum 12 month subscription. Details here.

Instead of the restricted functionality available with other online calculator packages, where users can only calculate results in a one-dimensional way, Calculators & Evaluators incorporates Bizezia’s interactive Lead-Generation Technology. This allows users to:

  • Print results
  • Share results with friends and colleagues by email
  • Export results to Excel
  • Export results to PDF
  • Ask for an e-mail alert when the selected Calculator/Evaluator is updated
  • The opportunity to request more information from an accounting firm hosting the tools on their website using the Contact Us feature.

Bizezia is so confident that you and your clients and customers will enjoy using the Calculators & Evaluators that it comes with a 30 Day Money-Back Guarantee. If, within 30 days of the start of a subscription, you think that Calculators & Evaluators is not for you, Bizezia will refund your full subscription, with no questions asked.

If you want more information, call me on 01444 884221 or contact me by email at

Report shows impact of poor customer service

Report shows impact of poor customer service

I was interested to read about a BDO report, (read it here) written by the Economist Intelligence Unit which, for the first time has unveiled the impact of poor customer service on businesses worldwide.

The report shows that businesses admit widespread customer service failings are hitting their bottom line:

  • Nearly two thirds of companies worldwide find bottom lines significantly hit by poor service
  • One in four companies have failed to invest in customer service in the past two years

The survey of more than 800 senior business leaders around the world reveals that almost two thirds (59%) of all companies admit that a customer service failing has had a clear, significant impact on financial performance.

The survey also revealed:

  • ghandiA quarter have lost customers as a result of poor customer service (27%)
  • Service failings have hit the share price of one in seven companies (15%)
  • 23% have had to compensate customers due to poor service
  • 84% of the companies, surveyed believe that customer service is ‘very’ or ‘moderately’ important to their financial performance, but only a third of companies (36%) currently have a strategy to link service and bottom line.
  • Despite customer service draining profits for many, one in four (27%) businesses have made no investment in service whatsoever in the last two years. In addition, less than a third of companies (28%) have a designated head of customer service on the board.
  • Only a quarter (29%) of business leaders feel being seen to be customer focused is key to career progression. Indeed, employee and other internal issues are taking precedence over customer concerns in nine in ten organisations (89%).

The report also finds that for many companies engagement is still low-tech: 36% of companies use social media to engage customers and just 15% believe social media will become the most important method of engaging with customers – more than a quarter believe its importance in 2020 will be the same as it is now.

Allan Evans, Global Head of Clients and Markets at BDO, said “Boardrooms are blinkered – even with clear evidence that poor service is hindering profitability, businesses are failing to invest in, track or apportion sole responsibility for service. We’re calling for more companies to put service on the boardroom agenda and have a clearer focus on the link between service quality and the bottom line. Only then will companies be able to develop clear and effective strategies to make a return on service.”


Monica Woodley, the EIU’s Managing Editor, commented: “It’s clear many businesses find themselves in a service catch 22 situation. Companies intuitively seem to understand customer service impacts financial performance, but they are unsure how to make a clear link with the bottom line. So they don’t prioritise service at a board level because they don’t fully understand it, and they don’t fully understand it, because they don’t prioritise it. More businesses need to take action now to break this service cycle or risk losing out to competitors.”


Jo Causon, the Chief Executive of the Institute of Customer Service, added: “Financials tell the CEO where the organisation has been, but customer satisfaction data gives good indications of where it is going.”


Accountants are ideally placed to help businesses in this area. Those that attended the RAS Boot Camps in the 1990s have been busily imparting to their clients (and other firms’ clients too) everything they learned about customer service. As someone once said “Most businesses don’t actually want an accountant. They want someone to help them become more successful and profitable.”

To me, it makes perfect sense to provide the best service you can to your customers. This will result in the business being more successful and profitable. In February’s Better Business Focus publication, there’s a story about a young manager called Zhang Ruimin took who, 30 years ago, took control of a loss-making fridge factory in Qingdao, China. He was appalled at the low standards of workmanship and quality in its products.  In a dramatic expression of his wrath he gave out sledgehammers and asked factory workers to join him in smashing 76 faulty fridges in front of a large group of shocked employees.

