Research and Enterprise

1. Research and Enterprise • Business Awareness Programme ‘Business Planning – how do I create my first business?’

2. Research and Enterprise Research and Enterprise Starting in Business Business Awareness Workshop ‘Business Planning – how do I create my first business?’ Bernard Curren MCMI Research and Enterprise Knowledge & Innovation Manager

3. Research and Enterprise Starting in Business Programme Welcome to Planning and Regulation General introductions Domestics Outline of the Starting in Business Programme Outline of today's Planning and Regulation session

4. Research and Enterprise Planning and Regulation Small Business- what does it mean? Business Plan…why have one? Business Failure…some considerations!!! Legal status Business names, trade marks, licences Insurances , Tax, VAT Business Insurance Health and Safety, Employment Law Premises Contracts ..terms and conditions

5. Research and Enterprise What it means to be a small business Smallness means greater emphasis upon: Standing alone Operating with limited resources High levels of uncertainty and external dependency Being close to the customer Coping with ‘total’ responsibility Managing a wide range of task structures

6. Research and Enterprise What it means to be a small business - continued Greater scope for individual dominance and responsibility Managing networks with suppliers, customers, accountants. lawyers, bankers etc. Wide scope for change and flexibility

7. Research and Enterprise What is a business plan? & Why have one!!!

8. Research and Enterprise Planning is about looking to the future to minimise risk and maximise opportunity

9. Research and Enterprise Why have a Business Plan? 3 Main reasons A document setting out what you aim to do (setting targets and actions) Reducing the risk of failure/ increasing the likelihood of success Possibly assisting with the raising of business finance Make your mistakes on paper!!

10. Research and Enterprise The reasons for preparing a Business Plan? • To raise money • Minimise Risk • Increase success • Reminder of why/who/what/when • Assists in promoting the business to backers, suppliers, landlords and customers • To know where you are going. To know when you have arrived • Keeps focus on business issues • It encourages realism • Builds confidence in you and your team

11. Research and Enterprise Important parts of the Plan The vision….(where you are going) Why, When, How The Market……..Segment, Size, Trends, Customer profile, Competition, Suppliers and Distribution Financials…….Sales forecast, Cash Flow Forecast Profit and loss Forecast

12. Research and Enterprise Business Plan • Title page • Synopsis of the plan • Background information • Form/status decision – dis/advantages • Key personnel – details in CV • Description of product/s and or service/s • Premises – location, type, size • Market research activities, findings and results • Written short, medium an long-term objectives • Marketing plan • Financial plan • Contingency plan

13. Research and Enterprise The Cashflow This important document helps to: • Establish the amount of money needed and when it is required • Ensure that capital expenditure is controlled • Encourage efficient use of resources • Identify any shortfalls • Provides facts to help with decision-making

14. Research and Enterprise Reasons for Failure • Under pricing • Inadequate cash flow • Lack of capital • Over-trading • Change in market demand • Ill health • Failure to keep Bank informed • Third Party debt – major customer • Over estimating sales • Failure to control costs • Losing control over cash • Inadequate market research • Taking unnecessary risks • Failure to meet client nee

15. Research and Enterprise Legal Structure Sole Trader Partnership Limited Liability Partnership Limited Company

16. Research and Enterprise Sole Trader and Partnerships You must inform -Inland Revenue ) - Contributions Agency )HMRC - Customs & Excise ) In Law: 1) The Business and proprietor/s are the same. 2) You are solely/jointly responsible for all debts Tax Assessment: 1) Self assessed 2) Need to keep records for 6 years Tax Calculation: IR 30th September You 31st January Payments on account – January 31st and July 31st Penalties for late returns No external audit – the business is private

17. Research and Enterprise Limited Companies Set Up Minimum 1 Shareholder,1 Director and Company Secretary Buy Ready-to-use Company Solicitor/Accountant Do-it-yourself – via the internet or formation agent Registration Companies House Documents Certificate of Incorporation and Memorandum and Articles of Association Employees Pay as you Earn Company Profits Corporation Tax Accounts must be audited annually by an external auditor – additional costs

