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Understandable or not, it’s a mistake however. The fact is, profits are only one small piece of the puzzle for SMBs looking to grow a company in the long term.

“KPI numbers can seem like a bit of a foreign language to many,” says trades advisor, mentor and coach, Andy Burrows.

“If tradespeople want to improve and grow their business, there are key principles they need to focus on. It’s really not too difficult, it’s just a case zeroing in on what’s important and then changing some of your behaviours”.

Burrows says that most electricians have a ‘gut feel’ when there’s something wrong, but lack the objectivity that comes with a better understanding of their key performance indicators.

“You need to ask yourself: What gross profit percentage are you achieving? Are you generating a decent rate of return? What revenue figures do you need to achieve to make the business work? Because that’s how you measure success.”

The only way to truly understand the health of your business is by understanding the metrics most relevant to it. Done well, you’ll have valuable early warning alerts about potential problems and accurate indicators of the health (or lack thereof) of your business. Ignored, you might find yourself working too hard, for too little return on a business that isn’t sustainable.

The good news is that a basic analysis of the fundamental KPIs isn’t necessarily difficult, and with the right knowledge, some simple advice, and the use of some uncomplicated tools, you can get a handle on the numbers most relevant to you.

First things first

The first step is deciding what you need to measure. Every business is different, as is every business owner, so the stats that matter most won’t be the same for everyone.

Your accountant is an excellent place to start when deciding where best to spend your time. They’ll look at your industry, the size of your business, your particular goals, and where you are in your company’s life cycle.

Some key metrics they’re likely to recommend tracking:

• Cash flow
• Debtor days
• Profit per hour

The important thing is to understand why you’re following any particular metric and what those results actually mean for your business. Again, use your accountant or advisor to help you understand what you need to know and why.

Getting a handle on your cash flow

Cash flow

Noun

• The total amount of money being transferred into and out of a business, especially as affecting liquidity.

While important metrics can vary from business to business, cash flow is a constant. Without cash you’re out of business so being able to anticipate when a bill is likely to be paid, more or less, is crucial.

Cash flow forecasting is important to identify shortfalls in cash balance, particularly as an early warning system for such shortfalls. Having a good idea about your upcoming surpluses or shortages gives you planning confidence and ensures you can pay your suppliers and employees.

So how’s it done? It’s essentially a case of measuring ‘cash-in’ and ‘cash-out’, but that can be more involved that it might sound and working out the numbers with a spreadsheet can be tricky. An easier way? Let your advisor or coach figure out this number quickly (and they will, especially if they’re using a for-purpose debtor and cash flow management tool) and move on.

Understanding your debtor days

Debtor days

Noun

The average number of days your customers are taking to pay you, calculated by dividing debtors by average daily sales.

Debtor days are the ratio of how quickly your debtors are settling their invoices, or the difference between when you issue an invoice and when the debtor pays the invoice.

The amount of debtor days you’re facing will depend on several factors: Industry expectations, any early payment incentive schemes you have in place and how effectively you’re chasing overdue invoices. While the calculation is fairly straightforward (debtor days = debtors ÷ sales x 365), actually arriving at the final figure can be fairly labour intensive, so again, a skilled advisor, coach or accountant is likely your best bet.

Once you’ve established what your debtor days figure is, you can then compare it to your industry average to see how you fare.

Deciphering profit

Net profit per hour

Noun

• Net operating profit / total revenue producing or billable hours

One of the biggest questions that you need to answer is this: “Am I profitable?” It is, very much, the ‘bottom line’ for a business and the measure of whether what you’re doing is successful. You answer this by establishing your net profit per hour (net operating profit divided by total revenue producing or billable hours).

“The biggest mistake I see people make is not going back and analysing how profitable the jobs they’ve done have been, says Burrows.

“They’re so busy, they’re on to the next thing and on to the next thing, and not going back and asking ‘What is the most profitable kind of work I’m doing?’”