The message was clear – poor quality was no longer acceptable. Since then Zhang has focused on quality, innovation and branding in order to build the company, Haier, into the largest appliance maker in the world with a turnover of over $26billion.  One of elements of Haier’s success was learning from customers. For 4 years running the company has been voted the World’s No. 1 home appliance retailer.  There’s a shed-load of customer satisfaction emerging from China.

Email me at and I’ll send you the Better Business Focus publication when it is available.

Equal Pay – Is your firm exposed to claims running into £millions?

Equal Pay – Is your firm exposed to claims running into £millions?

equal payBefore I start, I should say that none of the remainder of this post is legal or other advice. Whilst every effort has been made to ensure that the information given in this note is accurate, at the end of the day only the courts or tribunals can give authoritative interpretations of the law.

Last week, Birmingham City Council were front page news having agreed settlements with thousands of women who were paid less than male workers who did equivalent jobs. BBC News reported that one law firm is said to be dealing with 4,000 outstanding cases. The legal claims over equal pay are said to total more than £1bn.

So, what’s all the fuss about?

It stems from The Equal Pay Act in the UK which is designed to eliminate discrimination as regards pay and other terms and conditions between men and women in the same employment when they are employed to do:

  • Like work – work that is the same or a broadly similar nature
  • Work rated as equivalent – that is, in jobs which a job evaluation study of part or all of their employer’s workforce has shown to have an equal value
  • Work of equal value – that is, in jobs which are equal in value in terms of the demands made on them under headings such as effort, skill and decision-making

Men as well as women are entitled to equal pay for equal work, but in practice most claimants are women.

A complainant, the fancy legal term for the person bringing a claim, must choose an actual comparator of the opposite sex who is treated more favourably and is shown to be employed on “like work”, “work rated as equivalent”, or “work of equal value”.  Equal value involves a comparison of the work of the claimant and the comparator under various headings such as effort, skill and decision.Equal value claims can be made using comparators paid under different grading systems, collective agreements or job evaluation schemes.

The Equal Pay Commission recommends that all employers carry out equal pay audits. This will help in identifying any potential vulnerability to equal pay claims. An equal pay audit is the best and most effective way to compare the pay of employees doing equal work and it provides a detailed picture to identify and put right any unlawful pay discrimination. There a useful toolkit on the Equality and Human Rights website, and money

The Equal Pay Act refers to the “same employment”, a term that has to be interpreted in the light of European law. Anyone thinking they have been unfairly treated by their employer will need to get legal advice on interpretation of the law by domestic courts and the European Court of Justice.

The Equality Act 2010 replaces the previous anti-discrimination laws with a single Act. It simplifies the law, removing inconsistencies and making it easier for people to understand and comply with it. The majority of the Act came into force on 1 October 2010. The Equality Act 2010 gives women (and men) a right to equal pay for equal work. It replaced previous legislation on equal pay, including the Equal Pay Act 1970, the Sex Discrimination Act 1975, and the equality provisions in the Pensions Act 1995. The provisions relating to equal pay are known as ‘the equality of terms’ provisions and are scattered throughout the Act, but are brought together in the Equal Pay Statutory Code of Practice.

There a useful glossary of terms used in connection with equal pay here.

From October 2014, The Enterprise and Regulatory Reform Act 2013 requires Employment Tribunals to order employers to carry out an equal pay audit, where they may have breached equal pay provisions under the Equality Act 2010, except in prescribed circumstances. The Act can be viewed on the UK legislation website here.

Is your firm exposed?

Obviously, Birmingham City Council is a big target. But compliance with the law on equal pay could become a nightmare for accountants and lawyers – in fact for any professional firm.

So, how do these firms go about checking whether they have any exposure?  Going through the following brief checklist could help.

