Category Archives: Business

Tips for Buying a Business

unduhan-84Apprenticeships are commonly perceived of as being only related to certain trades such as mechanics and builders. However, this simply reflects the limited options which have been on offer in Ireland and is not an accurate reflection of the broad range of areas for which apprenticeships can offer practical and high-level education. At a macro level, the skills gaps, high education dropout rates and high youth unemployment figures all indicate that an increased focus on apprenticeships in Ireland is the right way to go.

Earlier this year the Government launched Ireland’s National Skills Strategy (NSS) 2025, which is set to increase the number and scope of apprenticeships on offer. One of the aims of the NSS is a reform of the apprenticeship system, with a view to expanding participation and industry input. This is a welcome move for Ireland’s education system. Greater input from business and industry will be vital in creating an education system that will meet the needs of a modern economy and be capable of quickly responding to skill needs. Apprenticeships must form part of this system and, with plans to introduce new apprenticeships in the areas of IT, manufacturing and engineering among others, we are hopeful that this is on the way to being delivered. With Ireland’s apprenticeship programme set for expansion into new fields, it is time for both businesses and young people to consider the benefits these schemes can offer them.

A range of industries are set to benefit from the expansion in programmes, from IT to tourism and food. As Ireland moves to increase the number and scope of apprenticeships on offer, we must also seek to change attitudes and understanding of what apprenticeships can offer. They are much more than simply a route to a traditional construction industry job, and this year we will see new apprenticeship programmes introduced in areas as varied as culinary training and insurance practice.

Benefits for Employees and Employers

Apprenticeships provide a great opportunity for students interested in getting practical work-based experience as part of their education, while often also allowing them to earn as they learn.

They also offer many benefits to employers. The opportunity to invest in the future of a young person interested in working in your sector cannot be overlooked and apprenticeships can add excellent value to a business, especially an SME. Apprentices are a long term investment by a company and offer employers an opportunity to train new employees in specific practices and to shape their work habits, standards and culture to the particular business. While working within the business, an apprentice is continually acquiring applied knowledge and skills which meet occupational standards, with support from a training body.

Chambers Ireland is encouraged by the commitments of the National Skills Strategy on increasing the scope and availability of apprenticeships and we would encourage employers, particularly SMEs, to look at the opportunities an apprentice might bring and consider making this investment in both their business and the apprentice’s education and career.

What is The Potential Across the Irish Sea

The fall-out from the UK’s referendum on EU membership has created significant uncertainty for Irish businesses trading with the UK. Currency volatility, potential trade agreements, tariffs, duties and uncertainty in relation to the free movement of goods and people between Ireland and the UK are key considerations for Irish businesses with significant exposure to the UK market. In particular, the depreciation of sterling poses long-term challenges for Irish exporters whose revenues are sterling denominated but costs are euro denominated.

Amongst this cloud of uncertainty, opportunities exist for Irish companies. A UK acquisition can reduce currency exposure and provide a route for international expansion at a reduced cost.

Some of the key considerations for companies contemplating a strategic move into the UK include:

1. Acquisition – A Natural Hedge

The weakness in sterling creates an environment for companies to explore how most effectively they can hedge their currency exposure when supplying UK companies. AIB’s Chief Economist, Oliver Mangan, predicts that the euro-sterling exchange rate will remain volatile for the coming two-three years as the complex process of Brexit negotiations unfold.

For Irish companies with a large UK client base, exploring acquisition opportunities in the UK is a natural consideration when developing a solution to this currency exposure.

For UK companies seeking to position themselves ahead of the outcome of Brexit negotiations, acquiring an Irish company may provide a platform to facilitate continued access to EU markets or serve as a means of acquiring a new route to market or expansion of its customer base.

Other options which merit consideration alongside an acquisition-led growth strategy include mergers and joint ventures.

2. Expansion of Client Base at a Lower Price

UK acquisitions are currently significantly cheaper for euro-based investors following the depreciation of sterling post the 24th June vote. This is an important incentive for Irish corporates currently serving UK clients and for those with aspirations to enter the UK market.

An acquisition offers not only a hedge but also scope to acquire new customer relationships at a significantly faster pace than an organic growth strategy. In a post-Brexit environment, the UK will remain a significant economy in a European context. Therefore leveraging the opportunity to widen the customer base is an important strategic consideration in the current environment.

