Tuesday, November 23, 2010

Cash Flow is the Pulse of your Business

by Anne Feeley
Affordable Accounting Services

 Cash flow is the life-blood of every business. If you fail to have enough cash to pay your suppliers, creditors, or your employees, you’re out of business.

Cash flow is concerned with the timing of the movement of money. Inflows occur when you make a cash sale, collect from debtors, have investment income, or borrow money, etc. Outflows are generally the result of paying expenses such as wages, stock, taxes, purchasing fixed assets, etc. Cash Flow is not the same as “profit”, which is a snapshot of income and expenses at an event or over a certain period of time. You can make great profits, but if it’s all in accounts receivable, you have no cash to pay your daily expenses.

Four basic but important components to examine:

Accounts Payable & Cash Flow

Accounts payable and cash flow: Without payables and trade credit you'd have to pay for all goods and services at the time you purchase them. For optimum cash flow management, you'll need to examine your payables schedule.

Ensure you are purchasing at the best deal you can get. If you can’t get a better price, get better terms.
  • Ensure you get appropriate discount for early payment.
  • Only pay on the due date and not before.
  • Review contracts to ensure you only pay for what you want/get.
  • Negotiate volume discounts.
  • Review supplier contracts on a regular basis.
  • Aim to reduce the number of suppliers to leverage spend and prices.

Accounts Receivable & Cash Flow

The longer it takes for your customers to pay on their accounts receivable, the more negative your cash flows will be. Stay on top of your collection efforts.

  •  Issue invoice straight away and ensure it is correct.
  • Have the sales person do the collecting of cash.
  • Link any bonus to cash collection.
  • Review credit limits on a regular basis and reset based on current, not past, levels of business.
  • Implement strict early payment discounts.
  • As soon as credit period elapses have a regimented debt collection procedure in place.
  • Initiate credit collection procedures before invoices become due.
  • Trust your instincts. Sometimes it might be better to take less than 100% to get the cash rather than wait and/or never get the amount owed or go through expensive litigation.

Credit policy and terms form the blueprint you use when deciding to extend credit to a customer. The correct credit policy is necessary to ensure that your cash flow doesn't fall victim to a credit policy that is too strict or to one that is too generous.

Stocks & Cash Flow

An excessive amount of stock hurts your cash flow by using up money that could be used for other cash outflows.

  •  Don’t order more unless absolutely necessary.
  • Enter all stock on your system as soon as it is received to ensure full transparency.
  • Identify slow moving stock and repack, re-price, re-use to generate cash.
  • Renegotiate lead times from suppliers and reset minimum stock levels and order levels accordingly.
  • Negotiate consignment stock from suppliers.
  • Introduce/modify approval levels for stock purchases.
  • Discontinue slow moving / loss making product ranges.
  • Ensure ownership and accountability exists for every item of stock (i.e. stores manager)
VAT & Cash Flow

  •  Ensure you claim any VAT re bad debts written off in your VAT return.
  • Process supplier invoices as soon as they are received/issued.
  • Consider timing of invoice issue at month end to optimise credit on VAT return.

Four tips on managing your cash flows:

1. Contingency plans. You should keep three plans at hand.

a. Cash flows requirements when business is going according to plans.

b. When business is slightly lagging.

c. When business is hit hard (such as during these economic times).

2. Cash Forecasting. Forecast, make a budget, stick to it. Modify your budget only after thorough ongoing reviews of your cash flows and remember to include expenses that may not be due each month, such as annual insurance premiums and taxes.

3. Spending Controls. Make sure you carefully negotiate leases and look for price quotes. Frequently analyse operations.

4. Add Employees cautiously. Actively seek ways to maximize your and your employee’s productivity. You may also want to remember to consider alternatives such as outsourcing.

Cash Flow is the lifeblood of every business. The concept is much broader than that of profit, alone. Close monitoring is critical to success. You must have a firm grasp on carefully monitoring and managing the cash-flow pulse of your business. For more information on Anne Feeley, Affordable Accounting Services see http://www.affordableaccounts.ie/  or call 071 9174132 / 087 9719606. See our Facebook page at http://www.facebook.com/pages/Affordable-Accounting-Services/167511786616146?v=wall

Friday, November 12, 2010

How to lower your insurance costs

by Enda Candon of Firstwestern

Insurance is one of those dead money costs that we all in business have to have, but in many cases consider it as dead money as we rarely get an economic return on it. Cost containment and control are essential in these tough economic times, so a saving on any overhead is welcome. Here are some practical tips that we have used with clients to save them money on their insurance costs. In cases we have helped achieve 25% discounts on individual policies.

