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the Darkside.tvwww.
Inside this issue:
BRANDING FOR YOU MORE, MORE, MORE!
Selling up! Part 3 (of 5)Worthwhile PR StrategyCash Flow Tool KitHello from Lloyds
At Last!
SomeBright
ideas!
• Professional Presenter• Online Video• Professional Director• SSG Client Discount
• New Client Launches• Free Training Resources• Serious Stuff (Clare!)• Silly stuff from SSG
FEBR
UA
RY
2012
The Power of Three!Power of Th
Hello from LloydsFrustration!Something NewGill & Year EndsVikki explains P&LClare & Headcounts
A VAT Inspector CallsChallenge the Tax ManCash Flow Tool Kit
Finding a BuyerNever Ending LaunchTraining ResourcesWorthwhile PR Strategy
Economy UpdateYe Olde CataloguePops PantryNeed Help?
A trickle of positive news is beginning to filter through to increased placement values.
A little more money is being made by most.
More of our Client Ventures are interested in building a team over the next year or so & quite a few are actively seeking Employees right now.
More applicants to SSG are citing money as the reason that they want to work for themselves, rather than being fed up working for someone else (a sure sign that Recruiters are billing more than they were).
Inflation is coming down, whilst interest rates are set to remain very, very low well into 2013.
The rise in Unemployment has slowed down.
Fair enough – all of that good news is true but do any of you feel like taking it easy?
Are any of you so confident that you are planning a big summer holiday?
Anyone bought a new car recently?
It seems to us that although things are easier, things ain’t easy.
This is not yet the time to start cracking open bottles of Bubbly or booking a round of golf every Friday afternoon.
But it does seem the time to start to think about the future though.
One day, another Lehman Brother’s style recession will come along and we all need to prepare a little better this time I guess.
There are only a few things that you can do to insulate yourself against a volatile economy – you can build your Company and sell your business.
You can diversify your placement fees into opportunities outside of your core business or you can start saving as if you know that a recession is coming around again!
Whatever is best for you, let’s all be real to the fact that apathy is not an option.
None of us can afford to sit around hoping that the worst is behind us.
The recent recession may be almost over but just like London Buses, there is always a another recession on its way!
Ever So SeriousCLARE
advises you toRoll The Dice
-see page 25-
1. All the contents of The Dark Side are only for general information and/or use. Such contents do not constitute advice and should not be relied upon in making (or refraining from making) any decision. Any specific advice or replies to queries in any part of the publication is/are the personal opinion of such experts/consultants/persons. 2. The information in The Dark Side is provided on an "AS IS" basis, and all warranties, expressed or implied of any kind, regarding any matter pertaining to any information, advice or replies are disclaimed and excluded. 3. The Dark Side and its associates shall not be liable, at any time for damages including, without limitation, damages for loss of any kind(but excluding personal injury or death caused by negligence) arising in contract, tort or otherwise from the use of or inability to use the publication, or any of its contents, or from any action taken (or refrained from being taken) as a result of using the publication or any such contents or use of information contained in the publication. 4. No representations, warranties, or guarantees whatsoever are made as to the accuracy, adequacy, reliability, completeness, suitability, or applicability of the information to a particular situation. 5. Certain references in the publication refer to third parties over whom The Dark Side has no control or connection, business or otherwise.
Material Submitted by OthersSome sections in The Dark Side contain materials submitted by users. The Dark Side accepts no responsibility for the content, accuracy, and conformity to applicable laws of such material, and any views or opinions expressed by such third parties are those of the author alone, and do not necessarily reflect the views or opinions of the owners or publishers of the Dark Side.Effect of these TermsThese terms constitute the sole basis on which the Dark Side is published and made available and supersede and replace all prior or contemporaneous understandings or agreements, written or oral, or any implied terms which might otherwise apply.
EDITOR’S NOTE
Regular Stuff
Odds & EndsFeatures
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info@ the-darkside.tv
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Today’sSpecials
Time to Gamble!
3
It doesn’t matter what you do, at some point we all have to face the “dreaded VAT Man” knocking on our door.
Funnily enough, those few words seem to scare people into hiding under a large box and desperately hoping that he stops knocking on the door & leaves you in peace!
In reality, a VAT inspection is far less daunting than it seems. They don’t just turn up at your door unannounced together with a scary clipboard.
In fact (& don’t laugh!) some of the inspectors are even nice! - offering them unlimited tea and biscuits seems to lighten the mood too.
WHAT DO THEY WANT TO SEE?
As you know, you keep VAT records yourself and complete your own VAT return (all within the services provided by SSG).
The vast majority of businesses will complete correct VAT returns, pay the correct amount and generally be “above board”.
However, not all businesses are this honest.
Some Inspectors are quite nice really Be careful when filing any returns
Therefore, periodically HM Customs and Excise would like to visit to check how you keep those records and that you calculate your VAT correctly.
They are not there to find “extra” money that the tax man can grab from you - if they do find any errors they will request payment for any under paid tax.
However, with the backing of the SSG Services you know that the VAT collected from your clients is correctly accounted for and included in the VAT figures that we provide.
You also know that we keep your books and records here in a professional manner so any paper work provided to us is easily found to back up any reclaims for VAT
But they are not only there to check up on you.
They will also offer advice, answer any queries you have and generally try and assist you in calculating your VAT correctly.
PREPARING FOR A VISIT
As previously mentioned the inspector will want to check your books and records.
In effect they want to look at the information that we produce and keep here at SSG.
If you have a visit, SSG will provide the information ready for the inspection in an organised format so you do not have to worry about where information is.
HMRC will request amongst other things the following which SSG currently hold for you:
We will also be available on the day to provide any further information that is requested.
WHAT’S A VISIT ‘LIKE’?
The visit would generally last between a few hours to a day depending on your size and any findings they make.
The day would start with a brief background chat. Expect to be asked questions like :
An Inspector Calls!
KNOCK KNOCK....
Bank statementsVAT workingsSales invoices listingSales InvoicesPurchase Invoices
What market are you in?
What is your annual turnover?
Who are your regular clients?
What goods/services do you provide?
How do you account for VAT?
How are your Sales invoices raised?
What accounts procedures do you have in place?
What are your regular purchases?
He’s not this cool when the VAT man comes
knocking on SSG’s door
4
Hos
pita
lity
& C
ater
ing
Never an easy marketof course, but this Super
Star Recruiter hasalmost 10yrs of
serious experience inthe market.Traditionally
Temp-based, theoccasional Perm
fee ought to makethe daily grindseem worth it!
Market is EasternHome Counties
BLAST OFF!Feb
2012
For more info, contact:[email protected]
Con
stru
ctio
n CIS
Wor
k
Anyone familiar with theConstruction Sectorwill know that all CISrelated work createsparticular cash flow
problems for any newbusiness, but with
the help of SSG ourtalented recruiter
has a greatchance to compete.
East Midlands andall Temp!
BLAST OFF!Feb
2012
For more info, contact:[email protected]
The aim of this is to enable the inspector to get a feeling of what your business does, how you do it and whether you have relevant experience or have systems in place (like SSG) to ensure that you calculate VAT returns correctly.
Once this is completed they will then move on to checking a sample of transactions (both sales and purchases) to ensure that the correct VAT is being paid to HMRC.
This will consist of checking randomly selected entries in the VAT workings to the relevant paper work.
So, for example - they may see a sales invoice in a particular quarter’s VAT workings and ask to see the sales Invoice.
They may follow this through to see the payment of this invoice (either bank statement or factoring account).
Would you crack under theinterrogation?
Finally they will look at the returns submitted and look at what they would expect to see filed and look for differences to what you have submitted.
They would then seek explanations as to why there are differences. So, say you submitted a return that had £1,000 in the VAT reclaimed on purchases (box 4) but in the box where you declare cost of purchases (box 7) there was only £500 they would ask why your VAT was higher than the net purchase costs.
TIME TO PANIC?
Not at all!
All these things may sound daunting.
There may even be questions that you cannot answer on the day.
But don’t panic.
Once complete, the inspector will leave and put in writing any findings they made and any outstanding queries for you to answer.
And as always, do not forget SSG are with you all the way to make the inspection as hassle-free as it possibly can be.
If you want to chat, just give me a call – Darren Hulbert 01442 200 961 – we are here to help!
5
As an individual faced with a Self-assessment Late Payment fine from the Tax Man, the tendency is to cough up & shut up, but the latest advice is to Speak Up and Man Up!
In recent weeks, HM Revenue & Customs (HMRC) has LOST a series of court cases involving late filing of individual’s Tax Returns.
As SSG keep banging on, as individuals we all need to file our tax returns each year & you have two key dates to meet to avoid any issues – depending on whether you want to physically send a paper version of your tax return or just do it via the internet:
October 31st – this is the deadline to file a PAPER return &
January 31st – this is the deadline to file on-line.
However, new tax rules brought in this year allows our mates down at HMRC to automatically issue a £100 to anyone who fails to meet the January 31st deadline - & apparently, there are millions of us out there who fall under this catch-all system.
Even if you actually owe NO TAX, you will now still get this £100 fine if you file a late tax return.
The experts estimate that this new system will earn the tax man an extra £90,000,000 this year.
Money that will no doubt be spent subsidising the bonus payment at failing banks owned by the tax payer....
