The brainchild of CEO Colin Mills, former Finance Director of large multinationals and Plc companies, the FD Centre was established in 2001. It was the first business to provide Part-time Finance Director services in the UK.

The original concept for the FD Centre was to provide the skill sets of experienced Finance Directors of large corporations to the small and medium sized enterprise (SME) sector, allowing smaller organisations to benefit from the expertise of a highly experienced Financial Director without incurring the expense of hiring someone full-time.

The concept caught on quickly and the business has grown rapidly on a national scale. Over the last seven years the FD Centre has become the largest and most respected provider of part time Finance Director services in the UK.

The FD Centre aims to build long-term relationships with its clients through the provision of its range of added value services and by establishing a basis of trust and confidence.

Trust provides the platform for providing clients with additional products and services, either directly via the FD Centre or through connections with trusted and recognised financial and business advisors.

FD Centre clients include business owners and Managing Directors, who value the services of professionals who have good financial and management knowledge and have the real hands-on experience to deliver.

The FD Centre ensures that all its Finance Directors meet stringent recruitment requirements to secure quality of service delivery. All FD Centre Finance Directors are professionally qualified Accountants from major UK Chartered Institutes, all have held Finance Director positions in both mid sized and large organisations, all are extremely commercial and business savvy.

High quality expertise is gained through working with large organisations across all business sectors, such as; Mothercare, Dell, Oracle, Threshers, Tesco and Laura Ashley.

The FD Centre is structured regionally and therefore is able to provide an immediate service that has real impact for its clients.

Examples of some FD Centre programmes that have been developed to address some common SME issues include:

• Keeping control in fast growth companies
• Survival solutions for companies under pressure
• Business owner mentor and support programmes
• Cashflow improvement systems
• Raising business finance
• Preparing for business exit or sale

Our tough times check list, written by James Nicholson-Smith, Business Development Director, offers tips on what to do to ensure improved business in the present climate. To download the tough times check list click on the pdf download button at the bottom of the right hand panel of this page. 

Entrepreneurial Vision – Contents Page

“If anything can go wrong, it will go wrong”

Have you noticed how some newspapers glamorise entrepreneurs who have failed 3 or 4 times before they succeed. This is justified by saying that these entrepreneurs are risk takers and should not be punished for sticking their necks out and taking some risks. Richard Branson is often cited for his failures, like condoms, as often as he is about his successes.

Many commentators say “You learn more from failure than you do from success”. Whilst there are elements of truth about this, in many cases business failures could have been avoided if the entrepreneur concerned had taken a broader view of the risks that his business faced during its initial growth phases. In a US venture capital survey they found that 34% of second time entrepreneurs whose first venture succeeded, succeeded again. Only 23% of those that had previously failed managed a success. 22% of first time entrepreneurs succeeded.

As Finance Directors, we see too many business owners who have tunnel vision when it comes to their businesses. Consider a business as a racing car in an important race; the driver is the entrepreneur. Does a good driver focus on the finish line, the steering wheel and the accelerator only? Or would you expect a good driver to consider the use of gears, unpredictable behaviour by other drivers and the performance, reliability and safety of his car? A business owner needs to think beyond the big deal to start thinking ‘what could go wrong after I secure this potential order?’ Maybe component delivery is late, sub-contractor lets you down, product fails, product isn’t legal, customer complains if the product is not fit for purpose, delivery is rejected due to transit damage, incorrect paperwork, you deliver the wrong products, your costings are incorrect when agreeing prices, your bank facilities are withdrawn and/or no credit terms from suppliers, you end up with too much of the wrong stock, or the customer does not pay.

Many entrepreneurs have left large companies where these considerations are handled by others. When you are in the early stages of a business, your team may not be big enough to allow such delegation or support. Consequently team members have to do things that they have never done before and this exacerbates the risks enormously.

