Business Leader Magazine: Issue 6

The magazine for entrepreneurs & business leaders

Issue 6: Jan - Feb 2019

From beds to castles Dreams Beds founder Mike Clare talks to BLM about his business career

Sector report: what next for the ÂŁ20bn hotel sector?

Page 26

Debate: are robots set to replace factory workers?

Page 38

Fast-Track: what’s the secret to success at RSG? Page 54

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FROM THE EDITOR

PUTTING EVERYTHING ON THE LINE

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Dear reader,

32 18

54

In this issue...

Latest News Cover Story - Mike Clare Ones to Watch – Prezola Feature - Investing Review: Deals Debate - Funding Growth Sector Report: Hotels Feature - Retail Debate - Manufacturing Report: Metro Mayor Regional Review - London Tech City BLM Fast-Track – RSG My Working Day - Tim Mercer

2 10 16 18 22 24 26 32 38 42 50 54 60

EDITORIAL Oli Ballard - Editor editor@businessleader.co.uk

WEB Melissa Larkin - Website Development melissa.larkin@businessleader.co.uk

Barney Cotton - Assistant Editor barney.cotton@businessleader.co.uk

CIRCULATION Alex Tremlett - Circulation Manager alex.tremlett@businessleader.co.uk

DESIGN & PRODUCTION Adam Whittaker - Head Designer adam.whittaker@businessleader.co.uk BUSINESS DEVELOPMENT Sam Clark - Business Dev. Manager sam.clark@businessleader.co.uk

For our latest cover story, we met with entrepreneur Mike Clare – founder of Dreams Beds. In the interview he talks about how he put everything on the line when he launched the business in his early thirties – saying: “It was the biggest gamble of my life… if it hadn’t had worked, we would have lost the house and everything else. But unless you’ve got your balls on the line, you can sometimes baulk under the pressure at the first hurdle.”

This just about sums up everything, when it comes to what ingredients make a true entrepreneur and gives an insight into what separates those that aren’t and those that are. It’s a term that has been so stretched, that it is now often applied to people who haven’t necessarily earned the tag. Mike Clare is certainly somebody that has and his interview on page 10 is a fascinating read.

Choppy waters No doubt, in 2019 the UK is going to need entrepreneurs like Mike Clare to be at their best as we navigate the choppy waters of ‘Brexit’ – which (despite everybody being fed up of talking about) is having an impact on business confidence in the UK. Take manufacturing for example. At the end of 2018 we held a roundtable debate that brought together some the UK’s leading businesses in this sector to discuss the impact of Brexit and labour, supply chains and confidence were all flagged as areas of concern (page 38).

On the flipside, the weaker pound has boosted exports and also encouraged inward investment and travel to the UK. This has been witnessed by the those operating in the hotel sector and our extensive report can be read here (page 26).

ACCOUNTS Jo Meredith - Account Manager jo.meredith@businessleader.co.uk

As ever, we hope you enjoy this edition of Business Leader Magazine. If you would like to get involved or have any news you would like to share, please contact us on 020 3096 0020 or email: editor@businessleader.co.uk

MANAGING DIRECTOR Andrew Scott - Managing Director andrew@businessleader.co.uk

Yours sincerely, Oli Ballard – Editor

Advertise with Business Leader today by calling 020 3096 0020 | businessleader.co.uk Business Leader - The magazine for entrepreneurs & business leaders

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LATEST NEWS Richard Branson:

No deal Brexit could bankrupt Britain

Dealmaking solicitor sets up new business

An entrepreneurial and well-known solicitor has sold his stake in the company he set up, and will now pursue a new career.

Charles Cook has sold his stake in Cook & Co Solicitors, a firm he founded in 2008 alongside Vicki Neath.

British entrepreneur Sir Richard Branson has made a stark warning to UK politicians and businesses, as he believes a proposed ‘no deal’ or ‘hard’ Brexit could leave the UK in financial ruin.

Branson stated that leaving the European Union without a deal would lead to a series of problems and closures for companies across the UK. The Virgin Group founder also stated that Prime Minister Theresa May’s proposed version of Brexit was not a good enough offer, when compared to remaining within the EU. He made the declaration during Virgin Galactic’s space launch in the Mojave Desert in California.

Branson said: “I think Theresa May needs to be 100% honest with the public. She’s admitted that a hard Brexit would be an absolute disaster for the British people. From our Virgin companies’ point of view, a hard Brexit would torpedo some of our companies. If British business suffers, British people will suffer, and it’s really really important that people realise that.”

Under their leadership the business enjoyed ten years of organic yearon-year growth in both turnover and profit; growing from a corporate only

Charles has sold his stake to three of his colleagues – Vicki Neath, Peter Golding and Gareth Raisbeck.

Following on from the sale he has set up a new corporate-only legal practice called Cook Corporate Solicitors, that will specialise in mergers and acquisitions and the private equity markets.

ThinCats announces new support for UK SMEs with £200m funding agreement ThinCats has teamed up with BAE Systems Inc to launch a new £200m fund that will provide UK SMEs with commercial loans.

Damon Walford, chief development officer at ThinCats, said: “This additional funding programme with BAE Systems Pensions demonstrates our continued ability to link institutional investor capital to growing UK SMEs. “Our concerted regional focus and diversified funding sources has driven a significant increase in lending volumes – ThinCats achieved record levels of funding in 2018.”

Award-Winning Legal Advisers to Regional Businesses 2

boutique firm to one with expertise across corporate, dispute resolution, property, private client and family.

0117 925 2020 vwv.co.uk Issue 6: January - February 2019

LATEST NEWS

FTSE companies urged to appoint more women leaders

Britain’s creative industries break the £100bn barrier mark The UK’s creative industries made a record contribution to the economy in 2017, smashing through the £100bn mark.

economy since 2010, according to figures published by the Department for Digital, Media, Culture and Sport (DCMS).

The value of the creative industries to the UK is up from £94.8bn in 2016 to £101.5bn, and has grown at nearly twice the rate of the

Film, TV, radio, photography, music, advertising, museums, galleries and digital creative industries are all part of this thriving sector.

A governmentbacked review has urged FTSE 350 companies to do more to meet the target of a third of women in senior leadership positions by 2020.

Figures published recently in the HamptonAlexander Review’s 2018 report reveal the top 100 companies which make up the FTSE 100 index are on track to hit the target with more than 30% of board positions occupied by women. This has risen from 12.5% in 2011.

However, in the FTSE 350 almost one in four companies have only one woman on their board, and there remain five all-male boards. This means half the appointments to board positions will have to be filled by women over the next two years to hit the targets.

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LATEST NEWS

Big Issue partners with iZettle to offer contactless payment options

Global M&A deal activity down because of trade tensions and political instability Mergermarket, a global provider of M&A data and intelligence, has published its 2018 global report, which found that the number of deals struck over the year fell for the first time since 2010 to 19,232, after steadily rising for close to a decade.

Elizabeth Lim, Research Editor at Mergermarket commented: “With so many market-moving factors fluctuating throughout the year, mergers and acquisitions have understandably had a somewhat ambivalent 2018.

However, the transactions that did make it to the signing table reached £2.75tn worth of activity, ranking 2018 as the third-largest year on Mergermarket record (since 2001) by value. Average deal size saw its second-highest total value on record with £301m, just below the £313m peak reached in 2015.

“Intensifying trade tensions, political instability, and increased regulatory scrutiny took their toll on the number of deals struck over the year, though deal values fuelled by cheap financing, pressure on companies to consolidate and competition from sponsors remained relatively high.”

The Big Issue has partnered with contactless payments provider iZettle to launch trials of the technology for its vendors.

Up to 20 vendors across London, Bath, Birmingham, Bristol and Nottingham will offer contactless payments alongside regular cash payments, before the technology is rolled out nationwide. The pilot is the first of its kind. iZettle reports that more than 70% of payments in the UK are now cashless and this partnership will help boost financial inclusion for its vendors.

Big Issue vendor Easton Christian says: “I’ve definitely noticed a dip in the number of people carrying cash, which has had a knock-on effect on the number of magazines that I’m able to sell.”

hit with £385,000 fine following data breach Peer-to-peer ride-sharing platform Uber has received a fine of £385,000 from the Information Commissioner’s Office, following a data breach that has affected almost three million customers.

The European branch failed to notify over 35 million users and 3.7 million drivers following a hack in November 2016.

Cyber attackers obtained credentials to access Uber’s cloud servers and downloaded multiple files for users across the world.

ICO Director of Investigations Steve Eckersley said: “This was not only a serious failure of data security on Uber’s part, but a complete disregard for the customers and drivers whose personal information was stolen. At the time, no steps were taken to inform anyone affected by the breach, or to offer help and support. That left them vulnerable.”

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Issue 6: January - February 2019

LATEST NEWS

Staff first policy sees national firm collect Investors in People Accreditation National waste management company is celebrating after achieving IIP (Investors in People) Accreditation.

UK’s only tech ‘unicorn’ Blippar crashes into administration

Waste Source, which has 12 staff and was founded in 2010 to make waste disposal a simpler, cheaper and more effective process for clients, has achieved the highest standard for people management.

Augmented reality giant Blippar has announced that it has slipped into administration, meaning that all 200 staff will lose their jobs.

Investors in People represents 27 years of people management excellence to raise the standard of people management for the benefit of everyone. The internationally recognised accreditation is held by more than 11,000 organisations across 75 countries who lead, support and manage people well.

An often-praised beacon of British brilliance within the tech sector, Blippar fell into financial worries following a series of funding rows.