Anyway, the point is that these very same experts are now advising self-assessment taxpayers (like you and me) to challenge HMRC if we are not 100% certain that we have failed to do what we needed to do.
WHEN TO CHALLENGE?
The latest cases resulting in defeat for the HMRC have revolved around circumstances where the Revenue have been found to have acted as ‘unreasonable’ or ‘misleading’ or to put it another way, where the HMRC have not acted ‘fairly’ or ‘in good conscience’.
For example, if you post your return on time but it actually gets delivered after the filing date, it has been ruled that it is wrong for HMRC to impose a late filing penalty.
Another example involves individuals who freely admit that they failed to send their tax returns to HMRC on time but did not receive a reminder to do so for months after the deadline had passed & therefore they incurred additional fines (interest etc)!
Other examples cite the cases of honest tax payers simply making a mistake on their returns (which were then filed ON TIME) but were penalised anyway because of ‘inaccuracies’.
No need to dance to their tune!
There is no question that the general economic climate has precipitated an overzealous attitude amongst some tax offices and common sense has gone out of the window in an effort to bump up the revenues coffers through the imposition of fines.
WHAT ARE THE PENALTIES?
So, if you are just lazy & therefore late in filing your tax return, you will automatically be fined the standard £100.
Fact.
If you haven’t filed a proper return within 3 months of the due date, then additional DAILY penalties of an extra £10 will be added to your fine.
This daily £10 will top-out at a maximum of £900.
Time to
‘Man Up’
“Not another date to remember
- I can just about recall the Mrs’
Birthday!”
Late filing your
Tax Return
+
Daily penalties
=
You do the maths!(or do your Tax Return!)
6
‘Duff Up The Tax Man’
Taxpayers Urged to Challenge the Tax Man!
Let’s P
lay
Docto
rs &
Nurs
es
The HealthcareLocum market may
appear scary these days(with all the Public Sector uncertainty & legislation)
but it is a market wellknown to SSG & also to
our duo of Recruiters!SSG need to
provide special help withCandidate Attractionvia the Trade Press
(Staff Nurse) butin this Candidate ledindustry, there isn’t
much point in tradingwithout the raw product!
BLAST OFF!Feb
2012
For more info, contact:[email protected]
Super Geek Required!
Herts Based
If you are reading this advert, you surely must know what we do here at Support Services Group? So, let me save some ink and assume that you know what a bunch of great guys we are & how friendly, determined and entrepreneurial everyone at SSG is – blah, blah, blah!
You will certainly know that we are based in great offices in beautiful Berkhamsted (near Hemel Hempstead) and that we are very lucky to be successful, innovative and without internal hierarchy. Well, our next great move is to employ a Linked In superstar to help us develop and deliver a comprehensive Linked In strategy.
Every single Client that we have and every additional Budding Entrepreneur that we help to launch a new business is going to have to face the reality of Linked In and Social Media. With the amount of money, effort and hard work applied every working day to the issue of candidate procurement, it is obvious that we need to be 100% on-top of the latest cyber moves. But we want more...
• Candidate Procurement Strategy.
• Database Development.
• Client Relationship Management.
• Embedded Video & Broadcast.
In developing for both SSG and for all of our Client’s a detailed, pragmatic and cost effective solution to making the most of Linked In, you will then need to have the flair, interest and charisma to deliver this great work – in a useful and friendly way to a diverse range of recruiters working in many different sectors.
This is an opportunity to be the SSG
Expert! A Super-Geek with Flair! It will be fun, hard work and very rewarding. The position is open to anyone who can do the job – from recent Graduate to Returning-Mum to disaffected Recruiter. If you think you can do the job and want it – then apply!
Come on guys – take the challenge!
David Jones
07967 562 847 (8am – 9pm)
£25-30,000
Linked In Guru!
Fit to fill these Spec’s?
Time to get started?
We are looking for a couple of very special individuals. Recruiters who want to own their own business. Fee Earners who want to do something more than make money for someone else. Motivated Recruitment Consultants with the very special talent of being able to motivate others. This is both a job (with a good salary) & a business opportunity (you will own 50% of the business). Tremendous.
• £30,000 basic + Commission.
• 50% Ownership in the Company.
• Any Recruitment Sector.
• Unique backing & Support.
Based out of a wonderful office in Herts (Berkhamsted) you will work alongside a driven group of people with extraordinary talents and enjoy access to all of the tools that anyone needs to be successful. Truly.
The goal is to generate sufficient placement income to build a team of recruiters around you and to create something special. Tricky.
You can work in whatever market you have experience within – temp’, perm’ interim, contract across any sector. Access to job boards, recruitment software, vacancies, credit checking facilities, recruitment training, on-line testing facilities and so on is guaranteed. Is there anything else that you think that you need? Tasty!
Your business partner has ‘been there, done it & got the T Shirt’ but is also the first to recognise that this is your time – your opportunity. You do your job and our job is to ensure that you have every possible advantage to help you to grow your business.
This ought to be very exciting. You ought to enjoy the challenge and be desperate to get started. You need to be ‘ready’. You must be determined, full of self deprecating humour and currently living within commutable distance of the Berkhamsted office.
Jump on the ‘phone and start talking about what you want to with your career.
David Jones
07967 562 847 (8am – 9pm)
£30,000 Basic
50% Equity
Recruitment Consultant
After 6 months of failing to file, you will then incur a penalty of 5% of any tax due (or £300 – whichever is the greater amount).
After another 6 months (taking you to 12 months late) you will face another 5% (or £300) plus interest of 3% on the total!
The Easy Solution!
WHAT TO DO?
File on time is the glib answer of course.
If you don’t file on time & you do receive a fine, be honest and consider if you feel that you have been treated in an ‘unreasonable’ way or ‘unfairly’, then get in contact with us and we will let you know if we think you have a case.
Whatever you do, the advice is to no longer just do as you are told when the tax man issues his fines, but to look at what they are demanding & ask yourself ‘is this fair’?
X7
Just for a change, two things are really
hacking me off at the moment now:
“Almost finished with your Accounts
now Mr Jones”
We haven’t so much as lost a Son, more
gained an ‘Accountant’
I am reliably informed that an Accountant exists to not only ‘do’ your accounts but also to save you money by ‘doing’ your accounts.
The theory goes (I am told) that whatever an Accountant charges, you ought to be able to see how they have saved you more money than they cost you.
Apparently, if they charge you £500 for something or other, then you should be able to forensically trace where that £500 was recouped through their brilliance.
In other words, an Accountant should be able to ‘add’ something to your wealth!
(Did you see what I did there with the word ‘add’? – I used the word ‘add’ when talking about an Accountant, because Accountants ‘add’ things up.
So, by using the word ‘add’ when talking about an Accountant I made it seem like the word ‘add’ was something to do with them, as Accountants).
First things first then – that all seems rubbish to me.
Accounts &Accountants
what you expect Accounts to say, tell you or ‘mean’.
How the hell would I know?
Aren’t you supposed to tell us that Mr. Accountant?
So as I see it, the first thing an Accountant does is charge too much and the second thing an Accountant does is to ask you what they need to do.
This whole scam makes me think a little more kindly of ‘Fat Dave’ (you remember Fat Dave? He accidentally plasters Cats behind joists when working for pensioners).
Although Fat Dave charges way too much, he doesn’t ask you what he needs to do or how to do it (although perhaps he should).
Of course, my gripes about Accountants go way beyond this little snapshot or irritation!
Don’t get me started on how long they keep you waiting!
There ought to be a special dispensation from the tax man for late submission known as the ‘My Accountant never gets back to me’ clause...
So, how do you nail an Accountant?
Rule 1:
Always pay a fixed price for anything that he does for you.
Never pay ‘by the hour’ because the most simple task will subsequently take him hours!
Rule 2:
Visit one Accountant to help you to define what you need before you instruct another Accountant with what you actually want them to do!
Rule 3:
Never let a Family member marry an Accountant.
All simple stuff really, but I guess that what you need me for – to point out the bleeding obvious.
Of course, that mob at SSG will probably just suggest that if you have ‘any issues’ with your Accounts or what you might need an Accountant to do for you, just get in touch with that Darren Hulbert geezer (01442 200
961).
Accountants charge to do stuff for you in the same way that any one charges for what they do.
How can they claim that they are special because their service will save you money?
Any ‘professional’ can claim that can’t they?
A plumber saved you cash because he fixed a leak before the pipe burst and a hairdresser saves you money by cutting your hair before it grows so long that you start buying jumpers with ‘funny’ pictures cleverly knitted into the design.
Any twit can claim to save their clients money!
That just misses the whole point of anything.
A service is something that you need, not something that you buy because the provider claims it will save you money (or not).
So, that’s the first thing about Accountants which just doesn’t add-up (done it again – did you see what I did that time?!).
The second stupid thing about Accountants is what they always ask you about your ‘accounts’:
‘What would you like your accounts to
show you?’ OR
‘What would you like to see in your
Accounts’ OR
‘What will you use your Accounts for?’
You know what I mean – an Accountant who produces accounts wants to know
AC
CO
UN
TS A
ND
A
CC
OU
NTA
NTS!