To remedy the situation, management teams should take the opportunity once a month to consider what could go wrong and identify ways of reducing the risk of what could happen. The most common mistake is for entrepreneurs to develop too many products at the outset without proving any of them will stand up as a success. By their very nature, entrepreneurs are very optimistic. Therefore considering the risk of failure does not come easy to them and as a result many entrepreneurs try and delegate responsibility for dealing with Murphy’s Law to other members of the team without giving them any authority to say no to anything. In reality, all this does is provide a scapegoat when things do go wrong.

As Finance Directors there is a perception that we will prevent Murphy’s Law dragging down the business. In early stage companies where the opportunities for something to go wrong are so numerous, preventing everything that could go wrong is an impossible task. As a result, the majority of our time is spent focusing on the fallout from Murphy’s Law – minimising the financial impact when things do go wrong.

From our years of experience as Finance Directors our 4 top tips are:

• Identify what you are going to do, ie. product or service and don’t be distracted by other ideas. Do what you do, as well as you can and you reduce your chances of becoming a busy fool.
• Dedicate half a day per month to consider what could go wrong and put measures in place that help prevent it.
• Plan for other things to go wrong and make sure you have the skills in your team and financial resources to minimise the financial impact.
• Be honest with yourself and generate a team spirit that deals with Murphy’s Law rather than blaming employees or suppliers for your failure after the event.

Entrepreneurial Vision - Summer 09 – Contents Page

Politicians and even banks are talking about the green shoots of recovery. Is this wishful thinking on their part? It is fair to say that many of our clients have now become acclimatised to the current economic climate and are no longer just waiting for good times to return. There is a realisation that it is going to be much harder to make the same amount of money as it was 2 years ago and the risk of further shocks to the business are far greater. Many businesses have downsized and many have rationalised their product or service offerings to suit changing demand patterns.

At a recent workshop with prospective clients, one of the participants said “I am one of the lucky ones to have survived this recession and I am proud of the fact that my business is stronger in terms of its experience, but what should I do now?” Well the race continues, only the horizon changes. If you had a long term business plan 2 years ago it’s time to brush this off and have another read. You will probably find that not much has changed in the plan. Internally, the biggest change is in your heart and your head. You should be proud of your business in the way it has weathered the storm and continues to do so and pleased with yourself personally for navigating your ship and its crew through the storm. Externally the biggest difference is that there are far more business opportunities around at much more affordable prices:-

• If you were previously considering employing an operations director, these people will now be available in the market.
• If marketing the company in the mass media was too expensive previously, media has never been so cheap.
• If you are a retailer, expanding into new locations has never been more affordable.
• If you are a successful restauranteur or own other types of leisure facilities, there will be other businesses with good locations but poor management that are ripe for acquisition.

The real issue is how to choose the opportunities that are right for you. The answer is in your long term plan. If these opportunities are part of your growth strategy then the opportunity to exploit them when the cost is at its lowest, should not be missed. Obviously you must consider the risks and also whether the business can afford the investment before deciding whether to proceed.

It is always worth reminding yourself of the definition of an entrepreneur: “a person with the ability to recognise opportunities of benefit to an enterprise and the will and capacity to undertake appropriate innovative action while accepting the associated risks”.

Entrepreneurial Vision - Summer 09 – Contents Page

By Mike Southon

While some may dismiss the recent Father’s Day celebrations as another cynical exercise to support the greeting card industry, it is still a great excuse to spend the day enjoying fun and interesting father and child adventures.

Perhaps the most challenging father and child adventure would be to start a business together. In the nineteenth century, the words ‘and son’ applied to a business, was a token of security and longevity amongst the new wave of middle class industrialists and traders. But as companies began to grow and hire more experienced management, many firms dropped the family epithet in order to appear more substantial, especially in international markets.

I am often asked if I think that family firms are a good idea, and I always reply that, on balance, the binds that hold a family together are generally very effective in encouraging the teamwork required for a successful enterprise. But I sometimes find myself mentoring young entrepreneurs who have been sent to this country for a good education, specifically to bring this expertise back home to the family business. They have now developed new entrepreneurial ambitions away from their roots, and feel torn between the two options.

