Tag Archives: running a business

Tips for reducing your small business’s expenditure

Being your own boss is never easy. I founded G75 Media just weeks after the run on Northern Rock, and a few months before the global financial crisis began to sweep across the planet. Since then, I’ve steered my tiny business through two ages of austerity, Brexit and its myriad consequences, the interminable Scottish independence referendum, a global pandemic which saw us locked in our homes for most of a year, and – most recently – a double-fisted assault on small businesses from the Chancellor of the Exchequer.

Hard times in an age of quarrel

In living memory, it has never been harder to run a small business, or less profitable to try:

  1. Companies are paying ever increasing amounts of corporation tax, employers national insurance and other mandated levies, in exchange for dwindling amounts of state support.
  2. Generative AI and search engine algorithm changes have disembowelled the advertising-funded business model of many websites, rendering much of the internet economically unviable.
  3. Swathes of the HR sector have collapsed under a tsunami of speculative and specious applications.
  4. Hiring new staff has become a scenario to avoid wherever possible due to soaring taxes, day-one employer commitments and questionable legal rulings. Describing a serial absentee as ‘disorganised’ led to a company last year being found guilty of disability harassment, disability discrimination and unfair constructive dismissal.

As a result, individuals and businesses alike are choosing to spend less money and not grow their businesses. The consequences for entrepreneurs – often at the sharp end of such economic shifts – have been little short of catastrophic.

Nonetheless, many of you reading this will be self-employed or small business owners. Listing the myriad challenges we all face is less productive than considering ways of mitigating and tackling it, which is why the rest of this blog focuses on ways of potentially reducing business expenditure. Some are industry-specific while others are universal, but they might all help to shave small amounts off your annual outgoings – which could make a material difference to your prospects of surviving another year…

Scrutinise your monthly outgoings

This sounds obvious, and yet a lot of entrepreneurs couldn’t tell you how many standing orders come out of their business bank account – if they even have a dedicated business account to differentiate work-related funds from personal ones. If you don’t receive paper copies of bank statements, print out your three most recent ones. Highlight outgoings which are essential to the existence of your business, like Companies House statements or accounting fees.

Slash non-essential purchases

Next, study the non-highlighted bank deductions and consider how many of them really needed to be made. It’s easy to spend money on unnecessary things – stationery which sits in a cupboard, subscriptions you don’t get much benefit from, support contracts you haven’t called upon in the last year. It’s often surprising when you study bank statements how many superfluous items have been paid for, especially if you have a company credit or debit card.

Minimise advertising costs

I spent many years paying money to Google every month for online ads. In the final three years, I didn’t obtain a single paid piece of work from Google Ads enquiries. What I did get was a steady trickle of spam calls and junk emails. Perhaps advertising is essential for your company’s survival, but perhaps it’s not achieving what you hoped it would – or enough to justify its impact on your bottom line. Review the new clients you onboarded last year; did any of them come directly from an advert?

Work from home full-time

It’s tempting to have a dedicated office for your business, which then incurs rent, rates, heating costs and factoring charges. It’s desirable to spend part of each week in a co-working suite, sharing space and ideas with other people. Yet clients won’t pay you more, travelling soon becomes costly, and you probably won’t get any more done. Even working from your local café incurs costs you wouldn’t have at home. You can hire spaces specifically for meetings, but WFH where possible.

Renegotiate contracts

We’re all familiar with the annual increase in car or home insurance premiums – the loyalty penalty existing customers pay to fund new client discounts. There are likely to be many aspects of your business’s service provision where you could obtain a cheaper deal by renegotiating. Industry-agnostic examples include website/email hosting and broadband contracts, business insurance policies, bank account fees, tech support services and media or magazine subscriptions.

Only sub-contract to experts

G75 Media has spent almost two decades supporting companies and charities who wouldn’t be able to generate premium copywriting and marketing copy in-house. We’ve also worked with firms who simply didn’t want to carry out certain tasks internally. When every pound matters, an easy way of reducing business expenditure is to work longer hours and complete more tasks yourself. Yet content production is often worth outsourcing to experts – contact us to find out why…

How many clients should I have?

