Winter/Spring 2012
here’s how
we can help your business…
Prepare for the future
Predict
Tomorrow’s trends revealed today
Promote
Raise your profile for free
Forecast
Tips to aid cashflow
Welcome Energy market view
Energy Market View
A new year can be the ideal
time to take a fresh look at
your business. So for this first
quarter of 2012, we’re focusing What’s inside Energy market view
on topics to help you better Energy market view 3
Hot topic: Looking ahead 4 If you spent the last quarter wondering when winter was going to arrive, you
prepare for the year ahead. How to: Generate free publicity 7 were not alone. The year 2011 has been the tenth warmest since records began.
Energy savers 10 That means gas usage has been lower than expected so there is now plenty to go
Business movers 11 around, and we don’t expect to see the gas price spikes of last winter.
Spotlight: Cash is king 12
Ways to reduce your bills 14 That may mean energy efficiency becomes less of
a priority. But lower business gas prices this year Janet Wood is editor
Predict Benefits of Direct Debit 16 of Utility Week.
don’t mean they won’t rise again in future, so if you
What will tomorrow bring – and how can you be one want to avoid wasting money in the long term you
step ahead? Dr Frank Shaw of the Centre for Future should be talking to your supplier about practical
Studies foretells the latest business trends on page 4. ways to save energy.
Promote The energy league Objections under scrutiny
Tips on how to generate valuable publicity for your Bigger energy customers got to measure their What will change? Ofgem wants to reduce the
business, without having to spend much. Find out energy usage against other organisations recently, objections some energy suppliers make when
more on page 7. when the Environment Agency published its first companies want to change supplier. It plans to
‘league table’ of companies having to participate in monitor those objections very closely and it has
the government’s CRC Energy Efficiency Scheme. promised to investigate if necessary.
Forecast The same companies will be ranked again next year
When it comes to maintaining healthy cashflow, and there could be a big publicity bonus for those Second, Ofgem wants to make sure that energy
accurately forecasting future spending and income that have moved up the energy efficiency scale. brokers’ practices are up to scratch. At the moment
is just one valuable tool. For others, see page 12. But even smaller companies who fall outside the it does not have any direct powers over these
Energy savers case study
scheme can benefit from energy efficiency in the companies, but that could change. The regulator
We hope you enjoy this issue. Find out how a simple energy audit form of smaller bills. wants to be authorised to investigate and fine
helped a Nottingham bar reduce their
brokers that fail their customers. What is more, it
Pam Andrew energy bills significantly. Meanwhile, energy regulator Ofgem’s review of wants to make sure that all energy brokers have a
Customer Service Manager Read more on page 10 the energy market has reached the business sector. Code of Practice in place, and one that the regulator
Late last year, it published a suite of proposals that has accredited.
it said should improve the service businesses get
from energy suppliers and from the raft of energy
Telephone calls: We may monitor and/or record calls for security, quality or training purposes. Calls from BT landlines to numbers beginning with 0800 or 0845
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brokers that act as middle men.
Editorial content provided by Susannah Lawson & Associates (www.slcommunications.co.uk).
Npower Direct Limited (registered in England and Wales No.3782443) and associated companies. Registered Office: Windmill Hill Business Park, Whitehill Way,
Swindon SN5 6PB.
2 3
Hot topic Hot topic
Looking ahead
A view to the future:
understanding what trends
What will the world be like for small
are likely to emerge can help
and medium-sized businesses in you adapt your business to
2020 and beyond – and what key meet market needs.
opportunities will there be?
Business strategist, process consultant and
futurist Dr Frank Shaw has a fantastic job title.
He is Foresight Director at the Centre for Future
Studies, a Kent University Innovation Centre-based
consultancy he founded in 1996. Dr Shaw has been
an advisor on the future for more than 30 years.
“Our foresight work involves research and analysis
across political, economic, social and technological Dr Frank Shaw,
themes,” he explains. “We help our clients – Foresight Director at the Centre for Future Studies
national and international companies, not-for-
profit organisations, government departments and
agencies – to anticipate the future and manage is that quality of life will improve and standards of
change in their external environment.” Over the they pubs, restaurants or shops. Enabled by digital
past 14 years, the Centre has gained international
living will be much higher. There will be a need for Did you know?
technologies, products and services will be subsumed ‘re-skilling’, but many people will earn a living as
recognition for its contribution to future thinking. A
• ccording to the Office for National Statistics,
into a wider experience.” freelancers working for several businesses, rather the UK’s population will reach 67.2m by 2020
than being an employee at one.” and 73.2m by 2035 (in 2010 it was 62.3m).