Occasionally a father and child may decide to work together in later life, as happened with eco-friendly company Extreme Green. The senior member of the team, Bob Sands, had a very successful twenty-five year career on the front line of chemical cleaner product development, but always working for other people. His son, Tom chose a different career, working for various marketing agencies to develop their consumer and business brands.

A chance conversation lead them to the conclusion that there was an excellent new market for ecologically friendly chemicals which not only did as good a job as the traditional products, but were also attractive to the major retail chains and to consumers. Extreme Green now has a wide range of environmentally friendly products, including ten household cleaning products and a range of garden care range that includes patio cleaners and rodent repellents.

As well as being totally biodegradable, all of their products have a high level of integrity, being free of any manufacturing shortcuts, such as harmful additives, that might make the products potentially hazardous to use. Extreme Green uses only the lowest toxicity ingredients to ensure the products are kind to people and to the planet. Nothing is tested on animals, and even their rat repellent product ‘Ratty’ makes the rats disappear with no environmental damage or dead bodies to pick up by the tail

Major retail chains, including Homebase and Home Hardware, have enthusiastically taken up Extreme Green’s products. For B&Q they provide a range of exclusive products, such as a decking cleaner, and they are often asked to design bespoke chemicals, including a biodegradable rail de-icer for the train operators.

Their view on being a family business is that they are definitely having fun, although there can be occasional robust discussions where the other family members think about quietly hiding the sharp objects in the kitchen.

Both men are essentially happier as ‘back-room’ boys, Sands Senior designing ever better products and Sands Junior creating even more attractive packaging for their own and their clients’ products. They realised they needed complimentary skills and resources to grow the business, so appointed Craig Huth, one of their angel investors, as Managing Director, Kevin Vyse as head of marketing and James Nicholson-Smith from the FD Centre as part-time finance director. Growth funding has been arranged with the Royal Bank of Scotland who advanced them £150,000 via the Government’s Enterprise Finance Guarantee.

In the pre-internet days their challenge would be how best to raise and spend the large sums necessary for marketing their products to make them household names. Nowadays the Innocent Drinks phenomenon shows that it is entirely possible to build a powerful consumer brand by word of mouth only, so long as you have a good premise and a funky brand, which is well thought out and effectively taps into the collective zeitgeist of the buying public.

The traditional route would be to pay a celebrity to endorse your products, but this can be seen nowadays as commercial and manipulative. Next generation celebrities prefer to enhance their own and other people’s brands by extolling the virtues of a wonderful new product they have cleverly discovered themselves, on Twitter and Facebook.

Everyone today realises they need to be greener. The Sands’ message, for celebrities and consumers alike, is that everyone should be Extreme Green.

Extreme Green can be found at www.extremegreen.co.uk 

This article Copyright CMike Southon 2009 All Rights Reserved
Not to be reproduced without permission in writing
Originally published in The Financial Times
         Mike Southon can be contacted at mike@beermat.biz, www.beermat.biz  

A key moment in this year’s series of “The Apprentice” highlights the extent to which many business people are unaware of company law requirements, according to a leading Midlands corporate lawyer.

“Many fans of the BBC series cringed when, during her semi-final interview, the eventual winner Yasmina Siadatan seemed unaware that her company’s accounts are a public document”, says Philip Round, an associate solicitor in the Black Country law firm George Green LLP.

On being grilled by “international troubleshooter” Claude Littner about the financial performance of her restaurant business, Ms Siadatan seemed to be momentarily surprised that such information is publicly available.  “Of course, interview pressure and skilful editing might have been contributory factors”, continues Mr Round, who is based in George Green LLP’s Cradley Heath office.  “This is, however, symptomatic of a wider confusion amongst directors about their compliance obligations, particularly at a time when company law is undergoing wide ranging reforms.”

According to Mr Round, the Companies Act 2006 – the final key provisions of which came into force on 1 October 2009 – was intended to make company law more accessible, but has in fact created potential pitfalls for unwary directors. 

