The Customer Should Always Come First
The customer should always come first. You need to ensure that they are never made feel like a nuisance. You need to welcome them and make their experience a pleasure that they look forward to.
Never quibble with them regarding their displeasure, as the goodwill lost will cost more than the product with which they are unhappy. Pick your customers carefully, so disputes should be few and far between.
You should provide a personal complaints line direct to yourself. The customer will appreciate the personal service from the boss, and if you are doing things right it shouldn’t be a time-consuming task.
This also ensures that your staff are unable to hide customer dissatisfaction from you. It will give you an insight into what’s really going on. The buck should stop with you anyway.
Be the best, don’t accept second rate because your customers won’t. You need to instill this attitude in your staff.
Keep an eye on your competitors and focus on how you can do it better. Match them on any improvements they are making in dealing with their customers.
Incorporate your business to limit your liabilities. If your incorporated business fails, all is not lost.
By incorporating, you will get access to higher-quality advisors who don’t tend to advise sole traders and other small entities.
Work with your partners and staff as a team, and pool resources and skills. Your staff need to know that the happier customers are, the more salary they will receive.
The achievements that the business makes should be celebrated with the team of staff that are responsible for them.
Having a plan B takes away the focus from plan A. Having a plan B is accepting that plan A may not work.
Train yourself to disregard your negativity. Think positively and have a half-full attitude.
Believe in yourself and don’t let anyone undermine your confidence.
All groundbreakers have had to fight a lot of negativity to achieve what they have. If you can’t do this, how can you expect your team to believe in you.
Don’t assume that everyone sees the world as you see it, especially your customers. Try to see their experience through their eyes.
Don’t assume that your customers are happy because they don’t complain, and then review the amount of times that you have assumed that someone else will complain about something that you haven’t complained about.
Pay attention to detail, as little things mean a lot. You don’t get a second chance to make a first impression.
Small details such as flowers and up-to-date magazines in reception, to uniforms and general staff appearance, and biscuits with the coffee provided can distinguish you from your competitors.
Be able to react to change, and be innovative. But try to be proactive rather than reactive. Don’t get stuck in your ways and insist that your business is better than the usurpers.
Don’t ignore the financials, keep an eye on your budgets. Have a plan and review progress and reassess whether your targets are going to get you to where you want to be.
When you stop jumping out of bed eager for work, have a rethink at what you’re doing and why.
Have fun, don’t let it take over your life entirely. Take time out to do what you want with your life. Don’t get trapped having to work to pay off a mortgage on a property you don’t really need.
Plan for retirement, you can’t do it forever, and remember that there ain’t no pockets in shrouds.
Or the stress will kill you eventually.
Take advice from professionals and follow it. Ignore what it says on Google, professional advisors do know what they’re talking about (mostly!).
Ensure you are insured for all eventualities (because they do happen!), then forget about it.
Insure the lifestyle that you want for the rest of your life.
You’ve got a responsibility to your employees to ensure their lifestyles also.
The earlier you start to build your pension pot, the bigger it will grow. You’re likely to outlive your pension pot because we’re all living longer!
What Makes a Successful Business?
Luck, good judgment and a lot of hard work.
A well thought-through business plan is essential for a successful business. I include an example of a business plan next as an indication of the detail that is usual in such a document.
Example of a Business Plan/Finance Application
Business Plan for JT’s Restaurant.
August 2017
Index
Summary of Application
Financial statements of Yoko’s Sushi House (only one year included here)
Resumes of Paul Kendall and Tony Zoyo (not included in this book)
Details of profit shares and ownership from years 1 to 5 (not included)
Details of profit shares and ownership for years 6 to 10 (not included)
Financial forecasts of JT’s Restaurant to 30 June 2020 (included in Chapter 3)
Draft agreement to sell the property to be known as JT’s Restaurant at a fixed price of £200,000 in five years’ time (not included)
Detailed breakdown of the purchase price of £120,000 (not included)
Valuations and details of inventory (not included)
Business Plan for JT’s Restaurant.
August 2017
Summary of Application
The following detail lays out Paul Kendall’s and Tony Zoyo’s (otherwise known as Japanese Tony or JT) plans to set up a business called JT’s Restaurant, based in the premises previously known as Yoko’s Sushi House in Birmington, UK, on 1 July 2017.
The audited accounting records of Yoko’s Sushi House for the three years to March 2016 are appended to this document (on the understanding that the detail therein is confidential and disclosed solely for the purpose of this finance application (Table 12.1)).
Paul Kendall is a retired chartered accountant and is to undertake a management and administrative position in the business (for tax and security reasons the business is to be set up as a sole trader in his name).
Tony Zoyo is a very experienced chef, who has worked in a number of Michelin-starred restaurants, and for a time in Yoko’s Sushi House.
The resumes of both of the above are appended to this document.
