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Oiling the wheels of commerce

Australian Grant Jones had already set up and run several companies in his home country but when he needed a new company to develop a revolutionary process for cleaning up oil spills, he turned to the UK.
‘ Forming a company in Australia is just so complicated,’ explains Grant, who is now based in Monaco. ‘They almost demand DNA samples!’
Grant realised the true potential for developing the process lay in Europe and the US so turned to the UK to form his company to further the product’s development.

The process consists of applying two chemically benign substances to oil to transform it into an inert plasticine-type substance which floats on water and can be easily collected and disposed of. It is unique in its simplicity, with huge potential.

‘ The immediate attraction is the thought of cleaning up the traditional oil spill at sea, but when you consider further, you realise its potential use in smaller applications such as harbours, ports and waterways. There is even potential application right down to businesses, factories, commercial kitchens and even the home,’ says Grant.

Insight # 1: ‘To form the company, I turned to the Internet. I just entered “UK companies set-up” into a search engine and about a thousand popped up. I looked at the first six, one of which was Duport. I liked the look of their site immediately - it was simple and easy to understand.’
Grant had already tried contacting a similar company a few days earlier but managed only to leave an answerphone message. He is still waiting for them to call back.

Insight # 2: ‘I rang Duport and spoke to Hilary, who works with Derrick Phillips in Duport’s frontline team. She was fantastic and funny. I only wanted to register the name at first and she did this easily and cheaply. Their speed amazed me. In Australia, the process takes weeks and is so complicated. I couldn’t believe how quickly Duport turned it round.’

So KOSP Ltd was born – Kalocsai Oil Solidification Process, named after its inventor, now sadly deceased.

But Duport’s services did not stop there. Grant recognises the huge benefit of what he calls the ‘drinks and garlic bread’ approach. ‘I owned a string of pizza stores in Australia and we trained our staff to offer all the extras. In our stores, we were virtually giving away the pizzas but making money on extras like drinks and garlic bread.’ In the same way, Hilary was good at finding out Grant’s other requirements and offering solutions. ‘She offered me Duport’s excellent Company Secretary services, which we were delighted to use.’

Insight # 3: ‘Derrick and his team have fulfilled every promise Duport made. Their attitude is very good, as is their whole approach when talking to customers. They exceeded my expectations.’
Grant is already in the process of setting up yet another company.

Insight # 4: ‘Duport were so fantastic that I am using them to establish my new company as well, and I have already referred people to them. It was an excellent experience.’
Contact details
KOSP Ltd, 13 St George’s Business Centre, St George’s Square, Portsmouth, PO1 3EZ.
Tel: 02392 818 745
Fax: 02392 818 740
If you would like information on setting up a company or a website for your business, click here or contact Derrick Phillips on 0117 330 8910.

How to leap-frog your competitors

When setting up a business you need to find out about your competitors. And once up and running, you need to keep tabs on them. Such knowledge can give you a distinct competitive edge.
So start building a file on them, looking at everything from the customer’s viewpoint. Ask suppliers and employees what they know about the competition.
Here are 18 crunch questions to help you keep you one, if not several, leaps ahead of your rivals.

1. Who are your competitors?
Direct competitors are easy to identify – they offer a similar product or service in the same way to your target market. But you also have indirect competitors – people selling the same product in different ways (maybe ferry tickets on the web instead of in a travel shop). Or they are selling alternative solutions to the same needs (train or air-tickets?).

2. What products and services do they offer?
Do they overlap with yours?

3. What customer needs and wants are they satisfying?
Needs are different from wants: you need a car but you want a Mercedes.

4. Are their benefits powerful and attractive?
What is their unique selling proposition? Do you have benefits and selling points in common?

5. How do they position themselves?
Are they the Savoy or a McDonald’s? What’s their tone? Avuncular and learned or rough-and-ready, brash and with-it? Is their mind-set corner-store, High Street franchise or old establishment? How do you position yourself in relation to them?

6. What are their pricing strategies?
What is included and excluded from the price? Are they exclusive and high-priced or a dime-a-dozen? How does this affect you?

7. Are they as passionate and knowledgeable as you?
Or are they more in it for the high volumes, loss leaders or portfolio fillers?

8. How do they market themselves?
What buying habits are they trying to influence?
Where do they advertise? What sales channels do they use – retail, direct mail, Internet, wholesale? Pose as a prospect so you get on their mailing list.

9. What is their sales literature like?
How can you make yours stand out in comparison?

10. How much does geographical location matter?
The right kind of competition in close proximity can be advantageous – it lures more prospects to the area. If they are thoroughly inconvenient to reach, but still do well, what is their secret?

11. How good is their staff?
Are they recruiting? If so, for what positions? Who are they hiring and why? Should you be considering enticing them over to you?

12. What resources do they have in terms of finance and people?
Are they growing, level pegging or declining? If so, why?
Use the Internet to get hold of credit reports on them.
Find out how many employees they have, and what they do. For instance, do they have a maintenance department or do they outsource this?

13. What are their strengths compared to yours?
How can you meet or exceed them?

14. What are their weaknesses?
How can you exploit these?

15. What are their billing strategies?
Do they ask for cash on delivery or offer free credit? Do they accept credit cards? How does this affect you?