“Many directors who are unsure about a procedural issue will consult their company’s articles of association,” continues Mr Round.  “This is the main constitutional document which sets out the procedure for board and shareholder meetings, and rules relating to the issue and transfer of shares.

Existing companies may well find, however, that many provisions of their articles of association are no longer correct.”

“For example, the 2006 Act has introduced a more detailed procedure for the passing of written shareholder resolutions, which must be followed by all companies regardless of what their articles say.  Also, proxies have been given enhanced rights which must be recognised.  Directors are likely to follow procedures stipulated in their existing articles for the passing of written resolutions or the convening of general meetings.  If these are based on the old law, they are likely to be misleading or even unlawful and may result in the decisions of shareholders and directors being vulnerable to challenge.”

Mr Round recommends that companies review their articles to ensure that they are up to date.  “If companies do not bring their constitutional documents into line with the current law, the ensuing procedural errors will no doubt come to light on a subsequent sale of the company.  The reaction from potential purchasers is likely to be frostier than that of Nick and Margaret in Sir Alan’s boardroom.” 

According to Mr Round, new companies incorporated on or after 1 October 2009 will face a slightly different problem.  “Many existing companies’ articles are based on a statutory default form, called Table A, which companies usually tailor to suit their needs.  A new default set of Model Articles replaces Table A in relation to companies formed on or after 1 October.  The Model Articles are much shorter than Table A, and omit some key provisions which many companies would find useful, such as the power to appoint alternate directors, and detailed procedures for addressing directors’ conflicts of interest.  It is therefore more important than ever for new companies to adopt a bespoke constitution rather than relying on the default Model Articles.”

Mr Round highlights another change which will have a significant impact on all companies.  “From 1 October, Companies House have introduced a whole new suite of company forms, which will replace the existing forms – such as forms 288 and 88(2) – in their entirety.  Any old style forms filed after that date will be rejected.  A company will also be required to file a statement of capital each time that it alters its existing issued share capital.”

Mr Round recommends that all company officers familiarise themselves with these changes.  ”Companies have understandably neglected housekeeping issues because of the current economic situation.  Keeping up to date with changes in the law should, however, be an integral part of any company’s strategy for surviving the downturn.”

Established in 1897, George Green has 11 partners and 75 staff, and is headquartered in Cradley Heath with a satellite office in Birmingham.

For further information, contact Beverley Weston, Marketing and PR Manager for George Green LLP, Tel: 01384 340585.  Email: bweston@georgegreen.co.uk

Potential company investors should be as cautious as the “Dragons” from the BBC series “Dragons’ Den” in reviewing both the commercial and legal terms of their proposed investment, according to a leading Midlands corporate lawyer.

“Fans of ‘Dragons’ Den’ are used to watching contestants see their business plans torn to shreds by a panel of potential investors,” says Clare Martin, an associate solicitor in the Black Country law firm George Green LLP.  “As a result of recent company law changes, it is crucial that prospective minority investors in a company adopt an equally critical approach to the terms which they are offered.” 

According to Ms Martin, who is based in George Green LLP’s Cradley Heath office, reforms introduced by the Companies Act 2006 can have the effect of weakening the position of minority shareholders. 

“Many shareholders will be familiar with the concept of ‘authorised share capital’,” explains Ms Martin.  “This creates a ceiling on the number of shares which can be issued without further shareholder approval.  This restriction has, however, been abolished for companies incorporated on or after 1 October 2009, although existing companies will have to pass a shareholder resolution in order to disapply their current authorised share capital limit.” 

“Also, directors of private companies formed on or after 1 October with only one class of share will not require shareholder approval to allot further shares of the same class.  Again, the shareholders of existing companies will need to resolve to give the directors this freedom.” 

Ms Martin continues, “Although new companies can choose to adopt a more restrictive position, the combined effect of these changes increases the risk of minority investors with no presence on the board finding their shareholding diluted without their knowledge or consent.” 