8
Something New
In conjunction with a small team of Professional Television Presenters & Experienced On-Line Producers, SSG has created the opportunity for you to enjoy the marketing & branding advantages of New Media.
It is now widely accepted that professionally produced video content is the next key stage in the development of a branded on-line strategy for any serious Recruitment Business.
Until now, the production of innovative, high quality video content has been expensive, complex and rare, but with the help of SSG you can transform your existing web presence & branding strategy.
Never mind that current research suggests that Video content is 50 times as effective as text SEO, why not simply differentiate your business to potential Clients & Candidates and gain a serious competitive edge over your competitors whilst generating a real buzz across all social media?
WHAT DO YOU NEED TO DO?
It’s easy & quick!
SSG will draft a ‘template’ Company presentation for you which you can edit however you want (a simple Word document).
We will generate a branded landing page for you & record your video using top professional Presenters and experienced Producers (with significant TV and On-Line experience).
HOW LONG DOES IT TAKE?
Once you approve your script, we will assign studio time and return the carefully crafted on-line video within days of production.
HOW DOES IT GET ONTO MY WEB SITE?
SSG will create either a text link (e.g. <Click Here to find out more>) or upload an Image or Icon anywhere you decide on your web site (just as SSG has on our www.SSG-PhD.tv home page – see our mini Clapper Board).
SHOW ME AN EXAMPLE?
Why not take a look at two recent examples of the work produced:
www.hostmyvideo.co.uk/bigsky
www.SSG-PhD.tv
Which Presenter do you prefer?
WHAT’S THE COST?
Either a one off payment of £799 or 3 Monthly Payments of £299.
I WANT A DISCOUNT!
Existing SSG Clients can generate this outstanding Branding Opportunity for just £499.
WHO TO CALL?
To book your Recording Date, please contact either Clare Armstrong on 01442 200 957 or David Jones on 01442 200 944.
Up to 3 Minutes of crafted Video
Presented by a Professional Presenter
Branded in your Company Colours
Branded with your Company Logo
Fresh, Relevant & Targeted Content
Professional on-line branding!
professionally presented video!
THE latest tool in business branding
9
Regular readers of The Dark Side will know that we are trying to provide an overview of the basics involved in understanding how to sell a
recruitment business.
Part 1 (November 2011) examined ‘the basics’ whilst January 2012 (Part 2) looked a little more closely at how to ‘groom’ a business for a sale.
Well, let the excitement continue as we now look at how one might actually find a buyer for the business. Please try to contain your enthusiasm until the end of the article – I wouldn’t want you to get too worked up.
Oh, and before I forget – please don’t forget that you can access any of the articles generated through TDS so far via the web site (www.the-darkside.tv/recenteditions.htm) - but you probably already knew that.
Anyway, to recap:
Our hero (‘Chubby’) has built his recruitment business into a healthy & profitable (£300,000 p.a.) venture employing 12 Recruiters from a single office location.
Chubby worked hard getting the right advice and spent some considerable time ‘grooming’ his business (i.e. looking carefully at all aspects of Commercial, Legal and Financial Due Diligence) and now hopes to secure a sale based on a multiple of the profits (i.e. a sale price generated as a Price Earning (PE) multiplier, reflecting the Future Maintainable Profits of the business – the ‘FMP’).
The next thing that he needs to do (apart from ‘do a few pounds’ as Mrs Chubby often ponders to herself as Chubby snores his way through MOTD) is to generate a ‘sales brochure’ and then approach a few intermediaries who might like to help him find a buyer.
This really means that Chubby must find the wit & wisdom to produce an Information Memorandum – which is really the ‘CV’ of the Company and then approach sales brokers who specialise in the recruitment sector.
An Information Memorandum:
An Information Memorandum (‘IM’) is the Company CV – it is a really significant document detailing the history of the Company, the biographies of the people employed by the Company, the processes relied upon by the Company, the detailed financials and other information that might be useful to a potential buyer.
Of course, a good IM ought to present the positives of the business but in an objective and reliable format. There is no point in ‘exaggerating’ any successes as any subsequent due diligence process would immediately highlight any such ‘exaggerations’.
It is serious document which would typically NOT be something that Chubby would put together himself.
I wish my IM had been honest....
Quite often, the production of an IM would be the responsibility of the Sales Broker (your ‘intermediary’), but of course the production of any IM comes at a price.
Obviously, the price of an IM can vary but it is likely to be thousands and require a lot of intellectual effort from Chubby and his colleagues – records, analysis, conjecture & objectivity.
It might be tempting to try and skimp on the cost of your IM but maybe a longer term view would be more helpful – pay a couple of thousand pounds extra now which might generate a sale worth hundreds of thousands of pounds extra in a few months! Sometime, the old sales adage of ‘you get what you pay for’ is true!
Sales Brokers:
Let’s be clear, there are a number of different ways to sell your business.
These different routes can range from simply listing your business with a Sales Organisation (e.g. a firm like Avondale - www.avondale-group.co.uk ) or using a highly respected Recruitment Specialist (e.g. like John Bissell at LBA www.lba-info.co.uk) or by approaching a well-to-do mainstream Accounting Firm (such as Smith & Williamson - http://www.smith.williamson.co.uk/).
All have differing methods for generating interest in potential buyers and charge accordingly.
Most intermediaries will want to charge both a fixed fee (‘up front’ payment) but also a percentage of the proceeds of any successful introduction – much like a Recruiter placing a Software Engineer or Sales Person.
The percentage charged for this introduction can range from 1% to (typically) 4-5% of the total sales value of the ‘deal’.
Selling a Business - Part 3
10
Demonstrate a significant knowledge of the Recruitment industry.
Never circulate or advertise a business without Chubby’s consent.
Seek a signed confidentiality agreement from Chubby.
Qualify all potential purchasers.
Subsequently supply information (IM) to appropriate target buyers.
It is the role of all such intermediaries to work with the Vendor (i.e. Chubby) to ensure that the IM is appropriate and then shortlist a number of suitable potential purchasers. This target list of potential purchasers would then be approached with an ‘Executive Summary’ of the Company and followed up with a copy of the IM, if appropriate.
Like any other ‘sales’ process, a good intermediary will usually know of potentially active purchasers of Recruitment Businesses but also know of potential buyers who may be interested if the ‘right’ opportunity arose (which is really like having your live vacancies and your speculative mailing list for a good candidate).
So, what would you expect your intermediary advisor to do?
Well, at a minimum, they must;
It is a good idea to think of any intermediary as just like any good Recruiter you have worked with in the past – there are good guys and there are bad guys.
Intermediaries make their money mostly through the successful completion of a deal – so, we know that they want you to sell your business!
Think carefully about what you think your business is worth before agreeing to any formal meetings!
Indicative Offers:
If your intermediary does a good job, they may well generate ‘interest’.
By that, we mean that they have approached a potential purchaser and that potential purchaser has requested more information and formulated an indicative offer.
An indicative offer is presented to the intermediary who then contacts Chubby – who gets way too excited at this!
This is an offer in name only really – it is subject to due diligence (remember that phrase?) and is often a device for sounding out a Vendor.
Almost always, whatever the Indicative Offer is (e.g. a PE based multiple of 8 times the PBIT of the business) it is likely that if a sale eventually took place, the actual sum paid to the Vendor will be less!
A purchaser may well be happy to potentially pay the full price of an indicative offer but the business that they have expressed an interest in would have to be perfect!
The purchaser would need to complete their entire due diligence process and object to nothing that they uncover!
This is highly unlikely and Vendors should be aware that an indicative offer is no where the same thing as hard cash!
Any Due Diligence (DD) team sent into the business of a Vendor will be sent to that business not only to verify the quality of the business (so that the
would-be purchaser feels justified in buying that business of course) but also in an effort to push down the price that a purchaser might need to pay!
It is the job of the DD team to not only identify weaknesses (e.g. poor accounting policies or a lack of management structure or whatever else) but also to negotiate in advance on that all important Indicative Offer price!
The issue that all Vendors face is that once at the stage where an Indicative Offer has been made, the Vendor is so enthused & committed to the process (& idea) of selling-up, that the Vendor becomes very malleable and significantly more likely to accept a PE not of 8 times the PBIT, but perhaps 7 or even 6?
Potential purchasers recognise that vulnerability and the DD team will be itching to exploit it!
But, an indicative offer is a formal approach by a would-be purchaser & is great news! At last, something which even Chubby can appreciate!
Due Dilligence is all about squeezing
the price!
There are ‘good’ Brokers and ‘smarmy’
Brokers!
Words To Learn Today:
Information
Memorandum
Indicative Offer
Intermediary
Completion
11
Costs?:
OK, so here we are at the stage where an indicative offer has been made for your business as a result of the IM generated and distributed by your intermediary.
You have already spent considerable time & money getting to this stage but now you need to spend more!
It is time to make sure that you have proper legal representation as well as the services of an Accountant (to cover your tax issues).
Like anything else, this expert entourage can be as cheap or as expensive as you feel is appropriate – but again, this is really not the time to worry about trying to save a few pounds.
You are already committed and need to push through that commitment to a conclusion.
Get the experts in!
There is always a catch somewhere!
What Next?:
OK, so now you need to complete – get the deal done and the money in the bank!
The key word is now ‘Completion’ and as you would have expected, completion is not easy.