Equal Pay Checklist – Are you exposed? (© Copyright 2014, Bizezia Limited)

o  Have you paid a male employee a bonus or given a pay rise but have not done the same for a female employee because she is on maternity leave?

o  Have you restricted sick pay, holiday pay or pension benefits of a female employee because she works part-time?

o  Have you put male employees on individual contract and told them not to discuss the terms with female employees?

o  Have there been any mergers or acquisitions where pay rates for the same job have never been harmonised?

o  Have jobs changed over time but because no job evaluation or other review has ever taken place, the growing similarities between jobs have not been recognised?

o  Are there any similar jobs which were originally paid at the same rate but one of the jobs is now done by a part-time worker who does not have access to the same total pay package as her full time male colleague?

Author’s Note: this checklist is not complete. I intend to update it as events unfold.

What next?

Over the next week or so, I shall be adding to the checklist and probably add it to the online Calculators and Evaluators – see here. It will be useful tool for professionals to introduce the issue to clients as a value-adding service, and of course for businesses to use themselves. I’ll also be talking to law firms to see what expertise is available on this matter.

In the meantime, please email me with your thoughts on the matter to

Make a date with Tax Calendar

Make a date with Tax Calendar

tax calendarI’m pleased to say that the Bizezia 2014 Tax Calendar is now available, here.

It’s an interactive tax reminder for your website. Tax Calendar is a great way to ensure your clients and prospects never forget their tax dates, and it’s a valuable resource which will help attract and retain website traffic, generate leads and enhance existing client loyalty. Bizezia’s Tax Calendar is a value-adding website tool which interactively displays relevant tax dates.

The Tax Calendar contains 3 different calendars for different types of user:

  1. self-assessment taxpayers
  2. companies and employers
  3. partners and partnerships

The people viewing the calendar can choose the following viewing options:

  1. year view
  2. month view
  3. list view

The calendars are simple to use with colour-coded clickable graphics to represent the tax dates occurring. You can access any of these views from all parts of the calendar.

Lead Generation Technology
Tax Calendar is not only a useful resource for clients and prospects; it goes one step further by giving users the opportunity to request more information from the host accountancy firm using the Contact Us feature. This innovative technology brings prospects to your door.

·       All key dates are covered for Self-Assessment Taxpayers, Companies & Employers and Partners & Partnerships

·       Key dates are presented by month, by year or as a downloadable list

·       Easy to use with colour-coded clickable graphics to represent the tax dates

·       Online, on-demand delivery through your website

·       Choice of colours to match your website

·       Tax Calendar is updated automatically by Bizezia

·       Contact Us

·       No programming experience required on your part

·       No set-up fees, just an easy and affordable monthly or annual payment option with minimum 12 month subscription

·       Free support from Bizezia

·       Attract and retain website traffic

·       Generate leads

·       Build existing client loyalty

·       Provide a useful knowledge resource for your clients and prospects

·       Keep yourself up-to-date with this valuable tool

There is no set-up fee for Tax Calendar, just an easy and affordable monthly or annual payment option with a minimum 12 month subscription.

Bizezia is so confident that you and your clients and customers will enjoy using Tax Calendar that it comes with a 30 Day Money-Back Guarantee. If, within 30 days of the start of a subscription, you think that Tax Calendar is not for you, Bizezia will refund your full subscription, with no questions asked.

If you want more information, call me on 01444 884221 or contact me by email at

Does it add up? Is 10,000 hours really the key to success?

Does it add up? Is 10,000 hours really the key to success?

keytosuccessBest-selling author Malcolm Gladwell studied the lives of extremely successful people to find out how they achieved success. Gladwell’s book Outliers popularised the work of K. Anderson Ericsson and the notion that the key to success in any field was logging 10 years or 10,000 hours of practice. It’s worth reading The Influence of Experience and Deliberate Practice on the Development of Superior Expert Performancei, here.

Does this resonate with you?

Louis Pasteur, inventor of pasteurisation, is said to have remarked in a university lecture, “chance favours the prepared mind.” But how much preparation is enough? If you’re a fan of Malcolm Gladwell’s work, you know the answer: it’s 10,000 hours of preparation.