The augmented reality firm was much celebrated within

entertainment, and rose to prominence in the public eye following their extensive work with David Attenborough’s BBC series, Planet Earth II. Blippar was one of the UK’s only tech unicorns – a start-up business that is valued in excess of $1bn.

Our simple ethos goes a long way.

We help businesses cut through the noise and achieve results.

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LATEST NEWS

Ascot Group makes two senior board appointments

The Ascot Group, a London and Bristol based marketing and media group, has appointed a new Finance Director and a corporate lawyer to its board.

Ernst Young (EY) trained Chartered Accountant Ashley Cartman joins as Group Finance Director, while Charles Cook, a specialist corporate and M&A lawyer, has become Non-executive Director.

Ashley has enjoyed a career that spans Debenhams PLC and Momentum Financial Technology, as well as running his own accountancy practice. He holds a Diploma in Strategy and Innovation from Saïd Business School (University of Oxford) and specialises in highgrowth companies.

Charles Cook is a well-known corporate lawyer who specialises in mergers and acquisitions. He has a portfolio of board positions including the Bristol Private Equity Club and he recently sold the solicitors’ practice he founded, Cook & Co, which employed 25 staff.

Charles said; “I have worked with Ascot Group’s CEO Andrew Scott on several projects over the last ten years and witnessed his business grow from a small start-up to a major group of companies employing 70 staff. I’m delighted to join the board and support the business as it grows.”

The Ascot Group was founded in 2004 when Andrew Scott launched Purplex, a strategic marketing consultancy firm. He had previously been ‘client side’ as a marketing director and was involved in a number of acquisitions and exits in industries as diverse as manufacturing, distribution and retail.

Andrew commented: “We have an experienced and talented team at The Ascot Group but we wanted to strengthen the board as part of our longer-term growth plans. Ashley and Charles will work more strategically with me to develop our own business and identify new opportunities and potential acquisitions.”

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Mike Ashley launches attack on Debenhams boss after £40m investment rejection

Sports Direct owner Mike Ashley has launched an extraordinary attack towards the boss of Debenhams, about his offer of a £40m investment into the struggling department store chain.

Ashley, who owns 29.7% of Debenhams, sent the letter to Sergio Bucher, stating that without the money the company “has zero chance of survival.”

Debenhams plan to close up

to 50 of its stores following a downturn in business. The letter suggests the firm would take an additional stake in Debenhams.

In a statement recently, the Newcastle United owner said that House of Fraser, which he bought from administration for £90m in August, could merge with Debenhams.

Under his latest plans he would inject the funds in return for an extra 10% stake and a waiver from being forced to make an offer for the whole company under takeover rules.

Mourinho’s sacking good news for HMRC Jose Mourinho’s departure from Manchester United may not come as a complete shock, given the club’s run of form, but their loss will come as a welcomed bonus for HMRC say accounting, tax and advisory firm Blick Rothenberg.

Andy Timpson, a partner at the firm said: “Press reports of a £24m severance to Mourinho, which may largely be made up of contractual pay to the end of his contract, will mean a significant tax bill close to 50% should be making its way to HMRC.” Issue 6: January - February 2019

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LATEST NEWS

Piers Linney joins Business Leader Awards judging panel Former Dragons’ Den star Piers Linney is the latest high profile figure to join the line-up of Judges for the 2019 Business Leader Awards.

£675m fund to transform UK High Streets and Town Centres

The entrepreneur and investor is a champion of scale-up businesses and brings a wealth of experience to the judging panel. He qualified as a lawyer and is a former banker and fund manager with extensive experience in corporate finance and M&A. Piers is also a Non Executive Director of the government-owned British Business Bank, which has facilitated over £12bn of financing for UK SMEs.

Towns across the country have been urged to bid for a share of £675m to transform their local high streets into modern vibrant community hubs.

He commented; “I am a passionate believer in the importance of SMEs to the success of the UK economy and I am committed to helping ambitious businesses scale-up. The Business Leader Awards is a great way to recognise some of the UK’s most dynamic start-up and scale-up businesses.”

The Future High Streets fund which opened recently will help local leaders implement bold new plans to transform their town centres and make them fit for the future, with co-funding to consolidate properties on the high street.

The Business Leader Awards champions British business across all sectors and is open to companies large and small, with 16 categories and a special ‘Business Leader of the Year’ accolade.

A panel of judges independently assess award entries and the winners are announced at a prestigious gala awards dinner at the Hilton on Park Lane, London, on 21st June 2019.

Oli Ballard, Editor of Business Leader Magazine, commented: “Starting and running a high growth business is exciting but also very challenging, and Piers is known for providing practical, no-nonsense advice and support. His experience and passion for scale-up business will be a real benefit to the judging process.”

Tesla shares fall 8.2% despite record high production Electric carmaker, Tesla, has announced its fourth quarter trading update, which showed production has risen 8% on the previous quarter – a record high – to 86,555 vehicles. However, deliveries of 90,700 were behind analyst estimates.

Tesla also announced that it was cutting the price of its US Model S, Model X and Model 3 by $2,000 (£1600). This aims to partially offset a fall in the federal Electric Vehicle tax credit, from $7,500 (£6000) to $3,750 (£3000).

The shares were down 8.2% in early trading following this announcement.

Ahead of the announcement, CEO Elon Musk urged all Tesla owners to take advantage of tax credits available to electric car users.

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Issue 6: January - February 2019

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BECOME UNSTOPPABLE

COVER STORY

“I WOULD HAVE LIKED TO BUY THE COMPANY BACK” IN 2008 MIKE CLARE SOLD DREAMS BEDS FOR £222M. FOR OUR LATEST COVER STORY, BLM MET THE ENTREPRENEUR TO LEARN MORE ABOUT HIS BACKGROUND, HOW HE ACHIEVED BUSINESS SUCCESS AND HIS PLANS FOR THE FUTURE.

WHAT INSPIRED YOU TO GO INTO BUSINESS IN THE FIRST PLACE?

it hadn’t worked – we would have lost the house and pretty much everything else.

My mother and father both had their own businesses and when I was at school I used to buy and sell bikes and albums, among other things. I was always that way. I was a bit of a ‘wheeler dealer’ and it was these formative years that inspired me to venture into the world of business.

But I see that as a good thing because unless you’ve got your balls on the line, you can sometimes baulk under the pressure of the first hurdle. However, if you know you’ll lose everything if it fails, you do everything to make it work.

I also wanted to prove to myself that I could be a success in business. My brother was very academic and studied at Cambridge University. I knew I wouldn’t be cleverer than he was, but I tried to prove myself in a different way.

YOU WERE 30-YEARS-OLD WHEN YOU FOUNDED DREAMS BEDS. WAS THIS A MASSIVE GAMBLE AT THE TIME? It was the biggest gamble of my life. My wife was pregnant with our first child and we had a mortgage. If 10

DREAMS THEN BECAME A RETAIL GIANT - WHAT WAS THE KEY INGREDIENT THAT GOT THE BUSINESS UP AND RUNNING? When people start businesses, they don’t quite know where it’s going to lead, it’s just about getting started.

Some people write business plans and analyse everything to the nth degree, but I believe in getting on with it and just doing it and seeing where it develops. It was this approach that helped to fuel success.

Cont.  Issue 6: January - February 2019

MIKE CLARE

“SOME PEOPLE WRITE BUSINESS PLANS AND ANALYSE EVERYTHING TO THE NTH DEGREE, BUT I BELIEVE IN GETTING ON WITH IT AND JUST DOING IT AND SEEING WHERE IT DEVELOPS. ” Business Leader - The magazine for entrepreneurs & business leaders

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COVER STORY

guarantees, but it got easier and easier, once we got bigger and the model was right – it was a case of just replicating what you had done before.

HOW KEY WAS MARKETING AND PR TO THE SUCCESS OF DREAMS BEDS? It was crucial. We used to do a lot of PR and TV advertising, which was the bulk of our marketing. But we would do PR stunts where we would do wacky things to get publicity.

For example, we’d have a grand opening for a store in a new town we were launching in and would raise money for the Mayor’s charity, which usually consisted of a manager doing a sleep-in in the store window.

IS THIS A MESSAGE TO FUTURE ENTREPRENEURS THAT A BUSINESS PLAN ISN’T FOOL PROOF? That’s right, you just never know. There could be a competitor or a new market that’s opened up or something happens in life, business or the economy, which changes everything. You can’t predict everything. I originally thought we were going to open a load of sofa bed shops, but we actually went in the directions of beds.

“TRAINING STAFF, GETTING A GOOD TEAM, HAVING A SYSTEM WHICH WORKS, WAS ALL PART OF OUR SUCCESS TOO. YOU NEED TO GET ALL THE PLATES SPINNING AT THE SAME TIME TO BE SUCCESSFUL.”

IN OVER 20 YEARS DREAMS EXPANDED MASSIVELY AND ACCUMULATED 200 STORES. WHAT WAS THE KEY TO THIS GROWTH? Pleasing the customer was key and making sure you have loyal customers by offering good service with good value, but also making sure you offer a decent selection in stores. There wasn’t a presence online at the beginning, so what you offered in stores needed to be good.

Training staff, getting a good team, having a system which works, was all part of our success too. You need to get all the plates spinning at the same time to be successful.

ONE OF THE WAYS YOU MADE DREAMS SUCCESSFUL WAS THE LOCATION OF THE OUTLETS? Prominence is important and car parking space is important too. Stores like ours are now mostly found In retail parks, but at the time we used a lot of ex-car showrooms.