3. UK M&A Volumes and Valuations

The uncertainty posed by Brexit has affected the volume of M&A activity in the UK. A recent study1indicates that 495 transactions were announced in July 2016, a 5.5% drop on June and nearly a third lower than the same period in 2015. Despite the decline, these numbers clearly indicate that the UK remains open for M&A transactions.

Phone Number on The Advantages

Traditional telephony, where your phone calls are trafficked over physical lines, is dying out. The public switched telephone network (PSTN) has been decommissioned in some European countries, with end of life dates set for the near future in others. It is expected that the end date for Ireland will be announced soon.

The reason for this is IP telephony, or VoIP (Voice over Internet Protocol). This technology uses your broadband connection to traffic your phone calls and has long been accepted as the alternative to PSTN due to the real business benefits it can offer. Essentially it allows you to put your phone system and phone numbers into the “cloud” so they are not reliant on the physical PSTN to work.

How does this improve your business communications? Let’s take a look at five very real benefits.

1.    Flexible user management
For cloud phone numbers, the inevitable comings and goings of employees in an organisation pose no issues. If an employee leaves, assigning their old number to a new starter in your organisation can be done with a couple of clicks, no matter where they are based. They don’t need to sit at the same desk as the previous person and use the same phone cable. They don’t even need to be in the same office.

If someone needs to work remotely, either from home or while they travel for business, there’s no issue with them staying contactable via their same number. In its most basic setup, a cloud phone number is usually pointed at one or more devices i.e. your desk phone or a soft phone.

2.    Improve your operations
With a cloud system, you can put time of day rules in place with some simple clicks. This means that when someone calls out of office hours, you can play a specific message mentioning what the office hours are or perhaps providing them with an alternative contact method. You can prompt them to leave a voicemail afterward, or even redirect their call to that alternative contact number.

If a person calls within office hours, they can be directed to the receptionist or the boss or even given a full menu of options to choose from for each department. This is known as Interactive Voice Response (IVR).

Your organisation may have more than one “main” number. For example, your sales team might have its own general number as well as each sales rep having their own direct dial. When the sales line rings, it’s possible to set up which team member’s phone should call first, or perhaps all of them should. If the call goes unanswered for a period of time, you can redirect it to the team leader’s or manager’s phone.

The beauty of a cloud-based phone number is not that these services are simply available. They are available for PSTN numbers too (although it can be an arduous and expensive process). Rather, with a cloud phone number, these rules can be tweaked whenever needed by someone within your own organisation – no matter how many times they need to be changed.

3.    Get in-depth reporting
As your cloud phone number works via the internet, it is a lot easier for your virtual phone system to provide reporting data on your calls. Duration, date, number called or whether or not it was a transfer – all of this information is easily available.

You can use call recordings for training purposes, check the call performance of your in-house sales team or an individual user, or keep a tab on how many calls are coming in to your customer support team.

Reporting for a traditional phone system can be accomplished. However, it will be priced as an add-on to your service or you will need to contract a third party to provide you with the capability rather than have it included with your phone system. There will also be limitations on the information that can be provided.

Choosing a Business Name

unduhan-83Some aspects of selecting a business name are subjective and reflect the personal wishes and preferences of the owner. There are, however, some mistakes that business owners make in naming their establishments that just don’t make good business sense. Avoid these and your business name can serve as a real asset that can help bring many profitable returns.

1. ABC
A business name that comes at the beginning of the alphabet can be a plus since many business listings are alphabetical; however, some businesses have taken this strategy to absurd levels. Using A, B, or C as the first letter of your business name can help, but be sure the name is something that makes sense and is something you like and are really comfortable with.

2. Use a Simple Easy-to-Pronounce Name
The idea is to get people to remember your business name and to be able to understand it, spell it and pronounce it. It should also be short enough to fit on a business card or display on a sign.

3. Allow for Growth
Choose a business name that is wide-ranging enough to give your business growing room. Geographic business names are popular e.g. Arklow Housecleaners. But what happens if your business takes off and you’d like to expand the geographic area you cover? The same goes for naming a business after one product or service. For example, the name “Joe’s Lawnmowers” would need to change if Joe decides to add other related products. Stay away from names that describe current fads or trends: If a new “Millennium Bookshop” opened in 1999, it may have sounded timely – nine years later, it would sound dated.

