December 2006. Employment Law ‘Overwhelming’ for Small Firms
The new regulations on age discrimination and maternity leave have left many small firms feeling ‘overwhelmed and unsupported’, according to the Forum of Private Business (FPB).
Keith Chetwynd runs an engineering company in Atherstone, Warwickshire and says he is drowning in employment law.
“It stops me from wanting to employ people, unless it is absolutely necessary. This is my business, started 25 years ago, and we are now fighting stiff competition from abroad whilst struggling with more and more regulations at home.
“Employment law is difficult and you are left wondering whether or not you have got it right. The fear of tribunals and then subsequent appeals make you feel wary every day.”
Speaking about the launch of the FPB’s latest edition of its ‘Employment Guide’, Len Collinson, the organisation’s national chairman, spoke of increasing burden on employers.
“The owners and managers of small and medium-sized businesses rely on informality and closeness to employees in the running of their firm,” said Collinson.
“Employment regulations tend to mean paperwork, records and outside interventions. Misunderstandings can lead to costly and disruptive consequences.”
Collinson said that the complex nature of rules and regulations meant there was a greater risk of non-compliance for small firms due to their limited resources.
The FBP said that it is not surprising that the increase in new employment regulations has led to a growing number of employers facing disputes with their employees.
See the recent Start-ups article 'Why Use A Virtual Office'.
December 2006. Agility Is The Key To Success For SMEs.
In a world where 24/7 communications are increasingly important, companies of all shapes and sizes have to work extremely hard to keep their customers happy all the time.
But small and medium-sized enterprises (SMEs) must work even harder to maintain the loyalty of their customers, because they face an endless stream of competition from larger companies, who have the money and manpower to be “on-call” for their clients constantly. So for SMEs, fast and efficient communication is vital if they are to achieve business success.
While large companies can simply employ a whole workforce of people to take care of their customers, small businesses may struggle to respond quickly to the demands of their clients and new business prospects - particularly if they are out of the office attempting to expand the business.
With no constant stream of communication between these parties and staff, SMEs are in danger of missing new business opportunities, or worse - losing valuable clients. Moreover, smaller companies should take note of recent research findings which have shown that owners of UK small businesses are currently losing the equivalent of one day each week to unproductive “dead time”, which is spent commuting, travelling to meetings or waiting at train stations.
With this in mind, it is clear that SMEs must tackle these problems as a matter of urgency. Now is the time for small enterprises to think carefully about how they can be more “agile”, if they want to compete with larger companies on a level playing field.
December 2006. Each Lost Customer Costs Small Businesses £4,910.
A nationwide survey carried out for T-Mobile, has revealed that, on average, small firms are missing out on £4,910 of profit for each lost customer. Small businesses are therefore suffering significantly reduced profits due to losing customers.
The survey identified that a lack of responsiveness is viewed as the biggest cause of poor customer service. Key survey findings are;
Each lost customer costs small businesses £4,910
37% state that lack of responsiveness is to blame for poor customer service
90% of small businesses aim to reply to customer calls and emails within 24 hours
Small Business Owner Managers spend, on average, 37% of their time away from the office
Over a fifth of small businesses believe that mobile technology increases responsiveness by more than 50%
In the last 12 months, small companies have lost at least four customers each. Meanwhile, 37% believe that lack of responsiveness to queries contributes most to poor customer service.
In examining the approaches taken by small firms to customer communication, 88% reply to customer emails and 93% return customer calls within 24 hours. A third of businesses respond to customer complaints immediately.
While 56% of respondents stated that they believe small businesses are best at providing customer service, Derek Williamson, Head of Business Marketing at T-Mobile UK, warns that to remain competitive, speed of response should be re-considered.
“Evidence suggests that larger competitors are much quicker to respond to customers and this is a significant threat for small businesses. An immediate response to customers is the ideal but small companies should, at the very least, examine ways in which queries, either via email or phone, can be replied to within a maximum of one to three hours.”
He adds, “By their very nature, small businesses are highly adaptable and are ideally placed to capitalise on the customer service opportunity. But at the same time resources can be limited. Therefore, it’s important to consider how technology, especially internet enabled mobile devices, can be used to ensure that customer relationships are never jeopardised through a lack of responsiveness.”
On average, Small Business Owner Managers (SBOMs) spend 37% of their time away from the office and for those that have access to mobile technology, the ability to respond to customers (35%) and progress emails (24%) whilst on the move are the two key benefits. Over a fifth of small companies (24%) stated that mobile technology had increased responsiveness by more than 50%.
Although 62% of small firms invite customers to provide feedback on their services or products, just a fifth (20%) provide their staff with customer service training. Similarly, 55% do not conduct any research or analysis to monitor changes in customer needs.
“Superior customer service is not a mysterious art that only large firms with thousands of employees can ever hope to deliver. By focusing on a commitment to delivering great service by exceeding expectation, small businesses can, not only compete, but thrive,” concludes Williamson.
(http://www.bytestart.co.uk/content/news/1_12/cost-of-lost-customer.shtml)
December 2006. 'Invest In Staff Not Price Cuts' Firms Told.
Investing in the best staff is the most successful way to ensure the growth of a business, it has been claimed.
According to a survey by Grant Thornton, the fastest growing businesses ranked having the best people as the number one factor that made them better than competitors.
This contrasted with financial issues, such as pricing, which was ranked as only the eleventh most important factor for business success.
However, businesses showing growth of less than 5% per year, placed having the best staff much lower down the list of priorities - in fourth position.
Instead, more static businesses placed ‘high customer retention’ as the top factor that set them apart from their competitors, and pricing was ranked as fifth.
“The less well-performing businesses are always going to be forced to compete on price if they have little else to offer their customers,” said Alysoun Stewart of Grant Thornton.
“Recruiting the best people is possibly the greatest investment a business could make.
“Our advice is not to settle for 'Mr Average' when a little extra effort, be it financially or otherwise could secure a better person for the job,” Stewart added.
Flexibility to adapt to changing market conditions also ranked highly among fast growing businesses, as well as delivering a world-class service.
(http://www.startups.co.uk/Invest_in_staff_not_price_cuts_firms_told.YcVglX1oX8KDRw.html)