18. Research and Enterprise Social Enterprise Objectives Trading Social Purpose Owned by the community Not for profit legal structures: Company limited by Guarantee Charity Industrial and Provident Society Social Firm Community Interest Company

19. Research and Enterprise Business Names, Logos & Licences Regulated by Business Names Act 1985 Using your own name Passing off Checking for names in use Using a trading name Consider domain names Trademarks Business Registration…..HMRC…..Local authority……HSE

20. Research and Enterprise Data Protection Act 1998 • The 8 Data Protection Principles: • Data shall be: • Fairly & lawfully processed • Processed for limited purposes • Adequate, relevant & not excessive • Accurate • Not kept longer than necessary • Processed in accordance with the data subject’s rights • Secure • Not transferred to countries outside the EEA without adequate protection Do you need to register? Find out at: www.informationcommissioner.gov.uk

21. Research and Enterprise What is VAT? Value Added Tax A tax on the supply within the UK of: Goods Services Imports and acquisitions into the UK Charged by a taxable person/entity In the course/furtherance of business

22. Research and Enterprise VAT Registration Advantages Claim VAT on most purchases thus: • Reducing net expenses • Reducing costs to VAT Registered Customers, Exports and EC Sales Commercial credibility Discipline of keeping records up to date Disadvantages • Charge VAT on all Taxable Sales • Submit VAT Returns (usually quarterly) • Need to keep records for 6 years

23. Research and Enterprise VAT Liability/Rates Calculated on sales value over a rolling 12 months. Accounted for (typically) quarterly Compulsory Registration threshold = £67,000 Voluntary Registration at any time below this De-Registration threshold = £62,000? Taxable Supplies: Non Taxable Supplies: Standard 15% - Exempt Reduced Rate 5% - Outside the Scope Zero Rate 0%

24. Research and Enterprise What Insurance will I need? Legal Requirements (compulsory) Vehicle Insurance Employers Liability if you employ people Other forms of Insurance Public Liability Product liability – if you sell, repair or supply Professional Indemnity – for consultants Goods in Transit, Loss of money, Fire Building and Contents Personal Insurances – such as pensions Health & Life Insurances

25. Research and Enterprise Do you need a Licence? • Local Authority • Theatre, child-minding, taxi service, nightclubs, pet kennels, sex shops etc • Environmental Health Dept • Hotels, restaurants, tattooing, massage, acupuncture, abattoirs, etc • Police • Possession or sale of firearms, to work with children • Magistrates • Sale of alcohol, betting shops, gaming • HM Customs & Excise • Bureau de change, money transmission, third party cheque cashing • Office of Fair Trading • Credit Licence; Lending money, debt collection, hiring, leasing, etc • Planning Officer • Building regulations, alterations, change of use etc

26. Research and Enterprise The Law and your Business Customer Obligation: The Supply of Goods and Services Act The Sale of Goods Act Trade Descriptions Act Consumer Protection Act The Unfair Contract Terms Act Consumer Credit Acts Weights and Measures Acts Unsolicited Goods and Services Acts The Prices Acts The Goods and Drugs Act The Distance Selling Regulations Expert advice can be obtained from the Trading Standards Department of your Local Authority

27. Research and Enterprise Health & Safety Health & Safety at Work Act Offices, Shops and Railway Premises Act Factories Act Fire Precautions Act Health & Safety (First Aid) Regulations Act www.hse.gov.uk for risk assessment checklist

28. Research and Enterprise Premises Trading from Home House Deeds Capital Gains Tax Planning Issues Home Insurers Commercial Renting LicenseLease Easy in, easy out - Period - Break clause - Full repairing - Assignment - Sub-letting - Landlords legal fees - Rent Review dates - Service charges

29. Research and Enterprise Terms and Conditions of Trading Delivery timing Payment dates Ownership (retention of title) Cancellation Price Refunds policy Force majeure Consequential loss IPR issues

30. Research and Enterprise Useful Websites • Business Link… http://www.bldc.co.uk/ • BERR http://www.berr.gov.uk/ HM Revenue & Customs www.hmrc.gov.uk www.plymouth.ac.uk/businessservices Contact Numbers: Local Business Link Office0845 600 9966