Will the high street survive? Micro-business growth
The closing of large numbers of small retail Long-established businesses will become less Growth sectors T
• he average age of people in the UK will rise
businesses in the UK and the ongoing phenomenal common. Shaw anticipates a significant surge in Over the next ten years, Shaw says the main growth to 39.9 years by 2020 and 42.2 years by 2035
rise of online selling has led some to believe that micro-businesses, many of which will be part-time sectors will be healthcare (especially elderly care, (in 2010 it was 39.7 years).
the high street will largely be dead in the next 10 enterprises “formed to satisfy a demand for a short home healthcare services and nursing care facilities),
or 20 years, but Shaw disagrees. “The high street period before the owner closes it down to start technology, nano-technology, energy, food, water, T
• he number of people in the UK aged 85-plus is
won’t die, but patterns of shopping behaviour another venture”. The current trend for people the creative industries, management, scientific and expected to reach 1.9m by 2020 and 3.5 million
will change and the retail environment will be running more than one small business at a time technical consulting services, computer systems by 2035 (in 2010 it was 1.4m).
transformed to become even more leisure and will grow. design (and related services), employment services,
entertainment-focused.” T
• he number of people aged 90-plus is expected
education and full-service restaurants. to triple by 2035, and the number aged 95-plus
Money will be entirely electronic in the near future,
People will still want to visit shops in town centres, he says. And the ‘working week’ will cease to exist, “The fastest-growing firms will outsource more, will quadruple.
says Shaw, but their expectations will change. “It as the boundary between work and leisure will no focus on IT integration and be willing to invest in
will be about exploration, adventure and social T
• he number of UK centenarians will reach
longer apply. Although earnings have slowed down production and distribution,” says Shaw. “Over the
gathering. The outlets that succeed will be those 110,000 come 2035 – an increase of more
dramatically in recent years, Shaw says they will period to 2020, successful small businesses will
that offer a unique consumer experience – be than eight-fold on 2010’s total of 13,000.
increase, as in the past. “Perhaps of more relevance incorporate technology into every process.
continues overleaf...
4 5
Hot topic How to
Generate free publicity
Despite shrinking marketing and advertising budgets, there is still an
overwhelming need to let potential customers know about your business.
Techno boom: Penny Wells asks whether DIY PR is the perfect no-cost solution.
devices that utilise
technology for every
process are set to
“Some PR ideas are so effective they generate Something newsworthy
publicity time after time – and often they’re quite
become the norm. “You’ve got to give journalists something
simple,” observes former journalist Paul Green,
newsworthy. All day long they receive uninspiring
who now runs his own PR agency, Northants-
press releases, so your story must stand out.
based Publicity Heaven (publicityheaven.com).
Journalists also like to write about the first, newest,
oldest, biggest, etc. And they like to write about
The technology revolution will leave no person Mega trends 2020 Green says the obvious advantage that gaining
pioneers – which is why entrepreneurs such as
or organisation untouched. The digitisation and press coverage has over advertising is that it costs
5
• 0 billion devices will be connected Richard Branson have become globally famous.”
mobilisation of every process will affect us all.” nothing. “You can employ a PR agency, of course,
worldwide, continually ‘talking’ to each
as writing a professional-looking press release
other via mobile broadband.
Specialise to prosper requires skill, and getting it to the right journalist “Your press releases must also
The SMEs that prosper will be niche businesses • onsumers will demand an ‘eco-conscience’ from
C can take perseverance,” he explains. But, says
Green, to increase your chances of success if
be targeted to the most
operating in ever-finer market segments. their brands.
“Affordable e-commerce solutions, together you choose to do it yourself, there are a few appropriate media, and if
with cheap outsourced manufacturing or product ‘
• Social shopping’ (a method of e-commerce where golden rules. possible, to a specific individual
sourcing, will enable SMEs to connect with market the shoppers’ friends become involved
segments identified through social media,” in the shopping experience) will be common. rather than a general news desk.”
says Shaw.
T
• oday’s ‘digital natives’ (someone born during If you are announcing a new team member or
Size will become less of an issue in business, Shaw or after the introduction of digital technology) customer, Green advises sticking to the trade press.
predicts, as long as you harness technology’s will be in their 30s and make important corporate “It must be very newsworthy for a regional paper
potential. “Classifying the nature of an organisation buying decisions. to write about that stuff, but if you win a national
by the number of employees or turnover will award, local papers will be interested – that’s why it
‘
• Augmented reality’ will help people find pays to enter awards. Your press releases must also
become meaningless. More important will be the
information about a place simply by pointing their be targeted to the most appropriate media, and if
number of IT staff they have, the type of roles they
camera phone. possible, to a specific individual rather than a general
perform and what level of IT expertise they possess
to support the organisation,” he concludes. news desk.”