It is fraught with danger – not just in finishing off the ‘deal’ but in making sure that you are careful in what you wish for – what happens once you have sold your prize asset?
You are likely to get your money OK but at what price?
What will you need to promise (& deliver) to earn that pay day?
Next time we shall find out!
Mob
ile T
echn
olog
y
Just confirmed! SSG isvery excited to confirm
the launch of a high end(100k+) Contingency
Recruitment businessspecialising in Mobile
Technology. From Programme Managers
to Technical Guru’s,our 40+ Recruiter
certainly has earnedthe right to launchher own business
after ‘all these years’(as she puts it!)
BLAST OFF!Spring2012
For more info, contact:[email protected]
REC
RU
ITM
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IES QUALITY, CARE, INTEGRITY
Recruitment Consultant- Cardiff
Recruitment Consultant - £25k + Commission
Recruitment Consultant - Trades & Labour
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Basic salary to £30K Generous bonus schemeWarm deskSupportive environment with mature approachAutonomy to run your own desk - contract, interim, perm or dualLarge database of experienced candidates - professional, technical and managerialNational and local clients, including blue chip businesses First class training and on-going support
0845 269 [email protected]
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Established agency - 20+yrsTaking responsibility for a Perms deskSupplying Admin, HR, Call Centre Staff360 Recruitment Consultant role securing new business winsFull TrainingLots of autonomy to grow business and maximise your earning potentialOpportunity to take full control of your desk in a non micro-managed culture
0845 474 [email protected]
Trades & Labour
Basic to £28kUncapped commission structureWarm deskExciting growth stageActive database of clients and candidatesProductive and team focused environmentGenuine opportunities for career progressionexcellent support and every opportunity to excelCompetitive salary, superb commission structure
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On-Site
Basic salary to £22k + Bonus OTE £30k25 days holidayExcellent training and on-going support providedThe Role & RequirementsBuild relationships with clients and staffRecruitment and Registration of candidatesTraining and Induction of agency workersDaily register checksAttending client meetings to ensure client satisfaction
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Snr Recruitment Consultant - £35k + Uncapped Commission + benefits
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Full 360 Role, Initially supervising Team of 3 Providing Perm & Contract staffing to the Engineering marketsReporting to Regional Sales Director - lots of autonomy/responsibilityIt is planned that the division will grow to 8 - 10 headsFast-track career progession to Division Manager/Sales Manager (full P&L responsibil-ity) 0845 474 [email protected]
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12
Think about the well known proverb – look after the pennies and the pounds will look after themselves.
Well, the start of a new business is a little like this.
If a company is launched well with great attention to the small details, then it has a better chance of being a successful business – able to weather the inevitable storms.
Common sense stuff.
From time to time, potential Clients will wonder why SSG feels the need to cover so many seemingly trivial & diverse launch elements – does it really matter if the VAT number is applied for on ‘Day 1’?
Why do we need to ramble on about Restrictive Covenants or compliant Terms of Business or the detail of Corporation Tax – why can’t we just build the web site and provide access to the job boards?!
As you probably already know, internally SSG will apparently divide our work with any Recruiter into two stages – Stage 1 is of course ‘The Launch’ and Stage 2 represents the period of ‘On-Going Support’.
“We all love a good launch!”
Apparently these are two distinct phases and apparently we see the end of Stage 1 as the start of Stage 2.
The reality is something very different of course and that reality recognises very clearly that without a formal and comprehensive business launch, it can be very tricky providing an equally formal and comprehensive support facility.
For example, much of the Legal & Compliance work traditionally associated with the launch of a new business is in fact probably more concerned with ensuring that the required building blocks are in place to not only run the ‘back office‘of the recruitment business but also in place to support the personal tax situation of a Recruiter who just so happens to own a Recruitment Business!
Again, traditionally SSG likes to compartmentalise the launch process of a new Recruitment business into neat, little ‘bite sized chunks’ which we conveniently label as:
(By the way, should you ever want to tease any of the Launch Team, ask them to explain why we talk of about the ‘Power of Three’ – which is nothing to do with a new American Motivational Movement but more to do with the incessant list making & internal compliance designed to ensure that nothing is missed!).
Legal & Compliance:
You will recognise most of the processes involved in the Legal & Compliance side of the launch of a business (e.g. Name checks, trademark checks, Company registration, Bank accounts, VAT, Inland Revenue & so on) but might overlook the importance of Data Protection, Money Laundering or challenging the Credit Rating of our Recruiter Partners.
Without spending significant time (throughout the Launch process) understanding the personal situation of our Recruiter Clients it is unlikely that we will be able to broker the best on-going support in terms of payroll, factoring, banking and tax.
Creative Work:
Come on SSG, why not just jolly-together a basic web site and run off a few Vista-Print Business cards?!
What more does any start up business need?
Of course, we fully appreciate the urgency with which many of our start-up ventures need to begin to trade and generate placements – we are just as anxious that placements are made too!
But the branding of a business is a journey which needs to start at the right point, which is always a considered and careful development of logo, business cards, email header and Company Web Site.
This is just the start of the journey of course & as we progress to on-line Video, PDF Brochures and Presentations & so on, the development of your business can be traced back to the fundamental roots of that first meeting with SSG.
Accounting Structures:
Ok – we agree that it takes a strange sort of Recruiter to demonstrate genuine interest in many of the accounting processes undertaken throughout the launch process!
Even we find it difficult to share Darren’s team’s enthusiasm for VAT, Corporation Tax, P&L’s and Debtors Days!
The SSG Launch Process
Why a Good Business Launch never really ends!....
Legal & ComplianceCreative Work &Accounting Structures
13
Careful planning avoids costly errors
later on
However, to be fair to our Number Crunching friends, the time spent with each new business in understanding the Accounting process is very likely to not only help the new business to save money (through proper expense claim procedures for example) but also to ensure a good cash flow of the new business – or a tax saving process at the end of the Company financial year.
It all counts and the detailed launch process will ensure that the on-going support is maximized.
WHY TELL YOU THIS NOW?
Throughout the launch process, SSG will encourage you to concentrate on all of the finer details of running your own business.
We ask that you pay particular attention to all the tasks involved in the launch process, to help us all to ensure that your business is set up with solid foundations.
We know that you will make sure that all of your new end-Clients will be given properly branded & up-to-date T&C’s for example.
All of this ATD (Attention To Detail) will give your applicants complete confidence in you throughout the recruitment process.
Candidates will happily register with you, reassured by the fact that you are a legitimate company with a carefully constructed & well branded website.
But, what happens if together with SSG you fail to progress the launch of your business through the on-going support process?
What happens if you fail to recognise the need to update this or modify that?
What happens if you fail to progress the launch of your business with a new on-line video presentation?
What happens if you fail to investigate fully the fresh offerings of SSG?
Yep, you guessed it – even with the most basic understanding of business algebra - a fail + a fail + a fail + another fail tends to lead to a failure!
HOW YOU CAN HELP?
It is really by paying attention to all the
we just go on and on and on.
But I am guessing that you are beginning to know that already!
Why not give me a call to chat through how we can continue to re-launch your business with you?
There are probably many fresh ideas, new processes and innovative services which may not be working to the advantage of your business.
My number is 01442 200 956.
We have plenty of experience of doing just this and have dealt with many queries over the years.
If we don’t know the answer to something, we have, at our fingertips, experts in legal, financial and training who will be able to help.
Don’t be afraid to ask for help or to flag any problems to us. Make sure that you get your company off to a flying start!
individual elements of the launch process – however small – that your company has the best chance of success.
So, throughout the launch process, you can help in many obvious ways - including:
1) Taking care to complete forms and return them to SSG in good time so that we can organise bank accounts, data protection etc.
2) Keep a good track of expenses, logging information and keeping receipts so that expenses against the business can be easily claimed.
3) Don’t over-complicate the logo design and the website – remember these are selling tools – they won’t make you money!
4) Pay careful attention to your terms of business and prepare these as soon as possible during the launch process
5) Invoice regularly and keep in touch with the Accounts department of SSG. Remember we are happy to act as credit control for you and chase for non-payment of invoices.
6) Ask for help on the legal or financial side if you are running into difficulties.
But – more than this (much more in fact) you can help your business to be constantly launched (throughout the on-going support stage) by responding to seemingly daft requests (usually from the Accounts team!), by looking closely at what new services are available from SSG, by communicating your anxieties to SSG, through sharing your War Stories, your successes and so on.
The launch process never really ends –
UK ECONOMY UPDATE
2012 is starting pretty well it would seem with Inflation Down to 3.6% (from over 5% in the last quarter of 2011) & Interest Rates set to remain at historically low levels (0.5 of 1%) throughout the year. This solid data coupled with a slow-down in the growth of unemployment and an easing of the Eurozone crisis is generating a positively balmy business atmosphere!Against this raft of good news is the general uncertainty that we have all laboured under since the Lehman collapse back in 2008 & a suspicion that it isn’t all over yet. But with the UK set to avoid a
double-dip recession and UK growth projected at 3% in 2013 things are on the up.Specific data of over 100 Recruitment Companies confirms a very positive level of optimism without that optimism translating into significantly higher placement numbers than in 2011- yet!‘Even for the most cautious amongst
us, the Recruitment Industry
continues to recover with many of us
now familiar with the changed
landscape’ (David Jones Owner of SSG) ‘Our advice is to focus on the basics
and remember that placements are
made by putting candidates in front
of clients & not by worrying about
Greek Bailout Conditions’
X14
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15
As the owner of a thriving Recruitment Business, it can be particularly confusing to understand the difference between year-end accounts & annual returns – after all, they are both yearly obligations which you are legally required to complete.