We’d go to a town that we wanted to open in and we’d negotiate a lease with the landlord and as we got bigger it became easier because landlords would approach us, and we’d have bigger rent-free periods.

To start with I’d have to give personal

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JUST BEFORE THE FINANCIAL MELTDOWN IN 2008, YOU SOLD THE BUSINESS IN MARCH OF THAT YEAR. DID YOU SEE THE CRASH COMING OR WAS IT JUST A CASE OF THE TIMING BEING RIGHT? I should say I foresaw the crisis and my timing was impeccable. But, truth be told, we thought about selling for a few years.

However, the business was doing well and in hindsight we could have continued on for a few years.

A number of factors came together to make it seem like the right time, and the timing was lucky. We got out on a good price.

WHAT WERE THE CONTRIBUTING FACTORS TO EVENTUALLY SELLING THE BUSINESS? I wasn’t doing the stuff I originally enjoyed in the early days. I’d become the chairman, and it was a bit boring to be honest. The company was 21-years-old, and I just thought it was the right time.

YOU THEN SPENT NINE MONTHS “RETIRED”, HOW DID YOU DEAL WITH THE FREE TIME WHICH CAME WITH THE SALE? I travelled a lot, moved to a new house and did a lot of the things that people do when they come into a bit of wealth, which was fun.

I wasn’t ready to sit on a beach for the rest of my life though. I wanted to do something else and I’ve always tried to make money in my life, so not doing that was difficult.

Issue 6: January - February 2019

MIKE CLARE

WITHIN A YEAR YOU SET UP CLARENCO AS A BUSINESS GROUP TO COMMERCIALISE A HOBBY OF YOURS. YOU ESTABLISHED FIVE PROPERTY DIVISIONS. CAN YOU TELL READERS MORE ABOUT THE BUSINESS? I’d always achieved success with my own personal houses, which I’d bought and sold a few of. At Dreams, when you had 200 stores, containing free holds and some lease holds - collectively it was a lot of property, which was where my understanding came from. We got into unusual properties, executive homes, country mansion estates and we wanted to work with something which was a bit more unusual than the run of the mill properties like buy to lets or student flats.

YOU’VE DEVELOPED A HABIT OF BUYING AND RESCUING WHAT ARE ‘UNIQUE AND UNUSUAL‘ PROPERTIES. WHAT IS IT ABOUT THE BUSINESS THAT YOU’RE SO PASSIONATE ABOUT?

I wish I had bought Dreams back, it’s one of my biggest regrets, but I enjoy feeling proud about a company’s success.

AND FINALLY, WHAT’S YOUR ADVICE TO ANY FUTURE ENTREPRENEURS? Persevere and don’t give up. A lot of people get daunted by some sort of problem they come across.

“I WISH I HAD BOUGHT DREAMS BACK, IT’S ONE OF MY BIGGEST REGRETS, BUT I ENJOY FEELING PROUD ABOUT A COMPANY’S SUCCESS”

But there are always problems in business, if there weren’t then everyone would be doing it, but it separates the men from the boys.

Face the challenges, become optimistic and move forward.

Come up with something different than anyone else has, if you do copy someone else, then why will you be better? You’ve got to offer some uniqueness about it, whether that’s a better price or better service, you have to find your USP. You always need a bit of luck in business, work hard, be innovative, clever, fair and honest, but also a bit of luck never goes amiss. 

Rather than buying investment businesses, like a hotel, which is a concrete block, which might have good return on investment, I was looking at unusual properties which we called ‘amazing venues’ whether it be castles in Scotland, a château in Wales or a monastery in Worcestershire. Each of them was unique in their own way. They weren’t hotels, so we turned them into one, which was fun.

IN 2013 YOU VERY NEARLY BOUGHT BACK DREAMS BEDS, WAS IT AN OPPORTUNITY MISSED FOR YOU, DO YOU BELIEVE? I would have liked to have bought the business back, it was a big regret. I very nearly did but I think there were a lot of powers in the background that didn’t want me to buy it back again.

I’m very proud of Dreams, it’s always been my baby, but I’m not involved on a shareholding basis.

People always want me to start a new bed business and I have ideas, such as a new business called Buzz Beds, which a lot of people would get behind me to do, but at the moment with the hotels I don’t have the time, but we’ll see.

Business Leader - The magazine for entrepreneurs & business leaders

13

ADVERTORIAL

Can you give me an overview of The Donkey Sanctuary?

The Donkey Sanctuary will celebrate its 50th anniversary this year. We started out as a sanctuary for donkeys in the UK but our late founder, Dr Svendsen, wanted our focus to be global, wherever donkeys needed help.

To do this she set up a charity called the International Donkey Protection Trust (IDPT).

That trust then became part of the sanctuary.

We started out with some partnership projects in universities across the world. We had one in Mexico City and the University of Ethiopia – and that was for training vets in order to get better treatments to the donkeys.

We’ve grown into a charity that works with all stakeholders to improve the welfare and status of donkeys which are relied upon by millions of people around the world.

As a charity, we cannot reach about 45 million (FAOSTAT)* donkeys in the world by ourselves – now we are already reaching nearly two million donkeys in over 35 countries. We need partnerships with other people, such as Barclays.

The Donkey Sanctuary Sidmouth, Devon EX10 0NU

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Can you tell me about your role within the charity?

My role is the Head of Programmes within the global programmes team. When I say ‘global’ – it really is all encompassing. We are drawing together programmes of work looking at all sorts of challenges – from helping donkeys in tourism to those in the construction industry. This is especially concerning in India where there are multistorey buildings being constructed, and where you can see donkeys taking bricks right up to the top floor. You sometimes see donkeys working with broken legs and many others injuries in industries like this.

We are working on both national and international levels to increase the knowledge and awareness of donkeys and the people Issue 6: January - February 2019

BARCLAYS

How are Barclays supporting The Donkey Sanctuary?

BLM interviews Alex Mayers – Head of Programmes at The Donkey Sanctuary about the charity’s international growth and how Barclays have helped the charity in their mission.

Alex Mayers

that use them in their communities.

As we work with different countries, we need to know how donkeys are being used and valued, and we work with partners who have knowledge of local customs, cultures, laws and values. Through this work, we are now reaching donkeys in over 35 countries.

Can you tell me about the sanctuary itself?

We are open to the public 365 days a year, and we always have staff on site managing the donkeys. Last year we developed our visitor experience and opened a large restaurant, a visitor centre and a gift shop.

We have a number of different farms, each with a number of donkeys on, whether they have been rescued or given to us by owners who can no longer look after them.

Many of those donkeys come with different challenges, but we have an incredible team here. We look after the health and welfare of the animals – this is a place where donkeys can be free and have a home for life. The donkeys here are extremely blessed as we have nearly 50 years of expertise. We are always learning more information about their welfare, environmental issues, their use in human society and the relationships they need to have with each other.

We also have a state-of-the-art donkey hospital, which is a one-of-a-kind facility. We are extremely valuable as a local attraction.

Our main objective is to be a home for the donkeys, but that has meant that we have also become a real family attraction – and entry is always free!

How have Barclays helped you?

The way that we work is largely through partnerships across the world, such as the one with Barclays. For example, we have offices in Ethiopia and in Mexico City which have grown through partnerships with other people and organisations. Most partnerships require funding of some sort – this can help a project, employ staff or provide new equipment or facilities.

What Barclays do is help us get funding to our regular partners. Our accounts team work very closely with Barclays to make that happen. If it wasn’t for that ability to get that money where it needs to go quickly, we wouldn’t be able to reach the number of donkeys that we are currently doing. They offer us a convenient method for funding our regular partners. That’s where they come into their own.

Our Relationship Manager at Barclays means we have a direct line to get what needs to get done as soon as possible. They have helped us in our long term plans, to help us get the funding to the right places at the right times.

Are Barclays helping you with your future growth plans?

Yes they are, especially as our future growth plans become more complex – as we are looking at how we spend our money overseas.

We are looking at different ways in which we can grow and help more animals. Our growth comes with due diligence processes and working in new countries comes with new challenges – and as we evolve we need

To find out how we can help your business success please contact Paul Jarrett +44 (0) 7917 503485 E: paul.jarrett@barclays.com

partnerships that look at a wide range of options. Barclays understand that this is an important part of our growth process.

Is it the case that charities are having to become more like businesses?

In many ways, we are already businesses – the ways in which we work are not radically different. We still have governance structures to adhere to and stakeholders that we report to. We have an income that we need to report against.

Like a business, we work to strict project and programme management structures. We have governance structures and legislation that we run our charity by. We are already a business – we are just doing it not for a profit.

Can you tell me about the role that The Donkey Sanctuary plays in the local economy?

We have just gone past 700 employees across the entire organisation, and we have become the second largest employer in East Devon, after the district council. The impact that we have had on the local economy is significant, but not just for staff numbers.

In May, we host Donkey Week, where we get hundreds of people from all over the world and open up all our sanctuary-farms for them. Normally, only the main sanctuary site is open to the public, however during that week we have talks, shows and events for donkey lovers. This has a great impact on our local economy.

www.barclayscorporate.com

Barclays Bank PLC is registered in England (Company No. 1026167) with its registered office at 1 Churchill Place, London E14 5HP. Barclays Bank PLC is authorised by the Prudential Regulation Authority, and regulated by the Financial Conduct Authority (Financial Services Register No. 122702) and the Prudential Regulation Authority. Barclays is a trading name and trade mark of Barclays PLC and its subsidiaries. *(FAOSTAT) Food and Agriculture Organisation of the United Nations.