L
• aptops will feature holographic keyboards
projected onto any type of surface.
Some business-owners now put themselves up as
• -health kits will help doctors to monitor patients
E business commentators, notes Green. “Journalists
in real time – sometimes thousands and readers like expert opinion. And if your writing
To find out more about the Centre of miles away. skills are good enough, you could contribute free
Paul Green, articles to publications or write blogs for websites.
for Future Studies visit PR Agency Publicity Heaven
Taken from Accessing the future, a report produced by Your business will usually get a mention.”
futurestudies.co.uk the Centre for Future Studies and Access UK.
continues overleaf...
6 7
How to How to
Speak out:
making an announcement about a
business win (top right) or a new
team member (right) can generate
free publicity for your business, as can
offering expert opinion to relevant media.
Common mistakes Developing a public persona Net gains “Ten minutes on prime-time
Green says common DIY PR mistakes include
business-owners trying to push dull, irrelevant
Ling Valentine has a great track record for
generating publicity. Partly as a result, her
LINGsCARS has also gained publicity for its
unconventional website (lingscars.com), which
TV on a hugely popular
or non-stories. “Journalists don’t really care about Gateshead-based online contract vehicle hire divides opinion massively. Some describe it as one show, plus all the associated
your business, they’re focused on their readers. business, LINGsCARS.com, has become of the ugliest websites ever, yet it has won awards
They often have to spend time wading through hugely successful. and attracts 100,000-plus unique visitors every
publicity, would have cost
‘guff’, so when something special comes along month. Love it or hate it – you can’t ignore it. me hundreds of thousands
– they jump on it.” “Gaining media coverage saves a lot of money
on advertising and marketing,” says Valentine. “Visitors want to find out about my vehicles and of pounds.”
Perseverance is also key. “Often business-owners “That means I can keep my prices attractive, prices, but they also want to be entertained. They
Ling Valentine talking about the benefits
give up after one failed press release, but not every I don’t have to pass costs onto customers. visit lots of other websites, so I need to grab their of appearing on the BBC’s Dragon’s Den.
one you send out will lead to coverage – no matter I stopped paying for advertising years ago attention,” explains Valentine. “Most other car
how good your story,” explains Green. “Your – it was a waste of money.” sites think their visitors are ready to buy there
expectations should be realistic. PR shouldn’t be and then, but that’s not so. I play with visitors
seen solely as a lead-generation tool either, it’s Valentine appeared on Dragons’ Den in 2007 and for months and years, before they have a car
more about raising awareness and supporting the famously turned down investment from Duncan from me.”
rest of your marketing activity.” Bannatyne and Richard Farleigh. “I’d won an
entrepreneur of the year award and I was asked by To generate yet more publicity, Valentine bought
Publicity stunts are a tried and tested method the BBC to go on Dragons’ Den,” she explains. But a truck, complete with giant rocket, which she
of gaining press coverage, but Green sounds a while the deal on offer was not attractive enough used to advertise her business to motorists on the
cautionary note: “Your stunt must be fresh, fun, to make her concede a share of her business, it did A1. “I get massive visitor spikes after my publicity
exciting and highly visual. Make sure it’s legal, still have a positive effect. That appearance really stunts,” she says. “I do it because it’s cheaper than
too – otherwise you could well get the wrong helped her business. advertising and – crucially – it works.”
type of publicity!” Ling Valentine,
owner of LINGsCARs
8 9
Energy savers Business movers
Moving premises?
When you’re moving premises, there’s a lot to think about. That’s why we have a
dedicated Business Movers Team to take the hassle out of finalising your energy bills.
npower’s energy efficiency expert provides
tailored advice to the Southbank Bar. Here’s what to do if you’re leaving a premises Step 3: After your moving day
supplied by npower, whether you’re the tenant
Job done! We’ll handle the rest. Once we’ve received
or the owner.
and agreed your reading(s), we’ll send you a final bill
Improving efficiency Step 1: Before your moving day so that you can clear the account(s) for this property.
Gather together the following information and call Please remember
us at least 30 days before your move:
If you don’t let us know you’re moving out, you’ll
How a Nottingham sports bar has reduced its fuel bills and carbon footprint • our npower customer reference number
Y continue to be liable for all charges until the new
- thanks to an energy audit from npower (this is on your last bill). tenant confirms their moving in date.
