Author: Megan Davies

9 Things You Need to Remember While Negotiating Contracts!

There are several aspects of business that can only be learnt through actual experience. One of them is negotiating contracts.

Several people fear the negotiation process because it is an intrinsically uncomfortable process. Asking for more money or making personal demands doesn’t come naturally to everyone. But with the right toolkit, you can breeze through contract negotiations. And you’d better get used to it, because you’ll have to handle a lot of contracts whether you’re a business owner or a company employee.

Having the right mindset is critical to contract negotiations. You have to believe that you are going to get your way. Bring a positive attitude and a smile to the table. You’re not signing contracts with the enemy. The people you’re negotiating with are going to be your business partners in one capacity or another.

Let’s take a look at some things you need to remember when you’re in the process of negotiating contracts.

1. Be patient

Don’t rush to get a contract signed. Rushed contracts usually leave one or both parties dissatisfied. It’s understandable if you want to get the negotiation done with, but taking the extra time to examine your contract will benefit you tremendously in the long run.

2. Involve an expert

You might know what you need from a contract in terms of an overall business output, but you could get trapped by the legalese. Get a lawyer you trust on board to frame the wording in a way which protects your overall interests. Even if you’re good at negotiation, involving an expert is always a good idea.

3. Don’t forget term sheets

Term sheets are basically a broad overview of the terms of your contract. Before you get into the specifics, it’s a good idea to make sure all parties involved agree on the big picture.

4. Take it one step at a time

Negotiating a complex and lengthy contract is an inherently tedious process. In the beginning, make sure you’ve got the basic details agreed upon. Making some headway is crucial to the overall success of the negotiations. After you’ve established a rapport with the other party, you can dive into the deeper, more difficult issues.

5. Think about the specifics

The flowery language on a contract might make for good reading if you’re of a certain leaning, but you need to understand what it translates to in the real world. How much will you be making?

6. Use the phone

Emails are notoriously difficult to decipher at times. You aren’t aware of the body language of the sender and sometimes people can word things in a confusing manner because they don’t have the best command over the language. If you’re unsure about certain things in your contract, pick up the phone and have a conversation. It will help sort things out.

7.Don’t fret too much about the first draft

The first draft of your contract is just a starting point. Don’t be alarmed if there are certain things in there which aren’t to your liking. It’s called a ‘negotiation’ because you will be changing certain aspects of the contract.

8. If you can’t make the tough calls, get someone who will

If you’re not a naturally assertive person or find it difficult to be demanding when the situation calls for it, ask for help from someone who is capable. It could be your business partner or even a spouse.

9. Do your research

You don’t want to make outlandish demands that the party you are negotiating with simply can’t afford. Take some time and do your research. See what similar services or products cost in the industry. Ask some experts for advice.

Negotiating a contract is like a very slow game of chess, except both parties need to come away from the table victorious. Before you begin the process, figure out what your short and long-term goals are. If you have a clear vision, it will help you navigate the tricky waters of contract negotiation better.

Got a question about your business? If you are looking for Fulham accountants or a tax advisor in London, get in touch!

e: office@londonaccountants.co   t: 0203 137 9791

Kind Regards,
The Team at London Accountants

 

Creating your business to-do list!

When you’re an entrepreneur, your to-do list is often long and constantly growing longer. 

There are an overwhelming number of things you need to do, and it can feel like they’re all urgent. In such cases, it’s easy to push important tasks to the side and focus on less-vital activities, but that often means you miss deadlines, make mistakes or always feel as though you’re trying to catch up.

Here are some ways for you to determine the most productive order to complete your tasks.

1. Know all of your tasks

It isn’t enough to have a running list of tasks in your head; you need to write them out so you can see them at a glance. Take the time to list all your tasks, and break down large tasks into smaller steps.

Write a list of the activities you need to do for the week, (or even the next two weeks) on Monday morning. Include information such as how urgent they are, how long they’ll take to complete and what their deadlines are.

Now you know what you need to complete and you have an idea of when things need to be done.

2. Determine what tasks are vital

There are many methods for determining which tasks are the most vital. Here, we’ll go into two: the Eisenhower Decision Matrix and the ABCDE Method.

In the Eisenhower Decision Matrix, you classify each task into one of four quadrants. These quadrants are based on whether the task is important, urgent, both or neither. Tasks that are both important and urgent should be done first, followed by those that are either important but not urgent or urgent but not important, and finally those that are neither important nor urgent. If possible, delegate tasks that aren’t both important and urgent to someone else.