The plan is to buy the business (only) of Yoko’s Sushi House, as the present owners want to retain the property (initially). It will become available for sale after year five, the owners’ reasons for this delay are not known at this stage (but it may be due to taxation).
It has been agreed that the property will be sold to Tony for a fixed price of £200,000 in five years’ time, and further funding may be required at that stage if the business hasn’t built up a reserve of retained profits at that point.
The association between Paul and Tony needs further explanation in order to assist with this finance application. They have known each other for a number of years and Paul is a regular customer at the restaurant.
The owners have made it known that they wish to retire from the business, and Tony, who has put in a lot of effort to make the business what it is today, does not want to see his efforts wasted.
He has negotiated the purchase price of the business using his personal relationship with the current owners, and the price would be far higher on the open market.
Unfortunately, due to events outside of Tony’s control, Tony’s finances are far from ideal to apply for a business loan.
Paul has a lot of faith in Tony’s culinary skills, and is willing to put security up and provide management expertise to help Tony take over the business.
In exchange for this, Tony has agreed to fix his income from the business to a salary of £60,000 a year for the first five years, and has agreed to Paul’s staggered withdrawal from the business thereafter.
They have decided to change the business name as they wanted it known that Tony will have more of an active role in the business, and his culinary skills and involvement will be focused on.
Financial forecasts for the first three years trading of JT’s Restaurant are appended to this document, and are very much in line with the business’s current trading.
(Example of statutory accounts)
Yoko’s Sushi House Limited
Directors’ Report and Unaudited
Financial Statements
For the year ended 31 March 2014
Yoko’s Sushi House Limited
Company information
31 March 2014
|
Directors |
Yoko Fernandez |
|
|
Rafa Fernandez |
|
Company Number |
12345678 |
|
Registered Office |
The Sushi House |
|
|
Winkle Street |
|
|
Birmington |
|
|
BE1 1EZ |
|
|
UK |
|
Accountants |
Fiddle & Scarper |
|
|
Balance House |
|
|
Money Lane |
|
|
Birmington |
|
|
BE1 1EL |
|
|
UK |
Yoko’s Sushi House Limited
Directors’ Report
For the year ended 31 March 2014
The directors present their report and financial statements for the year ended 31 March 2014.
Principal Activities
The principal activity of the company was that of a licensed restaurant.
Directors
The following directors have held office since 1 April 2013:
Mr. R. Fernandez
Mrs. Y. Fernandez
This report has been prepared in accordance with the special provisions relating to small companies within Part 15 of the Companies Act 2006
On behalf of the board
Mr. R. Fernandez
30 September 2014
Yoko’s Sushi House Limited
Chartered Accountants Report to the Board of Directors on the preparation of the unaudited Statutory Financial Statements of Yoko’s Sushi House Limited for the year ended 31 March 2014
In order to assist you to fulfil your duties under the Companies Act 2006, we have prepared for your approval the financial statements of Yoko’ Sushi House Limited for the year ended 31 March 2014, set out on pages 3 to 10, from the company’s accounting records, and from information and explanations you have given us.
As a practicing member firm of the Institute of Chartered Accountants in England and Wales, we are subject to its ethical and other professional requirements which are detailed at icaew.com/regulations.
This report is made solely to the Board of Directors of Yoko’s Sushi House Limited as a body, in accordance with the terms of our engagement letter dated 11 June 2013.
Our work has been undertaken solely to prepare for your approval the financial statements of Yoko’s Sushi House Limited and state those matters that we have agreed to state to the Board of Directors of Yoko’s Sushi House Limited as a body, in this report in accordance with AAF 2/10 as detailed at icaew.com/compilation.
To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than Yoko’s Sushi House Limited and its Board of Directors as a body, for our work or this report.
It is your duty to ensure that Yoko’s Sushi House Limited has kept adequate accounting records and to prepare statutory financial statements that give a true and fair view of the assets, liabilities, financial position and profit of Yoko’s Sushi House Limited.
You consider that Yoko’s Sushi House Limited is exempt from the statutory audit requirement for the year.
We have not been instructed to carry out an audit or a review of the financial statements of Yoko’s Sushi House Limited. For this reason, we have not verified the accuracy or completeness of the accounting records or information and explanations you have given to us and we do not, therefore, express any opinion on the statutory financial statements.
Fiddle & Scarper
Balance House
Birmington
30 September 2014
Yoko’s Sushi House Limited
Profit and Loss account
For the Year Ended 31 March 2014>
Yoko’s Sushi House Limited
Balance Sheet
As at 31 March 2014
For the financial year ended 31 March 2014, the company was entitled to exemption from audit under Section 477 of the Companies Act 2006 relating to small companies.
Directors responsibilities:
The members have not required the company to obtain an audit of its financial statements for the year in question in accordance with Section 476.
The directors acknowledge their responsibilities for complying with the requirements of the Act with respect to accounting records and the preparation of financial statements.
These financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime and the Financial Reporting Standard for Smaller Entities (effective April 2008).