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15

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Issue 6: January - February 2019

PREZOLA THE ONES TO WATCH SERIES IS SPONSORED BY GRANT THORNTON UK LLP One of the world's leading organisations of independent assurance, tax and advisory firms T: 0117 305 7600 | E: andrew.a.charter@uk.gt.com | www.grantthornton.co.uk

Marriage made in Heaven Meet the £15m wedding gifts company taking on Amazon and John Lewis

W

hen you think about it – weddings is an industry that isn’t going to disappear any time soon. There is a certain inevitability to it and tying the knot is a multibillion-pound global industry.

charge growth. This saw the Business Growth Fund (BGF) pump £3m into the business in May 2017. Tellingly this was the only investment BGF made in the South West during 2017.

Married – which bolsters our offering as this is an invitation and bookings platform that allows the user to manage everything else to do with their wedding, in one centralised place.”

Founded in 2011 by husband and wife team Dom Beaven (previously a Managing Director at Future Publishing) and Ali Beaven (previously an Interior Designer) – Prezola calls itself the UK’s favourite on-line wedding gift list providers and is on a mission to take wedding gifts into the digital century – taking on the likes of Harrods, Amazon and John Lewis.

As part of this investment, Dom says they worked with BGF to establish a new board of experts covering finance, branding and logistic.

Ali goes on to say that weddings, interestingly, are still analogue and often organised via a spreadsheet, which is unusual comped to how a person now typically organises their life.

The business currently turns over £15m and employ over 50 staff, with a head office located in Bath and a warehouse in Westbury.

How does the business work?

The way the business works is simple.

Couples register online and create their wedding gift list from around 50,000 products - from over 500 brands - listed on the website. The audience is intentionally millennial and high-end, with Dom and Ali careful curators of the brands they associate themselves with.

What does the future hold?

So, what does the future hold for Prezola.

Dom explains: “On average, Prezola currently work with around thirty thousand couples a year but there are 300k weddings take place each year, which means there is a huge amount of the market to go at.”

Regarding the businesses’ five-year plan – Dom comments: “The plan is for continued growth. A little while ago we had to make the decision if we are an e-commerce or wedding business and we decided we’re the latter. Following this we acquired Getting

Charity and cash donations can also form part of the list and the process is end to end, with guests coming to the website to buy and once the couples have finalised their list, the Prezola team purchase the gifts and make a consolidated shipment to the couple after the wedding.

Regarding the numbers, the business has seen a rapid rise. And in May 2017 additional funding was brought on to turbo Business Leader - The magazine for entrepreneurs & business leaders

“Many people expect to be able to everything on their phone. Gift lists have been around for 200 years and traditionally you would go to your local department store to arrange them. We’ve taken an old tradition and modernised it for a new online audience; and we’re at the forefront of this shift.”

Ali and Dom say that the target for the business is £50 turnover in five years and this will be helped by international expansion – with Australia and USA as target markets – but of course, there are challenges.

Dom comments: “Our business is seasonal so initial expansion into Australia will give us two summers and we then plan to target other countries.

“Our revenue comes from the couple getting married and their guests who buy the gifts.

Of course, when consumer confidence is down this can hit and there are some major economic and political challenges; but I believe consumer are bored of hearing about them and despite some worrying sign in 2017 we haven’t seen a major impact and basket values remain stable.”  17

FEATURE

WHAT’S IT REALLY LIKE TO BE AN INVESTOR? B

ecoming an investor sounds like a dream job, doesn’t it?

Picking and choosing which businesses to invest in, which sector to plough money into and then if all goes well reaping the financial rewards and accolades which go along with successfully aiding a company’s growth.

But what do investors actually do week in week out? Business Leader Magazine takes an in-depth look into the day in the life of an investor.

Ask any investor and there will be many contributing factors as to why they want to invest in businesses in the first place.

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For Reece Chowdry, founder of awardwinning venture capital firm RLC Ventures, his attraction to investing started because of his love for a certain piece of technology.

“After purchasing an Apple iPod in 2002 and believing in the product, I became interested in investing in technology,” Reece explains.

“Despite my classmates and family thinking I was a bit unorthodox, I was blown away by the product’s design and software, and that sparked my interest in technology.

“At the age of 13, I started my technology investment career by asking my dad to put all my birthday and pocket money into buying Apple stock.

“It was the sale of that same stock 12 years later that started RLC Ventures.”

For ex-Dragons’ Den star Sarah Willingham, a successful career in the hospitality sector was outweighed by a desire to become a mother. No longer wanting to run businesses, Willingham saw an opportunity

“AT THE AGE OF 13, I STARTED MY TECHNOLOGY INVESTMENT CAREER BY ASKING MY DAD TO PUT ALL MY BIRTHDAY AND POCKET MONEY INTO BUYING APPLE STOCK.” Reece Chowdry

Issue 6: January - February 2019

INVESTING

Not the usual 9-5 But what does the day to day life of an investor contain? And how are new investment opportunities scouted?

Jamie Waller is a successful angel investor who was the CEO and founder of Jamie Waller Limited, which he founded in 2004.

It was in 2017 that Waller left the business having sold his holdings for more than £33m. He also started the London-based software company Hito, selling it in 2017 for £9m.

Jamie now invests in businesses that have been ‘overlooked by others’ with his new firm Firestarters, a £13m investment fund for early stage businesses. With a focus on businesses with a turnover of £2 to £20m that require both cash and expertise to scale.

He said: “I’d say my day to day life as an investor is extremely segmented.

“Around 25% of it is looking at new opportunities, a quarter of it is just general admin of the various businesses that we work with and then the last 50% of my day is helping existing investments which we work with.”

Ned Dorbin, leader of the investment team in the South West and Wales at Business Growth Fund PLC (BGF), adds that the day to day schedule of an investor can vary, but one thing is constant, investors are always on the hunt for more investment opportunities.

He said: “My day to day schedule is full and busy. It’s always very varied, a few days a month we have board meetings with companies, conference calls and we spend time meeting and networking with people who might be able to work with us.

Cont. 

“MY DECISION TO BECOME AN INVESTOR WAS DRIVEN

BY THE FACT THAT I NEEDED TIME TO START A FAMILY.” Sarah Willingham

to become a shareholder, with influence, while also conducting the balancing act of raising a young family.

She said: “My decision to become an investor was driven by the fact that I needed time to start a family. I had a successful career in my twenties but having four children in four and a half years, it became apparent to me that my life running businesses was not going to work with a young family.

“I knew I had to change and that’s when I became an investor. I knew I could take a significant enough stake in a business to be influential but not run it solely.

“I was able to back really good people, who were quite frankly better than me at running their business but needed help at the growth phase. Which is where I excel.”

Business Leader - The magazine for entrepreneurs & business leaders

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FEATURE “At BGF, we spend a lot of time going out and introducing ourselves to companies and what we do. The BGF brand is well known now and we get companies approaching us direct, but we also gain investment opportunities through word of mouth.”

Reece added: “Each day is different. As we receive around 1,400 investment applications a year, meeting new founders to learn about and evaluate their tech businesses forms the main part of my day.

“As board advisors, we also spend time supporting our existing portfolio companies by offering strategic advice. I frequently meet our fund investors to ensure they are updated with the latest investment activity and developments in portfolio companies.”

“I PERSONALLY LIKE TO INVEST IN BUSINESSES WHERE THERE’S ALREADY A LOT OF DEMAND. I LIKE TO MAKE SURE A BUSINESS I INVEST IN TURNS OUT TO BE BETTER THAN EVERYONE ELSE.”

the work continues as we offer different types of support structures and advice to our portfolio companies to help them along their growth journey.”

Jamie added: “I think a typical investment can take from start to finish around seven months. The process starts off straightforward at first with a few meetings and exchanges of information.

“This can take a few hours a week, but once you commit to take it further then its full time for two or three people for four to eight weeks.”

Perseverance is needed Any investor will tell you that some investments don’t reap the rewards for many years after the initial placement. It’s a game of perseverance in most cases.

“It’s all a long game,” Emma-Jane Packe, managing director of The Supper Club, explains. “It can often take about seven to 10 years for the investment to mature and larger returns tend to be gained in the later stages, so it’s worth holding onto the investments for the long run.

“Remember, if you don’t follow on in further

investment rounds, you may lose your preemptive rights further down the line.

“Be prepared to take a portfolio approach with businesses you’re going to invest in as most are likely to fail. From an odds perspective, members recommend making about ten different investments.

“For balance, equity investments should be about 10-15% of your total portfolio.”

As mentioned by Packe, the difference between a good investment and bad can be minimal, even if full due diligence has taken place, markets can change, consumer habits can shift, and investing can at times be a risky proposition.

However, Jamie doesn’t see angel investing as a gamble, instead he aims to find businesses which have already shown scalability.

He added: “A lot of angel investors take the approach of putting down £50,000 on 20 businesses and thinking some of them will come good. I prefer a business already turning over, say, half a million, making a small profit and ready to move to the next level.”

Influential Business Investors

Sarah Willingham Time and patience Investment opportunities can take time and require a lot of patience. The typical investment opportunity can sometimes take a while to come to fruition, with many falling through due to business disagreements or other logistical elements.

Warren Buffett

“The process between our first meeting with founders to investing in their business typically takes around four to six weeks,” explains Reece.

“During this period, our team performs deeper analysis and due diligence to investigate the viability and scalability of the company.

