Business - Report and accounts

June 2020 Companies in the news

June 29, 2020July 26, 2020

Not surprisingly the stock market has been very volatile this month, rising and falling as the mood about Covid swings from positive to negative. Companies have of course their own unique circumstances.

Lookers Group PLC – reported a large fraud had been discovered, and that did not get well received by investors who had been pushing the share price up as the opening of car show rooms was announced by the Government.

Marsdens the brewery continued to rise due to its announced merger of the brewery side of its business with Carlsberg.

REASONS TO RESEARCH YOUR COMPETITORS AND SUPPLIERS

May 12, 2020September 25, 2020

INTRODUCTION:

Continuous research and assessment are an important factor in the longevity of your business. Market research is one of the most crucial building blocks of any new as well as grown-up businesses. It includes the assessment of the strengths and weaknesses of the competition. Market research allows you to make changes and swiftly promote your business without compromising your actual position in the market. It is a vital step before moving into a new business or planning to uplift an existing one, as it saves your money from failed projects.

As nowadays, the outbreak of the COVID-19 pandemic has occurred globally, many of the companies are facing serious financial difficulties. The main reasons include precautionary shutting down of the markets on an almost global level, as well as the online sale and purchase of goods and services. So, in this condition of financial issues, it is quite good to research your competitors and suppliers so that you may outstand the competition or at least improve your business a bit more than others.

However, governments all over the world have taken initiatives to settle down the competition so that the availability of goods and services, especially food, does not become a global challenge. This study covers some benefits and important reasons to research your competitors and suppliers continuously.

WHO ARE YOUR COMPETITORS?

All businesses have to face competition. Every one where your customer can spend his money instead of you is your competitor. Competition is not just another business offering a substitute, and it may be a similar product that takes your money away from you, making it redundant. Today, with the increased use of internet marketing, you do not only have to compete with your immediate neighbor but also with businesses from other countries.

Types of Competitors

There are three main types of Competitors:

Direct
Indirect,
Alternative competitors.

Direct Competitors:

A direct competitor is another firm that offers the same solutions to meet the needs of your customers as your business does. Direct competitors meet the most visible competitive pressures that most companies endure, even though they are only one.

Indirectly Competitors:

Indirect competition is a battle between dealers whose products or services are not the same but who can still meet the needs of consumers. This term is in stark contrast to direct competition, in which companies are selling products or services that are mostly the same.

Alternative competitors:

An alternative competitor is another company offering a product or service that users can use instead of adding your product or service.

WHO ARE YOUR SUPPLIERS?

A supplier is a business or a person who provides products or services to another person or business. It is like an intermediary between the manufacturer and retailer. The supplier purchases high-quality products at a good price from the manufacture and provides a retailer for resale.

A supplier makes sure that the stock is of sufficient quality, and the communication is forth-coming.

As the markets get saturated with different competitors, companies need to work closely with their suppliers to get the best out of their products.

HOW CAN YOU ASSESS YOUR COMPETITORS?

Market research involves collecting and analyzing information about your competitors and suppliers. There are many ways to assess your competitors. For example, you can get to know your existing competitors through advertising, exhibitions, trade fairs, and many more. To assess your competitors, read about them. Look for ads or articles in the mainstream publications or trade press. Get to know their marketing strategies and their contacts. Ask for a trial in the case of online business competitors.

Researching your competitor is far easier than it may seem. While researching your competitors, keep in mind to collect information about their prices, quality, customer service, and if their marketing material is as engaging as yours. Keep a record and evaluate the information you collected about your competitor and find out the gaps in the market that you can exploit. This also indicates the situation of supplier saturation in your area of the market.

Check for what you can learn from and perform better, what they are doing the same as you, and what they are doing worse than you.

WHY SHOULD YOU RESEARCH ABOUT YOUR COMPETITORS AND SUPPLIERS?

Nowadays, due to COVID-19, many companies are facing financial difficulties, mainly because most of the customers have switched to online shopping where they can browse and give a try to different companies providing the same products or services. In this situation, running your business smoothly and coping up with the competitors is quite difficult. Even you may lose your customers, and your competitors may lead the market.

However, you can achieve success by optimizing your marketing and sales according to your competitor research. Knowing about your competitors and their offers can make your marketing, products, and services stand out. You can use this knowledge to create marketing strategies such as setting up a competitive price and improving your business performance by taking advantage of the weaknesses of your competitor.

If you found something that your competitors are doing better than you, you must update your product, service, or marketing as well as customer service or anything that makes you better than your competitor. You can also opt for changing your suppliers to go for the better ones.

Once you have got the idea, no doubt you can do even better. Once you research your competitors, you get to know their potential to bring about a positive change in the market. Maybe, you have been planning to do so or having a product licensed for a long time before someone else could.