“It’s easy to get really busy doing lots of jobs, and accepting jobs that you possibly shouldn’t. That’s a case of not having very good ‘filtering’.”

Filtering your clients is the secret to finding out which customers are simply not worth having. Either because they cost you more than the revenue they bring in, they consume a disproportionate share of time and money, or they create stress by paying late.

“It could also be jobs that are geographically problematic, i.e. wasting time in-between jobs. It might be taking jobs from people who are really super fussy and constantly micromanaging you. Filtering your clients is about getting to that point where you can ask ‘Who is the best type of client for me to proactively chase?’”

“And you’re only going to find that out by doing analysis.”

(Click here to find out how to grade your clients).

Some aspects of your business will always be out of your control. An understanding of your key performance metrics, knowledge of what they mean and grasping how they will help you reach your goals is something you can always control.

Taking the time to understand them — and seeking help to understand them if you need it — will help you maintain your business’s performance.

Debtor Daddy politely and persistently reminds your customers to pay. Set-up takes just three minutes, then with just a few clicks, Debtor Daddy is on the job. When an invoice is due, relax. Debtor Daddy follows up with perfectly crafted email reminders that get results, meaning you can get back to what you love.

So how do you stay on top of things through the mad rush?

Don’t get stressed – get systematic.

When things are busy, you need to have tight processes in place to stay in control.

Make sure your systems for rostering, ordering stock, customer bookings and payroll are all as streamlined as possible. If you need assistance with putting them in place, goRoster can certainly help.

Fight chaos with communication

Keeping the communication lines open is key to maintaining a calm workplace. Make sure your staff know exactly what is happening – who is working what shift, how many people are in for dinner and any private functions that are booked for example.

Clear communication to your staff will make them feel confident and happy in what they are doing. And the positive vibes will no doubt rub off on your customers!

For instance, say you employ 50 people, with an annual turnover of just 6%. While this rate of turnover is nothing to worry about, if the three people that jumped ship each held critical roles, there’s going to be considerable collateral damage. This includes a negative impact on your other staff in terms of morale, performance and productivity.

Replacing workers is costly

You can expect to spend at least one-fifth of an employee’s annual salary on replacing that worker. This includes everything from advertising the position, the time and costs associated with recruiting, onboarding and training new hires. It also takes into account lost productivity while new employees come up to speed and master their new roles.

So, lose three employees on $65,000 each, and you’re looking at a $39,000 hit off your bottom line just to replace them. Of course, if you lose key executives, this cost will be much higher. In fact, replacing a highly specialised role can cost you as much as double the initial salary.

Zero voluntary turnover not the holy grail

Equally, even achieving zero voluntary turnover may not necessarily be a good thing, especially if your business is changing and your people are rooted to the past. It’s important for any business to bring in new talent and with it fresh ideas, different experience, and new perspectives. In fact, healthy turnover can actually help rejuvenate a business.

Healthy vs. unhealthy employee turnover

The key to managing employee turnover is to first identify whether your current turnover is healthy or unhealthy. And while this is influenced by your industry, profession, and where you’re located, as I said earlier, it all depends on who’s leaving.

Whereas, there’s no one magic number for employee turnover, company culture plays a pivotal role in employee retention.

Culture key to retention

In fact, in any firm that is considered a great place to work, culture plays a key role. For instance, look at Salesforce, which topped this year’s Best Places to Work list of employers with more than 100 employees. The company puts its success down to a workplace culture built around the spirit of “Ohana”, which means “family” in Hawaiian, and the close-knit ecosystem of employees, customers, partners and communities that the company has built.

Likewise, for Rackspace Australia which topped the list of great places to work for companies with fewer than 100 employees. The company takes its culture very seriously with a team of ‘culture instigators’ who allocate a percentage of their time to making sure everyone feels included and has a say.