• Date of occupancy change.
Business may be thriving for the Nottingham- halogen lamps with 5 Watt LED, and by sealing a
• forwarding address where we can send your
A Of course, we’d be delighted if you’d take us
based Southbank Bar, but Assistant Manager gap in the beer cellar wall where the drinks pipes
final bill (or your refund if you’re in credit). with you to your new premises! When you call
Andrew Nicholls still believes reducing the pass through.
us we can also set up a new supply account at
business’s carbon footprint is important. C
• ontact details of your landlord or letting agent your new premises quickly and easily.
“As far as energy efficiency goes, we are always Nicholls and his team have already changed the
(if applicable).
looking to improve,” he says. “I think more and lighting, with no noticeable impact to the ambiance
more people are now realising we all have to do of the bar. “All our spotlights have now been • The new occupier’s details (if known).
our bit – and it all makes a difference.” reduced to a lower wattage, and we adjust them
via a dimmer to suit the conditions in the bar at the Step 2: On your moving day
The venue is the number one sports bar in time - but no-one’s noticed any difference in terms
Read your meter(s) and call the Business
Nottingham – located a stone’s throw away of brightness,” he says.
Movers Team with your meter readings
from both Nottingham Forest and Notts County
Other measures are still in the process of being and account numbers to hand.
football clubs – and also hosts regular live
music events. But despite being popular with actioned, but Nicholls is impressed with how easy
the punters, how did it fare in npower’s energy it is to make a difference. “Anything that can save
assessment? The audit identified that the bar can the business money is always welcome,” he says. To talk to the Business Movers Team
implement some very simple measures to make “And when you know you are also doing your bit Call
for the environment, that makes it even better.”
significant savings both in terms of cost and
business energy. 0845 166 3360
Call our energy efficiency helpline to find out
npower’s energy specialists calculated that the which audit option is best for your business and Or visit
business could make annual savings of £757,
nearly 10% of its annual energy costs, through
how much it would cost npower.com/businessmovers
simple changes, such as replacing 15 x 35 Watt 0845 070 4019 to find out more
Lines are open Monday to Friday 9am to 5pm
10 11
Stoplight Spotlight
Cash is king
It’s perhaps one of the cruellest entrepreneurial ironies that even seemingly
profitable businesses can fail if they run out of cash. Mark Williams looks at
what can be done to make sure your cashflow remains healthy.
The well-worn business cliché has never been Optimising prices
more true or relevant: turnover is vanity; profit
Clark advises keeping your prices at optimum level,
is sanity; cash is reality. Sales and margins only
which means generating sufficient profit, while
matter up to a point. Not having enough
remaining competitive and attractive to customers.
cash to pay your bills on demand can have
“You need to maximise sales, too, of course, and the
disastrous consequences.
easiest – and cheapest – way to do this is, if possible, If you grant credit, issue your invoices promptly
to sell more to existing customers. and chase them as soon as payment is overdue. Cashflow solution?
“Maintaining healthy cashflow is a key
New customers should be checked thoroughly
challenge that all businesses face,” says Asset-based lending (eg invoice discounting and
“If your sales slow down, employ different tactics, before credit is granted. Clark advises credit-
chartered accountant Elaine Clark, Managing factoring) could provide a cashflow solution. The
such as offering special prices, early payment checking existing customers at least every
Director of online accountancy practice Centre for Economics and Business Research
discounts, cheaper prices for cash up-front. year (better still, every six months). To lessen
CheapAccounting.co.uk. “Some make the classic estimates it could benefit as many as 650,000
Obviously, work out whether your business can your exposure on large sales, you could ask for
mistake of spending large sums of money they SMEs and lead to an increase of between £531m
afford this – never go below a base line gross deposits on order or cash on delivery.
don’t have – usually on stock. They make some and £1.4bn to the UK’s GDP by the end of 2012.
margin. But if you aren’t making enough sales,
sales, but not enough to pay their suppliers or they
you’ll experience a serious cashflow crisis –
don’t get the money in soon enough. Running out The benefit of forecasting Invoice discounting is a facility usually provided by
probably sooner rather than later.”
of cash is fatal. Often there’s no coming back.” Predictably, Clark is a big fan of cashflow specialist divisions of banks that allows businesses
projections. “You must include all outgoings to draw against their unpaid invoices, while
Don’t bank on help otherwise they can be dangerously inaccurate, retaining control over their sales ledger. Factoring
but cashflow projections can help you spot means selling your unpaid invoices to a ‘debt
As Clark points out, post-credit crunch, businesses
potential crises before they happen, which factor’ that collects your debts and takes over
can no longer expect their bank to always help
can enable you to take preventative action. your ledger management.
them out of a short-term cashflow crisis. “New
Those who can maintain and interpret financial
businesses will find it almost impossible to get
forecasts have a much better chance of Typically, you receive most (up to 80 per cent) of
bank credit. Many owners put themselves at
managing an effective business.” the invoice’s value and get the balance once paid,
financial risk by using their personal savings to get
minus interest and a ‘transition fee’.
their business through tough times.”