Increase your excess

Raising the excess on your insurance policies usually lowers your premiums. This can lead to savings of up to 10% on policies.

Bundle your Policies

Even though your policies may fall due for renewal at different times of the year, bundle all your policies and ask insurance companies / agents to quote you for all of the business.

Use a Broker

Work with an Insurance Broker to help you figure out what coverage you need and get it at a competitive price can be a good option, if you are unsure of the precise cover you need. An independent agent or broker is paid by commission, but will shop around to find you the right coverage at the right price.

Reduce Risks

Risk management minimises your insurance claims and brings your premiums down. Implement procedures to make sure that you aren’t taking on risky employees—for example, by checking the driving record of anyone who will drive for you. Many companies offer lower premiums or discounts to policyholders who take certain safety precautions. Installing smoke detectors or a security system is a couple of steps you can take that may get you a lower-priced policy. Always make sure that your business is adhering to relevant legislation such as health and safety and employee legislation as in some cases insurance can be invalid if you do not.

Levels of Cover

Evaluate all your insurance policies for their risk/benefit, and decide which ones you think you will really need. Don't over insure. Do you really need cover for old and low value office equipment and computers?

Motor Insurance

Consider dropping collision cover on older vehicles. If the car is only worth €1,500, why pay €200 per year extra for collision cover.

Prioritise your Greatest Risks

Once you’ve dealt with required coverage, spend your money where you need it the most. If you face a serious risk of a loss that could wipe you out, put your insurance cover there first.

Don’t Duplicate Coverage

A business can have so many policies in place that you may find some things being insured more than once. For example if you have only a few relatively inexpensive pieces of business equipment, your existing property coverage may be adequate. Or, you may be able to purchase an inexpensive endorsement to increase your coverage. Review all your policies carefully, or have your broker do this. Eliminating dual coverage should save your money.

Group Insurance Schemes

If you belong to a trade organisation, professional group, or other business association, you may be eligible for special rates on certain types of insurance.

See the first western blog at http://endacandon.wordpress.com/

Contact Firstwestern at http://www.firstwestern.ie/ or e-mail: Info@firstwestern.ie phone: 071 912 2834 http://ie.linkedin.com/pub/enda-candon/6/839/224

Monday, September 27, 2010

Email Marketing – But Not As We Know It!

By Louise McDonnell, 2Market
Okay first things first, I’m not referring to sending hundreds of emails using Outlook or Outlook Express (or whatever mail server you’re using). Even if you are smart enough to be using the BCC option. No – in fact, Email Marketing is much more powerful than that. And the good news is it’s cheap as chips and very effective.

So what is it? Well – there are special applications you can use online which allow you to send emails to targeted lists. Emails will not be treated as spam by your recipients’ mail server – so already that’s an advantage. But the main benefit of using these packages is that the actions of the recipients can be tracked. So you’ll be able to see, who opened your email, how many times they opened it, if they clicked any of the links from your email to your website and what links they clicked.

Think about it – you send this email to a few hundred addresses, who are you going to follow up first? Pick out the recipients who opened your email the most. And if you’ve been pitching a few products – you’ll even be able to tell which product they were interested in by reviewing links they have clicked.

It’s no wonder that email remains the most popular online promotional format for Irish Marketers, according to the second Online Marketing Sentiment Survey conducted by AMAS among members of the Marketing Institute f Ireland (MII).

So where does 2Market come in... well, we can help with creating email content which will have maximum impact, setting up the campaign, seeing it through to delivery and monitoring the results. We can also update your website to ensure your email campaign has the greatest impact. Sound interesting – Call Louise McDonnell on 096 37777 or feel free to fill out an online enquiry form at www.2market.ie.

Friday, August 27, 2010

Considering Computerising your Financial Accounts

By James Doyle, Synergy Network Ltd

You have already taken the difficult step of setting up a business and are using either manual books or a spreadsheet to record your transactions. You realise that you could be getting better information and that many small businesses use computerised accounts system.

So what is involved and why would you do it. Well, for one thing you will save yourself time as you only have to enter a transaction once in the system.

It is very easy to run a report which will show who owes you money and more importantly for how long. Do you spend much time preparing the Vat return or do you hand it over to your accountant – now with either Sage or TAS you can run a Vat return at a click of a button. Instead of using a word processor you can produce a professional looking invoice or statement with your own logo from the system. You will have a better handle on the overall performance of the business by running regular profitability reports.

As your business expands your system may need to record sales orders and deliveries and check whether a particular item is in stock. You may need to open a Sterling bank account to deal with UK suppliers or customers. If you have Sales reps you might want them to take orders on handheld systems and download them into your accounts system.