For freelancers, there’s a perennial balancing act between finding enough work and becoming overwhelmed. If you haven’t got enough clients on your books, the days can become frustrating and drawn-out in equal measure.  Attract too much work, and the only way to meet the constant barrage of approaching deadlines is to start working in the evenings and weekends – or let your quality control drop in the interests of getting work out of the door. Since these options will respectively lead to burnout and lost clients, it’s far better to seek the Goldilocks solution – just the right amount of work to keep you busy without precluding holidays or a good night’s sleep.

The problem many freelancers face is knowing how many clients to have on their books at any given time. It’s a tightrope act every self-employed creative or company director will wrestle with on a regular basis. To help people who want to be a freelance writer set realistic targets, and to benefit people already struggling with this thorny problem, we’ve shared our thoughts based on our own experiences. These are the key factors to bear in mind…

Frequency of work

Firstly, review your existing client portfolio (assuming you have one). How many of your accounts are regular, as opposed to sporadic or seasonal? G75 Media produces weekly blogs for a leading Ofcom-approved price comparison site, and a biannual newsletter for a national chain of opticians. The latter is more time-consuming, but the former requires several hours dedicating to it every week. Get a year-to-view planner and map out the level of work you can expect in the rest of 2024, which will highlight gaps in your schedule and indicate how many clients to have.

Existing commitments

Next, think about your own lifestyle. Do you need to finish at 3pm every day to do the school run, or take a few weeks off every summer for childcare? Do you go abroad every December to escape Christmas, or struggle to work regular hours due to unpredictable caring responsibilities? Many companies don’t care when or where freelance writers produce content providing it’s supplied by a certain deadline, but some firms might expect you to be available at set times. And that’s before we get into the thorny issue of whether you’re allowed to work from a home office or expected to attend client premises…

Complexity of assignments

Every client has varying expectations. We have clients who are happy to receive Word documents, and others who want articles uploaded into a CMS like Wix or WordPress. Some clients want copyright-free images supplying, while others expect pull-quotes and meta descriptions. This affects the amount of time each piece of work requires – in turn affecting how much free time you have. Spend a week compiling a timesheet at 15-minute intervals to get an idea of how busy you really are. This will reveal the proportion of your week being wasted on procrastination/social media/coffee breaks/chatting.

The risk of losing clients

In G75 Media’s first full year of trading, we had two clients who provided 75 per cent of our annual turnover. Today, we have a dozen clients, none of whom individually contribute more than 15 per cent of our income. Consequently, the loss of any one client wouldn’t be catastrophic. It’s easy to put all your eggs on one basket, especially early in your freelancing career, but always think about how you’d fill the working week (and pay the bills) if you suddenly lost your biggest source of income.

Your personality

This is far too diverse a factor to sum up in one paragraph, but essentially, it relates to how you cope under pressure. If you’re a single workaholic, burning the midnight oil enables you to increase turnover, whereas a fifty-something parent may be less keen on weekend working. Everyone copes differently with pressure, impending deadlines and project management. Being organised also makes it easier to juggle multiple projects; Trello boards are a great way of highlighting key deadlines and ensuring you don’t forget anything.

Although G75 Media has a healthy roster of freelance copywriting clients, we’re always happy to discuss new assignments and projects, from one-off commissions to regular work. Contact us to discuss how our award-winning copywriting services could benefit your brand or business.

How to deal with unpaid invoices

If you’ve ever had to chase unpaid invoices, this blog is for you…

An image accompanying advice for small business owners about pursuing unpaid invoices
Advice for small business owners about pursuing unpaid invoices

Any small business owner will probably have a few stories about unpaid invoices. To a sole trader or entrepreneur, the lack of payment for work carried out in good faith represents a uniquely frustrating issue. It can also have a disproportionately large impact on profitability, affecting everything from overdraft charges to the person or company’s ability to pay salaries and dividends. This situation is compounded by the effort required to claw back owed monies, often from companies who are desperate to stall and procrastinate until the last possible moment.