Approved by the board for issue on
Signed ...................................., ....................................
Director Director
Yoko’s Sushi House Limited
Notes to the Financial Statements
For the year ended 31 March 2014
1. Accounting policies
1.1 Accounting convention
The financial statements are prepared under the historical cost convention and in accordance with the Financial Reporting Standard for Smaller Entities (effective April 2008).
1.2 Compliance with accounting standards
The financial statements are prepared in accordance with applicable United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), which have been applied consistently (except as otherwise stated).
1.3 Turnover
Turnover represents the amounts receivable for goods and services net of VAT and trade discounts, to the extent that the company has a right to consideration arising from the performance of its contractual arrangements.
1.4 Goodwill
Acquired goodwill is written off in equal annual instalments over its estimated useful economic life.
Goodwill -5 years
1.5 Tangible fixed assets and depreciation
Tangible fixed assets are stated at cost less depreciation. Depreciation is provided at rates calculated to write off the cost less the estimated residual value of each asset over its expected useful life, as follows:
Fixtures, fittings and equipment. Reducing balance 10%
1.6 Stock
Stock is valued at the lower of cost and net realizable value.
1.7 Financial instruments
Financial instruments are classified and accounted for, according to the substance of the contractual arrangement, as either financial assets, financial liabilities or equity instruments. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities
1.8 Deferred taxation
Deferred taxation is provided at the appropriate rates on all timing differences using the liability method only to the extent that, in the opinion of the directors, there is a realistic probability that an asset or liability will crystallize in the foreseeable future.
Yoko’s Sushi House Limited
Notes to the financial statements (continued)
For the year ended 31 March 2014
2. Operating profit
|
|
£ |
|
Operating profit is stated after charging: |
|
|
Amortization of intangible assets |
4000 |
|
Depreciation of tangible assets |
4133 |
|
Directors remuneration |
7692 |
3. Investment income
|
|
£ |
|
Bank interest |
70 |
4. Taxation
|
|
£ |
|
UK corporation tax |
7,175 |
|
Deferred Tax |
7,528 |
|
|
14,703 |
5. Intangible fixed assets. Goodwill
Yoko’s Sushi House Limited
Notes to the financial statements (continued)
For the year ended 31 March 2014
6. Tangible fixed assets. Fixtures, fittings and equipment
7. Debtors
|
|
£ |
|
Prepayments and accrued income |
330 |
8. Creditors: Amounts falling due within one year
|
|
£ |
|
Bank loans and overdrafts |
1,237 |
|
Corporation tax |
7,175 |
|
Other taxes and social security costs |
2,093 |
|
Directors current accounts |
28,930 |
|
Accruals and deferred income |
1,768 |
|
|
41,203 |
Yoko’s Sushi House Limited
Notes to the financial statements (continued)
For the year ended 31 March 2014
9. Provision for liabilities
|
|
Deferred Tax |
|
|
Liability |
|
Accelerated capital allowances |
7528 |
10. Share capital
|
|
£ |
|
Allotted, called up and fully paid |
|
|
50 A Ordinary shares of £1 each |
50 |
|
50 B Ordinary shares of £1 each |
50 |
|
|
100 |
11. Statement of movement on profit and loss account
|
|
Profit and Loss Account |
|
|
£ |
|
Profit for the year |
17,189 |
12. Control
The company is controlled jointly by Mr. R. Fernandez and Mrs. Y. Fernandez, who each own a 50% shareholding.
13. Related party transactions and relationships
Mr. R. Fernandez and Mrs. Y. Fernandez, directors of the company, have a loan account with the company against which personal expenses and drawings may be charged. The loan account has remained in credit throughout the year and the balance at 31 March 2014 was £28,930. The loan is interest free and repayable on demand.
Yoko’s Sushi House Limited
Detailed trading and profit and loss account
For the year ended 31 March 2014
Yoko’s Sushi House Limited
Schedule of administrative expenses
For the year ended 31 March 2014
Administrative expenses
|
|
£ |
|
Wages and salaries (excl. NI) |
50,432 |
|
Directors remuneration |
7,692 |
|
Employers NI contributions |
2,915 |
|
Rates |
8,021 |
|
Insurance |
1,004 |
|
Light and heat |
2,916 |
|
Repairs and maintenance |
5,267 |
|
Printing, postage and stationery |
135 |
|
Advertising |
536 |
|
Telephone |
1,218 |
|
Motor running costs |
1,776 |
|
Traveling expenses |
90 |
|
Legal and professional fees |
1,408 |
|
Accountancy fees |
1,400 |
|
Bank charges |
348 |
|
Sundry expenses |
2,021 |
|
Amortization on goodwill |
4,000 |
|
Depreciation on fixtures, fittings and equipment |
4,133 |
|
Total |
95,312 |
Table 12.1 Spreadsheet showing the workings for the tax saving example