Before deciding which system to implement you should be clear in your own mind what features/modules you want from the system and the benefits you expect it to bring to your business. You should also look for assurances on the following issues:

1. Is the system proven in the marketplace (as opposed to being developed by the neighbours child !!)

2. Will the system be capable of growing with the business in terms of extra modules and users

3. Can the system provider also deliver training and ongoing support afterwards

4. Are references available from other users of the software

5. Is the system capable of being backed up for security purposes

6. That your staff who will operate the system are buying into it

Once you have chosen the appropriate system (whether it be Sage 50, TAS, Exchequer Enterprise or some other system) for your business you need to plan the implementation. What date is the system going to start from and have you got all your manual or spreadsheets up to date. It might be advisable to concentrate on getting your customers and sales invoices up initially and follow on with your suppliers and purchases. You will need to consider whether you will attend a classroom training session or get onsite training which will be more specific to your requirements. You will also need to specify the reports which you will need from the system as this will have implications for the set up. The main thing is to have a plan and get assistance and training from experienced systems providers.

If you wish to discuss computerising or upgrading your accounting system contact James for a free consultation at 071-9146815 , jdoyle@synergynet.ie or check out the website http://www.synergynet.ie/.

Friday, August 20, 2010

Maintaining your Profits in 2010

by Enda Candon of Firstwestern

There are ways to continue to make profits in a recession. Here are four simple things any business can do to help their bottom line in 2010.

1. Take advantage of decreasing costs. Most businesses are both suppliers and customers at the same time. Your business needs to buy goods to sell or raw materials to manufacture and employ people. When demand weakens, remember your suppliers business is probably falling too. Therefore it is opportune to renegotiate every supply contract to get lower costs and look at getting your staff to take pay cuts as the cost of living is also falling.

2. Thinking the only way to increase demand is to cut price. Price cuts aren’t the only way to stimulate demand, and sometimes is not the best approach. Remember its easy to lower prices, but much harder to increase them again as customers become accustomed to lower prices. Many times buisiness can be more successful when competing on service, quality, or something other than price. So shifting to price cutting in a recession is often a losing strategy.

3. Failing to recognise increased competition. In a recession, competition accelerates because more businesses are chasing a smaller market size. In addition, when unemployment rises, people start new businesses thus further increasing competition. So the need to have a competitive advantage is even more important in a recession than in a booming economy.

4. Demand for all products does not increase in a recession. When customers cut back on their spending, they often substitute one product for another. For instance, discretionary spending on dining out in top restaurants has decreased, however fast food sales has increased. So look at areas and markets that your business serves and figure out the products and services demand is likely to increase for and lead the way in supplying them.

See the first western blog at http://endacandon.wordpress.com/
Contact Firstwestern at http://www.firstwestern.ie/ or e-mail: Info@firstwestern.ie phone: 071 912 2834 http://ie.linkedin.com/pub/enda-candon/6/839/224

Tuesday, August 10, 2010

Small Hinges Swing Big Doors

By Brian Dolan, Progressive Business Development

Life is something which seems to happen to us while we’re not paying attention. One morning we suddenly stop and inspect a stranger staring at us from our reflection in a shop window. He (or she) may well be fat and forty, greying or balding, and trailing the current fashions by a decade or two.

Our pressing engagements keep us moving, but later, a closer examination in the mirror at home confirms our growing suspicions. It really was our own reflection…

Sudden realisation of an unpalatable fact does not confirm that this fact happened suddenly, usually the reverse is true. It happened at glacial speed; a waistline gaining in synchronisation with our jeans wearing out, and a looser style purchased. A comfort level in personal style achieved, and retained for years as if in suspended animation.

I’ve chosen two events, which creep up on us over time, and we may think of friends or colleagues who we feel fit this bill. But let’s examine it in context. All of us go through our daily lives moving fluidly from past, (remembering successes or failures) to future, (hoping or dreaming). But how many of us make a point of spending some time each day in the present, and while we are there, examining our daily routines, habits and customs?

Our current life is a function of our habits, which assist us tremendously in performing routine tasks, but unexamined will trap us in an existence which we never intended.

We all see ourselves in the future as a fit, happy and financially secure person, but our habits may be charting a very different course.

In 400 B.C. Socrates said, “The unexamined life is not worth living”. I believe he may be right, but for reasons he never suspected. The game is on! Pay attention!

Develop a habit of doing more than you are paid for, and before you know it, you’ll be paid for more than you do. Contact Brian Dolan at 071-96 45752 e-mail brian@bdolan.com 087-2374695.