Based on research suggesting that practice is the essence of genius, Malcolm Gladwell has popularised the idea that 10,000 hours of appropriately guided practice was “the magic number of greatness,” to achieve success.  In his book Outliers, Gladwell says that it takes roughly ten thousand hours of practice to achieve mastery in a field.

It sounds like an interesting idea and it’s one that has been getting quite a lot of attention recently and the idea has come under fire. Critics argue that the “10,000-hour rule” is over-simplified and doesn’t account for genetic differences. In The Sports Gene, former Sports Illustrated senior writer David Epstein (author), points out some contradictions to Gladwell’s rule – for example, that athletes at the same level of competition can have very different amounts of practice time or playing experience, and that success in sports isn’t determined only by how much an athlete practices.

In an article posted on line in the New Yorker last year Gladwell, here  comments on his theory and supports the research findings he reached.

In his new book, Focus: The Hidden Driver of Excellence, best selling author of Emotional Intelligence (which I first read during my MBA studies in the late 1990s), Daniel Goleman says “The ‘10,000-hour rule’ – that this level of practice holds the secret to great success in any field – has become sacrosanct gospel, echoed on websites and recited as litany in high-performance workshops. The problem: it’s only half-true.” Read more on what Goleman says in a posting on Huffington Post, here.

My view is this. To achieve success you need to be able to see things that exist and envisage something new, plus all or some of these:

  • An innate skill or aptitude
  • Desire
  • Commitment /Perseverance
  • Opportunity
  • Serendipity
  • Focus

What do you think?

Bizezia has a publication on achieving success in business: 130 Reasons why some people are much, much more successful in business than others. Some of these reasons come from mega-successful entrepreneurs while others come from working with small businesses, over the last 40 years.

If you would like a copy of this publication, please email me at:

Practice Management: Winning new clients

Practice Management: Winning new clients

practice managementI found something new on Accountancy Age Insight. To refresh your memory, this resource allows accountants to keep up to date with the most recently added briefings to its online service. The latest is from Sage: Practice management: Winning new clients

Sage (or is it Accountancy Age Insight?) say that running an accounting or bookkeeping practice can be very demanding, and it can often mean juggling marketing and sales to keep the business growing. The duties and responsibilities of running a business are critical tasks that must be performed in order to gain new clients. However, these are usually not the core function of the owner at the outset and more often than not, these skills need to be honed and developed.

Sage’s whitepaper helps by looking at how your firm can expand its potential client base by improving marketing communications and widening its web presence.

You can download this paper from here. Registration is required.

£8 million technology boost for UK high streets

£8 million technology boost for UK high streets

It sounds good to me: A brand new, £8 million initiative, designed to re-invigorate UK high streets, has been announced by Science and Universities Minister, David Willetts.

The initiative, a funding competition run by the UK’s innovation agency, the Technology Strategy Board, will allow businesses to compete for funding awards, in order to trial innovative ways of addressing the challenges facing UK high streets.

The competition is seeking innovative technology solutions to boost the high streets by exploring new approaches to retailing/services, logistics and travel and traffic.

Minister of State for Universities and Science, David Willetts said: “Technology plays a vital role in people’s everyday lives and has the ability to influence our movements and shopping habits. By developing innovations to regenerate the retail sector we will be able to breathe new life into the UK’s high streets. This competition will encourage exciting new developments that could change the way business is done across our high streets. Giving shoppers and businesses real time information that they can use to their advantage will make a real difference in helping to boost the UK economy.”

High Streets Minister Brandon Lewis said: “Britain’s shopping culture is changing with online shopping pushing town centres to evolve and exploit new technology to prosper and attract people to their local high street. This government is committed to supporting high streets and this competition will challenge them to come up with exciting and innovative ways to be at the forefront of change. It builds on the £1 billion support package of new tax breaks for shops and sensible changes to planning and parking rules. That investment combined with strong local leadership can help high streets remain at the heart of communities for decades to come.”