Exit interviews

When people do leave your business, exit interviews are an important learning tool. Candid feedback here is invaluable. But rather than asking them to tell you why they are leaving, ask them for suggestions on how you could improve the business.

Stay interviews

Of course, rather than leaving it until the horse has bolted, an alternative to exit interviews is to hold regular “stay interviews”. Instead of finding out why someone is leaving, find out what you could do to make sure that person sticks around. You can conduct these interviews as part of your regular employee happiness surveys.

Remember, it’s expensive to recruit a new employee. If your company culture is the reason why your employees leave, then it’s a perfect time to have a good look at how you recognise performance, provide opportunities for growth, and the quality of manager-employee-co-worker interactions.

How is your business supporting the most important needs of your employees for meaningful work, market compensation and benefits?

With landmark strategies in use by over 16,000 clients in 30 countries and two bestselling books to his name, “Accounting Practices Don’t Add Up – why they don’t and what to do about it” and “Remaining Relevant – the future of the Accounting profession,” Nixon is the lead speaker at Firm of NOW, an international touring conference that delivers the latest research and thoughts on practical steps and necessary tools needed to create a leading accounting firm.

Why did you want to run your own business?

I am very goal-driven. I have 174 life goals to complete. Collectively, they all involve having lots of time and having lots of money. If you’re in a job (which I heard stands for ‘just over broke’) it’s hard to have the time and the money. Life is for living not existing, and for me and my family that means having amazing experiences. Starting a business should come from passion of a cause, making a difference or just wanting to create wealth. A business should fuel your life not be your life. For me it was the only option. PANALITIX is my seventh startup. It’s also the best one!

What was the hardest thing about getting started?

Capital. I have started most of my companies on my credit cards – very expensive capital. However, it’s capital that is there and can be used. As the credit increase letters would arrive from the banks I would always accept the new increase. I figured I could use it now, make some sales and pay it off later. These days with crowdfunding, angel funding and maybe venture capital funding it’s easier than ever (provided you’ve got a great idea that helps a lot of people solve a lot of problems) to get started on other peoples money.

What has been the most rewarding moment?

When my existing client base started investing in my business. At the time of this interview we have 110 clients who are investors. They believe in what we’re doing, love what we’re doing and want to be part of it. It’s very humbling to have your clients / customers be your investors.

What’s the one piece of advice you would give someone else about to start their own business?

I am going to give two pieces of advice:

1) It sounds cliche’, but if you have a passion, you’re committed and believe you can do it then just do it and play full out. I meet so many people who keep a job whilst they start a business. They’ll succeed very slowly – if at all. I have started five of my seven businesses on credit cards when I couldn’t afford to. I’ve left jobs to start businesses and left businesses (that I was an equity holder in) to start businesses.

2) You’ve only got one ass, you can only ride one horse at a time. I know the likes of Sir Richard Branson or Elon Musk have multiple businesses – but they are not the norm. I’ve met Sir Richard a number of times and he started with 1. Now he has 400+ with a a full formula and management team to run them. The regular Entrepreneur is not wired up this way. It’s about FOCUS – Focus On one Course Until Successful.

For this reason, Xero recently surveyed more than 1,200 former and current small business owners in the U.S. to gain a better understanding of what sets millennials apart from their older counterparts when it comes to starting and running a small business.

The results are indicative of a generation raised during recession and rapid technological advancement, and show what you need to know about their expectations in order to attract and retain millennial clients.

They’re cautiously optimistic about the future

Understanding what motivates millennials to start their own businesses is perhaps the most important piece of the puzzle when it comes to developing your firm’s approach to servicing this generation. Watching dedicated workers losing their jobs during the financial crisis seems to have changed the way millennials view the corporate world.

Our survey found that, for 52 percent of millennials, being their own boss is one of the greatest motivators for starting their business. Further proving how shaped they were by the recession, 22 percent of millennial entrepreneurs cite fear of unemployment as the driving force behind their entrepreneurial bids – that’s double that of respondents aged 30 to 50.