Wednesday, August 4, 2010

Using Facebook from a Business Perspective

Facebook for Business, practical tips

by 2Market - online and offline marketing experts in Sligo and West of Ireland

Most businesses don’t realise what a powerful marketing tool Facebook is.

There are over 1.6 million people in Ireland on Facebook, with 850,000 people logging on once a day and 83% logging on at least once per week.

According to an Irish survey carried out by Mulley Communications in April last, a significant proportion of advertising on Facebook is read. 71% of those surveyed indicated that they looked at ads on their profile pages. It also found that users paid even more attention to page updates in their newsfeed wall.

Convinced? Here is my practical guide to doing business on Facebook and integrating it into your online and offline marketing strategy!

1. People set up “personal profiles” in Facebook and businesses set up “business pages”. This may sound like a basic recommendation, but I come across businesses all the time, that are using a “personal profile” which is a breach of Facebooks terms of use, and could result in an instant termination of the account. And if a business has built up a few hundred or even a few thousand (and yes I have come across this..) friends, losing all those valuable contacts would simply be a disaster.

2. Personal profiles are limited to 5000 friends, so that’s another reason to use a business page.

3. Personal Profiles have “Friends” and Business Pages have “Likes” (Previously known as “Fans”).

4. “Friends” on facebook have access to each other’s personal information, photos and posts. So keep your friends as “friends” and your business associates as “fans” (of your business page.)

5. Fans of your business page will receive updates from you, but have no access to your personal profile. This is an important point to make as most businesses I come across, have avoided Facebook or are using it incorrectly for this very reason.

6. A business page may have more than one administrator, so the task of updating your business page can be shared between a number of people in your organisation.

7. Invite all your “friends” to become “fans” of your business page. Remember, social networking is “word of mouth online”, so use your contacts’ to spread the word. Encourage all your employees/friends to repeat the exercise which will help to get the ball rolling!

8. When you have 25 “fans” you can personalise your business page (eg. www.facebook.com/2market) by using the following link: http:/www.facebook.com/username

9. Post interesting regular (but not too regular) updates on your facebook page. Give your fans (and potential fans) a reason to keep coming back for more. Be inventive; run competitions, encourage discussion... think outside the box! The key is to differentiate yourself from your competition!

10. Post updates on other relevant Facebook pages. For example; I’ve often posted updates on the Mayo Association Facebook page for events I think their fans may be interested in.

11. Remember to encourage your “fans” to visit your website. So always include a link to the most relevant page on your website. Most businesses miss this point. Your Facebook page is a very powerful tool to drive traffic to your website. Use posts’ on your business page to stimulate interest and redirect traffic to your website.

12. I continue to find PPC Advertising on Facebook an amazing tool as it enables advertisers to accurately target people based on their location, demographics, likes/interests, their education and work.

Want to find out more...? 2Market manages a number of Facebook Business Pages for clients across a range of sectors. Simply call us on 087 9291125 or fill on our online enquiry form.

Wednesday, July 21, 2010

Negotiating renumeration changes in contracts

by Michelle McLoughlin of Michelle McLoughlin Solicitors

Varying or re-negotiating an employee’s contract of employment is a matter of contract law. Contract law prohibits any unilateral (one-sided) alteration of a fundamental term of a contract so in order to change the terms of a contract, there must be agreement by both sides to the contract.

Salary would be a fundamental term of employment and so, it cannot be cut unilaterally without an employee's agreement.

To minimise any risk of a claim it would be best to consult with employees, explain the circumstances leading to the employer’s proposal, ask the employees for alternatives to a reduction – are any employees prepared to work less hours, have they suggestions that will result in the same cost cuttings as an alternative to salary reductions etc., set out the consequences should the cost cutting measures not occur and obtain the employees' agreement to such variation and reduction in salary in writing.

Where a salary reduction is unilaterally imposed without any consultation or without the employees’ agreement, employees have a number of potential legal avenues available to them to seek redress:

• Claim breach of contract
• Claim unlawful deduction of wages
• Claim constructive dismissal
• Claim the existence of a trade dispute

Morale, trust and industrial relations within an organisation would also be impacted by any such unilateral action which can cause long term negative consequences to an organisation.

Michelle McLoughlin is a solicitor who specialises in providing corporate and employment law assistance. For further information Michelle can be contacted on 087 6674534, e-mail: info@mmcloughlinsolicitors.com .Website: http://www.mmcloughlinsolicitors.com/

Monday, July 19, 2010

Lean Sigma as Applied To SME’s

by Brian Murray of B.Murray Consultancy Services
Lean Sigma is an improvement methodology used by many top medium to large companies to great effect to maximise profit and performance.
The core concepts of Lean Sigma can be equally beneficial to SMEs.

