Business Brainstorm Ideas

[Jamez]

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[Dr Lobster*]

my girlfriends dad is into this sort of thing, he invested about the same as you in a few different companies and has made about £12000 - can't remember what they were, he's in spain atm, but i can find out.

my business is based on software.

one of the best sectors to get into, which is suprising (but i have had some success in doing so) is the voluntary sector. a lot of these places have little computer knowledge and i've found that by writing some specific software for them can have big rewards. i've written a number of management systems which are used to keep track of clients and internal activities - they are usually open to new ideas and smaller firms or sole traders helping them out.

i'm actually doing a presentation tomorrow to market some software i'm writing specifically designed for the education sector. i've studied the frameworks on the becta website and have crafted something pretty special to the extent that there is nothing quite like it around.

the problem i've always found is time, i also have a day job which i need to keep because it pays for all the bills, my girlfriends wage is for the fun stuff so this does slow my progress down.

i haven't yet got the guts to take a leap of faith and do software development full time, we could afford to live without my wage, but i'm just too used to having everything i want whilst and i'm working on software there is often little coming in. i have updated my business model and i will now charge for more services than i did but it can be difficult to get the balance right.

[Gavin Scott]

Anyone thinking in investing in a business should be advised that the UK (and I suppose other countries) suffer from "late payment culture".

Unless you have a stream of money coming from other sources, you might want to reconsider investing cash into small businesses - especially if you have large fixed outgoings like rent.

I've been around long enough to see some great small companies fold because of being forced to wait for payments.

In essence I suppose I am saying the risks may be far larger than you expect.

Get a small pension plan and invest in "small arms and munitions".

You won't go wrong there.

[Jamez]

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[Gavin Scott]

Hence why all invoices I produce have a date in four weeks from when the invoice was printed which clients must make sure payment is received.

If they don't pay within four weeks of the first invoice, a second is issued and after a further four weeks (12 weeks after the initial invoice date) a legal warning would be sent to them from my solicitor.

If they STILL don't pay (after two invoices, a solicitors letter and probably a few dozen phone calls) then I would be forced to seek legal action and/or debt recovery agents (for outstanding amounts of over 200 GBP).

Pretty standard procedure there.

The problem for many is that they hope to receive repeat orders, or be booked by the client again (depending on what your services entail). When you start threats of legal activity or collections agencies, you can be pretty sure they won't book your services a second time.

Apart from that, a legal letter is going to cost you about £20 (if you have had the foresight to set a flat rate with your solicitor). On a £200 debt, 10% is lost immediately. Depending on your margins, this could be too much of a hit to take each time. A collections agency may take even more than that.

Its a completely cyclical issue for industry, as late payments from customers causes everyone up the chain to suffer the same cashflow problems.

[Jamez]

.......

[Sput]

Perhaps now is a good time to threadjack and mention that my little conman problem (mentioned it here a while back) has disappeared at the drop of a letter I wrote myself threatening legal action. I now HAVE the goods, only 2 months late.

Woo.

[Gavin Scott]

There should be a law against it.

Well there are laws against it, but enforcing them is only acheived by following the steps outlined above.

But there isn't much point stressing about the way the world is - its just a fact of business these days.

Thats why I would suggest that all the young 'uns with a bit of cash burning a hole in their pocket consider something other than keeping a small business afloat.

One of my mates has set himself up as a freelancer, but hasn't taken much consideration of what his tax bill is likely to be. I'm really worried for him, as he will find out the hard way how important it is to apportion monies to a separate account in anticipation of his bill.

Nor has he been keeping receipts.

Oh dear. I wish I didn't know so much about things, then I might not worry so much.

[Jamez]

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[Nick Harvey]

There should be a law against it.

Have a detailed look at "The Late Payment of Commercial Debts (Interest) Act 1998".

It doesn't guarantee you getting you your money any sooner, but it IS nice to know it's perfectly legal to charge far more interest than you have to pay to Mr Lloyd, Mr Barclay or Mr Hong-Kong.

I think the rate you can charge is about 8% above base; whilst you shouldn't be paying more than 3% or 4% above base for your business loan.

There's also a fixed administration charge of between £40 and £100 (dependant on debt size) which you add on as well.

I've probably still only got £1,200!

More like £1,000, sadly.

[marksi]

There should be a law against it.

Well there are laws against it, but enforcing them is only acheived by following the steps outlined above.

But there isn't much point stressing about the way the world is - its just a fact of business these days.

Thats why I would suggest that all the young 'uns with a bit of cash burning a hole in their pocket consider something other than keeping a small business afloat.

One of my mates has set himself up as a freelancer, but hasn't taken much consideration of what his tax bill is likely to be. I'm really worried for him, as he will find out the hard way how important it is to apportion monies to a separate account in anticipation of his bill.

Nor has he been keeping receipts.

Oh dear. I wish I didn't know so much about things, then I might not worry so much.

A mate of mine was in exactly the same position, and like you I did warn him that when you're working freelance that it's vitally important to keep records (and a sum of money) each month for the taxman... he didn't, and eventually ended up with a £12000 bank loan to pay off what he owed...