4. Create Your Identity

A business name should be one or more of the following:

  • Memorable
  • Descriptive
  • Imaginative
  • Distinctive

A good way to start is to write down key words that describe what your business is, what it does, and what pleases you about it. Use a dictionary and thesaurus to find different words that express these things. Also look for famous expressions that might pertain to your business.

So, let’s say Mary has a small business selling her delicious fruit tarts, and she considers herself to be the best at what she does. Mary names her business “Queen of Tarts” because: she loves the play on words, it expresses what her business is and does, and the word “queen” is perfect – she’s female and her thesaurus shows that “queen” also means “person of authority”.

5. Being an island

You’ve thought up 15 business names that are in the final running, and you think they’re all pretty good. Now is the time to get some feedback. Run those names by some close colleagues, family and friends. You might be surprised at the number of things they bring to your attention that you’ve overlooked. A little constructive objectivity goes a long way when choosing a business name.

Things You Can Control

The InterTradeIreland All-Island Quarterly Business Monitor (April-June 2016) indicated that over 95% of businesses surveyed across the island have no plan in place to deal with the consequences of the UK’s vote to leave the EU. Moreover, nearly one in five report that this uncertainty will lead to a decrease in their level or speed of investment.

Crucially, this uncertainty and degree of pessimism comes at a time when the wider economic and business back drop is very positive, with 90% of businesses reporting they are stable or growing. Encouragingly, also, is the result that almost two thirds of businesses on the island state that they have the ambition to grow in the immediate future.

In the meantime we encourage businesses to focus on the things they can control, such as:

1. Customer and Supplier Relationships

Focus on developing close value-adding partnership relationships with customers or suppliers that can endure potentially destabilising changes in pricing relationships.

2. Business Planning

Possessing a clear and concise plan for your business that identifies clear objectives, critical processes, threats and opportunities is a vital step to navigating uncertainty. Clearly this plan should be reviewed and adjusted on a regular basis.

3. Innovation

Innovation should play a key part in your business plans. Uniqueness in a product or service offering comes with a premium that can offset disadvantageous cost movement. InterTradeIreland’s Challenge Programme  shows businesses how to build innovation into their DNA.

4. Currency Hedging

A currency hedging plan reduces a business’s risk of losing out when the value of the currency you are selling in declines relative to the company’s core operating currency. As such, hedging is a risk management strategy that protects rather than creates profits. Guidance on hedging can be provided by your bank.

The AIB Start up Academy Has Impacted Martin

If you can apply to the Academy, absolutely do. It was the best thing I ever did and it completely changed our business,” he says. “If you speak to the rest of the finalists, I’m sure they would say the same. It really was an invaluable eight weeks.”

The immediate impact of the win

Martin’s company is Nasal Medical, which produces a range of nasal filters and dilators that help with various breathing issues, from allergies to sleep apnea. The effect of the Academy win on the nascent company was instantaneous.

“The minute we won, things went crazy,” Martin explains. “I think the advertising from The Irish Timesreally helped. Online sales became extremely busy and have continued to increase on a daily basis.”

Despite the challenges of scaling up the business, Martin has already achieved some impressive sales figures: “We’ve sold a substantial amount of the discreet snoring aids in 500 pharmacies and we’ll be in 1000 before the end of the year,” he says. And he’s already set his sights on some big targets at home and abroad: “We’re in McCabe’s pharmacy, Health Express, Pure Pharmacy group, Horgan Group, O’Sullivan Group, McLoughlin-McSharry Group, and McCauleys, and we’re in discussions with Boots and Lloyd’s and a number of other big chains. We also hope to be selling in the UK by January or February of next year and Germany in mid-2017.”

Expanding the business

The initial success of the business has also allowed Martin to expand his workforce. “At the moment there are two of us in the company but we have two sales and marketing staff joining in October,” he says. He hopes the new hires will lighten his workload, which remains prodigious. “I don’t have any time at all,” he explains. “We have a ten-month-old baby and even getting time to see her is difficult at the moment. I often work until midnight and am up again at six. Thankfully, my wife, Marie-Louise, is very understanding and supportive. Once we take on the new employees, hopefully the pressure will be reduced.”