Technology Strategy Board Chief Executive Iain Gray said: “There is real appetite among business and consumers to come up with new ways to regenerate our high streets. This competition is aimed at encouraging businesses of all sizes to come up with innovations that address key challenges, such as ways we can combine both physical and virtual shopping or develop real-time parking information.  Up to £2 million will be available for feasibility studies in phase 1 of the competition called Re-imagining the high street, and those successful projects will then compete for a further £6 million in phase 2.”

The competition

  • The funding competition opens on 13 January 2014. The deadline for registration is noon on 26 February 2014 and the deadline for applications for phase 1 of the competition is noon on 5 March 2014. A webinar briefing session will be held at 10am on 20 January 2014.
  • The competition is being run under the SBRI (Small Business Research Initiative) programme that provides opportunities for innovative companies to take advantage of public sector procurement to solve specific problems. SBRI competitions are open to all organisations that can demonstrate a commercial potential to their solution. The scheme is particularly suited to emerging and small businesses.

Further information:

You can find further details of the funding competition at Re-imagining the high street.

Interesting Tax News

Interesting Tax News

A couple of interesting stories today:calc

HMRC Car and Car Fuel Benefit Calculator

Last week, HMRC announced that its car and fuel benefit calculator has been updated to include calculations for 2014 to 2015.

When a company car is made available for the private use of an employee a ‘benefit in kind’ value is calculated in relation to the car, and the fuel if that is also provided for private use.

This calculator:

  • allows you to calculate the ‘benefit in kind’ value of a company car and, if appropriate the car fuel benefit
  • provides an indication of the Income Tax you would be liable to pay for the provision of company car and car fuel benefit

The calculator allows calculations for the years 2009/10 up to 2014/15.
Information about forthcoming changes is available by following here.
To make a calculation, you need to go to: although it wasn’t working when I last tried it.

James Hay calls for flat rate of pension tax relief

A flat rate of pension tax relief would give most people a better incentive to save into pensions, according to Sipp provider James Hay, reported here.

The head of technical support at James Hay, Neil MacGillivray, said pensions were not as popular as ISAs with working age savers and cost the government, which only earns back £1 in every £3 in pensions’ tax relief.

Speaking at a masterclass at the New Model Adviser® conference, MacGillivray said it was time to look again at a recommendation made by Centre for Policy Studies author Michael Johnson in 2012, namely that pensions’ tax relief should not be given at individual’s marginal rate but on a flat rate basis.

‘If you are going to restrict tax relief you still need to incentivise people to save, if you won’t get tax relief at the higher rate then, as Michael Johnson suggest, there needs to be a flat rate at around 30% so it is cost neutral for the government.

‘For basic rate taxpayers it would be a real incentive to save. For a higher rate tax payer it would not be as good as incentive as it was, but still be better than an ISA.’

The New Model Advisers article says that the lifetime allowance for tax-relieved pension contributions was lowered from £1.8 million to £1.5 million in 2010 and will be cut to £1.25 million from April 2013. The annual allowance will also drop from £50,000 to £40,000. MacGillivray said further cuts to the annual allowance would make a lifetime allowance unnecessary.

He also called for a period of stability within pensions’ policy and to stop political meddling.  ‘We should take the short-term politics out of pensions because politicians are elected for five-year periods and need to get elected,’ he said.

That’s a disappointment: UK misses forecasts yet Britons are optimistic

That’s a disappointment: UK misses forecasts yet Britons are optimistic

Disappointingly, new economic data published last week has cast serious doubts over the strength of the UK’s economic recovery. It has prompted warnings against an early rise in interest rates.

tearThe Office for National Statistics (ONS) said that manufacturing activity and broader industrial output were both flat in November, from October. Not only that, but the ONS also revised down the growth figures for manufacturing and wider production for October. Separate figures showed construction activity fell 4%, the sharpest monthly decline since June 2012.

On an annual basis, all three sectors showed growth, with manufacturing up 2.8% in November from a year earlier, the strongest performance since May 2011. Construction output, a stronger performer for much of 2013, was up 2.2% on the year.