Forty-nine percent of millennials remain cautiously optimistic about the growth of their small businesses. This reflects their need for guidance and support from their accountants and bookkeepers. By using cloud accounting software, which automates manual processes like data entry and makes reporting as simple as the click of a button, you have more time to provide those advisory services across all of your clients – including millennials.

Millennials are cloud leaders – and you should be too

Growing up exposed to a proliferation of technology, millennials are building their businesses using applications and software that were unavailable to baby boomers when they were the same age. Cloud technology, giving small business owners the ability to run their business from anywhere at anytime, has proven a boon for millennial entrepreneurs in more ways than one – the use of which has come to be an expectation for this group rather than a desire.

Millennials are turning to cloud technology to run key business operations at a much larger rate than baby boomers – as evidenced by our survey results. More than one-third of millennial entrepreneurs run the majority of their business in the cloud, while only one-fifth of baby boomers do the same.

The mobile nature of small business ownership today is seeing more young entrepreneurs do their bank reconciliation, send invoices and check their cashflow on-the-go – while they’re waiting in line at the grocery store, riding in the back of an Uber and even traveling abroad – all from their mobiles. The flexibility given to millennials by cloud technology has even shaped how they measure their businesses’ success – 79 percent view a healthy work-life balance as a key indicator of how well their business is doing.

Having a schedule conducive to travel is the second most important success benchmark for 67 percent of millennial small business owners. Both of these results indicate that utilizing and emphasizing the use of cloud accounting software is important if you want your services to resonate with this generation. Millennials expect to be able to collaborate with their trusted advisors from wherever they are on any device.

Meet them where they are on social media

Early exposure to social media means that millennials are more inherently versed in the ins and outs of these networks. For this reason, 62 percent of millennial small businesses choose social media as their channel of choice for one-to-one customer communication.

So when it comes to attracting and retaining millennial clients, it’s important to not only follow their lead but meet them where they are. This is shown in our survey results, which found that social media is their preferred method of communication with their accountants and bookkeepers.

Keeping in touch with your millennial clients via social media, coupled with collaboration using cloud accounting software, is key. By doing so you can be part of the conversation with your customers as well as the added advantage of being able to check in with them when necessary and provide immediate responses to their urgent questions.

Millennial small business owners are unlike any of their generational predecessors. By understanding what motivates them, collaborating with them on cloud accounting software and communicating with them via social media you’ll be able to meet the accounting needs of this often-misunderstood generation.

You can read the full report here.

Large companies like Motorola, Hewlett-Packard and others use the same basic concept but refer to their programs by different names. Nevertheless, small manufacturers and other small businesses can reap the benefits of the just-in-time approach to control inventory costs and maximize the value of the inventory they have on the floor.

In a nutshell, a manufacturer contracts with a supplier to maintain inventory levels of raw materials and other supplies needed for the manufacturing process so the manufacturer doesn’t need to. This helps lower production costs by reducing the cost of the inventory they carry, and helps increase efficiency throughout the manufacturing process, allowing the manufacturer to potentially lower costs to their customers. The same basic concept can also be applied to anyone who needs to stock inventory or otherwise has a supply chain.

Because this model is primarily a manufacturing model, we’ll use the manufacturing process as an example. Finding success with a just-in-time approach depends upon three important components:

1. A disciplined manufacturing process.

In order to successfully incorporate a just-in-time methodology, you’ll need to ensure you have complete control of all your production processes. The entire assembly line needs to be in sync and you can’t afford errors in production. Tight inventory control is crucial because if the part isn’t there, the assembly line stops—making downtime expensive both in terms of production and manpower.

This means repeatable processes must be in place to ensure that your employees keep track of what’s being used and what’s needed, so that there’s enough inventory to meet your manufacturing goals.