Martin has also seen the benefits of the prize package, with his first meeting with creative agency Rothco already bearing fruit. “We’re rebranding the filter product, which I’m delighted with, and we’re working on a new brand for people travelling on aeroplanes to block the germs carried in the recirculated air. We have a pharmacy at Dublin Airport who are going to trial it,” he says. “As a normal start-up, we’d never have access to something like that. It’s gold, because it could potentially decide whether the customer buys the product or not.”

How Do The Effective Meetings

Effective business meetings are an exercise in communication: we speak, we listen, we discuss, we decide. Meeting rules may vary from one situation to another, but holding effective meetings is essential to getting things done. If you want to learn how to conduct a meeting, here are nine simple ways to help you through the process.

1. Call only necessary meetings

Before you begin the whole process of calling and holding a business meeting, ask yourself if it is really necessary. Do certain people actually have to gather in the same room to accomplish your purpose, or could a series of phone calls or an email serve the same purpose? Develop a reputation for calling meetings only when necessary, and people will be more willing to devote their time to them.

2. Invite the right people

Invite people who have something to contribute or who need to be involved in the discussion. If you have to consult someone for information or authorisation about an agenda item and that person is not there, it’s frustrating for everyone. Consider inviting them just for a specific agenda item. On the other hand, don’t invite people just because they are at a certain level in the organisation. Busy people appreciate your consideration of their time.

3. Create an effective agenda and distribute it well before the meeting

An effective agenda is much more than a list of topics. It can function as a meeting announcement, as well as a tool to help the meeting organiser  control the discussion. Sending it out in advance lets people know what will be discussed and gives them an opportunity to gather information they will need and prepare their input. Effective meetings begin with effective agendas.

4. Start and finish on time

Don’t wait for latecomers – start on time without them. You should also avoid the temptation to bring latecomers up to date on what has taken place before they arrived, a practice that penalises those who came on time. People shouldn’t be rewarded for upsetting everyone else’s schedule. Allot time to each subject on the agenda and stick to it. Effective business meetings start and finish on time.

5. State the objective at the start of the meeting

State an objective that is results-oriented rather than discussion-based. e.g. “We are meeting this morning to approve the final budget for next quarter.” This is a measurable objective, toward which you can work during the discussion. Don’t say, “We are meeting to discuss…” After all, you could discuss for hours and technically you would have met your objective, but you could hardly describe it as an effective meeting.

6. Keep the meeting moving toward its objective

Don’t let people drag the discussion off track. Keep reminding them of the objective and redirect the discussion back when they stray. Your communication skills come to the fore as you lead a business meeting.

What is The Budget Affect

In last year’s Budget, the Minister introduced an Earned Income Tax Credit of €550 for small business owners who cannot benefit from the PAYE tax credit of €1,650 available to employees. The Minister announced an increase in this credit to €950 for 2017.

The three lower USC rates have been reduced by 0.5%. Accordingly, all income earners will have a lower tax burden to varying degrees. The ceiling at which the 2.5% USC rate applies is increased to €18,772 – this ensures that a full-time worker on the minimum wage will remain outside the top rates of USC.

2. Minimum Wage

The higher cost to employers arising from the increase in the hourly minimum wage from €9.15 to €9.25 will take effect from 1st January 2017.

3. Entrepreneur relief

The standard rate of capital gains tax remains at 33%. However, the Minister announced a reduction to 10% in the capital gains tax rate that applies to disposals by Entrepreneurs of qualifying assets. Entrepreneur relief offers the reduced rate of capital gains tax on the disposal by an individual of business assets up to a lifetime limit of chargeable gains of €1 million. The Minister is to review this lifetime limit in future budgets.

To qualify for the relief, the business assets which include shares in a company must have been owned by the individual for a continuous period of at least three years in the five years immediately prior to the date of disposal.

4. Share-based remuneration

Following a public consultation and review of share-based remuneration earlier this year, the Minister announced the intention to develop a new, SME, focussed share-based incentive scheme which is to be introduced in next year’s Budget.

5. Retailers and Tourism

The reduced 9% VAT rate for tourism and related activities will continue to apply.  The Minister noted that the reduced rate will act as a buffer for the sector against the weakness in sterling which increases the cost of holidaying in Ireland for British tourists.