Recent industry and consumer surveys have pointed to growing confidence about economic prospects, prompting debate about when, not if, the Bank of England will raise rates. But the cynic in me said, when good news was being bandied about: “don’t believe anything until it can be verified”, but then at one time I was a registered auditor after all.

BBC News reported that BNP Paribas economist David Tinsley called the data “unambiguously poor” but despite the data, he said that the UK’s economic fundamentals were “broadly encouraging” and the new figures should keep “the lid on over-exuberant (interest) rate hike expectations”. But David Kern, chief economist at the British Chambers of Commerce, warned against a rise any time soon.

“Although longer-term comparisons show solid annual growth, these monthly figures are disappointing. It’s a timely reminder that the recovery is not yet secure, and should also dampen the clamour for an early rise in interest rates. The government must continue to implement measures to boost growth, to ensure that the UK economy is on firmer ground before any such step is introduced.”

Samuel Tombs, UK economist at Capital Economics, cast some doubt on the Q4 figures: He said: “November’s weak industrial production figures signal that GDP growth in the fourth quarter is unlikely to be quite as strong as the business surveys have indicated.”

Also on Friday, the National Institute of Economic and Social Research (NIESR) released estimates suggesting that GDP grew by 0.7% in the final three months of 2013. The economic research group said that this suggested the economy had expanded by 1.9% last year, up from growth of just 0.3% in 2012. This would put the level of GDP at just 1.2% below its pre-recession peak in January 2008, NIESR said. But then good news: NIESR added that: “The economy is expected to expand at a reasonable pace in 2014.”

The economy is still 1.2 per cent smaller than it was before the recession struck, NIESR said.

The Mail Online reported that the UK economy has its best growth for six years despite slowdown in Q4 2013.  The money markets didn’t like it at all. Sterling tumbled against the euro and the dollar as weaker-than-expected manufacturing and construction figures added to the disappointment over the slowdown in the final quarter of 2013. ‘A triple whammy of weak economic data out of the UK has resulted in a pounding for sterling,’ said Kathleen Brooks, research director at

Azad Zangana, European economist at Schroders, said: ‘Despite the wave of optimism on the UK economy, the evidence suggests that the economy slowed in the fourth quarter of 2013. We forecast fourth quarter GDP growth to slow to 0.5 per cent.’

Over the weekend, the BBC reported that Britons are more optimistic on the economy, according to a survey by think tank British Future. The number of British people who are optimistic about the economy has trebled since 2012, the survey suggests. It found that 29% of people were optimistic about the economy in the year ahead, compared with only 9% in the same survey in 2012. And on the other side, the proportion of those feeling pessimistic dropped from 74% to 40%. The BBC story is here.

But my cynicism must be misplaced. According to Tim Wallace writing in City A.M. (here), bank lending is expected to rise in every area of the economy, analysts at EY forecast today, as the recovery finally gives banks the confidence to supply more credit. But it’s restricted to the UK as apparently no other European country’s bankers have so much confidence, and it’s all down to the strength of the recovery in Britain.

Looking on the positive side, firms of all sizes and sectors in the UK are expected to benefit, with healthcare, media and telecoms firms particularly likely to borrow more from willing lenders, 74% of whom expect the UK economy to improve, compared with 56% across the EU as a whole.

All this glowing (and growing) confidence means that British banks expect to cut their loan loss provisions compared with Eurozone banks who are still hiking their likely losses on bad loans.

You needn’t worry about other parts of the market which are propped up by government support, including the Treasury’s Help to Buy mortgage guarantee programme. However EY’s Global Banking Outlook, also out this week, warns these supports could make the current spurt of mortgage growth unsustainable. Sensibly it says: “Many are wary of encouraging too much growth in this sector at a time when interest rates are at an all-time low.”

Such concerns have led Bank of England governor Mark Carney to withdraw the Funding for Lending scheme from the mortgage market, a programme which offers banks cheap funds if they increase lending.