2. A good supplier relationship.

Lowering your warehouse costs by reducing inventory requires an excellent relationship with your suppliers. These suppliers will assume the costs of maintaining inventory while ensuring that the supply chain of inventory is readily available and deliverable to you when you need it.

Creating an excellent relationship with your supplier requires some forethought. As such, there are some things you should consider when negotiating with suppliers. For example, instead of thinking of how to achieve the lowest price on purchasing inventory today, the just-in-time methodology requires you to think longer-term. By creating contracts with suppliers to guarantee inventory delivery over the long term (think in terms of yearly—or longer—contracts) a small manufacturer can ensure they have readily available inventory when they need it at the lowest price possible. This is not only good for your business, but a potential win for your suppliers who enjoy the benefit of guaranteed business over the course of a 12-month or longer period.

The just-in-time approach also has the potential to reduce waste by eliminating parts or raw materials that become obsolete or otherwise unneeded within your manufacturing process.

3. The right technology.

Implementing a just-in-time methodology today is much more accessible than it might have been 50 years ago when it was introduced by Toyota. Technology makes it much easier to monitor inventory levels in real time and instantly communicate with suppliers to properly manage inventory levels within the manufacturing process.

The Internet makes it possible for what was once very expensive technology to be accessed by small businesses at relatively lower costs. Barcoding parts to track inventory usage makes it easy for you and your suppliers to keep track of inventory levels. The Internet makes it possible for your suppliers to see, in real time, whether you need more component parts or raw materials, enabling them to act quickly to get you what you need.

The just-in-time model requires a close, even intimate, relationship with your suppliers. As such, communication with your supplier is critical. Utilizing the right technology is critical in maintaining an open line of communication with your supplier. This will likely mean your suppliers will need access to your production schedules and instant notifications of any changes that would either increase or decrease your production.

Taking a just-in-time approach could be a great way to increase the efficiency of your manufacturing process. To determine if it’s the right approach for you, you’ll need to ask yourself a few questions:

1. Do you produce a predictable amount of products every day, week or month? Can you predict how much inventory in parts or raw materials you’ll need during your production schedule? If not, a just-in-time approach will be difficult to adopt.

2. Are your suppliers willing to stock the inventory you need and make smaller, yet more frequent, deliveries? Are they willing to negotiate favorable terms for the guarantee of long-term commitments from you? Can you rely on them to give you quick access to the supplies you need?

3. Are your employees willing to adopt new systems and technology that initially may add a step or two to what they are currently doing within your manufacturing process?

4. Are you willing to invest in the technology and tools to monitor your inventory and communicate with your suppliers so they have visibility into your production schedule and can seamlessly manage your inventory?

Although a just-in-time methodology is a popular way to help businesses manage costs and increase profits, you need to evaluate whether or not it’s right for your small business and determine if you’re willing to make the investments required to implement it. Fortunately, the technology you need is more accessible than ever before.

A few months ago we set up an innocuous little survey on the WorkflowMax blog to help us understand our customers’ pain points better. We wanted to create more targeted and relevant content that would address their issues directly (and maybe even bring a smile to their face as they scrolled past the occasional GIF and bad pun).

One of the issues which keeps cropping up in the survey responses is that of time management. More specifically…not finding the time to do everything!

Harvard Business Review calls to-do lists “a million dollar opportunity”. This post discusses how re-thinking the humble to-do list can give you back your time. So whether you’re a compulsive list-maker, a serial productivity app downloader, or simply want to know what NOT to do when it comes to to-do lists and productivity, read on my friend, because this blog post is for you!

Mistake 1: You’re collecting apps

“Finding the right tool to track your to-dos is highly personal, and one person’s best is another’s junk” – via Lifehacker

Whenever a new productivity app hits the store or gets a glowing review in Netted, you just know it’s going to solve all of your problems. It’s beautiful, well designed, and has already racked up a few decent reviews. Of course you download it immediately, have a quick play and then, because you have tons of stuff to do, figure you’ll get back to it later.

