Business Builders Network

For businesses who are struggling to come up with the funds to pay off outstanding debt, the struggle can be overwhelming. Not only are creditors using increasingly pressurising methods, sending letter after letter and adding more and more interest onto an amount, but the current economic climate means that banks are reluctant to lend. This can, and has, led to a number of failing businesses closing their doors for the very last time.

Whilst most will believe that burying your head in the sand is the best course of action, seeking insolvency advice from accredited professions is of extreme importance in these circumstances. Without this kind of help, companies can completely miss an opportunity to continue successfully trading. Whilst bankruptcy is always an option however undesirable, there are plenty of other solutions that are readily available for businesses to take by the horns.

Company voluntary arrangements, pre pack administration and individual voluntary agreements are all examples of the many options out there. A CVA, which is a legally binding agreement between a debtor and a creditor is a particular favourite amongst struggling companies.

1, CVA – With a company voluntary arrangement a company in debt is able to reduce the amount that they pay back to their creditors each month in order to be able to continue trading. Whilst this sounds ideal, it is important to remember that creditors need to agree to every term and condition that is set out. Without their approval, this agreement will not happen.

2, IVA – An individual voluntary agreement is where the individual in debt (a CEO or director) can make a creditor an offer. This can be a lump sum that will cover the majority of the debt or simply an amount that is paid each month over the course of five years. Again, the creditor will need to completely agree to the offer that is being made whilst also agreeing to wipe out any interest or outstanding amount once the five years has passed.

3, PPA – A pre pack administration process, on the other hand, does not require a creditor’s approval. Instead, the failing company is bought by a director of an insolvent business. The failing business is liquidated, meaning that normal trading can be resumed through the new company without the burden or stress of debts and financial worries. This particular option is not favoured by creditors, for obvious reasons, but it is an option nonetheless.

Any business that is experiencing financial problems will agree that the best course of action is to act fast. Redundancies and staff cuts should be the last thing that a director suggests. Cost cutting incentives should almost definitely be implemented before a situation is seen to get worse.

Royal Bank of Scotland, in which the British government holds 82% share, has run into more troubles. Its net losses for the year 2011 have doubled to almost two billion pounds from 1.21 billion pounds in the previous year. The bank has been seriously hit by the Greek Debt crisis and compensation payments linked to insurance misselling. The bank paid its staff a total bonus pot of 785 million pounds, down by 43% as compared with its payout in 2010. This included 390 million pounds for its 17,000 investment banking staff, the lowest since the bank was effectively nationalised in 2008 and less than half of last year’s payout of 950 million pounds

There are many outstanding websites of small businesses who have made available the surveys of little industries. This survey provides the customers with the positive reading and is most welcome in the present troubled and negative environment of the businesses. One thing that comes in mind is when this survey has taken place. The survey indicates that everything is changing very fast in the world of economy. And sorry to say, but this condition is worsening in the United Kingdom as well as the monetary system of the world.

About 350 small industries have undergone this survey and here are the main results of the survey:

62% of the small businesses, all over the world, are likely to increase their turnover in this year that is 2012.

65% of the people, who have participated in this survey, believe that starting a new opportunity is the solution for their businesses in this year.

The companies have stopped hiring following the recession and even cut down in the number of the employees. But this year, according to 27% of the participant in this survey, the companies will start hiring new people.

However, the majorities, about 79%, of the people have said that they the earnings from different sectors will be stable this year in comparison to the last year.

Almost 75% of the people said that they do not think the financial system will be better in this year.

Therefore, only time will tell what will happen to the World Economy, whether it will be better or the bad condition will continue to prevail.

The personal computer industry continues to struggle with consumes showing strong preferences for I- Phones and I-Pads. Not surprising then that Hewlett-Packard amongst the world’s biggest computer makers, is faced with its own challenges. Investor confidence in the company continues to tumble and the company’s present market cap has tanked to about $54 billion as compared to almost $104 billion a year ago. For the quarter ended January 31, HP’s profit dropped by 44% while revenue fell 7%. To make matters worse, the company’s forecast it is up against weaker-than-expected results for the quarter ending April 31. Overall HP posted fiscal first quarter net income of $1.5 billion compared with $2.6 billion a year ago. Revenue declined to $30 billion from $32.3 billion in the same period. Analysts say that the company’s supply chain is in a complete mess. Floods in Thailand have also hurt it badly. However, the company’s co-chief executive Meg Whitman is hopeful that her plans for cost cutting, investing more in areas such as online cloud computing, security and tools that help businesses manage data, will help HP win back lost ground. Various analysts have also recommended investors to stay invested in the company for the long run. But to win back investors’ confidence, HP will have to try harder and race against the time to make itself health again.

 The basic ingredients of a competent and effective team leaders are discipline, aspiration, assertiveness, and domain knowledge. The techniques, which a leader should follow to make his journey more comfortable, are quoted below:

1. Cooperation and Coordination: Focus should be on the team effort rather than Individual contribution. Teamwork should be encouraged to increase the productivity of the team.

2. Crystal clear Goals and well defined responsibilities: Each team member should have clear idea of his or her accountability and responsibilities.

3. Encourage people to give ideas: A team generally consists of people having different educational and cultural backgrounds. So there will be difference in ideas and opinions. Encourage and coach team members to provide ideas and to pay due respect to each other’s opinions and suggestions.

4. Promote team discussions: Team huddles and team meetings should be held on regular intervals. Leaders should approach to team members to discuss problems and encourage them to provide solutions and constructive suggestions.

5. Assign decision-making powers to subordinates: It will not be possible for a leader to look after all the nooks and corners of the business alone. He has to select people whom he can delegate decision making powers.

6. Appreciate: Some times a thank you note or a pad in the shoulder recognizing his skills matter a lot. Recognize the hard and the smart work of the team members and reward for excellence.

7. Finally, your manners with others, moral values and work ethics should be an example to the team. This will bring the required environment for an efficient and consistent team.

It is very complicated to deal with expectations of the employees of a company, because its prosperity will be harmed if you intend to meet too much whereas too less might cause high worker turnover. Here are some steps, which should be followed to meet the employee expectations so that the stuff can be converted into a contented workforce as well as their prized possessions.

• More than 80% of the employees look forward to a bonus and a rise. If you are a manager or the owner of the company, you know very well that each employee cannot be promoted, as it does not suit your budget. So for this, you should give a salary hike or attractive bonuses to the workforce in order to keep both sides happy.As an owner of the company, you should not encourage gender discrimination. You must maintain the diversity of genders at all levels of your company so that each and every worker is happy with the rules, which in turn displays a well, balanced employee policy.

• It is the prime responsibility of the owner of the company to provide a pleasant, open as well as stress-free atmosphere to the employees because who does not want a comfortable and relaxed environment to work?

• You can offer the employees the shares of your company at a favored price at a definite time. It is more helpful than giving the cash bonus for the company and the employees find an inspiration to work with more concentration.