My experiences of applying Lean Sigma to SMEs are detailed below.

• Resources are scarce in most SMEs and they are at different points on their improvement cycle so any Lean Sigma program has to be bespoke to that particular SME.

• The projects that give the greatest return in the shortest period should be targeted first.

• A Coach or Mentor is often involved to support the Owner Manager and staff with practical help and training. These Mentors need to roll up their sleeves and work with Team rather than just citing Theory.

• Owner/Management buy in is essential. A good understanding of the basics of Lean Sigma is required.The jargon and theory that accompanies much of Lean Sigma is a major turnoff to many SMEs. Concepts have to be explained in a meaningful way.

• Culture change is difficult and takes time particularly in longer established SMEs. Step by Step changes often works better than the 'Big Bang' approach of a full Lean Sigma roll out. The initial Projects and the training of staff on particular tools is often the most difficult period where fear of change and lack of confidence often arise and where good guidance is essential.

• Most Lean Sigma Tools will be inappropriate to most SMEs. The 80/20 rule often operates where 20% of the available tools will be adequate to manage 80% of the issues requiring improvement.

• Finance to support a Lean program is often a major issue to many SMEs. Enterprise Agencies such as the Sligo County Enterprise Board with the current 'Tradelinks 2' program can be of support.

• Some of the most common Tools used for SME improvement are,

i) Detailed Process Mapping and Tools (A visual overview of the operation including key steps/problem return loops etc. and associated improvement tools which leads to process improvements).
ii) Cause and Effect Diagrams (also known as Fishbone or Ishikawa charts. This gives all the possible factors in a formal manner that influence a parameter to understand issues at a deeper level e.g. efficiency).
iii) Key Performance Indicators (KPIs) and using trend charts/key data to monitor key information for maximum return.
iv) The 5S's (Formal way of having a place for everything and everything in its place to improve efficiency).
v) The 7 Waste's, (reduce/eliminate waste in all its forms to improve return).
vi) Value Stream Mapping (highlights activity which does not give a return and may not be necessary).
vii) Mistake Proofing (changing equipment/procedures etc to reduce/eliminate errors).
viii) Benchmarking (Taking relevant beneficial lessons from other operations and applying to own operation to improve KPI's).
ix) Brainstorming (Getting the best ideas in a formal manner from the workforce to solve a problem or improve operations).
x) Improvement Teams (Finding and implementing operational improvements through experienced members of the workforce).
xi) DMAIC (Structured problem solving methodology for improving/solving deep process issues = Define/Measure/Analyse/Improve/Control).
xii) SPC (Statistical methods/data collection/ Charts appropriate to the SME for monitoring and improving operation processes/KPIs)
xiii) TPM, Total Productive Maintenance (For optimum operational efficiency)
xiv) The 5 Whys (To drill down to understand the real problem).

Many other tools are available on a case by case basis.

B. Murray Consultancy Services has 34 years of experience in Best Operational Practice Methods and has provided Mentoring support to many Irish SMEs and Consultancy to numerous Multinationals world wide.
For further information and a free consultancy contact Brian Murray on (087)284600. e-mail brianmurraydonegal@hotmail.com. www.bestqualitypractice.com

Wednesday, June 16, 2010

Protect your business, safeguard your employees and save money

by Mary Darlington,BSc., CFIOSH, CFCIPD, MIITD, Darlington Consulting
Chartered Safety and Health Practitioner

If something in your business was causing you to lose money, causing your employees to be out of work and threatening services to customer, you would want to do something about it, wouldn’t you? Accidents and injuries at work can cause all of these.

However if you manage health and safety the same way you manage everything else it can allow you to have all your key employees at work when and where you need them, producing the products or delivering the services to keep your customers happy.

Poor health and safety costs money. High productivity and excellent safety are not mutually exclusive. They can and do work hand in hand enabling businesses to be safe and make a profit.

Adopt a Preventative Approach
Preventing of accidents and ill health should be your key aim and it is entirely achievable and cost effective. Preventing and or reducing accidents means lower Employer's Liability insurance and lower costs overall.

Key Steps to good health and safety
1. Get yourself competent advice and help
If you don’t have the expertise in health and safety yourself, buy it in and get started.

2. Outline roles and responsibilities clearly
Make sure that everyone knows their roles and responsibilities, give them the tools to meet their responsibilities and then hold them accountable.

3. Train everyone
Train everyone from Chief Executive down so they understand how accidents can be prevented.

4. Set Health and Safety Goals
Set health and safety goals for the business, and individual objectives for all managers

5. Set standards of performance and behaviour
Communicate to all employees what they can expect from you and what you expect from them. Accept nothing less than full compliance.