16. How do their customers regard them?
Try to identify current and past customers and ask them about their experiences. Maybe some of your own customers buy from your competitors.
When you land a new customer, ask about their past suppliers. The key question is, ‘What was wrong with your last supplier?’

17. What assumptions are you making?
Check these again. Research your own customers to find out whether you are on course. You are only good if your customers say you are.

18. What else are you competing with?
For example, what do people do when they don’t buy from you or your competitors? If you sell holidays, what else do people spend their money on if they stay at home? If people aren’t buying your tinned soup, is it because they are buying from the competition, they are making it themselves or because soup is now out of fashion? How will this influence your strategy?

Develop a strategy

Once you have all this information, analyse their strengths and weaknesses and relate them to your own. Their strengths are your threats, their weaknesses your opportunities. Be as objective as you can.
Look to yourself. Are your strengths good enough to lure people away from the competition – or even to keep existing customers? Could your weaknesses be driving people away?

Look to the market. Are there trends emerging that could destroy your market or require you to service it in a different way?
This kind of research and analysis will throw up lots of new opportunities. Acting on your findings will keep you at the front of your field. But remember, you don’t have to be streets ahead – in a race, the first horse can be ahead by as little as a nose.

Government information site

A new website has been launched that provides a single access point to all relevant government information and services for business.
The site, fronted by Business Link, the DTI-backed business advice service, has been created to ensure that the 3.3 million small and medium-sized businesses in England find it easier to locate and understand the rules and regulations they need to know.

The site will also carry useful information on grants and support schemes and guidance on issues such as employment law and tax, all in jargon-free language and an easily accessible format.
The new Business Link site is www.businesslink.gov.uk


Litigious employees?

Worried about employees taking you to court? Well, it seems that fewer are doing so. The number of Employment Tribunal applications has dropped by 12% to 99,000 in 2002/2003.

• 26% were claims for unfair dismissal;
• 23% were claims for unlawful deduction of wages;
• 17% were claims for breach of contract;
• 12% were discrimination claims.

How did people fare? ACAS helped settle 39% of cases; 31% were withdrawn; 13% were successful at tribunal; 11% were unsuccessful at tribunal; 6% were handled by other means.

Just 4% of sex discrimination claims and 3% of race claims were successful at trial. 75% of these claims were withdrawn or settled before trial. The average award for unfair dismissal was just over £3,000, while the average award for sex discrimination was around £5,000, though it was nearly £8,000 for race discrimination.

Why the drop in the number of claims overall? According to Kimberly Shaw of Solicitors Collyer Bristow, it may be that more employers are attempting to resolve issues in the workplace, or negotiating settlements before they get to court.

Meanwhile, such claims place an enormous burden on employers, in terms of management time and legal expenses. So can you recover your costs? Sadly, unless a claim can be shown to be misconceived, frivolous or vexatious, or the applicant has been unreasonable in their conduct of the case, costs will not be awarded.

‘ This has been the case,’ says Robyn McIlroy of Masons Solicitors writing in WorkplaceLaw.net, ‘even where the employer has made a perfectly reasonable settlement offer which has been rejected by the applicant.’
www.masons.com ; www.collyerbristow.co.uk


Raising finance from private investors

Businesses struggling to raise elusive growth capital now have access to a vast resource of informal private funding from a new breed of business angels.
The Development Capital Exchange (DCX) has more than 200,000 successful entrepreneurs on its books who wish to invest between £20,000 and £500,000 each in growing enterprises.

Some want to join these enterprises as directors so that they can contribute their valuable, hard-won business experience to mitigate against the high risk of failure among growing enterprises.

DCX delivers the information exchange through which successful entrepreneurs can identify opportunities to exploit the under-utilised Enterprise Investment Scheme.
The scheme has evolved to the point where 20% income tax relief can be claimed on up to £150,000 by entrepreneurial investors each year, and remain exempt from all Capital Gains Tax if shares in the investee company are held for three years or more.
For more information, visit www.dcxworld.com

Speeding up cheque clearance

The Federation of Small Business is demanding government action on the time it takes for cheques to clear.

The FSB believes that a government bill to overhaul these payment systems is long overdue. John Walker, FSB Policy Chairman, said: ’In the 21st century it is inconceivable that both cheque and electronic payments should take three days to clear.

‘ The Office of Fair Trading has proved that banks make money on the back of their customers when a payment reaches one account long after it leaves another. The Bill should include measures that allow heavy fines to be imposed on banks that consistently make money in this way.’


Sunday working – could you be guilty of discrimination?

Employers paying wage premiums to staff working on a Sunday could be acting in breach of the religious discrimination laws that came into force in December 2003.

Alan Lewis, of Manchester-based law firm George Davies, said: ‘Sunday is recognised as the Christian Sabbath day and for that reason an incentive is usually offered to employees in order to compensate for work on that day. However, UK employers are no longer able to discriminate, directly or indirectly, on the grounds of religious belief.

‘ Sunday premiums could be unlawful if an employer fails to treat others with different religious Sabbath days the same way,’ said Alan Lewis.