In amongst placements, drop outs(!), interviews, staff issues and endless other paperwork, you are supposed to not only compete these annual accounting tasks but somehow find time to actually understand what they mean! It can be tough.
ANNUAL RETURNS
An annual return is required by Law to be filed at Companies House on behalf of your company.
The return confirms the basic information that Companies House holds for the company.
This includes the registered office, the directors and shareholders.
The return covers the first twelve months from the date your company is incorporated and is made up to that ‘birthday’ every year thereafter.
Sounds complicated, but actually the process of filing an Annual Return is very easy and as your Company Secretary, SSG helps with the process.
Unfortunately there is a charge paid to Companies House for filing the return, but this is a business expense and not a personal one.
The easiest way to file the return is online and at present costs £14 which is £26 cheaper than filing a paper one at £40.
Please note that it is important to file your Annual Return as failure to do so could lead to prosecution and a fine, plus your credit rating could even be affected.
YEAR END ACCOUNTS
Each year your limited company has to file financial statements and produce Corporation Tax Computations.
As you probably already know, at SSG we have an excellent external Accountant which we recommend to our clients, but of course, it is still your prerogative to choose any Accountant that you wish to help.
The Accountant will produce on your behalf and perform the following:
To make this all happen, SSG will provide year end packs which are passed to the nominated accountant.
The figures at year end are reflected in the monthly management accounts so it is in your interest that you read and understand what is in the MMA.
The external Accountant which SSG recommends will send you the following documents:
The Accountants will also advise how much corporation tax is due and the date when it needs to be paid by.
The abbreviated accounts form the CT600 and this declaration will need to be signed and returned to the Accountant for filing with the relevant Government bodies before the expiration of the filing date to avoid any late-filing penalties being incurred.
The first set of accounts for any new business will need to be filed with Companies House within 21 months of the date the company was incorporated.
After this first submission by any Limited Company, the subsequent accounts will need to be filed no later than 9 months plus 1 day after the year-end date – e.g. if your year-end is the 31st January, the accounts must be filed no later than 1st November.
It’s always later than you think
Year End Accounts and Annual Returns
Year End? We’re only in February!
A brief check of the validity of the figures produced by SSG.
Produce the financial statements for submission to Companies House (abbreviated accounts), and the relevant government bodies
Prepare a Corporation Tax Computation
Submit the tax computation to the Inland Revenue
Calculate the Corporation Tax due.
Two sets of the full accounts, one for you and one for your records.
Abbreviated accounts which are a short version of the balance sheet and notes for Companies House.
CT600 form for HMRC (Corporation Tax calculations).
Declaration for you to agree the accounts.
16
Nei
l fro
m W
olve
rham
pton
JOKER! £50
WINNER!
p
JQ:
A:
A Recruitment Consultant was asked what the capital of California was
“That’s easy” he said “It’s C”
Ang
ela
from
Lon
don
JOKER! £50
WINNER!
g
JQ:
A:
Why can’t Recruitment Consultants make ice cubes?
They always forget the recipe
Am
y fr
om S
trat
ford
JOKER! £50
WINNER!
y
JQ:
A:
How do you know if a Recruitment Consultant has been in your office?
There’s Tipp-ex on your computer screen
The penalties for late filing can be very high with Companies House fining between £125 and £375. HMRC will charge daily interest on top of a percentage of the corporation Tax due which can increase the bill dramatically.
WHAT NEXT?
No need to panic or do too much either!
As you know, SSG will contact you at the appropriate time to talk through what information we might need to get the ‘ball rolling’.
Having said that, it is always good to be prepared – so, if have any queries on the any of the points raised in this article, please do not hesitate to contact either me or the ‘big cheese’ Darren Hulbert.
You know the telephone numbers of course but just in case – Gill 01442 200 965, Darren – 01442 200 961
Monthly Cash Flow Summary
Profit & Loss Projection Tool
Project Income & Model What-If scenarios
Plan your Tax Payments
OK, you may not be able to guarantee oodles of placement revenues every month but with a little help, you can certainly help to control where all of the money goes & when!
Cash Flow is crucial to any business & the cliché that Cash is King is never more true than it the Recruitment Industry.
A placement isn’t a placement until the money is banked as we all know, but controlling how your cash flow affects you as a business and as a person makes everything that bit easier.
SSG has generated a brand new Cash Flow Tool Kit designed exclusively for you – charting where your money is, what money is available to develop your business and how you can forecast a real business budget.
New Weapon!
‘The Cash
Flow
Tool Kit’
In conjunction with your Monthly Management Accounts, this new Cash Flow Tool Kit will guarantee that you know exactly where your ‘business is’.
No need to worry about guessing what might happen, now you can model any financial scenario with a click of a button.
HOW DOES IT WORK?
SSG will load your current financial data into your Cash Flow Tool Kit.
All you need to is to complete a simple ‘front sheet’ (what placements do you hope to make, where would you like to spend money etc).
Instantly, your cash flow will be generated.
If you change your mind just change the front sheet.
It is that simple.
WHAT NEXT?
Contact Darren Hulbert (01442 200 961) to order your free Cash Flow Tool Kit.
X17
18
Still unsure about P&L?
?CALL US TODAY!
0845 475 9449
What is your P&L & what does it
mean?
Enjoying your Monthly Management Accounts every month as I am sure that you do, I am convinced that you will also have a very good understanding of what your Profit & Loss précis is all about, but over the next few pages I thought that it might be helpful to explain in more detail what one can learn about your business from the ol’ P&L, so you can use it to its full potential!!
So, as a Limited Company you will have to produce a set of Year End Accounts every year and submit them to HMRC.
Your Accountant will produce these for you and calculate your amount of Corporation Tax to pay to HMRC (if any is due).
You know all of this of course and you also know that as a SSG Client, we are there to undertake this work for you.
Within the Monthly Management Accounts which SSG also produce for your business, the P&L (Profit & Loss) Statement records your Monthly & Annual Sales Income (Revenue) less any expenditure for Cost of Sales /Business Expenses and shows whether you have made a Profit or Loss over a specific period of time.
All makes sense so far!
Specifically, your P&L shows you:
One thing to remember when perusing over your P&L whilst drinking your cup of coffee, is that it does not show whether your Sales Invoices or Purchase Invoices have been paid and therefore is not a reflection of your Cash Flow for your Business.
Your Cash Flow is very important for your Business; you need cash for your Business to survive.
If your cash is flowing into your Business faster that it flows out of your Business then you will be running a healthy Business.
But if however your Cash is flowing out of your Business quicker than it’s flowing into your Business you will struggle to pay your Suppliers for Rental of Offices, Advertising Costs, etc and struggle to pay your Staff!
The P&L is not to be confused with your Cash Flow for your Business.
The P&L is a statement of your Accounts over a specific period of time whereas your Cash Flow relates to the amount of Cash flowing in and out of your Business.
Ok, so the Top Part of your P&L (found on Page 4 of your Management Accounts as below) shows the Total Income for the month and also the Total Income for Year to Date.
This is the total amount of Invoices you have raised to your Customer/Client for Temporary or Permanent Placement of Candidates, Sales Invoices Net of VAT (without VAT).
It also shows your Direct Expenses relating to your Sales Invoices. Expenses which are also known as Cost of Sales.
Basically, any expenses that relate directly to you raising your Sales Invoice.
Once your Direct Expenses are taken away from your Total Income you are left with your Gross Profit!
Ways of increasing your Cash Flow and therefore your P&L looking healthier could be:
ACCOUNTS Made Simple!& a tiny bit
How your Business is performing over a specific period of time.
Incomings (sales revenue) and Outgoings (cost of sales, overheads & expenses) and whether you have made a Profit or Loss.
A summary of your Sales Invoices raised to your Customers/Clients and your Purchase Invoices made from your Suppliers/receipts for goods
Invoicing your Customers/Clients as soon as your candidate has started working, prompt Invoicing means prompt payment!
Not rushing finding a perfect candidate to fill your vacancy, you don’t want to have to raise a credit note!
Credit checking potential Customers; let’s make sure they can afford to pay you!
Chasing any debts owed to you as soon as they become overdue! Negotiate terms of payment not only with your Contact but with Accounts who will be paying your Invoice!
Keeping in contact with your Suppliers, maybe adjusting your credit terms to match your sales invoice terms.
Factoring your Sales Invoices, a proportion of your Invoice will become available straight away allowing a good cash flow.
The Voice of Vikki
The bottom half of the P&L (found on Page 5 of your Management Accounts as below) shows any other Expenses incurred by the business for the period, also known as Overheads.
Once these expenses are taken away from the Gross Profit you are left with your Net Profit which is your Profit after all your expenses are taken into consideration. If at your Company Year End you are In Profit, you will pay 20% of this Profit in Corporation Tax to the Tax Man! (Why not re-read the Corporation Tax Article in previous editions of the Dark Side?)