6. Measure Health and Safety Performance
Measure health and safety performance every month, every year and try to improve over time.

7. Provide resources for health and safety
Provide resources (people, time, money etc.) to manage the health and safety effort and take action. Talking about it or sending emails about it will not make it happen.

8. Integrate Health and Safety into every management decision
Blend health and safety into every management decision you take. Whether you are hiring employees, buying new equipment, launching a new product or service etc., there are health and safety issues that must be can be planned for and managed.

9. Identify and Manage the hazards
Identify the hazards and assess the risks in all your work activity. Eliminate, minimise or control those hazards effectively so that the work can be done in a safe and healthy way.

10. Consult with employees
Management don’t always have all the answers to health and safety problems so consult with those actually doing the job, tap into their expertise and implement practical measures to protect them.

11. Talk about Health and Safety
Management need to give health and safety the same level of importance as the other key business issues such as Finance, Sales, HR etc. Put health and safety on all meeting agendas and be pro-active about it.

12. Use your Moral Barometer
We have lots of health and safety laws and regulations. As well as complying with them Managers need to refer back to their moral barometer often. Before you ask any employee to do something ask yourself the following questions:

• Would I do this task myself?
• Would I allow my own son or daughter to do it?
• Have I given this employee all the training they need to do it?
• Have they got the right equipment?
• Are there logical, practical procedures for them to follow?
• Have I don’t everything as a Manager to protect this employee?

Safety is everybody's business.

Darlington Consulting provides a range of health and safety training and consultancy services. For further information and a free consultation contact:

Mary Darlington
Darlington Consulting
Tel. 086 2437677
Website: www.darlington.ie

11 Questions to test your Business Idea

by Enda Candon, Firstwestern Consulting

If you have a new business idea, or think that you have come up with the next iphone or facebook, here are 11 questions to help you determine if you have or not. Answering these questions honestly and frankly will give you much needed detail for your business plan as well.

1. Are you filling a void?

A clever idea is nothing more than an idea if nobody actually needs the product or service. "You have to determine that there's something actually missing to a specific market--something you're going to supply,"

2. Does the idea pass a live market test?

Many ideas lend themselves to an easy market test to determine if the product or service is needed or popular. A new jam or preserve, for instance, could be tested at a farmer's market before being pitched to retailers. If it doesn't sell at all to the market crowd, the product may need to be re-examined before being launched.

3. Does the idea have shelf life?

Are there upcoming or pending changes in technology that could render your idea obsolete? Companies not on guard for changes in technology or consumer trends can be swept away while competitors move ahead. Or it could be that there is new legislation in the pipeline that will make your product obsolete or unwanted.

4. How large is the market for the idea?

If a business plan requires that you sell to 60% of a potential market in order to make a profit, then the idea isn't realistic. Better business ideas can achieve profits by attaining a smaller market share of 5% to 10%.

5. Is there a high barrier to entry?

The best ideas have high barriers to entry. If an idea is good but not patentable or protectable in some other manner, then there is a risk that other companies and competition could start the same business and over run you.

6. Is the idea scalable?

The best business ideas incorporate plans that can be replicated and easily taught. Therefore can you easily scale up with increased production as the market requires or introduce other new products and services using the same equipment, skills and processes?

7. Can the idea be priced attractively?

There may be a reason why nobody else is already doing what you're thinking about--they can't make any money doing it. You have to run and test the numbers and make sure that the product or service can be offered to the market at a price the market is willing to pay.

8. If it weren't your idea, would you put money into it?

This is a simple question and an important acid test. "If a stranger pitched this idea to you, how likely would it be that you'd buy in?"

9. How much funding will the idea need?

Financing has rarely been easy for entrepreneurs, today's tight market makes things even worse. When it comes to specific business ideas, you have to ask yourself "How much money do you truly need to get the business off the ground?” If the idea will take colossal start up funding, it may be more prudent to examine business ideas with lower budgets.

10. Do industry experts hate your idea? Good.

Just because so-called experts hate an idea doesn't mean it's bad. It can often prove to be a good thing. Many companies are so entrenched that they sometimes don’t see change coming until it is too late and may also under estimate the importance of a new innovations. A major example of this was the introduction of the Dyson vacuum cleaner when all other manufacturers did not see the advantage of a vacuum cleaner without bags.
11. Can you pitch your idea as a business in 20 seconds or less?

Quite simply if you cant state and explain why it’s a good business idea in 20 seconds, then more than likely there isn’t a real opportunity.