COVID-19 AND ECONOMIC COMPETITION:

During normal days, the competition is needed to keep the prices at their low. Still, in the present condition, when the COVID-19 crisis has affected the markets all over the world, the collaboration has been preceded. The governments have been balancing the defending competitions with some exemptions to competition rules so that the entire economic sectors can survive.

THE ULTIMATE BENEFITS OF COMPETITOR RESEARCH:

Due to the COVID-19 pandemic, when almost all the businesses are facing difficulties regarding sales and finance, researching and understanding your competitors and suppliers is a very useful tool to enhance your business. While everyone else is striving to drive their business on the best pace, market research, or you can say competitor and supplier research prepares you for the global market changes. This is how you cope up with the global market change, and your business will not be left behind.

While you collect and analyze your competitors’ information, you get to know your potential customers and as well as different ways to please them. Through this knowledge, you can effectively plan and develop a strategy to promote your product, service, or marketing. You can alter the suppliers or a specific component of your business, including suppliers, accordingly.

Doing proper homework for researching the competitors ultimately saves your capital from being wasted in failed projects. Market research where saves your money, it also helps you to bring out the most unique and the most innovative project out of the numerous similar ones.

Especially during the present days of COVID-19 pandemic, when everyone is locked in their homes, you cannot get to know the direct customer reviews. In this situation, researching your competitor helps you optimize your products, services, or marketing while being within budget.

CONCLUSION:

The outbreak of the COVID-19 pandemic has up-ended the markets all over the world. This has led to massive shifts in demand and supply, asymmetry in information and other disconnects in markets, as well as significant uncertainty of the market. All this has changed the dynamics of affected markets and will continue to change in the near future.

These changes are more likely to trigger the market competitors to raise concerns, including fixed prices for the supply of a product, restricted supply, or allocated markets for specific products. Moreover, the deceptive marketing practices, including misleading advertising saying the treatments are effective for the coronavirus, and anti-competitive conduct by the dominant firms will be a threat to other competitors.

To evaluate the competitors and suppliers, you must first know who the competitors are and how do they compete with you. Once understood about the competitors, collect all the information on their product and marketing, including their lowest price, marketing strategies, and quality. This will help you identify your strengths and weaknesses so that you may improve in certain fields, including changing your supplier.

By proper competitor research, you may also get to know if they have launched or planning to launch a new product in the market. The competitor research does not mean to imitate the values of a competitor, but it means to create a room for continuous improvement. During the COVID-19 pandemic, almost all markets are facing difficulties regarding their finance sector. This is because the coronavirus has heavily affected sales and marketing, leading to uncertain changes in the global market. During this period, where many companies have lost their financial stability, and many others will be going to lose theirs, proper competitor research may be beneficial to run your business swiftly.

Bio – Adrian is the CEO of our sister site Reporting Accounts, he is very active around the web and can be found in places such as VK / VKontact he is well known in the UK worlds of Accountancy and Ecommerce.

Covid-19 and the UK economy

April 25, 2020July 26, 2020

Whilst the world has seen many pandemics, the UK like so many other countries around the World has watch from a distance without adequately preparing for the impact that such an outbreak would have here.

Sadly of course the UK has been hit hard, and wasn’t very well prepared, we were slow to test and even today flights are arriving at Heathrow from Italy and the USA and there are no scanners or even basic questions about if travellers are infected or not. So it seems the UK has a lot of lessons that it is finding hard to take on board.

The NHS has done a great job or rather its front line staff have, but again this pandemic shows high lumbering and inefficient the UK health service is. The economy has had to be shut down because of worries that the NHS is unable to cope should infection rates get out of hand.

Hopefully lessons will be learned, but these will be very painful, at the cost of 10,000’s of good companies that would otherwise have grown and developed, but now will be out of business.

The travel and hospitality sectors have been increbible hard hit, and really good people are suffering all as a result, though of course travel requires international locations to also be clear.

Hopefully some positives will come out of this, more people will work from home and cut down the use of public transport, with all its now all too obvious health risks.

Budget 2020

February 9, 2020July 26, 2020

This years budget will be a really interesting one, now the Conservatives have their well deserved majority they can afford to be radical, also the first budget of a new administration is often seen as the time to push through unpopular tax rises, whilst towards election time things need to be less radical and more popularist.

I support Boris and I know his instincts are for big capital spend items, such as the bridget between Scotland and Ireland, I also know he will want to be seen to deliver for the new MP’s he has in the Midlands and North of England.

So what do I expect?

Well big increases in spending on projects for one.

HS2 will most likely go ahead.

Environmental spending, here I am expecting a VAT increase on Fossil fuel, Gas for example is currently 5% that could rise to 20% making it much more attractive to use companies offering renewable sourced electricity instead and taxing that at 5% instead that would put further pressure on the move to renewables.