Only you never do (you’re too busy!)…and thus into the graveyard of productivity apps your new toy goes, quickly outliving its moment of glory. Trust me, I know the feeling – only instead of “to-do” apps my vice is fitness tracking apps. So let’s break the habit together!

Here are some tips to help:

• Clear out the apps you’re not using; Pretty basic right, but just like your room needs the occasional once over, so does your phone. Why use up precious space with unused apps that only create clutter and confusion?
• Get familiar with the app’s features; These days most apps come with tutorial videos, support documentation (depending on how complex it is), testimonials and contact details for help.

Mistake 2: Out of sight out of mind

This is easy to do if you’re guilty of Mistake 1 as well. Downloading a bunch of productivity apps, grouping them into a meaningless category called “productivity” and then promptly forgetting about them is counter-productive.

So what should you do?

• Minimise the number of apps you have (refer back to tips in 1)
• Make sure your app(s) are easy to find on your preferred device (e.g. not hidden on the 5th window of your iPhone’s hoem screen!)
• When sorting apps into folders or groups, make sure to choose a logical naming convention!

Mistake 3: You’re trying to do everything

“The longer your list, the less you accomplish” – Wired

I know making lists can be addictive; the more to-dos you add, the more productive you feel. But are you compulsively adding everything to the list, regardless of whether or not it’s appropriate? And then padding it out with excessive detail?

A to-do list shouldn’t be endless (think about how daunting that would be!) and definitely should be specific. Consider the difference between “Finish Project” as an item on your list and “Finish Webpage Layout Draft 1”…!

Here are some tips to help:

• Try delegating your tasks. A great manager or project lead knows how to let go of control and empower others in the team. Assigning tasks to staff members is one great way of doing this or using the collaboration feature your tool offers.
• Be brutal. Is everything on the list really necessary? If you don’t want to delete it outright, at least archive old lists so they’re hidden away from sight but still there if you need them.
• Ask if there’s a better way. For example, could you leave a quick post-it note on a colleague’s desk, rather than input a specific “action item” in your list? Or could something be resolved by a direct conversation?

Mistake 4. You’re not organising your list

If you’re not prioritising the items in your list how will you know where to start? Trying to do everything all at once is a surefire way to set yourself up to fail.

Some apps give you the ability to “pin” tasks to the top of a list, add colour categories or even offer the option of tagging with hashtags for easy searching and filtering.

My favourite way of keeping my lists nice and tidy is to have a master group and sub-tasks or categories within it.

Our supremely organised product team uses Trello to provide a big picture overview of upcoming releases; they group projects by due date, such as “immediate”, “within two weeks” etc. Anyone assigned to the card gets notified when a change occurs, and you can open up the card to dig deeper for more detail.

Mistake 5: You’re not setting reminders

When you’re trying to keep on top of multiple jobs, deadlines and milestones, setting basic reminders is incredibly useful. Most planning/scheduling apps have this functionality – so make sure you’re taking full advantage of it! In WorkflowMax notifications can be created to alert you when:

• The state of a job changes
• New tasks, notes or documents have been added to the job
• The actual time on a job or task is approaching or has exceeded the estimated time
• he due date of a job or task is approaching or has exceeded the estimated due date

Tip: When creating notifications try not to have too many or include the wrong people in a notification. The more relevant a notification is, the greater the chance it will be read and actioned!

Mistake 6: You’re using someone else’s system

“There’s task management methods that’ll fit you perfectly—and others that’ll never work for you no matter how hard you try” – via Zapier

All right, can we just pause for one second and recognise that we’re all different, beautiful unique human beings. Hallelujah.

Sure, streamlining the way your team communicates is important, but for personal workflow management, there often is no “blanket solution”. Are you more of a visual person? Do you need to have a physical system offline? Does an endless 10 page Excel spreadsheet do your head in?

Understanding your way of working is the first step to finding a solution that’s right for you!