See the first western blog at http://endacandon.wordpress.com/. Contact Firstwestern at http://www.firstwestern.ie/ or e-mail: Info@firstwestern.ie phone: 071 912 2834 http://ie.linkedin.com/pub/enda-candon/6/839/224

Thursday, June 3, 2010

Trading as a Company - The Pro's & Con's

by Neil Gaynor, Gaynor Consulting

There is much debate presently as to merits of incorporating a business (i.e. Trade as a Limited Company). Many Directors of Companies have had to give personal guarantees to financial institutions, thereby reducing or eliminating the benefits afforded by limited liability. However overall there are still more positives than negatives in operating as a limited Company.

Here are the main advantages and disadvantages of Incorporation.


• Limited Liability
• Lower Tax charge
• Pension planning advantages
• Motor & Travel expenses for employees (Civil Service rates)
• Potential extraction of surplus money at retirement
• New ventures may qualify for start up exemption (3 Years)


• Higher annual administration and compliance costs
• Close Company tax surcharge
- Investment Income
- Service Companies
• Additional responsibility for Directors

Neil Gaynor & Company, Chartered Accountants, provide Accountancy, Business Advisory, Tax, Training & Mentoring services to small business. For further information and a free consultation contact Neil Gaynor on 071-719144366
or 087-2547941.
E-mail: neil@neilgaynor.ie http://www.neilgaynor.ie/

Friday, May 28, 2010

How to Grow Visitor Numbers to your Website

by Lousie McDonnell, 2Market

The Internet can be a great way of finding new customers and increasing sales.

But simply developing a website and launching it on the world wide web will not have an impact on your bottom line. In fact don’t be surprised if no-one is visiting your website at all. That’s why I’m always sceptical when I hear comments like, “I tried the Internet, but it just didn’t suit my business”. Nonsense.

I believe that Google is now being used in Irish homes in the same way the “Golden Pages Directory” would have been used in times gone by. The Internet or more specifically Google is used more and more by consumers whether they are searching for local cinema listings, a new car, to check their bank balance, a holiday, perfume ..... the list goes on..

So – how do you ensure your business gets some of the action! I believe businesses need to put a strategy in place which complements their marketing and sales activities in the real world. This online strategy will probably incorporate some or all of the following activities:

• Search Engine Optimisation (SEO)
• Internet or PPC Advertising
• Email Marketing
• Social Networking.

Search Engine Optimisation (SEO)

Getting found in Google. When someone does a search for a key word or phrase related to your business, you want to be on the first page of results. That’s what SEO is all about. It involves working on your:

• website content
• page titles and descriptions
• links to and from other relevant websites.

Internet or PPC Advertising

These are the sponsored links that are found above Google’s organic listings and also on the right hand side of the results page.

If you are not achieving good results in Google organic results then PPC Advertising, using Google’s Adwords, may be a good option for your business.
You set up a campaign which involves choosing keywords and phases, on which you place a bid. The cost of your bid depends on the popularity of your chosen keyword and phrases. If the quality of your ad is good enough and your bid is higher than the competition, then you will achieve the number one position in Google. You are only changed when someone clicks through to your website.

Email Marketing

This is a great way to drive your target audience to your website. You need to build up a database of email addresses of customers or potential customers. It is important that you use specialist email programmes, so that your email is not treated as spam by your recipients email servers’. Then if your content grabs your recipients’ attention and is persuasive enough you should achieve click throughs from your email to your website. A compelling “call to action”, will facilitate converting this traffic into sales!! Check out my last blog for more information on email marketing.

Social Networking

This involves using social networking sites to find new customers. The premise is that people like to do business with people they know. Whether its FaceBook, Twitter, Flicker or LinkedIn, your contacts will also have contacts with whom you may end up doing business. The only cost usually is your time. Does it work – it sure does. Think outside the box and you will achieve results and increased sales.

2Market Online Marketing

2Market has created and implemented successful online marketing strategies for businesses not only in Sligo and Mayo but all over Ireland. Our clients like our no nonsense approach and of course our success rates! See what our customers say about us on our testimonial page. And please feel free to contact us to see how we can help your business win more online sales.

Call Louise McDonnell on 096 37777 or feel free to fill out an online enquiry form at www.2market.ie.

You, Inc.

by Brian Dolan, Progressive Business Development

Starting a business is just like riding a bicycle, when you’ve done it once, you can come back to it in years and find that all necessary skills are retained. Only those engaged in business ownership can realise the full import of the above sentence.

Any parent watching their firstborn meet their new bike with tears of joy and infectious enthusiasm will smile encouragingly, while calculating the travel time to the local hospital. Blood will be spilled today! And yet the bike is not confiscated and the child re-swaddled in the discarded cotton wool. How can this be? Schadenfreudian parents? A sports car brochure with no travelling room for Junior? Say its not so!