The study also warned that the varied new regulations from country to country may reverse some of the globalisation of recent decades, a so-called “Balkanisation” of the financial system.

I keep hearing warning bells in my head about our economy. Keeping an open mind but not going around empty headed is what I shall be doing. You might like to do the same.

The Importance of winter for SMEs

Originally posted on 18 Dec 2013

This winter will see the strongest SME growth since the financial crisis began, according to a new report from the Centre for Economics and Business Research (Cebr) and British Gas Business.

The report, The Importance of Winter for SMEs, predicts £400bn of revenue for the UK’s small businesses during winter 2013/14, representing a 7% increase on the same period last year, and 12% up since winter 2010/11. Wholesalers have the largest opportunity, with an estimated £130 billion of potential revenue available, whilst retail and manufacturing businesses are looking to share a slice of £24bn and £42bn respectively.

The report makes useful reading for those who advise SMEs, particularly accountants:

  • The winter growth opportunity varies by SME sector. Educational businesses have the largest proportion (27.2 %) of turnover in winter, as the long summer hiatus pushes work into other parts of the year. Winter is quietest for construction firms, who only see around 22% of their annual turnover fall between December and February.
  • Yet the winter months also present a number of significant challenges for SMEs. The lead up to Christmas brings bumper sales for many retailers and other businesses, but this is typically followed by depressed revenues in January and February that result in more SME liquidations and bankruptcies in the first quarter compared with any other time of year. The report forecasts that more than 3,000 small businesses will fail in the first quarter of 2014, which would represent a 14% decrease on the same period this year.
  • Severe weather can compound the pressures on small businesses. Cebr have forecast that a repeat of the kind of supply chain disruption caused by snow and colder weather in 2010 would cost the economy more than £1.9bn this winter, wiping 0.5% off UK economic growth.
  • As cases of flu peak during December and January, illness also poses a major human resources risk, particularly to the 75% of SMEs in which the owner is the only employee. In businesses where the owner is the only employee, the business could stand to lose as much as £200 for every day they are absent from work.

I’ve already gone on record to say that the SME market is one of great potential and growth for accountants who are arguably in the best position to assist SMEs. Download the full reportfrom Cebr and British Gas. Registration is required.

Read the Cebr press release here.

How SMEs (including Accountants) can make the best use of social media

Originally posted on 18 Dec 2013

There’s an excellent article in The Guardian, Small Business Network explaining how SMEs can make the best use of social media.

He says that success with social media lies in the subtleties even though sometimes it gives SMEs an inferiority complex. To succeed, without the dedicated team that many large brands have working on their social media output, it can seem like an uphill struggle. However, following a few simple guidelines can soon bring results for those who are willing to put in a little time and effort to immerse their SME in the right circles of social media.

Once social media influence is gained, and built on, companies will find they are in the enviable position of having direct access to their customers, prospects, suppliers and future talent pool at the click of a mouse.

If you are an accountant advising SMEs, it’s worth reading this article (see link below) and even following the tips yourself.

More at Bizezia News here.


This week’s announcement that Facebook will embark on what could be its next $1bn (£614m) line of business, according to analysts, with the roll out of video ads across the social network imminent, offers new opportunities to SMEs and accountants. Facebook say that the new ads will offer advertisers a way to reach its 1.1bn users with video clips in the news feed that will automatically play on desktops and mobile devices.

More at Bizezia News here.

Free Publication

If the whole concept of social media confuses you, why not ask for my publication: Social Media Glossary. It’s available free of charge. Just email me at:


If it’s Twitter that interest you, it’s easy to attract more followers and engage the ones you have, according to Twitter themselves. All you need is an attention-grabbing Twitter profile. Here’s how to make one:

1. A picture is worth a thousand words
Upload a profile picture; a logo, image or product shot that represents your business.

2. Show your best side
Write a catchy bio that shows your personality and links to your site.

3. Add some colour
Customise your background with one of our themes, or upload your own image. Click the design tab in your settings to get started.

Learn more…