6. SMEs in the Construction and Property Sector

The Minister introduced a new ‘Help to Buy Scheme’ for first time buyers of new houses that take out a mortgage of at least 80% of the purchase price. This scheme will provide a rebate of income tax paid over the previous four years. The rebate is subject to a maximum of 5% of the purchase price of a new home up to a value of €400,000. New houses with a cost between €400,000 and €600,000 will also qualify for the scheme but the rebate is calculated at the €400,000 limit. No rebate will be paid on new house purchases in excess of €600,000. The rebate does not apply to the purchase of second hand houses.

The Home Renovation Incentive will be extended for a further two years to 31 December 2018. This measure provides income tax relief to home owners who undertake qualifying renovation works which cost a minimum of €4,405 (excluding VAT). The relief is payable over the two years following the year in which the work is carried out and equals 13.5% of the qualifying expenditure.

Overcome the obstacles

What makes it so hard for founders to confront what they don’t know? For starters, they grow so accustomed to improvising that they assume they’ll learn whatever they need to know by doing. They assume part of running a growing business is rendering judgments without having all the answers.

Have you fallen into this trap? See if the following statements sound familiar:

  • I’ll never have all the information I’d ideally like to have, so I need to do my best with what I know
  • I don’t have anyone critiquing my performance every day. There’s no one around telling me, “You don’t know enough about this. Learn more before you plunge in”
  • Launching a business is a leap of faith. I’m busy drumming up excitement in our future. Obsessing over what I don’t know isn’t going to help us grow

What’s more, business owners cherish their independence. They may reject unsolicited input from others, especially if outsiders try to tell them what to do or how to do it. Unless entrepreneurs schedule periodic meetings with a mentor or advisory board, they may operate in a vacuum and lose perspective on their own strengths and weaknesses.

Self-confidence is a prerequisite for building a business. But too much confidence can convince you that you know what you’re doing when you really don’t, causing you to stray far from your field of expertise. Another obstacle is the temptation to assume you can muddle through on your own. Telling yourself, “I can get by for now” or “I can figure this out myself,” prompts you to accept your limitations without attempting to patch up knowledge holes. Even if you accept your knowledge gaps, you might not want to dwell on them because it makes you uneasy. Feelings ranging from misguided pride to flaring anxiety can lead you to forge onward rather than taking the time to confront unknowns.

Quiz your employees

To help identify your knowledge gaps, tap into your employees’ expertise to become more familiar with the inner workings of your business. Begin by asking workers, “What do you need to know to do your job?” Sit with them at their desks and ask them about:

  • The processes they’ve adopted
  • The systems they use
  • The knowledge they draw upon

Then compare what they know to your understanding of what they need to know. You may find that employees’ jobs have evolved in new and surprising ways. Expect to come away from this exercise thinking, “I need to find out more about.”

Also ask employees, “When it comes to working at this company, what do you wish you knew more about?” This question encourages them to share their knowledge gaps, which you can help fill. By exchanging insights and information about company operations, you’ll gain a stronger sense of how you can educate yourself and your staff to appreciate both the nuts and bolts of your business and the big-picture issues it faces.

Finally, ask both your peers and employees point blank: “Tell me what I don’t know.” Kick off every staff meeting by going around the room and asking participants to volunteer something they’ve recently learned about the business.

Starting out in Farming

In the latest edition of AIB Agri Matters two young progressive farmers offer advice to aspiring young farmers in setting up a new farm enterprise or starting out in farming:

1.      Know exactly why you’re doing what you’re doing – if you don’t it’s hard for anybody else to know. Explore the options and pick the one that suits you best. Seek advice from others to see what worked for them.

2.      Establish a good track record when you’re young – in work, in college and with the Bank – it gives others more comfort you have the credentials to deliver on your plans.

3.      Put your best foot forward when meeting the bank – prepare well in advance. Don’t sell yourself short – Have your costing’s and have your research done. Show you understand your business and its profitability and most importantly ensure your lender understands it.

4.      Treat the farm as a business – if you don’t look after the business, financial management is useless. The opposite is also true. Costs and cash flow must be controlled and monitored to ensure the business remains profitable and bills can be paid, when they fall.

5.      Have a simple system – more easily expanded, and helps ensure consistency and accuracy – especially important where additional labour is employed.