This is the situation G75 Media recently found itself in. We’re no strangers to unpaid invoices – of the 96 invoices we filed one year, 21 were paid late (though all were eventually settled). Every late payment had to be laboriously chased up, while three overdue invoices from one particularly troublesome client led to debt recovery proceedings. We’d worked with this client on a weekly basis since May 2014, but our working relationship ended as a direct result of these payment issues.

What can you do to protect yourself against unpaid invoices?

Ultimately, even the most organised of sole traders and small businesses may find themselves out of pocket if a client isn’t able or willing to settle on time. However, these steps should help to minimise the risk of clients making a conscious decision not to pay what they owe:

  1. Make your payment terms clear at the start of any working relationship. Inform a new client in writing that your invoices will require settlement within a specific time period. Ideally, you should request client confirmation that they approve these terms – a one-sentence email from your main contact is perfectly sufficient.
  2. Submit invoices on a regular schedule. G75 Media invoices every client on the last working day of each month. Each invoice contains an itemised list of work carried out that month, leaving no ambiguity about what has (and hasn’t) been done.
  3. Include bank details on the invoice. Clients can’t stall by claiming ignorance about payment methods if each invoice lists your bank’s sort code and account number. Publish details of your payment terms and add a sentence like “unpaid invoices may be handed over to a debt collection agency” for clarity.
  4. Don’t accept cheques. Some firms in more traditional industries still prefer to pay by cheque, which provides an ideal excuse if payment isn’t received – “it must have got lost in the post”. Cheques can also bounce, unlike a BACS transfer.
  5. Keep a detailed spreadsheet with notes of every submitted invoice number, the date it was submitted, and who it was sent to. This allows you to see at a glance whether any invoices from previous months are still outstanding. G75 Media’s policy is to begin chasing up invoices on the last working day of the month after submission.
  6. Don’t pursue unpaid invoices by phone. Instead, forward your original invoice-bearing email to the client with a note asking them to ensure settlement within an acceptable time period. A single email thread is far tidier than multiple ones, especially if messages subsequently end up flying back and forth between different people/departments at the client’s side.
  7. Remain calm. If clients are happy to default on an invoice due date, they’re not going to be swayed by the knowledge you can’t pay yourself a dividend. Emotional appeals will cut no ice, and nor will (understandable) frustration. Remain calm, factual, polite and unapologetic in requesting what’s rightfully yours.
  8. Set a deadline. Instead of tossing and turning in bed at night, set a point at which you will delegate matters to a specialist (see point 9 below). G75 Media gives companies one month’s grace to resolve outstanding invoices, which are occasionally caused by an account manager forgetting to forward them on and thereby missing that month’s payment cycle.
  9. Instruct a debt recovery firm to issue a Letter Before Action. You might need to use specialist firms if the client is based in a different part of the UK, or overseas. The company G75 Media uses has had very positive results with LBAs, which are emailed and posted to the client. At this point, you may have to withdraw from any further correspondence.
  10. If the LBA doesn’t work, initiate full debt recovery proceedings. This will cost a significant percentage of your original invoice, and many debt collection firms won’t be interested in three-figure sums. Even so, it’s better to get 75 per cent of something than 100 per cent of nothing. This is the point where you step back entirely, and let events run their course.

Because we’ve always taken a proactive approach to unpaid invoices, G75 Media has endured very few bad debts in our 16-year history. One or two firms went bust before they paid us (including the failed publishing house Prior & Partners and the endlessly rebranding commercial property developer then known as Fresh Start Living), while a couple of entrepreneurs saw an opportunity to simply vanish and block all attempts at contact. However, it’s been years since we last submitted an invoice which was subsequently written off as a bad debt.

Today, G75 Media is discerning about the companies we work for, conducting Companies House checks and researching each prospective client. We submit a legally binding, solicitor-approved contract for services to new clients before work commences, insisting they agree to various terms (including payment schedules) before work commences. And we don’t continue working with companies who have more than one outstanding invoice – our resources are too precious to waste on non-payers!