“Finally, other investors from our network of angels and VCs may be brought in to the funding round, from which the final investment is made. Even post-investment, 20

Deborah Meaden Issue 6: January - February 2019

INVESTING Adding to this, Reece said: “Investing in start-ups at an early stage is fundamentally different to all other types of investment.

Needless to say, start-ups are riskier as 70% of all businesses fail within 10 years.

If you’re expecting stable and steady moderate returns, stick to bonds.

Sarah believes it’s all about a need or want for a service.

and we work well together, with openness to influence.

However, she is quick to stress that the management of those running the business can be a key aspect on whether to invest or not.

“The measure of a good investment is the return you get at the end of it but the lead indicator is the management relationship.”

“I don’t like re-educating a market,” Sarah explains. “I personally like to invest in businesses where there’s already a lot of demand. I like to make sure a business I invest in turns out to be better than everyone else.

“On the plus side, returns can be significantly higher in the long run for early stage investing. To reduce the risk substantially, ensure portfolio diversity by including companies from different verticals.

“Also, when they are at their early-stage, it is better to invest in the founder, as they are the ultimate drivers of their business’s longterm performance.

“Finally, when starting out, start small.

Begin by investing through crowdfunding platforms and angel networks in businesses that you can understand and are personally interested in.

“Ultimately, start-up investing is exciting but to be successful it requires more than pure luck.”

“A LOT OF ANGEL INVESTORS TAKE THE APPROACH OF PUTTING DOWN £50,000 ON 20 BUSINESSES AND THINKING SOME OF THEM WILL COME GOOD.”

When asked what makes a good investment,

Jamie Waller “Secondly, I always research if there is a market for the business and also how they can reach their potential customer base.

“Finally, it’s all about the people. Are those who are running the company better placed to do this business than anybody I’ve met. If you can mix all of those you’ve got a really good chance of succeeding.”

Ned concurs with Sarah, stating that he is a big believer in the management of the business being a crucial part in a good or bad investment.

He said: “It’s a management relationship that works well. When you have people who are driven, want to push on with Sir Richard Branson the business Business Leader - The magazine for entrepreneurs & business leaders

Reece added: “When investing in seed-stage start-ups, there are several ways to judge whether the investment will be successful.

For RLC Ventures, we focus on three key aspects: team, market and product.

“A strong team is central to the success of any business, but none more so than early-stage companies. And the founder’s experience, commitment and entrepreneurial drive allows them to have a clear vision and strategy to achieve their ambitions.

“We have found that companies disrupting large and out-dated markets are more likely to be successful e.g. financial services. And finally, the product must be scalable, have barriers to entry and address a real-world problem to achieve the growth objective we seek.”

Technology comes to the fore As the ever-changing world of technology comes to the fore within business there will undoubtedly be more investment opportunities on the horizon.

But what are the latest trends and the state of the investment scene currently? Dorbin sees technology will still be the focus for future investment opportunities.

Technology investments always get a lot of attention, manufacturing continues to be a strong sector.

Reece believes the next few years could provide an exciting time moving forward.

He said: “Investors are much younger than before. Fuelled by the generational wealth transfer and increased awareness of the importance of early-stage tech companies, young people are becoming more active investors in start-ups.

“Although there is a long way to go, there is also increased diversity within the industry. With a more diverse mix of venture capitalists, a wider range of insights and perspectives are achieved which ensure the best start-ups are identified and backed.

“Finally, there seems to be a paradigm shift of successful tech companies emerging in Europe who have enjoyed recent successes such as Monzo, Farfetch, Revolut and Funding Circle.”  21

REVIEW

Round-up of key deals from around the UK CMA raises concerns with £1.73bn PayPal and iZettle merger The Competition and Markets Authority (CMA) has been investigating PayPal’s £1.73bn acquisition of Swedish mobile payments company iZettle. The deal, which completed in September 2018, brings together the two largest suppliers of mobile point of sale devices in the UK. The CMA has found that PayPal could face insufficient competition after acquiring a market-leading rival. The findings raised concerns that the merger could result in customers, which include SMEs, paying higher prices or receiving a lower quality service.

Avison Young to acquire GVA in transformational deal Global real estate agency Avison Young has announced that it has acquired GVA, in a move that will combine them within their existing UK operations.

GVA, which employs 80 people in its Bristol office, is a multi-disciplinary business offering clients a service that spans the entire property life cycle from strategy and planning through to delivery and management.

The firm has 1,500 employees in 15 offices in the UK, Ireland and Poland. GVA is also a founding member and majority shareholder of GVA Worldwide Ltd.

Sports nutrition firm makes £32m acquisition to accelerate growth Lancashire-based Science in Sport has agreed to acquire protein products maker PhD Nutrition for £32m. Science in Sport will pay £28.5m in cash and £3.5m through the issue of 5.8 million shares, at a price of 60p per share.

The acquisition is expected to have a positive impact on revenue, with PhD set to deliver mid-teen percentage growth in the first full year following deal completion. The acquisition will also complement Science in Sport’s plans to expand into international markets, as PhD already has a position in the Middle East and China.

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Vue acquires German cinema group for £115m Vue International has acquired CineStar in Germany for an upfront payment of £115m and variable consideration of up to £81m.

This represents a maximum potential enterprise value of £196m.

The acquisition of 57 premium multiplex sites with 449 screens is the largest in Vue’s history, and signifies Vue’s continuing confidence in the European market and the future of the international exhibition industry.

Issue 6: January - February 2019

DEALS

Investments firm makes a splash with deep sea electronics £162m acquisition Caledonia Investments has acquired a majority stake in diesel-powered electricity generators manufacture Deep Sea Electronics for £162m.

In the most recent audited consolidated accounts for its financial year to 31 May 2018, Deep Sea reported a gross profit of £21m and profit before tax of £13m on turnover of £38m, and, at that date, had gross assets of £35m.

Frankie & Benny’s owner adds Wagamama to portfolio in £559m deal Asian-themed chain Wagamama has been approached about a takeover by Frankie & Benny’s owner The Restaurant Group for a cash sum of £357m, in a deal set to be worth £559m on completion.

TRG plans to expand Wagamama, which currently operates over 200 outlets worldwide, with 158 UK-based restaurants, by converting TRG sites into Wagamama restaurants – explaining the chain was well placed to capitalise on the trend for healthy eating. TRG also owns a number of wellknown fast-casual dining chains, including Chiquito and Joe’s Kitchen.

Under the terms of the deal, Caledonia acquired a 98.9% equity stake in DSE for £117m, provided a short-term bridging loan of £50m, while the management team had invested £1.7m for the remaining equity.

Ashley to the rescue: Sports Direct buys Evans Cycles for £8m Evans Cycles, which has 60 stores across the UK, has been sold to Sports Direct owner Mike Ashley, for £8m. Immediately after the purchase, Ashley warned there will be hundreds of jobs lost throughout the firm.

opening its first shop in South London, employs 1,300 people and put itself up for sale last month as it has struggled amid tough High Street conditions.

Evans is the second national retailer Ashley has rescued in recent months, following his acquisition of House of Fraser.

The bike chain, which started in 1921

Business Leader - The magazine for entrepreneurs & business leaders

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DEBATE

FUNDING GROWTH IN YOUR BUSINESS The Panel: Dan Hardy Crowdcube Rose Lewis Collider Alex Dunning Seedrs Harry Davies Wayra Nigel Walker Innovate UK Mark Brownbridge The EIS Association Jenny Tooth UK Business Angels Association Marilena Loannidou FinTech Investments

W

ith more options, providers and platforms available than ever before, for funding business growth, BLM recently attended the Business Funding Show’s latest seminar as a media partner.

The event looked at the challenges around early stage Investment and how best to navigate the initial years of crowdfunding and accelerators.

SHOULD INVESTMENT BE THE FIRST ITEM ON THE AGENDA FOR START-UP COMPANIES? Harry Davies: “Investment for a start-up business is going to be vital but definitely shouldn’t be the first thing thought about.

Before you approach any investors you’ve got to prove that you’re solving a problem, you’ve got to prove that the product market is there, and that what you provide is a problem which people will pay to have solved.

“If you don’t have that then you need to rethink the business model. You need a team

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that can deliver on the goals needed to be achieved.”

Rose Lewis: “If the first thing, as an entrepreneur, you think about is money, the chances are you’re not really passionate about the product and that’s what investors are wanting to see in you.

“I would say there’s a need to turn up to as many workshops that are put on as possible.

Not turning up shows you’re not interested or arrogant and you think you know everything.

Personally, we like open entrepreneurs who are willing to listen. We don’t always have the right answers either, but we want to know you’re open to new ideas and exploring different options for your business.”

HOW DO START-UPS GET INVESTMENT READY? Dan Hardy: “Before investment you need to network. Entrepreneurs are very giving with their knowledge and their experience of gaining funding. There are so many events out there for networking opportunities, so whether you need office space or marketing advice, there’s going to be an event that you can use to gain contacts.

Issue 6: January - February 2019

FUNDING GROWTH

taking the leap to re-direct. Quite often the gut instinct is to just fundraise again, give it another six months, and hope it changes, but that’s not the best way to do things.”

WHEN COMPANIES LEAVE AN ACCELERATOR PROGRAMME HOW MUCH MORE WELL EQUIPPED ARE THEY? Rose Lewis: “When start-ups leave an accelerator, they are better equipped to face the challenges of growth and development – they have a bigger network, and continued support and advice. Programmes can also give them access to a number of investors, who can support them for life, forming a very powerful set of ambassadors for their product.”