Zapier put together a comprehensive guide on the best apps for personal task management – head over there and compare the reviews to your heart’s content. But my top 5 favourites are:

• TeuxDeux; Great if you like a visual overview of your entire week in a calendar format, this “simple, designy to-do app”, lets you add to-dos as you go and check items off as you complete them. If you didn’t quite manage to get to everything, unfinished items will automatically be moved to the next day.
• To Round; Are you a visual thinker? Want a to-do list that’s more entertaining? Try this neat little app, which lets you create tasks as bubbles and prioritise by bubble size.
• Todoist; With the motto that “Keeping life in order shouldn’t be this hard”, Todoist is a simple and flexible productivity app that helps you “spend as little time as possible organizing and more time doing”.
• Google Keep; Require a great deal of flexibility? This app lets you capture your thoughts in any format. I love how simple, visual and effortless it is – you can collect and organise anything and everything, easily drag and drop notes to reorder them, capture, edit, share, and collaborate on your notes on any device, anywhere. The design is minimal and uncomplicated, designed to help you work at your best.
• And well…good old fashioned pen and paper. Vogue said it perfectly when it stated “there’s still something about a crisp new planner that is just irresistible”. So if you’re more the daily planner/diary type, there are plenty of inspirational options to get your hands on. Check out Kikki.K’s gorgeous collection of notebooks and planners, Mi Goals “get shit done” books, Good F*cking Design Advice, or of course Moleskine’s extensive range of notebooks.

At the end of the day, a to-do list is there to serve you, and your workflow process, to help you remember, organise and prioritise your tasks. By re-vamping your to-do list and steering clear of the 6 mistakes we mention, get your time back so you can keep doing what you love!

UK’s lagging productivity tackled

At Xerocon London 2016, we raised the issue of UK’s productivity problem and the importance of SMB productivity to the health of the overall economy – Hammond’s statement that the UK currently lags behind the US and Germany by some 30% demonstrates the reality that it takes a German worker four days to produce what we make in five. In turn, this means that too many British workers work longer hours for lower pay than their counterparts.

The announcement of a £23bn Productivity Fund fund is overdue, but a move in the right direction. Funding transport, digital comms, R&D and housing, it’s vital that the government recognises the issues behind the UK lagging badly behind the US, Germany, France and Italy in efficiency. Combined with the implementation of Sir Charlie Mayfield’s review of business productivity by providing £13m to help businesses improve management skills, this could be the start of an improved and more efficient UK.

The £400m VC fund injection will help companies to remain British owned

The growth of UK new tech companies is vital for the long term – particularly since the result of the referendum was announced. Too many great British technologies are acquired before they fully develop – DeepMind, the AI company founded in Cambridge in 2010 and acquired by Google in 2014 is a great example of this, as is the recently sold Skyscanner.

Now more than ever, we need more companies like DeepMind to emerge and remain British owned. Fund injections for VCs to invest in formation and growth is exactly what is needed to help make this happen, however, it’s something that must be spearheaded by Government too.

5G development – the right investment?

In the age of the cloud, online speeds are now paramount to productivity and economic growth. A trial of 5G mobile communications is a welcome investment for many, but current internet speeds for many areas across the country are still shockingly slow.

For rural small business owners 3G connection leaves a lot to be desired, which is why the £1bn investment to roll-out more full-fibre broadband by 2021 is a welcome proposal. An investment to improve current infrastructure will have a more immediate benefit for all small business owners across the country rather than simply those in built up areas, leading ultimately to the benefit of the UK’s economy.

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You may wish to consult a legal professional to help you with all the legal requirements that you must comply with, such as licences and registrations, contracts and leases.

If you need legal advice on a business issue, then the online Small business legal help guide  may help. It covers problems you may encounter such as contracts, employment, fair trading, leases, insurance, credit and debt recovery, finance and tax.

We’ve outlined six legal issues below to help you when starting your business and ensure you remain compliant.