We would urge anyone with a small business to follow the advice outlined above. Due diligence and a detailed paper trail won’t always protect you from defaults, but it should minimise the number of unpaid invoices appearing on your year-end balance sheet…

Ten things I wish I’d known

I left Scotland on Monday. Not in a going-on-holiday sense, but in a moving-away-forever sense. After 34 years living in the central belt, I am now a resident of England for the first time in my adult life. G75 Media remains a Scottish company (headquartered in a gorgeous Georgian office in Glasgow), but I’m no longer there with it.

My extended family’s departure from Scotland has been caused by a combination of political, professional and personal factors. And while we’re all in a better place now, I really wish I’d known this would happen. I would have been a less anxious person over recent years if I’d spent more time savouring the present, and less time worrying about the future. Does that sound familiar?

Don’t look back in anger

Looking back, I wish I’d known a lot of things when I was younger – especially things about running a business, which was never something I intended to do until freelance work kept landing in my lap. For anyone thinking about making the frightening yet exhilarating step of becoming an entrepreneur (or for anyone who already has), here are ten pieces of advice the me of 2021 would pass onto the me of 2005 if he could. Feel free to add your own suggestions below…

  1. Setting up a limited company beats being a sole trader. It took me two years to register G75 Media in 2007, and I wish I’d done it sooner. A limited company is more professional, provides greater legal indemnity against prosecution, and simplifies mortgage applications.
  2. Choose your accountant with care. I picked a local guy who promptly retired and left the business to that’ll-do junior staff. I then switched to a remote accountancy service, who invented a director’s loan account to save me some tax one year. It took five years to repay.
  3. Pick a dependable web hosting firm. If you want to switch web hosting company, your email account could be offline for days as the server repropagates. No small business can survive that, so choose an established UK-based firm with a 99.9 per cent SLA and rapid servers.
  4. Build networks. I have diligently applied for thousands of jobs over the last 15 years. Yet most new work today comes from people I’ve worked with in the past, LinkedIn connections or word-of-mouth recommendations. It’s not what you know…
  5. …Except it is. I’ve met so many people trying to bluff their way through roles they didn’t really understand. They always got found out in the end. Your business should also be your hobby or specialist subject. If it’s not, learn it inside out before sending out any invoices.
  6. Say no occasionally. Constantly saying yes saw me working myself into the ground trying to meet deadlines, or doing work I didn’t enjoy. As a lifelong vegetarian, I still wish I’d turned down that 2011 assignment to write about an animal by-products processing factory…
  7. Hold back before being negative. I was impetuous in my twenties, but I learned to wait overnight before reacting. Reviewing something with fresh eyes gives you a chance to make a message more powerful and effective. Plus, you might change your mind the next day.
  8. Never descend into bickering on social media. Some people thrive on arguments, while the professionally outraged revel in self-righteous indignation. Plus, you never know who might read your responses later on, when topicality has passed and the context seems different.
  9. Keep detailed records. I worked from a drawerless desk for three years, losing paperwork I needed and tax receipts I should have kept for six years. Box files were my saviour, and they’ll be yours as well. File everything unless and until you’re sure it’s not relevant.
  10. Don’t spend too much time worrying about the future. This one comes from the heart. I had a really poor 2013, but 2014 was lucrative. My income halved during the first lockdown, yet I ended 2020 with record turnover. Focus on the here and now, not what might be one day.

Finally, and I felt this was too important to include in a bullet-point list, give yourself some credit. I was quite harsh on myself in the early years of G75 Media, constantly feeling I could be more professional or working harder. I gradually abandoned the elusive pursuit of perfection, focusing instead on keeping detailed records and ensuring I didn’t send out anything bearing my name until I’d proofread it twice. Providing you act professionally at all times, maintaining a calendar or Trello board of deadlines and appointments, clients can’t ask more of you. And they won’t. They’re also struggling to remain professional in an age of home working and incessant multitasking. Being good at your job makes their lives easier, and they’ll be grateful for your competence and diligence.