If serious cashflow problems persist, Clark
strongly advises decisive action. “You might need
Effective cashflow management isn’t just a case of
to completely rethink your business. Making a
making sure your outgoings don’t exceed income.
Cash must enter your business on time. The first
few changes might put your business on a better For more information
financial footing, and independent advice from
step to maintaining healthy cashflow, says Clark, See the cashflow advice in the finance
an accountant should help, but doing nothing
is cost control. “It’s an ongoing job – your business section at
in the hope that your cashflow problems will
should remain lean and efficient at all times. Only Elaine Clark,
buy what you need and negotiate hard for the Managing Director, CheapAccounting.co.uk simply go away isn’t an option,” she concludes. businesslink.gov.uk
best price and payment terms.”
12 13
Ways to reduce your bills Ways to reduce your bills
How to… Cut your energy bill Agriculture: save up to 60%
Cleaning fans and ducts in agricultural environments
According to the Carbon Trust, most businesses can save 10% on energy costs – for example in animal, milking and feed sheds or
simply by implementing a few basic efficiency measures – and with a little where crops are stored in ventilated areas – helps
investment, savings can increase to 20%. In short, reducing energy waste to remove any build-up of dirt and other matter
which can reduce operating efficiency. Regular
reduces energy spend. cleaning and maintenance can save up to 60%
on energy costs.
No matter what type of business you run, there 2. Become switch aware
are likely to be some simple measures you can
Encourage staff to switch off electrical equipment
Savings for food and drink businesses
take to become more energy efficient, which Refrigeration costs can form a significant part of
and lights when not needed, and always at the
will benefit your bottom line. If you’re not sure a food shop, restaurant, bar or pub’s energy costs.
end of each working day. Turning off lights when
where to start, these three steps cost nothing Basic maintenance checks can reduce refrigeration
not in use can save around 15% on lighting energy
to implement and can save you money from costs by around 20% and also prolong the life of the
costs. And for a small office-based business, leaving
day one. refrigeration equipment. For example, just replacing
computers, monitors, printers and photocopiers
on standby, even when they are switched off at a faulty door seal can cut energy consumption by as
1. Don’t overheat the weekends and in holiday periods, can still cost much as 11%.
Heating can be a significant cost in any business nearly £350 over the course of a year.
where people work inside. For example, around Light your shop for less
12% of all energy consumed by manufacturing 3. Prioritise maintenance Lighting can be a major energy cost for retail outlets,
industries is used for space heating. Checking accounting for up to 70% of overall spend. Simply
Regularly servicing and maintaining boilers and
that heating is programmed to come on and replacing conventional tungsten filament bulbs or
heating systems can save on fuel costs. Aim to
go off at appropriate times can save a significant halogen spots with more efficient lighting types,
service your boiler every 12 months to ensure
amount each year, especially over the colder such as compact fluorescent lamps or LED spots,
optimal efficiency, which can save you up to
months. You can also be sure you don’t is a quick way to significantly reduce the energy
20% on running costs.
overheat your workplace by using the consumption of display and retail lighting systems.
following temperature guidelines:
Offices 19-21°C
More ways to save
Workshops 16-19°C
For more energy saving advice, visit
Heavy work 11-14°C
Stores 10-12°C
npower.com/smartstartQ1
Statistics: the Carbon Trust, 2011
14 15
Save time and money
with Direct Debit
Savings
You could pay 2% less for your electricity bills if you switch to
Direct Debit. Because your payments become easier to administer,
we can remove the surcharge that’s added to bills paid by other means.
Service
Save time paying bills. With Direct Debit, the payment is automatic
– so once it’s set up, you don’t need to do anything more.
Choice
Choose the best way to pay. You can opt for
variable Direct Debit and just pay for what
you used in the previous billing period. Or for
easier budgeting, you can pay the same
amount each month throughout the
year. Your account is then reviewed every
six to eight months to ensure your payment
is appropriate.
To set up a Direct Debit,
call us on
0845 166 3360
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