The ‘Top’ of your Profit & Loss Account
The ‘Bottom’ of your Profit & Loss Account
INCOME Actual £ Year To Date Actual £
Recruitment Fees - Temp 5,277.00 Recruitment Fees - Temp 61,296.89 Recruitment Fees - Perm 2,782.00 Recruitment Fees - Perm 18,887.00 TOTAL INCOME 8,059.00 TOTAL INCOME 80,183.89
DIRECT EXPENSES DIRECT EXPENSES Recruitment Staff 0.00 Recruitment Staff 0.00 Recruitment Staff - Comm 0.00 Recruitment Staff - Comm 0.00 Supply Staff 4,455.89 Supply Staff 48,686.94 Sales Advertising 50.00 Sales Advertising 324.00 SSG Venture fees 639.86 SSG Venture fees 6,691.80 TOTAL DIRECT EXP 5,145.75 TOTAL DIRECT EXP 55,702.74
GROSS PROFIT/LOSS 2,913.25 GROSS PROFIT/LOSS 24,481.15
GROSS PROFIT/LOSS from previous page 2,913.25 GROSS PROFIT/LOSS from previous page 24,481.15
ADMIN EXPENSES ADMIN EXPENSES Directors Salaries 658.41 Directors Salaries 4,480.46 Administration Wages 0.00 Administration Wages 0.00 Recruitment Fee 0.00 Recruitment Fee 0.00 Advertising 0.00 Advertising 0.00 Rent & Rates 150.00 Rent & Rates 1,050.00 Light & Heat 0.00 Light & Heat 0.00 Insurance 0.00 Insurance 262.50 Repairs & Renewals 37.95 Repairs & Renewals 113.88 Phone 69.02 Phone 775.63 Printing & Stationery 0.00 Printing & Stationery 137.22 Motor & Travelling Exp 0.00 Motor & Travelling Exp 64.92 Legal & Professional 0.00 Legal & Professional 0.00 Consultancy Fees 0.00 Consultancy Fees 0.00 Management Charges 0.00 Management Charges 0.00 Sundry 694.78 Sundry 1,898.45 Finance Charges 548.94 Finance Charges 5,101.86 Factoring Recharge 0.00 Factoring Recharge 0.00 Depreciation 0.00 Depreciation 0.00
TOTAL ADMIN EXP 2,159.10 TOTAL ADMIN EXP 13,884.92
Net Profit/Loss 754.15 Net Profit/Loss 10,596.23
19
KEEP AN EYE OPEN
So what should you look for in your P&L Statement and what can you do with it.
If you are making a loss then maybe look at ways to reduce your Cost of Sales, negotiate better deals on your Sales Advertising & Job Boards.
Reduce your Overheads by keeping a close eye on your Business Expenses, taking out any unnecessary expenses. If you are making a Profit how you can improve on this.
Obviously you are working hard and Business is good but there’s always room for improvement.
Maybe look at outsourcing your skills to other Businesses, charging a Consultancy Fee.
Keep networking with new and Old Customers/Clients, a new Placement may be just round the corner!
If you are looking to apply for a Mortgage, take out a loan or any other financing for your Business you would like your P&L to be in a healthy Profit position so I would suggest you try the above ways before you do so to make your Business look as Profitable as it can do at this point in time.
Some refinement is needed and you will need to trawl carefully for information that might be relevant to your current circumstances, but you get the idea?
Still with me?
Ok, well why not try a few of the following introductory search strings?
In addition to searching for help regarding being a Recruitment Consultant, what about using You Tube to gain a commercial understanding of the Economy, your Clients and the Tools you use every day?
Here are some suggestions for commercial search strings for the Economy :
Here are some suggestions for Tools Training:
What about some search strings for ‘trends’?
I guess that you are getting the point of course.
So, before you worry too much about what others know or what you don’t know that you ought to know, why not just commit to 15 minutes every day to ‘train’ yourself using a free tool?
So, here are you first couple – Mike Walmsley and You Tube.
FREE Training Resources
Recruitment & Business
There are many expensive tools that you can purchase to ‘train’ in any aspect of Recruitment or Business, but wouldn’t it be nice to have access to a comprehensive Resource which continues to grow but costs you virtually nothing?
Well, of course it would!
So, SSG is about to embark on the development of just such a Training Resource - just for you!
What follows is a brief overview of what you can access right now & a few ‘tasters’ of what it to follow as we build a proper resource for you.
Mike Walmsley
You all know by now the on-going access to Mike Walmsley which all SSG Clients enjoy.
This inclusive access comprises three key elements:
1) DVD Library of Recruitment Training Tutorials.
2) Live Webinars – 30 minute sessions covering key areas.
3) Live Training – intensive 2-day course in London.
For more information, reminders or help regarding Mike and what he can offer you, please contact Carly Hastings on 01442 200 946.
You Tube
You Tube is a laugh, a giggle and a place to post saucy videos of the girl who dumped you at University – but, it is so much more too!
Via the home page (www.YouTube.com), just try a few general searches around ‘Recruitment Consultant Training’.
You will be amazed at what is available for free.
Now you have all read this very interesting piece on your P&L you will dive straight into your Management Accounts, but what page can you find this on......... pages 4 & 5 with a breakdown of your Monthly P&L on pages 6 & 7.
A FEW CONCLUSIONS
Your P&L should be your “friend” and not a part of your Management Accounts you flick over with a mere passing glance!!
Cash must flow into your Business faster that it flows out or your Business will become insolvent!
Look at ways of reducing your expenses and increasing your Income which will both increase your Profit.
Make any adjustments to your P&L before applying for any Financing.
UK Recruiter tipsHiring recruitment ConsultantsKPIs for RecruitersUsing Jobs BoardsLinked In .v. Job BoardsUK Recruiter Training
UK Economy NewsUK InflationUK UnemploymentUK Interest Rates
Basic ExcelBasic PowerPointBasic SkypeBasic LinkedIn
UK Mobile RecruitmentUK Recruitment AppsUK Recruitment Forums
20
Advertise Publicise Network
Welcome to the second in a brief series of articles designed to provide you with the basics of Recruitment PR.
Last time (January 2012) we spoke about the three key things that all independent Recruitment Companies ought to focus upon, in an effort to constantly raise their profile:
Of course we all know what we mean by ‘Advertise’, although it is not always the case that advertising should be 100% focussed on attracting current candidates for your live vacancies!
Advertising needs to convey a message about how your business operates. For example, how would you judge a Company whose adverts were poorly written, lazy in detail and impolite?
Moving on, we also all recognise the modern mantra of ‘Networking’ – how can a modern Recruiter possibly survive without endless Tweets or regular LinkedIn updates? Did that sound sarcastic?
Well, cynicism aside, it is certainly becoming less acceptable to ignore Social Media and it certainly does not pay to bury your head in the sand with regard to the importance of your chosen market getting to ‘know you’, before they might ‘hire you’.
But let us leave advertising & networking for another time - today, we are going to continue to focus on that old imponderable – Public Relations (or ‘PR’ or ‘Publicity’)!
1. Advertise
2. Publicise
3. Network
A Proper Attempt at PR!
WHY BOTHER?:
They say, like any other expert service that Public Relations is only expensive if it isn’t done right! However, they also say that England can win the World Cup (so what do they know?).
Nevertheless, there are numerous examples of Big Brand Recruiters being adept at spending money to create an image – let’s take a few great household names such as Michael Page or Select or Hays. What do we really ‘know’ about these guys? Do many of us really have an insight into their professionalism? Who the hell knows if their Recruiters sit at their desks in their smelly underpants?
I doubt many of us really know for sure, but most of us would tend to assume that they are ‘Premier League’ recruiters whilst the local high street independent remains purely Conference League – South, Division 2.
But let’s also remember that PR is only useful if it is done properly and for the right reasons. There is very little point in convincing the wider recruitment community that you are a fantastically professional Recruiter if in fact you simply blast out CV’s ‘willy nilly’ (& yes, Willy Nilly is a proper phrase, all too rarely used in leading PR circles).
In other words, your PR objectives need to be clear and the method by which you generate your PR needs to cost effective and practical and just as important, the PR strategy needs to be sustainable.
SUSTAINABLE?:
They also say that ‘good’ PR is like water torture – you don’t notice it until it drives you insane!
For example, think about the worst adverts in the World – the most irritating commercial on TV or the most pompous self promoting ‘Industry Experts’ in the country.
What do they have in common? It is not the message but more how often you have heard the message!
If you still don’t believe me, just ask my dear old Mum, a Milky Way does fill you up between meals and a Mars a Day makes you a fat pig (it doesn’t help you work, rest or play).
Both examples of a message becoming real just because you keep on hearing it.
Our message ought to be that we launch recruitment businesses every month and that every month, there are great Recruiters who decide to work with us to launch recruitment businesses - every month. So, which of you doesn’t now know that SSG launch new Recruitment Businesses every month?
What that information conveys is our CORE MESSAGE – not the quality of our service or the cost of our service or the success of what we do – just the fact that we have a core message – i.e. that we launch Recruitment Businesses. For SSG, our message is sustainable.
So, if you have a sustainable message, the next thing that you need is to have a sustainable route to your market. In other words, you need to able to get that message out to the relevant community in a cost effective manner.