WHAT ARE YOUR THOUGHTS ABOUT ENTREPRENEURS GIVING AWAY EQUITY? Jenny Tooth: “Taking on equity really is the great turning point in your business, in terms of being able to accelerate growth much more rapidly. Sometimes people worry about giving away too much equity too early.

“People are protective about their business, but you need to get your idea out there and speak about it to gain an outside view and advice.”

Harry Davies: “Getting out there and speaking to people is important. But even more important is not to spend too much too early. There’s nothing worse than raising tons of money and then finding out that you’ve misspent.

“The more validation you can do at the early stage the better, it’s key to really enjoy the time building a company – it’s the most flexible you’re ever going to be in your journey.

Once things start progressing it can be quite hard to take a step back and look at things that might not be working too well. Plus

“But there are massive benefits to this and the reason is because you actually get investment to help you do the things you really need to do. Such as hire more staff, expand customer base and then businesses can actually start to produce to scale.

“The biggest and most important thing to bear in mind is that all equity isn’t the same.

What you will get from angels and angel investors will be different to what you get when you reach the next stage of funding. It’s all about having a strategic plan of how much equity is needed, what you want from equity and how much of the business is to be given away.”

Mark Brownridge: “Over the last few years we’ve seen the significant contribution that venture capital funding has made to SMEs – it’s given a big injection of capital that banks don’t necessarily like lending. Equity funding gives you money, but with EIS and VC money you also gain mentoring as well, which could be invaluable and open doors.”

“TAKING ON EQUITY REALLY IS THE GREAT TURNING POINT IN YOUR BUSINESS, IN TERMS OF BEING ABLE TO ACCELERATE GROWTH MUCH MORE RAPIDLY.” Jenny Tooth Business Leader - The magazine for entrepreneurs & business leaders

Nigel Walker: “Risk is a key thing when you’re starting a business, so you need equity capital. I see too many companies that are under capitalised. They don’t have enough equity and they haven’t got the financial resources to take the sort of risks they need to. I would advise not to be equity adverse.”

WHAT HAVE BEEN THE KEY CHANGES YOU’VE SEEN WITH REGARD TO ALTERNATIVE FUNDING OPTIONS? Jenny Tooth: “There have been some interesting trends which have emerged, not least the EIS, which has had a massive impact on the market because angels have been able to get 50% tax credit by backing early stage businesses. This encouraged angels to go in earlier into those businesses because they must be less than two years old.

“In parallel with that, crowdfunding platforms have been launched, which have seen a massive democratisation of investment for many people, with engagement increasing as people invested small funds of money into businesses. Since 2012 there has been a steady increase of people using the EIS and SEIS tax schemes, which means more and more money has come into the market.”

WHICH SECTORS ARE YOU SEEING MOST INVESTMENT IN? Nigel Walker: “We’re seeing whole industries being transformed and new industries being created, through things like digital manufacturing and the concept of the factory of the future. Businesses in these sectors usually find it harder to attract equity investment because the time it take to come to market can be longer.”

Marilena Loannidou: “Innovation and technology is influencing sectors such as life sciences and artificial intelligence and we’re seeing increasing investment in these areas.

If you’re fundraising, think about the whole journey because some companies in the UK fundraise in smaller chunks, but when companies in the US fundraise they go for larger chunks.

“This makes them focus on other aspects, meaning they can take their business to the next level quicker without having to organise more funding rounds. There is less availability of capital in the UK against the size of VC funds you see in the US.”  25

SECTOR REPORT

WHAT NEXT FOR THE

£20 BILLION HOTEL INDUSTRY

BLM INVESTIGATES, IN ITS LATEST SECTOR REPORT

T

he hospitality industry is one of the most important parts of the British economy, with total turnover reaching £98bn in 2017 – up from £92bn in 2016 and £86bn in 2015, according to data from the Office of National Statistics.

A huge contributing factor to the hospitality sector in the UK is the hotel industry, which according to analysis by Statista generated a turnover of approximately £19.4bn in 2017.

But with Brexit on the horizon, and the Great British Pound being at a lower level than previously experienced, should hoteliers be worried moving forward and how is the market currently performing?

The capital stays strong According to PwC’s Hotels Forecast 2019, trading growth is set to flatten in the year ahead due to economic uncertainty, weak business travel demand and an influx of new rooms scheduled to open across the country in the year ahead.

The report found that the outlook for London has levelled out with a year-on-year occupancy growth of only 0.1% and a marginal fall of 0.5% forecast for 2019, which will see occupancy levels drop one percentage point to 81% in 2019.

The research also found that Average Daily Rate (ADR) is forecast to see a marginal uplift over the next year, with 0.2% growth for 2018 .

Revenue per available room (RevPAR) growth will remain static with 0.3% forecast for both 2018 and 2019; a big contrast to the 4.6% growth in 2017.

Commenting on the latest forecast, Liz Hall, head of hospitality and leisure research at PwC, said: “2017 was a hard act to follow for hotel trading, in terms of growth and 2018 has been held back by uncertainty, slower economic growth, significant supply additions and reported stuttering business travel.

“Following a number of years of strong revenue growth, when there was not the imperative to focus on costs, prudent operators and owners need to adopt a stringent approach to operating costs growth in 2019 to preserve profitability.”

The research from PwC mirrors the findings from the 2018 London Hotel Development Monitor Report which states that the capital is set to add 11,600 rooms to its hotel market by 2020, providing business and leisure visitors planners with an even greater choice of accommodation.

Tracy Halliwell, director of tourism, conventions and major events at London Convention Bureau, said: “London is a world class destination for leisure and business travellers and it’s no surprise to see that hoteliers are showing a strong appetite for opening some of their best and most exciting properties in the capital.

“We’ve seen a number of different styles of establishments open across a range of price bands, providing even greater choice for visitors from all over the world.”

Cont.  26

Issue 6: January - February 2019

HOTELS

Business Leader - The magazine for entrepreneurs & business leaders

27

SECTOR REPORT

Commenting on the London hotel sector, Graham Craggs, managing director of JLL Hotels and Hospitality, added: “London is one of the most liquid markets in Europe and a popular investment hotspot for both domestic and international investors.

“The weaker pound has attracted a variety of overseas hotel operators and investors to invest in hotel real estate.

“Despite political uncertainty, investors continue to view London as a key destination.

“This is evidenced by the willingness to consider new development opportunities and the number of new hotel brands opening in the London market.”

Outlook for the regions But what about the rest of the UK? The findings from PwC revealed that occupancy levels in the regions across the UK have been averaging 76% since 2015 and are forecast to remain around this level for the next year, but will see a 3% decline in 2018 with no growth forecast for 2019.

ADR growth is forecast to slow compared to 2017, with an anticipated 1.3% increase

for 2018. Meanwhile, RevPAR is forecast to see a 1% uplift and a further 1.2% in 2019.

Commenting on the results from the report around the regions, Liz added: “Our forecast shows RevPAR in the regions to end 2019 23% ahead of pre-recession peaks in nominal terms but lagging in real terms by 7%. Demand continues to be driven by inbound tourism, domestic holidays and events.

“LONDON IS A WORLD CLASS DESTINATION FOR LEISURE AND BUSINESS TRAVELLERS AND IT’S NO SURPRISE TO SEE THAT HOTELIERS ARE SHOWING A STRONG APPETITE FOR OPENING SOME OF THEIR BEST AND MOST EXCITING PROPERTIES” Tracy Halliwell

“Occupancy rates have been creeping up from 66% in 2009 to an average of 76% in 2015. We forecast rates to remain at this level despite over 40,000 rooms to be added in the regions in 2018 and 2019. A continuing structural supply shift towards a greater proportion of budget rooms will sustain occupancy levels.”

Deals increase Regarding deal making in this sector, Brexit uncertainty hasn’t slowed down the amount of deals which took place within the hotel industry in the UK, as total deal volume in the first half of 2018 saw £3.8bn worth of deal activity; an 80% rise on the first half of 2017.

Such deals include Orchard Street Investment Management completing a £38m transaction for the 161-room Travelodge Quayside hotel in Newcastle; as well as two hotels in Cornwall - The Metropole Hotel in Padstow and the Fowey Hotel in Fowey - which were sold with a guide price of £10m and £5.5m respectively.

PwC estimates that the forecasted total deal volume will reach £6.8bn by the end of the year, a 40% increase on last year and the second highest volume of hotel investment in the UK after record levels of £9.3bn in 2015.

For 2019, deal activity is forecast to slow down with a fall of around 34% from 2018 to £4.5bn.

Brexit But what impact is Brexit having on the sector? With the UK’s impending exit from the EU set to take place on March 29, tourists from key European markets and the weaker pound mean London remains affordable for many leisure groups and compares well to competitor cities such as Paris.

This is further backed by analysis from the 2018 London Hotel Development Monitor Report published by JLL and London & Partners, which shows that the growth of the capital’s hotel market is set to outpace a number of major European cities by 2020, including Paris, Berlin, Lisbon and Milan.

Z Hotels is a fast growing independent hotel chain. On the impact of the weaker pound, its founder Bev King comments:

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Issue 6: January - February 2019

HOTELS

“At this point in time, London is amazing value for money for tourists. For anyone with any other currency than the pound, London and the UK is exceptionally good value for money.

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“With the pound so weak it makes it very hard for Brits to travel but it makes it very cheap for tourists to come here.