Another method is the ABCDE method, in which you assign each task on your list a letter from A through E based on its level of importance. Tasks with a level of A or B are the most important, while D and E are not at all important. Anything from C down can likely be rescheduled or delegated to someone else.

3. Schedule your tasks

Now that you know which tasks are the most important, schedule your to-do list in that order. Write yourself a daily list that puts the most important tasks at the start of your day. Don’t over-schedule yourself, though. After all, there’s a good chance that in the course of your week, a new activity that is both important and urgent will arise and you’ll need the space in your calendar to address it.

Give yourself deadlines in the day to get the work done, based on a reasonable assessment of how long the activity should take you. You can also chunk your work, in which you set aside specific, uninterrupted periods of time to do focused work and then schedule in breaks around that.

Make sure you turn off distractions and let your colleagues know that you aren’t available during those times.

Final thoughts

By determining which of your tasks are the most important to you and your business and scheduling your day based on that criteria, you can ease the pressure caused when you have a long list of activities to take care of.

Want to chat about your business? Get in touch with our advisors.

On average, small business owners spend 10 hours each week recording, organising, and processing financial transactions (everything from accounts receivable and payable, to employee payments, expense receipts and supplier invoices…argh!)

We can help with bookkeeping and accounting for small business owners – read on to find out more.

While the process may be time-consuming (and tedious!), effective bookkeeping is the foundation of sound financial management – which in turn, is the lifeblood of your business.

Feeling overwhelmed by mountains of paperwork and complex calculations?

Here are three bookkeeping basics to help ensure a healthy financial future for your small business.

1. Faithfully track expenses

Accurate and consistent expense tracking is crucial for claiming tax deductions and lowering your overall tax bill. Plus, analysing expenses can offer crucial insights into spending patterns and the overall profitability of your small business.

Small business owners should consider using a mobile app for simple, consistent expense tracking. Dext help do away with manual data entry with automated functions, including:

– Receipt data capture via your smartphone’s camera (no need to hold onto paper receipts, which can get lost or misfiled);

– Synchronisation with your phone’s GPS to track mileage of business travel; and

– Importing bank and credit card data, plus integration with accounting software.

2. Systematic invoicing and filing

Not the most exciting task…but efficient invoicing is about more than ensuring you get paid in a timely fashion. An invoice is an official record of the terms of each transaction and must be completed accurately to avoid errors in your bookkeeping process.

Here are a few tips for professional invoicing:

– Ensure each invoice includes all the important details: contact information, a tracking number, a detailed list of products or services rendered, and a breakdown of the total amount due;

– Provide an electronic receipt to reduce waste and create a paper trail if there’s ever a dispute; and

– Maintain an invoice-filing system that records when you sent the invoice, to whom, when payment was made, and any reminders sent out.

An online invoicing tool can streamline this aspect of your bookkeeping process and provide an efficient backup filing system.

3. Save time with accounting software

By law, every business is required to keep organised and timely financial records. However, manually posting income and expenses to ledgers and journals is time consuming –  not to mention stressful for the math-averse.

Shave some time (and stress) off your weekly bookkeeping with an all-in-one accounting software solution like Xero (our fave).

Online bookkeeping offers numerous advantages, such as:

– Instant reports and real time insights on profits and loss, customer accounts, payroll – and your overall financial “big picture”;

– Simplified data entry so you can collate and print invoices, purchase orders, and payroll much faster than with manual methods; and

– Improved accuracy through automation (once data is entered, the software handles all subsequent calculations and processes – including invoicing).

When it comes to accounting, vigilance is the key to mitigating risk and ensuring the long term profitability of your small business. Be sure to set aside time each day, week, and month to update and review your books to catch any red flags and ensure your finances are on track.

Kind Regards,

The Team at London Accountants

4 ways to make your business easier to sell!

Perhaps you’d always planned to build a thriving business to eventually sell for a tidy sum – or maybe for unexpected personal reasons it’s best to let your company go sooner rather than later.

No matter what the reason for selling your business, experts agree: it’s best to be prepared well in advance as it can take years to complete a successful sale.

These four tips will help you get a head start on making your business attractive to buyers for the day you’re ready to sell.

1. Get a business valuation 

Even if a business sale isn’t imminent for the next five years, it isn’t too early to meet with an appraiser. A valuation will give you a realistic picture of what your business is worth right now, and invaluable information on what you can do to improve its value.

When you’re ready to sell, having already had an appraisal can be a real plus for potential buyers. Sharing the details of your valuation shows transparency, creating trust and building credibility (while saving a buyer the expense of getting one done themselves!)