Ms Martin stresses that whilst shareholders potentially have legal remedies in such a scenario, these tend to be expensive and time consuming.

“It is far preferable for minority shareholders to ensure, at the outset, that they are protected by an appropriate mechanism in the investee company’s constitution, which enables them to participate proportionately in any further issue of shares.  Such a default mechanism is stipulated in the 2006 Act, but is commonly disapplied by companies who tend to adopt a more sophisticated procedure.  Shareholders should also ensure that they have a veto over any potential amendment to a company’s constitution which might weaken their position.” 

“Many investors are used to being as canny as ‘Dragons’ Peter Jones and Duncan Bannatyne in negotiating the commercial terms of their investment,” Ms Martin concludes. “Only by adopting a similar approach to the legal structure can they be confident of their investment strategy.”

Established in 1897, George Green has 11 partners and 75 staff, and is headquartered in Cradley Heath with a satellite office in Birmingham.

For further information, contact Beverley Weston, Marketing and PR Manager for George Green LLP, Tel: 01384 340585.  Email: bweston@georgegreen.co.uk

When businesses start up, most management teams have to do everything from cleaning the office to repairing faulty products. This is often deemed necessary at the start. However, as businesses grow they have to focus on the areas of the business that drive profit and generate cash.

Colin Mills – Founder and CEO of The FD Centre says “Skillful management teams can recognise those activities in the business that drive profit and those that merely have to be done. It is important for management teams, especially in a business’s early phase of growth, to appreciate the false economy of trying to do everything themselves without considering the management time that would be saved if they outsourced those functions that were not core to the business or required specialist skills”.

A classic example of outsourcing non-core processes would be insurance companies that focus their efforts on underwriting and investment activities whilst outsourcing sales generation and claims processing to companies like Capita.

Smaller companies typically outsource their bookkeeping functions, legal and accountancy and sub-contract manufacturing. However, other areas that could be outsourced would include human resource management, premises management, IT support, insurance, pension’s management and finance director skills. 

To determine what the business should outsource, the management should identify all the activities required to carry out the business and then set a priority attached to this in relation to driving profit or being an essential support and the management time and skill required. The management will then easily be able to see what should be outsourced and what they do themselves. The next task is to find an outsource partner that will deliver what you need at a price you can afford.

For an assessment of your business requirements and whether outsourcing could form part of your financial objectives, contact the FD Centre for more information.

It was summer 2008.

Alice ran a graphics studio. She employed 12 young artists and turned over a tad under £1m. Lovely lady. Lovely business.

Jason ran a web design company. He employed 4 webbies and turned over a tad under £350k. Lovely man. Lovely business.

And then came the recession.

At a summer barbeque, Alice openly confessed to me “We don’t do all that marketing stuff. We hate it, all that asking for the business that you reckon small businesses should do. People know how good we are and that’s an end to it!” She wouldn’t listen to me.

At the Christmas party she confided, “Time’s are hard. We’ve made all the designers redundant and moved out of our lovely offices. It would have made no difference had we done all that selling stuff cos everyone knows it just doesn’t work. It’s all down to luck. We’ve still got a great business and things will get better”.

My throw-away line, “Hope is not a method” was not appreciated.

March 2009 and Alice is another statistic. She’s declared herself bankrupt, handed over the keys to her house, taken the kids out of private school and put herself on the council house list. What a difference six months can make.

Meanwhile let’s get back to Jason; he didn’t hang around when the recession-mongers were getting their act together back in the summer. He took radical and evasive action.

“I’ve made some tough decisions” he told me over a barbequed chicken leg. “I‘ve read all your stuff and I am going to go for it. Starting on Monday, we will put prices up 10%, sack the bottom 20% of our customers and focus exclusively on the small number of high spenders we know. We are creating a new product/service which existing customers should love and we are creating a £100 website health-check with a money-back guarantee which should increase sales. I am going on a sales training course and I am committing to speak to 10 potential clients every single day. I am going to employ a business development manager for three months, three days a week. And if that doesn’t work then I can’t say I didn’t try.