“The biggest challenge facing the industry is recruitment. With the impending Brexit and immigration changes, the hardest thing will be for hotels and restaurants to source efficient employees to supplement their workforces.

“Immigration policy is changing toward skill-based immigration and predominantly many people in the hotel industry would be considered unskilled.

I think it will be difficult to find people to work in hotels, restaurants and pubs.”

What King says about immigration changing the work dynamic in this country is put into context when looking at a recent study conducted by Planday and YouGov. The findings showed that 11% of workers (equivalent to around 330,000 staff nationally) in UK restaurants, catering, bars and hotels were thinking about leaving the UK as a result of Brexit.

Airbnb Another threat to the hotel sector is Airbnb. It has revolutionised the lodging market by keeping hotel rates in check and making additional rooms available in the country’s hottest travel spots during peak periods; when hotel rooms often sell out and rates skyrocket.

This all spells bad news for hotels who have traditionally garnered their biggest earnings when rooms are scarce – meaning customers pay higher rates.

A report by Morgan Stanley found that 42% of Airbnb users have replaced a traditional hotel stay with a property from this platform.

The Bristol is part of a family owned collection of luxury and urban hotels, providing modern style and warmth in the waterside creative quarter of Bristol. With its modernist façade and warm contemporary design, it enjoys an unbeatable waterfront location in the heart of one of the UK’s most exciting and eclectic cities, as well as a central role in the local business community. It has recently been named as best city break hotel in the South West by The Sunday Times ‘100 best British Hotels’ 2018 The lively harbourside position ensures The Bristol is at the heart of a thriving creative hub, perfectly placed to access theatres, museums and art galleries; shopping in Cabot Circus; local attractions like the Clifton Suspension Bridge and SS Great Britain; and Bristol’s aerospace, engineering and financial services companies.

Open to both residents and nonresidents, The River Grille Restaurant with its lofty dimensions, exquisite floor-to-ceiling windows and harbourside views, enjoys a strong reputation locally. With a menu that changes with the seasons it has something for everyone and is particularly known for its signature barbecued steaks and fish

Airbnb was founded in 2008 and has grown rapidly at a time when plenty of other industry-disrupting platforms have flourished, including Uber, Craigslist, and Spotify.

Cont. 

dishes, not to mention the ever-present chocolate fondant - a must for dessert lovers. For a more informal venue, The Shore Café Bar offers an open-air terrace on the waterside – a popular destination with the urban after-work crowd.

Against the attractive harbour backdrop sits the hotel’s fully dedicated Meetings & Events Centre, which offers nine elegantly appointed event spaces, generous lobby and break-out areas, the best in technology and the dexterity to handle any kind of event from sales conferences to executive board meetings, training seminars to interviews and weddings to Christmas parties.

The hotel has always been a firm favourite with Bristolians and visitors alike. Its unique location and lively ambience, coupled with an exceptionally warm welcome and ‘can do’ service, ensures that The Bristol becomes a home from home. Throughout the hotel, the ethos is one of real warmth and thoughtfulness, delivered by a dedicated and professional team. The definition of success is for guests to feel that the hotel is more akin to a home and therefore will want to return again and again.

The Bristol Prince Street, Bristol BS1 4QF UK

T: +44 (0) 117 900 7818 www.doylecollection.com/bristol

Business Leader - The magazine for entrepreneurs & business leaders

E: jane_guy@doylecollection.com

29

SECTOR REPORT Commenting on the impact Airbnb has had on the hotel industry, Bev commented: “Black cab drivers have the same problem with Uber that the hotel industry has with Airbnb, in the fact that they’re unregulated and therefore they don’t offer the same quality and security.

“All of our hotels comply with the latest regulations in terms of fire safety, health and safety etc. But with Airbnb they don’t have any, you could be sleeping in a death trap, with no fire risk assessment, you have no idea. Properties fly in under the radar.

“How many Airbnb owners declare their earnings on their tax return every year and pay income tax?”

The issue on rates is something that the head of the Bristol Hoteliers Association (BHA) Imran Ali agrees with.

On the subject he said: “Not only do these properties not pay business rates but they lack the required level of fire, health and safety standards. I imagine as well, many landlords who still have a mortgage have not declared that they are leasing out their property to their lender and would be in

Cyber and terrorism risks for hotel operators

By Terry Edwards, Director, Real Estate - Jelf

new ways to by-pass cyber defences via these third-party systems and attachments to their systems.

Cyber-attacks and terrorism related events are two prominent risks that hotel operators face in today’s environment.

It is not just personal data and undetected gaps in core IT systems that can leave a hotel business vulnerable. Other areas, such as Building Management Systems which are typically not designed with cyber security in mind, can also be vulnerable.

Hotel and reservation systems can be interconnected with a large number of third-party systems and ‘attachments’.

Virtual intruders are increasingly finding

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“We’re happy for competition however it has to be on a level playing field. If nothing is done, hotels and B&Bs will suffer.

“It goes without saying that the local job market will also see a decline due to fewer services being needed. And finally, let’s not forget that the council will then start to lose income from the tax they currently receive from these legitimate businesses.” 

It is these very advancements, and the ever increasing reliance on automation and remote operations, that are exposing systems to possible cyber-breaches and full on attacks.

-

Hotel operators are typically required to manage and store large amounts of personal data with significant money and effort spent on securing their IT infrastructure to prevent breaches.

breach of their mortgage agreement. Not telling your mortgage lender that you are letting out your property also invalidates your insurance.

Building and access control systems are computers that monitor and control building operations such as airconditioning, electrical power, electronic card reading, lifts, fire alarms and suppression systems, heating, lighting, ventilation and surveillance.

Dedicated and comprehensive cyber insurance is therefore becoming increasingly and critically important to provide businesses with protection and support for a whole range of cyber related eventualities.

Terrorism has become a major risk factor for the hospitality industry. This should not come as a surprise given the continuous foot traffic, multiple entrances and exits and numerous public areas for congregation.

Western countries in particular have seen a marked increase in ‘Active Assailant’ incidents. These attacks are often carried out by individuals or small groups using guns, knives and vehicles to cause death, damage and destruction.

Traditional terrorism policies have historically been primarily focused around Property Damage, usually sustained from well-known and organised groups, and typically do not cover Active Assailant scenarios.

Hotel businesses are therefore increasingly opting to buy, or at least consider, Active Assailants insurance policies which cover costs such as medical or mental health care expenses, business interruption, legal liability or temporary security measures.

Issue 6: January - February 2019

ADVERTORIAL

Working closely with our clients is at the heart of our success

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ristol based event production company Sounds Commercial is delighted to have supported the Ascot Group as Technical Production Partner for the 2018 Business Leader Awards at Ashton Gate.

clients as preferred supplier long- term partnerships.

incredible accolade to be awarded this contract for five consecutive years.

Having worked with Ashton Gate through the first four years of the stadium’s development, providing Technical Production support, Sounds Commercial is now delighted to announce a joint agreement of a new two year contract to operate as Ashton Gate’s official preferred Technical Production Partner. This is a wonderful time to be working in partnership with Ashton Gate, as the business matures and we look forward to working together as Ashton Gate move forward with their exciting development plans.

The highly skilled in-house Event Management and Production teams ensure that Sounds Commercial’s one stop offering is of the highest quality at every stage of the process, providing a total in-house solution, from concept to delivery. Whether you are planning a meeting for 20 people or a gala dinner for 2,000, Sounds Commercial will support you every step of the way to ensure your event is a huge success.

This year, Sounds Commercial was also commissioned to stage the hugely prestigious League Manager’s Association Awards for the fifth year running. It is an

Are you planning an event and would like some help from the Sounds Commercial team? We’d love to see how we can help and if you quote LMA 2018 you will receive a 10% discount for any event booked between now and the end of February 2019.

Kieran Murphy, Commercial Director, said following the hugely successful event, “We hope you all had a great evening at the Business Leader Awards. This is the 6th year Sounds Commercial have been Technical Production Partners at this prestigious event and it has been a particular honour to be associated with Andrew Scott and his team at Business Leader right from the Magazine’s very early days.”

With five regional centres across the country, Sounds Commercial is one of the UK’s leading event production companies, providing full event management, exhibitions, video, and coordinating events across both the UK and Europe. The business, which was launched in 1986, has gone from strength to strength, and the company’s 32nd birthday in August was celebrated with the delivery of a new fleet of vans to support the business operation across the country.

Sounds Commercial’s ability to consistently deliver events at the highest level has attracted relationships with prestigious Business Leader - The magazine for entrepreneurs & business leaders

T: 01179 355 255

E: info@sounds-commercial.co.uk

www.sounds-commercial.co.uk 31

FEATURE

RETAIL: THE RENTS AND RATES SCANDAL BLM INVESTIGATES IF RENTS AND RATES ARE THE REAL ISSUES FOR THE HIGH STREET

T

he outlook for the British high street seems bleak, with numerous retailers, including Marks & Spencer, House of Fraser and Waitrose, announcing store closures and others going into administration.

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In fact, this year has seen the greatest number of store closures since Woolworths collapsed a decade ago, with 1,500 retail units left empty.

While much has been made about online shopping causing the death of the high street, the impact of business rates and high rents for high street properties should not go unnoticed.

High rents In a recent media interview, Debenhams chairman Sir Ian Cheshire urged landlords to wake up to the changes in shopping habits and, where appropriate, renegotiate leases which he compared to a ‘straitjacket killing more and more retailers’.