Remember that timing is often everything with a business sale. Once you know what your business is worth, you can decide whether it’s best to move forward, or wait for a growth phase or improved economic conditions.

2. Make a succession plan

Every business, large or small, needs a succession plan. And when you’re ready to sell, having an exit strategy in place will put a buyer’s mind at ease because you’ll have already ironed out a smooth transition for you and the new owner.

A succession plan should include both the human resources aspect (e.g. a training plan for the new owner and any employees that stay on when ownership is transferred), as well as the management of any financial, legal, or tax issues. 

Once you’ve made all the hard decisions about how the business will run without you, be sure to review it once a year to make sure it’s always up to date. 

3. Tidy up your financials

The biggest red flag for anyone considering a business deal has to be disorganized or incomplete financial records.

A potential buyer will want to see your yearly tax returns for the last three to five years, as well as balance sheets and your profit and loss statements. You may also be asked to share accurate sales and marketing data, the value of your assets and any outstanding liabilities – as well as your plans to resolve them.

4. Hire a business broker

Hiring a business broker with a proven track record can really simplify the sales process, especially if you’re too busy to look for an interested buyer or need professional expertise to get your business in order to sell on your preferred timeline.

You’ll want to meet with a few brokers to make sure you find the right fit. Look for someone with experience selling businesses in your industry, a large database of interested buyers, and an impressive closing ratio.

When you interview a broker ask for testimonials and info on the strategies they’ll use to market and sell your business. Reach out to your network for referrals. As with any professional service, when it comes to business brokers an honest recommendation can help you find a winner.

Final tips

Ask your broker about the best way to structure your business sale for the best return. If you’ve built up some solid equity it may be wise to offer a buyer a gradual sale or lease. In addition to a continued income stream for you, this type of arrangement can help make the deal attractive by reducing the new owner’s financial burden.

Kind Regards,
The Team at London Accountants

9 Steps to Leading People Successfully through Major Organisational Change!

Change in business is almost always a good thing, but often poor management means that the workforce becomes disengaged and the change process painful. In the worst cases, this results in irreparable damage being done.

It doesn’t need to be this way. Follow these nine steps and empower yourself to successfully lead your people through major organizational change.

1. Understand the change

Make sure you understand exactly what is changing and how it affects your people. Speak to whomever you need to in order to ascertain this properly. You need to know what the impact is on your people and the jobs they do. Educating yourself will mean you’re better equipped to communicate with your staff. It will give them confidence that you are the right person to lead them into the unknown. It will also relieve their anxieties, as they will feel able to put their trust in you to keep them informed and look after their individual and collective interests.

2. Communicate effectively

Regular and varied communication is essential in managing change. Initial briefings to employees should be face to face, with adequate time set aside to prepare beforehand.

They should be delivered by an appropriately senior manager who also has good presentation skills and a natural delivery style. The audience needs to be engaged, not alienated. Going forward, set up a recognized channel that will control the flow of information on daily developments.

This could be an online micro-site or a newsletter or bulletin. Make sure the tone and language is upbeat and that the positive messages the business wants to promote about the change are a recurring theme. You should consult with your marketing team for advice on how to do this effectively.

3. Consult with your people

Consult staff on their views and provide clear channels for those opinions to be received. Consider providing an email address to receive questions, or if you have set up a micro-site, set up a message board that allows for questions and answers to be posted online.

It is equally important to ensure you are responding swiftly to those questions. It’s a good idea to set up and publish an FAQ list, which will prevent having to answer the same question multiple times. This will also help inform the content of future communications through understanding the hot topics.

Ultimately, the change may be mandatory and not open to amendment, but even if this were true, communication must still be a two-way street. If you don’t demonstrate an active interest in employees’ views, then you risk an outright mutiny.

4. Use your champions

Identify the characters in your team that are positive about the change, and pick out one or two who are popular or hold sway over their teammates. These are your wingmen, and it’s important you tap into that resource early. Get them on side and meet with them regularly. Explain the important role they have to play in helping others to stay upbeat.

As well as being a supportive and positive voice amongst the people, they are also your eyes and ears, in a position of trust with colleagues. This means they will pick up on potential concerns or flashpoints early, and be able to bring these to your attention in confidence.

During any staff briefings, your champions will play a pivotal role in supporting managers; positive voices from the populace are invaluable.

5. Control the dissenters

The negative voices in your team are often the loudest and most influential. You will have a number of people in your team who are confused or undecided about how they feel about the change. They are susceptible to being convinced by the detractors in your team, who will attempt to rally them to their cause. If all those sitting on the fence jump off on the wrong side, your life will get difficult. Don’t let that happen.