It’s not so! The parent are wiser far, and will bear the pain of watching the crashes and ineptitudes of the clumsy learner over an extended period, so as to provide the child with the knowledge, skills and experience to easily pick up a bicycle, hop on, and pedal safely to any chosen destination. Goal, struggle, victory!

It is well worth the effort and pain on the part of the new cyclist. This complex skill of remaining upright on two impossible knifepoints confers freedom on those who master it. And the doting parents allow the carnage to continue until success has been achieved.

Freedom arrived so suddenly, being held upright by a sweating grumpy father to speeding down an incline and leaning into a curve is only the turn of a crank and chain. And now we get to do it again, and again, and again. The feeling is addictive. Speed, danger, and tenuous control, a heady mix, fire each synapse with intensity like never before.

Yesterday we were bound to our house, straining on a short leash; today the world awaits our every inspection. Our friends can be easily visited, Messages can be delivered for our mothers, and the sun is brighter and warmer on our backs than ever before. Fields with frogs and trees are within our grasp now, and still we can get home in time for lunch. Life is good.

And so, when we complete our formal education, and begin the practical exercise, our friends and family once more grit their teeth against the inevitable pain to come. They know, and at this stage we know, what lies ahead.

Fear of the unknown, fear of failure, wondering can we really have any measure of success at this. Expending effort to barely stay upright and thinking that walking seems so very attractive at this moment. God could make wheels if he so chose; aftermarket attachments must surely void the warranty on this complex bipedal bio-processor.

Speed kills! Slow down boys! A rich camel can’t enter Heavens gate! The rich have our money, if they had less we’d have more! Take what information you need out of context, but stop the hurt. This can’t go on. Get a job!

I refer to the choice that we all make as we begin the practical assessment after school called life. Not making a decision is a decision. Abdication of personal responsibility is a decision. It’s all a decision, whether conscious or unconscious, forced or freely made. Choose a job or choose to work for yourself. We make this decision once, and then we make it again daily for the rest of our lives.

Starting a business is just like riding a bicycle. You will get hurt. Blood will be spilled today. Calculate the travel time to your local lending institution before you start, finances are about to become cripplingly painful, and a cash injection may be required to ease your pain. Pray you never need a complete transfusion!

Your friends and neighbours now have a new rich source of entertainment, and tickets are free. It’s a public performance, hope you learned your lines. Of course you didn’t, the script isn’t available, its improv at its rawest, and it’s generally ugly. WHY am I doing this?

At this point, if you don’t know the answer to this question, the bike wins. Park it petulantly over the hedge, and proceed to the job centre. Walking never looked so good. Speed kills, slow down boys, we like out of context if it supports our decisions. Hang the relevancy, the lads are in the pub every night, why aren’t I down there with them? Why not indeed? Why not?

It’s about the warmer sun; it’s not about the blood. It’s about leaning into the curve with the pedals scraping the road. It’s about being terrified and exhilarated at the same time. It’s about winning at the game of life.

Protection keeps us alive from birth to early childhood. Education keeps us alive from early childhood to early adulthood. At early adulthood most of us die, but continue our daily grind until burial after our seventh or eight decade. Protection at early adulthood has the opposite affect than after birth; it kills off our entrepreneurial spirit, and forces us into a prebuilt box, commonly referred to as a job.

Not to worry, these boxes are no longer being manufactured to the same standards as experienced by our parents. Boxes made today rarely last more than twelve months, and some are much flimsier than this. Even the best-built boxes are deteriorating, and our children will only know them by stories and legend.

Remaining upright on an impossible knifepoint is not about balance, so don’t expect it. It’s about being always a little out of balance, first one way, and then the other, but constantly gaining momentum.

Of course it is scary, but the speed gained more than compensates for any inconvenience. There is a choice to be made. No decision is a decision, and its being made for you right now.

The game is on, pay attention.
The ascent is perilous, but the view is magnificent! B.Dolan
Contact Brian Dolan at 071-96 45752 e-mail brian@bdolan.com 087-2374695 Linkedin: http://ie.linkedin.com/pub/brian-dolan/9/146/170

Welcome to the Sligo Enterprise Blog!

In this section of the site we have asked our mentors and trainers to submit pieces on their experiences and thoughts on the world of small business as they see it. Most of our mentors have been working with small business for many years and have garnered a wealth of experience as a result.

To kick things off we have Brian Dolan of Progressive Business Development who provides us with a philosophical comparison between bike riding and starting in business called You Inc, and a guide on How to Grow Visitor Numbers to your Website from Louise McDonnell of 2Market-Marketing and PR.

Thanks to both for their kind submissions!