Levelling up the country has been mentioned a lot, so I think that means soaking Labour London with tax increases to pay for spending in the midlands.

Pension are under threat again, I really hope that is left alone, as we need to be driving up the % of incomes that are invested into the country and for people’s retirement.

If the higher rates of income tax are reduced or the starting point for the 40% then that is different, I really hope that is planned.

Rumours are often circulated intentionally only not to be included in a budget, which then gives a sense of relief which covers over the real intention which is to raise taxes!

Brexit Day is finally here

February 2, 2020July 26, 2020

Well I can’t believe it but Brexit has finally arrived, any how easy it was once the Brexit blockers were removed from Parliament, I don’t think those selfish MP’s spared any thought for the economic damage their dithering caused last year. The whole point of Parliament is for it to represent the will of the people, not to twist and resist it at every opportunity.

Anyway I take my hat off to Nigel Farage who has driven this whole agenda for the last 20 years, and what a stunning victory for Boris Johnson, without him we really would have been lost, but his popular charm brought victory and with that a majority enough to drive all of this through.

I expect trade negogiations to be straightforward, the EU can’t and won’t offer everything we want but its in their interest to agree to a free trade deal, as we are one of their largest export market.

Boris is also 100% on the money with his plans for Infrastructure spending, the Midlands and North of England really need it after decades of Labour under investment, so HS2 and possibly a bridge between Scotland and Ireland will be a fantastic boost to the economy.

I really hope for a budget with a long term plan to reduce income tax, particularly the abolition of the 45% rate and reducing both the starting point and rate of the current higher rate 40% – we need the £80K starting point Boris mentioned in the pre-election period and a lower actual rate, maybe 30% or 25%, though I accept this can’t happen in a very short time scale but if we move in that direction, the economy and country will really be transformed, to become the economic powerhouse we always used to be.

Budget 2020 – a golden opportunity

January 25, 2020October 15, 2020

At the time of writing this blog post which is towards the end of January the UK is just shrugging off the impact of the brexit logjam we all experienced last year. Our previous parliament tried and tried to block brexit going through but in doing so the confidence of the country took a real hit. It was so irresponsible of our politicians at that time not to consider the impact of their actions on the whole country.

Business stopped invested, people stopped spending. But the clear election result has changed that and now in this new decade there is a realisation up and down the country that we are in a new place, there is renewed optimisim, a sense of determination to get through things and make a success of things in 2020.

We already have the great announcement of the rise in the living wage to £8.72 and the intention to rebalance Government spending to better benefit the midlands and the North.

Pensions

What I would really like but don’t expect is an announcement of higher auto enrolment contributions for both employers and employees, I expect there will be a body such as the low pay commission setup to report back each year and make recommendations, that is a good idea but is going to take time. To tackle long term pensions and poverty in old age we need contributions going in to pensions for everyone sufficient to give a replacement income of around 60%.

At the moment, there is a lower earnings and an upper one, the lower is being abolished from the mid 2020’s but no date yet, we need the same for the upper one. Self employed are not within the scope of auto-enrolment but need to be. The correct level of contributions is something in the order of 12-16% of total earnings, whilst actual contributions are 8% of a band of earnings. So a long way to go. Increasing both employers and employee rates to 6% phased over 3 years would be a huge step forward, announcing that now would allow businesses and individuals to plan ahead.

By doing this we can abolish in work and in retirement poverty, of course pensions are long term investments but every day now as people retire they have a small but growing auto enrolment pension which they didn’t before. Due to the increases in contributions last year that is now growing faster, as every month passes that expected pension grows a little higher.

Income tax

The next big issue that is holding back our entire country is the excessive level of income taxes, Boris made a bold pledge to raise the threshold for the higher rate to £80K from £50K that is exactly what is needed, to remove a large swathe of middle class income from the higher 40% rate.

For me this budget is a golden opportunity to change direction on tax, the chancellor should declare that our direction of travel is now towards lower rates and higher thresholds. If I was Chancellor I would be announcing:-

Abolish the 45%
Increase the starting threshold for 40% in stages from £50K to £80K
Reduce the % for the higher rate starting now reducing to 38% with a target of 30%
Aim to reduce the basic rate to 15%

That really would set the hares racing and restore competitiveness to our country.

I sense Javid and Boris are both bold men with the right ideas so I am very hopeful that announcement along these lines will be forthcoming, it really will be interesting to see if they grasp the golden opportunity which their majority offers them and the potential to get that through whilst labour is in such disarray.

Bio – Adrian is the CEO of our sister site Reporting Accounts a local politician and chartered accountant. He contributes to many website about Business Intelligence.