Business registrations

All business owners in Australia have to register before commencing any business activities. As well as registering a business name, there are a variety of taxes that can impact on your business that you may be required to register for. These may include:

• an Australian Business Number (ABN)
• the Goods and Services Tax (GST)
• a Tax File Number (TFN)
• Pay as you go (PAYG) withholding.

Read our Registration and Licences topic for more information on what and how to register for to meet your tax and business obligations. There are other registrations such as registering for a domain name or registering a trade mark that may be applicable to your business. If you’re operating as a company, a different registration process applies than if you were a sole trader, partnership, or trust. Read our Register your company page.

Licences

If you operate a business, it’s likely you’ll need certain licences to make sure you’re complying with your legal obligations.

The Australian Business Licence and Information Service (ABLIS)  can help take the guess work out the licences, permits and registrations needed to run your business. You can search the ABLIS to find government licences, permits, approvals, registrations, codes of practice, standards and guidelines you need to know about to meet your compliance responsibilities.

The licence or permit you require may depend on the product or service you’re selling. You’ll need to find out whether there’s a licensing requirement for your particular business, or you may face fines or other difficulties.

Businesses selling products for consumption as food, for example, could need a Food Business Licence. However, there may be other licenses that aren’t so obvious, so it’s best to do some research into this area. Licenses and permits can vary from state to territory, so it’s best to find out this information from your local, state/territory, or federal government, to ensure you’re doing the right thing. Search for your state and business type in ABLIS today.

Privacy Act

A new set of privacy principles was introduced in March 2014. The principles cover how a business handles personal information, including the:

• handling and processing of personal information
• use of personal information for direct marketing purposes
• disclosing of personal information to people overseas.

Privacy Act 1988 obligations from the Office of the Australian Information Commissioner  (OIAC) website. You’ll need to be aware of your obligations under the Australian Privacy Principles (APPs). Check out theOAIC  website to see if your business needs to comply. Try the 9 Step Privacy Checklist for Small Business  to find out if it applies to your small business.

Anti-bullying laws

People who believe they’re being bullied in the workplace can apply to the Fair Work Commission  for help in resolving the issue.

Bullying occurs when a person or group of people, repeatedly behave unreasonably towards a worker. The behaviour also has to be deemed a risk to the worker’s health or safety. Read our Employing people topic for more information.

Download the Anti-workplace bullying guide  (PDF, 130KB) to find out more about bullying in the workplace.

Independent contractors

Independent contractors are self-employed and provide a service to a business.

They often negotiate their own payments and working arrangements, and have the opportunity to work for a range of clients at any given time.

Before entering into a contract, you’ll need to determine whether someone is classified as an independent contractor. Their status will affect their rights and obligations. It’s possible for someone to be an employee for some work and an independent contractor for other work.

You also need to remember that it’s illegal to fire, or threaten to fire, an employee if they don’t agree to become a contractor.

It’s important to know whether you’re hiring an independent contractor or an employee, so you can be sure you’re complying with your legal obligations.

Try our Contractor decision tool to find out if someone is more likely to be an independent contractor or an employee.

Unfair dismissal

Small businesses have different laws compared with larger businesses when it comes to unfair dismissal. Most small businesses (those with fewer than 15 employees) will fall under the Small Business Fair Dismissal Code .

If you are planning to terminate an employee, it’s important you follow the rules outlined in the Code.

What to do…

• Read the Small business legal help guide .

• Search the Australian Business Licence and Information Service .

• Read the Guide to privacy for small business  publication.

• Refer to the Working with contracts  guide for assistance with writing up business contracts.

• Consult an experienced business advisor, accountant or solicitor.

• If your business deals with chemicals or plastics, you can get an overview of regulatory requirements by reading the Department of Industry’s Chemicals Business Checklist 

• Read the trade measurement page if the price of your goods is based on measurement of quantity or quality.