Bright PR news
& sustainable!
The Power of Three
Worthwhile PR Strategy
21
Engage
Profile
Position
PRObjectives
ImproveR.O.I
Sustainable‘PR’
There is clearly no point to your PR activity if your message is clear but you cannot afford to generate that message. It is also important to remember what the cost of your PR really is – time and money tend to be equally important to a business which has a CORE MESSAGE worth promoting!
We also considered last time the alternatives of DIY PR & of paying an expert team to generate your PR.
We are going to assume that fledgling Recruitment Ventures are more interested in the DIY solution, but that does not mean that the importance of a sustainable route to market is any less important.
In other words, if I spend £1 on Advertising or £1 on PR or £1 on Networking, how much does the business actually make?
Playing the game for a moment, why not pretend that our imaginary Recruitment Company (www.Scatter-Gun.Com) invoiced £10,000 every single month.
Each month, Scatter-Gun also spends £1,000 on traditional ‘advertising. Each month, the big cheese at Scatter-Gun attributed £5,000 of the fees generated by the business directly to candidates procured via the £1,000 of advertising. Mr Cheese happily defines his ROI (Return On Investment) for his advertising at a healthy 5:1.
You may have a CORE MESSAGE which is all about quality, integrity and honesty but you need to generate that message in a sustainable way – otherwise you don’t really have a core message at all!
KEY OBJECTIVES:
Forget all that ephemeral nonsense about branding, culture & market penetration for a moment. I mean, let’s face it – the only worthwhile business objectives for your PR efforts revolve around making more money at some point as a result of that PR effort.
Again, if we consider the three ways in which you ought to be raising your Company profile, do you know how much do you spend on each route and can you (as yet) accurately determine your return on that investment?
Mr Cheese also knows for sure that as a result of his incessant ‘wining and dining’ of his local end-clients another £3,000 is generated. The cost of these endless lunches is £500 per month and so Fatty (as Mr Cheese is now known) says that his ROI for Networking is a super 6:1.
So, if advertising brings in £5,000 and networking brings in another £3,000, it might be plausible to suggest that the additional £2,000 of revenues is somehow a result of the vague and tricky concept of PR – in other words, as Recruiters when we don’t know exactly where our candidates or clients find us, we have to assume that the reputation of the business helped to generate that business?
So, for every £10,000 of generated business:
Advertising 5:1 (£5,000:£1,000)
Networking 6:1 (£3,000:£500)
PR ?? (£2,000:£0)
I guess the point that needs to be made is that a ‘complete’ business needs to think about where revenue comes from & also how revenues are generated – not just how much revenue is generated.
Is it enough to hope that your Company reputation will permeate the thoughts of quality candidates and attractive employers? Probably not & yet that is what the vast majority of us do – hope. Nothing else.
How many fledgling Recruitment Companies invest in a PR strategy and if they do, what are their objectives and are they relevant to the No 1 overwhelming objective of all businesses – which ought to be, to make a profit.
SPECIFIC OBJECTIVES:
It is quite easy to draw up a list of key objectives which any relevant PR Strategy ought to address. Most Recruitment Companies live and (often) die by the same criteria and the same key drivers determine the success or failure of the business.
So, what can we assume are your PR Objectives then?
After all, it is important to try to position your business as a Recruiter of quality, importance and relevance within your chosen industry.
Position,
Profile,
Engage,
Improve ROI &
Generate sustainable PR
X22
Do you have any“Media Relations?”
98% responded that a good Press Release starts
with a survey!
1. The Headline2. The Body Copy3. The 5 W’s and the H4. The Company Info’5. The Tie6. The Contact info’ &7. The End
Have a look at Page 18 & 19 of the January edition of TDS).
It is not enough to generate a Press Release and then email it to your contact at The Recruiter, for example.
The Editor at The Recruiter (who really is called Dee Dee Doke by the way) is going to receive many similar one-off press release efforts from DIY superstars like us and also from sharp suited PR Men (who secretly imagine that they are really like Don Draper out of ‘Mad Men’).
What you need to do is develop a sustainable series of Press Releases which convey particularly relevant news worthy story combined with your Core Message.The truth is that you could prepare 3 or 4 Press Releases in advance and email them through to your target Editors on a rolling fortnightly basis.
For example, which Trade Press Editor is not going to be interested in subject matter such as?
‘1 in 3 Contractors confused by IR35’ or‘April Tax rate changes good news for Recruiters’ or
‘Placement Fee income rises in a tight market’ or
‘Scatter-Gun.com doubles headcount on 2012’ or
‘Social Media now more important than Job Boards’
In other words, if your prepare these stories in advance as part of your sustainable PR Strategy, you can develop a ‘story’ which will be attributed to your great business, which delivers its Core Message with every story.
Forget for a moment where you would get the data for these press release efforts – we will come to that next time.
It is also very important to develop your target list of Media contacts and to also identify the difference between the media themselves. For example, it is quite easy to get a local industry news story into the local press.
It is much harder to get that local story into the trade press.
So, you need to have a database of media contacts which covers the following:
Trade PressLocal NewspapersTrade AssociationsJob Boards
We will define exactly how you can develop that database next time.
Social Media:
The second component of our sustainable PR Strategy is all about the labyrinth that is Social Media!
Love it or hate it, most of your Clients and almost all of your potential Applicants will either be on Twitter, Facebook or LinkedIn. The truth is that the whole Social Media environment is a bit of a nightmare for most Recruiters.
‘Connections’ do not equal ‘networks’ and Tweets do not equal influence. It is also true that ‘funny’ pictures of your sweet little cat on Facebook rarely lead to high value placements, but a combination of cynical exploitation and sustained effort will generate positive PR across the three main social media.
In itself a significant subject, we will look at Social Media exploitation in a later article in this PR series. But to set the scene, it is essential that as a business owner, your recruitment business maintains a blog, has a Twitter account with regular Tweets, a LinkedIn profile exploiting InMails and Groups & ignores the temptation to have a Facebook account!
It is also important to engage with your existing clients and candidates to canvass their opinions about key industry issues.
It is also important to increase your ROI and begin to positively attribute income to your PR effort.
It is also 100% essential (& not just important) that you develop a sustainable PR route which will publicise your core message.
So, like all other Recruiters you ought to be working towards a neat and tidy little model – as depicted by the lovely red diagram on the previous page.
A PR STRATEGY:
Remember, we are going DIY here – nothing spent other than sweat and tears. No money, no bribes and no wining & dining (sorry Fatty).
We are going to divide our PR Strategy into the following three distinct areas:
Media RelationsSocial Media &Surveys
Media Relations:
Yep, you’ve guessed it. We need to generate some ‘words’ which convey our core message and then convince editors and journalists alike to not only bother to read these ‘words’ but also publish them.
For a moment, I am going to assume that you recall the January 2012 PR article in TDS where I went to great lengths to define for you the ‘Magnificent 7’ elements of a great Press Release..... (Just in case you have ‘forgotten’ the Magnificent 7 elements of a great Press Release, they are:
23
Surveys:
The third component of our sustainable PR Strategy is all about Surveys.
Surveys are incredibly cost-effective both in terms of the minor cash expenditure and hugely valuable impact on clients and candidates alike.
Perhaps the best thing about surveys however, is the usefulness of the information in generating regular Press Release articles full of genuine insight and market knowledge.
Online surveys (using free online software) can generate numerous media opportunities and promote your business as being concerned with your industry, not just your profit line.
CONCLUSIONS:
So, what do we know?
We need to identify a sustainable PR Strategy which promotes our Core Message across a variety of press.
We know that we ought to promote our businesses through advertising, networking and publicity.
Publicity means PR and we accept that
‘publicity’ ought to be both a cost to the business and also a means by which we generate income.
We need to somehow generate a ROI for any ‘cost’ which our PR efforts incur.
Specifically, our PR objectives ought to include a positive effort at positioning our business, profiling what we do and engaging with our clients & candidates.
Our PR Strategy needs to involve a dedicated effort at Media Interaction (local & trade) coupled with a considered Social Media strategy.
Client & Candidate contact (& useful Press Release content) should be encouraged through the use of regular surveys, utilising the free online tools which are available.
FOR NOW:
Please take time to review this article and re-read the January edition of TDS.
Together these words of wisdom (don’t laugh) provide the starting point for a proper attempt to generate a PR Strategy which will create additional income.
If you really can’t wait for the next instalment and would like to talk through some specifics, please get in contact with David Jones at any time on 01442 200944
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In case you missed it....www.the-darkside.tv/recenteditions
X24
Be a VIDEO Star!Is AWR Evil?Business Blast Offs!Start Your Own BusinessTime to Sell Up?
Inside this issue:
Sometimesit’s hard tokeep up witheverything ........
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45k + Bonus + 10% EquityNr. Heathrow
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Fancy a PhD in Entrepreneurship?
Banks take a bashing
Inside this issue:
Selling Up! Part 1 Corporation Tax BasicsGoogle+ Exposed!The Death of Cold Calling?Who Owns YOUR Contacts?
See Page 12
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30k Basic 50% Equity!
Herts base for a GREAT Recruiter
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For more info, contact:[email protected]
the Darkside.tvwww.
Happy New Year?....