Target those dissenting staff members and speak to them individually. Show empathy and understanding for their concerns but explain the impact on their colleagues of their open expressions of negativity. Try to get them involved in meetings, taking an active role in being a critical but objective voice. But ultimately, if their views are extreme and it’s clear they intend to persist being a disruptive influence, then take a hard line. Tell them their behaviour is not acceptable and could lead to disciplinary action on grounds of their conduct.

6. Engage with unions

If your business recognizes one or more unions, make sure you engage fully with them during the whole process of change. This relationship needs to be managed very carefully and you should consult with senior HR management for advice and support.

Excluding union representatives from meetings or staff briefings, whether intentionally or otherwise, is not wise. It is unavoidable that there will be points of contention between senior management and unions, but maintaining an open and amicable dialogue is essential.

7. Maintain the business

Don’t let your team lose focus on their day-to-day responsibilities and the running of the business. It’s inevitable that there will be some impact on productivity during major change, but there is a limit to this, and staff need to be reminded that their normal roles and responsibilities still remain. Plan briefings and communications to minimize the impact on your resources, and by extension, your customers.

8. Toe the line

A lack of professionalism and objectivity of managers can spell disaster. Even if you feel that the business change is fundamentally wrong, or have concerns with the judgment of your seniors, you must not reveal this. You need to maintain the party line and express the changes in positive, objective terms.

Discuss your concerns with others you trust in the business if you need a sounding board, but be very careful who you confide in. Ideally, use confidential, independent channels, such as an employee assistance helpline, if your business provides one.

9. Manage outside influences

The change may attract outside attention from local or national press, or pressure groups. This might happen if your organization is particularly large, in the public sector, or in a regulated or contentious industry. In these cases, you also need to be aware of the effect of these outside agencies’ activities may have on your employees. You can rarely exercise much control over external media, but you can make sure your finger is on the pulse. This will allow you to react quickly if an external event occurs that’s likely to cause disruption or concern.

Change doesn’t have to be stressful and unpredictable, providing you plan ahead and stay in control. The key to success is keeping your employees bought in to the objectives, and engaged with the mechanics of the change. Following these nine steps will ensure you do that, and allow you to successfully lead people, unscathed, through even the most major organizational change.

Kind Regards,
The Team at London Accountants

It might take a few moments of your time to learn and understand how the software or app works, but doing so will save you valuable time and precious energy. It will also free you up to spend time on the tasks you love to do, not on all the paperwork and record keeping that go along with running a business.

If you’re a business owner, here are some programs that can help make your life easier.

1. Xero xero.com

Like many small business owners, you probably didn’t dream of owning your own business just so you could manage a paper trail and oversee cash flow. You likely have very little interest in following up on unpaid invoices or spending time paying bills. That’s where Xero comes in. Xero takes care of accounting for your small business.

You can create and track invoices and purchase orders, manage sales and purchases, and set up scheduled bill payments. You can even reconcile bank transactions any time from a computer, tablet or smartphone and have up-to-date financial information about your business. If you have employees, you can track payroll and manage time and money spent on projects.

Xero offers easier business financial management, without the headaches.

2. Dext dext.com

If you hate taking time away from your clients and work projects so you can manage your paperwork, Dext has what you need. Dext is a technology platform that small business owners can use to manage their vital business documents. Anything vital that relates to your business – such as receipts, invoices, and other documents – you simply capture on your mobile phone, through email, or scan on your computer, and upload to the platform.

Dext then takes the information and displays it for you so you can download it or send it to a connected accounting software. It can also categorise your expenses for you. It requires some time to set up manually, but once your account is set up, Dext will save you vast amounts of time.

3. Hubdoc hubdoc.com

Hubdoc takes care of data entry such as entering all your bills, invoices and other paperwork for you. Hubdoc allows you to take pictures of your paperwork, link it to your account, and develop usable data. It automatically fetches your bills and syncs with your accounting programs. You can even give your accountant access to the program so they can stay on top of your finances as well.

If you love the idea of simplifying your business and avoiding masses of paper everywhere, Hubdoc can help you.

Final thoughts

There’s no question that these types of apps and software platforms can make business owners’ lives easier. Most business owners didn’t start their own business so they could be surrounded by paperwork and endless record-keeping tasks. Choosing a platform that meets your company’s needs will free up time and energy to focus on the things you love to do.

Isn’t that why you got into business?

Get in touch

Have a chat with us to find out more.

Kind Regards,
The Team at London Accountants