By Christmas, Jason’s plan was paying off. While all his competitors were taking their foot off the gas he was visibly stepping up to the mark. And the result…?

Revenues went up by 20% compared with the same period in the previous year. Net profit margin was up 25%. They had fewer, but better clients.

March sees Jason breaking the £600k pa turnover barrier, taking £100k out of the business as net profit. He’s taking on three new coders over the next six months and the business development manager is now with him full-time. Well done, Jason!

Moral of the story: are you a lion or a lamb?

What did Alice do wrong? She can put ticks next to virtually all the reasons why people go bust:

• 1. Not behaving like the Boss
• 2. Ignoring the Customers
• 3. Ignoring the Competition
• 4. Ignoring the Numbers
• 5. Having no vision/passion/purpose/strategy
• 6. Employing the Wrong People
• 7. Selling the Wrong Product
• 8. Having the Wrong Proposition
• 9. Spending Too Much
• 10. Not Charging Enough

Shame, shame, shame.

Look at the list. Are you guilty of any of these failings? If so, what are you going to do about it?

Robert Craven shows MDs and owners how to grow their sales and profits and focuses on how to do this in recessionary times. His latest book is the runaway success “Beating the Credit Crunch – how to survive and thrive in the current recession”. www.directorscentre.com

He is a keynote speaker and the author of business best-seller ‘Kick-Start Your Business’ (foreword by Sir Richard Branson) and runs The Directors’ Centre, helping growing businesses to grow.

For further information, contact Robert Craven on 01225 851044 rc@directorscentre.com

The Home Office estimates that stolen plant currently costs the construction industry £400m* each year, through both theft of plant from operators and criminals hiring plant for fake construction sites. Industry estimates suggest that only 5% of stolen plant is ever recovered and returned to its rightful owners. Even then, recovered equipment is often difficult to identify as markings and serial numbers are usually removed.

The construction industry is working hard to combat the increasing volumes of theft and advanced technology is helping them in their efforts. Masternaut Three X has launched a groundbreaking tracking service for valuable plant and construction equipment using satellite surveillance.

Called Masternaut Asset Track, a covert tracking device installed in the equipment transmits the precise location of the asset and communicates this via the Internet. This eye in the sky system prevents theft and, therefore, minimises disruption to businesses that rely on constant availability of their assets to perform their jobs.

Asset Track provides many benefits that result from gaining real-time visibility of the plant or equipment. Using a web browser on a PC or hand held device, Asset Track users can see exactly where their equipment is situated and whether or not it is in use. The moment it moves out of a pre-defined area, the system raises the alarm and notifies the customer via email or text message. This will ensure that stolen equipment can be recovered quickly.

For plant hire companies, the system provides a record of usage for Pay-As-You-Use services. Customers are given accurate invoices, backed up by the system’s monitoring capability. In addition, because the ‘hirer’ is responsible for assets on loan to them, they now also have peace of mind from knowing that the equipment is fitted with a real-time tracking device and in the event of it being stolen it can be traced and retrieved.

Asset Track has been engineered for easy installation, robustness and longevity. The simple two wire connection and integrated long-life back-up battery provide a fit-it-and-forget-it solution to tamperproof equipment tracking. Furthermore, because Asset Track is based on proven Masternaut Three X technology, users will also benefit from lower insurance premiums and excesses.

“Masternaut Asset Track provides a simple and extremely effective method of location and recovery of stolen equipment. It is a foolproof system that gives instant warning of theft. It helps a customer retrieve their equipment and prevents them falling foul of opportunistic as well as organised criminals. In addition, customers can use the system to help prepare accurate itemised invoices for pay for use equipment hire. Asset Track provides a reliable way to accurately measure usage of the plant or equipment and thereby prevents disputes arising,” said Martin Port, MD, Masternaut Three X.

For further details on how your business could benefit from Asset Track, please get in touch. Web:www.masternaut.co.uk