Inside this issue:
How to escape the2012 doom & gloom
(page 13)
Selling Up! Part DeuxDevelop a Press ReleaseMeet SSG’s New Girl
3 Ways to SYOBClare is serious (again)Making the most of SKYPE
:::
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PE
Clare’s Serious Stuff
When you first started your business, you probably did a lot of research; on your market, your chosen location, your contractual restrictions, perhaps even on us!
You may have sought help from advisors and friends, colleagues in the industry; you may have read books, magazines, on line articles and other readily available sources before you took that next step.
You invested a lot, in terms of time, anxiety and questioning to make that final decision – working with us to get your business off the ground inevitably gave you a head start.... we hope!
So...now what?
For those of you who have survived start-up and are now pretty established and successful businesses, you may be wondering how to take the next step and grow your company beyond its current status.
A natural progression would be to take someone on.
Taking on people - whichever way you choose to do it - will always mean some form of investment for your business. Investing into your business is a risk of course and it can seem scary; after all, you have spent so much time and (as the Americans say) ‘sweat equity’ to get the business to this point, do you really want to risk it all by taking someone on who may not work out?
Initially, it is worth deciding the Why?
Why do you want to expand your business?
(I.e. what are the motivating factors behind this move?
It might be money, it might be the need to move into an office, it might be that you are over loaded with requirements that you want to move into a different market - it might be all sorts of things!)
Be very honest with yourself – if the Why is because the business is struggling and you feel that taking someone on will improve it, don’t do it!
Then the what?
Specifically, what market sector will this new recruit operate within? (e.g. the actual types of placements to be made? the industries & also will it be 'temp' or 'perm' based?)
Are you looking to this recruit to generate at all? - perhaps this is an admin/resourcer requirement.
What resources will the new recruit need (including money!)?
What revenue targets, for (say) the first year will you set for the new recruit (this helps to establish how long you expect to subsidise the cost of the new recruit).
What is the ramp-up period before you would expect your recruit to invoice?
What levels of revenue would you really hope that the new recruit would achieve when operating at 'normal levels'?
Then the where?
Where will the new recruit work from (your home? their home? your office?) Where will find this new recruit?
Do you actually know who the new recruit will be (i.e. is it an ex-colleague or will you need to advertise etc)?
Then the when?
When would you like this new recruit to start work with you?
And now the how?
We have all come across recruitment agencies that have ‘employed’ self-employed recruiters (first of all, this is a contradiction in terms!) and to a fledgling business, this seems an ideal scenario – take on no risk, just pay 50% of all the consultant bills.
What concerns do you have (i.e. what are you worried about when employing a new recruit?)
What do you feel are the negative aspects of hiring at this time?
What do you feel is a realistic figure which represents the amount of hard cash that is at risk should you new recruit fail?
(This is your ‘gambling’ money and you have to be prepared to lose it)
Increasing Headcount
25
We appreciate that you are busy making placements and tracking down great applicants.
It’s what you do & what it keeps the metaphorical Wolf from the pretend door, but please don’t forget that we are here to help whenever, whatever & whoever you are!
Why not chat to us about anything that comes to mind, but here are a few reminders of what might be of interest:
In fact, we are hopeful that even if you don’t have a specific need right now, we might be able to help if you just give us the opportunity to chat.
Why not get in touch and schedule a 30 minute call with any of us – we are especially keen to help.
Your team contacts include;
Clare Armstrong - 01442 200957Carly Hastings - 01442 200946
Jane Fisher - 01442 200956Vikki Buckley - 01442 200943
Gill Miles - 01442 200965David Jones - 01442 200944
• Professional Videos• Vacancy Lists• CRM Software• Web Site Updates• Branding Advice• Training• On-Line PDF Brochures• Skills Testing• Business Review• Credit Reports• Debt Management• Legal Disputes• Job Boards• CV Search• Cash Flow Forecasts• Expansion Planning• Apprenticeship Schemes• Public Relations
NEED HELP?You know where we are!
There are a number of problems here – the main one being that National Minimum Wage legislation makes it kind of illegal to do this.
It is also a false way of growing a business. The business itself isn’t really growing, you may be adding numbers to the bottom line but if you are truly looking to build an infrastructure and put in place the foundations on which to build an asset, this way can result in foundations of straw (just ask the pig what happened to his place when he built it like this).
Finally, unless they are truly self employed (and the ultimate test for this is that they are free to and do work for a number of different businesses and ‘clients’) then HMRC will be tempted to treat them as employed by your business and want to look to you to pay PAYE and ENIC.
EMPLOYEE - THE BEST!:
Therefore, the very best way (from a legal standpoint) is to take them on as an employee (you could pay minimum wage and then commission or roll it all in together) – this is better for your business as it grows and also from a legal and tax perspective.
Your business would have an employee; we can help you with the policies you would need to put in place, the payroll and legal help with contracts etc.
LIMITED COMPANY - SECOND
If you really cannot commit to taking on an employee, then the second best way to work with a recruitment consultant is if they establish themselves as a limited company and then just invoice your business for placements they make.
The recruiter has to be truly independent which means that they really should be working for other people at the same time.
‘SELF EMPLOYED’ - LAST!
The least legally solid way of working with the recruiter would be as a self employed consultant.
You would have to satisfy yourself that they are paying the right amount of tax and again they would need to be truly independent and not (for example) be sitting in your office every day, have ‘employee’ tools and generally acting like an employee.
Both limited company and self employed routes have ‘looking and acting like an employee’ dangers as the recent case of Weight Watchers (UK) Ltd v HMRC shows.
Here, consultants engaged by WWUK signed contracts describing themselves as independent contractors and not the servant of Weight Watchers.
They were required to pay their own tax and national insurance.
The consultants were only paid if they personally conducted their own meetings and they were required to obtain WWUK's specific approval in relation to time, date and place of any meetings.
Although the contract contained an express substitution clause, the Leaders were obliged to find a suitably qualified replacement if they did not want to lead a meeting.
The Tribunal dismissed WWUK's appeal and concluded that the Leaders were employees of WWUK rather than self employed contractors.
Here at SSG, we see part of our role to not only help you with the logistics of how to grow your venture but also to play ''devil's advocate'' (in other words, if we are able to dissuade you from expanding, it is probably because deep down you don't feel that the time is right! - the 'little-person' inside you is saying 'don't do it!!'
Employees can drive you insane!
To chat throughthis whole
expansions issueplease call
Clare Armstrong01442 200957
X26
ON THE COUCH WITH SSG
Every month, we are hoping to persuade one of our Budding Entrepreneurs to spend a little time ‘on the couch’ with SSG – detailing their experience of running their own business!
We want to know if the perception of ‘Working for Yourself’ is much different from the reality? What were your motivations to ‘do this thing’? Has been harder? Worse, more stressful? What have been the high points to date and what advice would you give fellow Recruiters?
This is a great opportunity to understand how others cope with the pressure, the uncertainty and the challenge of keeping your emotions in check! Maybe others will express the same concerns as you? Could it in fact be the case that it has been easier for everyone else & that all of the problems & challenges which you faced have been entirely your fault?..... seems unlikely!
‘IF YOU READ NOTHING ELSE, READ THIS’
Feedback from a dozen or so of our Clients has been to wonder why SSG does not produce a mini round-up of ‘stuff’ which Budding Entrepreneurs running independent Recruitment Businesses might need to know, want to know and want to share? Fair point I guess.
So, be careful what you wish for! From the March edition of TDS, Jane Fisher will produce just such a piece. Please don’t be surprised if Jane calls you in the next few weeks to ask your permission to share some of your good news, handy hints or warnings. It will be called ‘If You Read Nothing Else, Read This’.
Jane will focus on a précis of important Industry News, provide a mini Economic, Legal and Accounting Update, highlight specific SSG Client successes & wisdom and finally give a 10 line update from SSG.
Please feel encouraged to share any great news you might have with Jane – as we say in this very issue, any publicity is good publicity don’t forget!
HIRING AN APPRENTICE
Clare Armstrong gets serious for a change & has completed some detailed research regarding the Government’s much lauded Apprenticeship scheme – you know the one, hire an Apprentice for virtually nothing and ‘train’ them in some way.A lot of rubbish has been written about how much it costs the employer, what obligations you might have to the Apprentice and the apparently poor quality of the new employee.
Well, Clare has the detail for you – exactly what you need to do to benefit (including getting a £1,500 kick back from the Government) and the surprisingly high calibre of the 16-24 year old Apprentices available as part of this programme. Many are motivated, intelligent and determined to provide their worth.
If you need a Resourcer, Trainee Recruiter or committed Administrator, this Apprentice Scheme may well be just the thing for you, but as with all such schemes, you need to know your way around the Red Tape.
YOUR LEGAL DOCUMENTATION
You might be asking, ‘my what?’ at this point. Perhaps you didn’t know that you had any legal documentation?!
As the Recruitment World becomes increasingly more litigious, full of loop holes and cheats, we all need to be careful to ensure that not only do we have the core legal documentation to hand but also know where & how to access help, jargon busting advice and fresh documents, letters and updates.
We have investigated this tricky subject for you and surprisingly found few surprises but we have found a lot of obligations a Budding Entrepreneur & what to do about it.
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One day, it mightbe too late.....
Why not SYOB?(Start Your Own Business)