He comments: “Landlords haven’t changed their model, they are still stuck in a 19th

Issue 6: January - February 2019

RETAIL

it’s a big structural shift, which is basically saying old models have to be reinvented. If you’re starting out now you’d have much less space, much more online and much more flexibility. No one will now be signing 20-year leases”

century leasehold model, with business rates (a property tax) on top that are actually Elizabethan in how old they are, our tax system doesn’t reflect modern business models,” he said.

He also talked about how retail is evolving, by saying: “I think it is the reality. What you’re seeing is retail facing more change in the past three years than in the previous twenty...

0.7% in 2018/19 compared with 2016/17.

Amazon dismissed the findings and said the figures did not take into account rates paid on other premises, such as software development offices.

New West End Company, an alliance of Business rates central London retailers, revealed the most Calculated according to the market value of startling research. property businesses own, business rates It calculated that are the popular villain Marks & Spencer, “I THINK IT IS THE of the UK high street. a company with a REALITY. WHAT YOU’RE This property-based turnover of £9.6bn tax raises £29bn a last year, paid SEEING IS RETAIL year for the Treasury, £184m in business FACING MORE CHANGE of which retailers rates, whereas cough up £8bn.

Amazon, with a IN THE PAST THREE slightly smaller While business rates YEARS THAN IN THE revenues in the are not the only UK of £7.3bn, paid PREVIOUS TWENTY... culprit, complaints substantially less in from bricks-andIT’S A BIG STRUCTURAL rates – just £14m. mortar shopkeepers SHIFT, WHICH IS is correct that these New West End were introduced in calculated that a 1% BASICALLY SAYING OLD a pre-internet age sales tax on online MODELS HAVE TO BE and seem somewhat businesses could archaic now. raise more than REINVENTED.” £5bn, which could go As they are currently Sir Ian Cheshire some way to levelling structured business the retail playing rates add to an field. increasingly prominent problem for physical retail stores.

Business rates is something that Dave Lewis, Tesco chief executive, says needs a revamp, Business rates across the UK have increased claiming that the charges that firms must by 3%, in line with inflation. However, pay on their buildings played a ‘large part’ in research by independent retail advisors sending some retailers to the wall.

Altus Group found the average rates bill for department stores in England and Wales In a recent interview with the BBC, Dave said: was up 26.6% in 2018/19, compared with “Are we allowing it to stay competitive or are 2016/17 and large high street shops saw we, by stealth, lowering corporation tax and average rises of 10.8%. increasing business rates to a place which is creating an uneven playing field and forcing The online retailer conundrum people to think about how to avoid that cost Online retailers have been accused of and find other routes to the market?” bending the system to allow themselves a loop hole against business rates.

The Tesco boss said business rates was the biggest tax his company paid, adding up to Take Amazon, for example. The company more than £700m a year. operates warehouses from out-of-town locations in areas with lower property prices; “You need a level playing field … between an whilst high street retail outlets occupying a online digital world and a traditional retail piece of prime Central London real estate will store base model like the one we have.” pay higher rates.

Furthermore, Altus assessed rates paid on the 11 distribution centres owned by Amazon.

It found that rates for the centres rose by just

Business Leader - The magazine for entrepreneurs & business leaders

Cont.  33

FEATURE

In a Budget which Hammond said signalled the ‘start of the end of austerity’, he announced the treasury would provide £675m of ‘co-funding’ over the next four years “to support councils to draw up formal plans for the transformation of their high streets”.

Hammond also stated that the UK Government would bring in a digital services tax, which he expects will raise around £400m per year. Digital tech giants will be taxed 2% on the money they make from UK users.

Stephen Martin, director general at the Institute of Directors, said: “New taxes warrant a clear justification and careful implementation.

“The new proposed digital services tax may make political sense, but it has been announced with scant detail on how it will work apart from the revenue threshold, which is lower than even the EU has suggested.

The Chancellor must proceed with extreme caution here.”

Company Voluntary Arrangements CVAs Another issue impacting the retail sector are CVAs. Designed as a way to help save businesses in peril, CVAs are increasingly being seen as a way of bashing property landlords and protecting other creditors from losses.

The latest figures from the Insolvency Service show there were 94 company voluntary arrangements (CVAs) in the second quarter of this year, a 10.6% rise on the same period in 2017.

Entering into a CVA means retailers are able to close some stores and reduce the rents on others they wish to keep.

retail sector with Homebase, Mothercare, Carpetright, The Original Factory Shop and New Look - just some recent examples of store chains which have sought to ensure their survival by this method.

“THE NEW PROPOSED DIGITAL SERVICES TAX MAY MAKE POLITICAL SENSE, BUT IT HAS BEEN ANNOUNCED WITH SCANT DETAIL ON HOW IT WILL WORK.”

Steven Wiseglass, an experienced insolvency practitioner, director and co-founder of Inquesta, said: “A CVA proposal may involve negotiating a new lease on a retail unit with a rent reduction of, say, 30%.

Stephen Martin

“Yet if the landlord opposes the CVA proposal, there is a risk that the retailer will simply go bust and close.

“Put simply, landlords are increasingly having to choose between the devil and the deep blue sea.” 

CVAs have become a growing trend in the

OPENING & CLOSURES OF MULTIPLE RETAILER UNITS (2013 - 2018)

5000

Openings Closures

4000

3000

2000

1000 H1 2013

H1 2014

H1 2015

H1 2016

H1 2017

H1 2018

Time Period

Certainly, measures to preserve jobs and keep businesses afloat are to be welcomed, but the fact should not be ignored that landlords often end up as victims of this process.

Store closures have slightly increased against the equivalent period last year but it’s a significant fall in store openings driving overall net decline - a record level for the British high street, according to PwC research.

Russ Mould AJ Bell warns that entering into a CVA should not be taken lightly.

A net 1,123 stores disappeared from Britain’s top 500 high streets in the first

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“If it is passed, there is a real risk that highlygeared landlords will be unable to pay their mortgages.

“Yes, a landlord can at a later stage give the tenant notice to quit and seek an alternative occupant, but in today’s climate that is no easy task and a vacant shop will inevitably prove costly.

He added: “We have to be careful here, because CVAs are not free, or necessarily even cheap. Advisers and lawyers can receive several hundred thousand pounds in fees for their work, so CVAs are not necessarily the ‘get-out-of-jail-free’ card that they are always seen to be.”

Number of Units

Digital tax To try to make this more equal the chancellor Philip Hammond has launched a £675m ‘Future High Street Fund’, alongside significant business rates relief for small retailers from April 2019.

RETAIL

half of the year compared with a 222 store loss over the equivalent period last year.

Daily store closure rates have plateaued though at 14 stores a day but store openings have fallen, with a 773 difference between store openings in H1 2017 and H1 2018.

Issue 6: January - February 2019

ADVERTORIAL

chosen for Carmaker’s Prestigious on Demand Service return we’ll offer premium products. There could be someone in a business who’s a new starter awaiting a company car, or maybe there’s a representative of a company who needs a car for a meeting, we’re able to cater for this.

We provide an executive service in an executive way for a premium product. Audi on demand is easy, once setup on the system, you choose the car you’re having, the car you see is the car you’re having and the price you pay is just that.

Steve Smith of Bristol Audi spoke with Business Leader about his pride in his establishment, being chosen as one of the selected pilot dealers across the UK for the groups on demand service.

Audi AG have selected key positioned cities in the UK to roll out a future mobility project which they have launched in Germany, USA, China and Japan.

Bristol has been chosen as one of only 11 Audi on Demand centres in the UK. What trends are we seeing in the automotive industry?

Autonomous driving is a big one. There’s been a lot of bad press about it, but actually it’s an aid. It’s not there to replicate or replace the driver, but it’s there to make the car safer. Because of autonomous driving, the accident rate will drop for pedestrians and the occupants.

You’re one of only 11 centres in the UK to be a part of the Audi on demand scheme, what can this do to help businesses?

Audi on demand offers businesses the chance for a premium hire car experience in

There have been car rental firms around the country for many years now, how is Audi on demand different?

There’s a segment of the market that when they go to a hire company for a premium experience, for a premium product, with no hidden extras, they’re let down and we can fit into this segment. We’re not looking to get into the car hire market, but we are looking to fit into the gap where the car hire market doesn’t quite fit for businesses.

How has the scheme gone so far?

We’re only in major cities across the UK and we’ve strategically placed the scheme in those cities where there’s a real need. We started the project around two years ago in Los Angeles and Tokyo and we’re very lucky that Audi AG looked at the UK and wanted one in Bristol. I’m very proud that our Bristol site has been selected.

We’re given a lot of bad information about diesel vehicles, is the move away from these as necessary as we’re told?

I think a driver needs to look at what the needs are from their vehicle and base their decision on that, and not the scaremongering of local politicians looking to further their career by bringing projects in which contain

Business Leader - The magazine for entrepreneurs & business leaders

buzzwords. Diesel is not bad, old diesel was a lot dirtier than it is now and I get why we have to do something about that, but if you’re someone doing more than 12,000 miles a year, then a diesel is the car for you.

When looking at reducing harmful gases and fumes, electric vehicles will be the way forward. Our full electric vehicle arrives in January called the E-Tron, it has a range of 250 miles and it’s a real competitor for Tesla and others.

Where do you see the future of transport?

There will be less ownership. There will be more autonomous driving where you will go to your office and then the vehicle will go and park itself in a car park. These car parks will be able to fit twice as many cars because you don’t need space in between them for people.

I also think there will be fewer two car families. Parking is of a premium and therefore I think leasing cars will become more of the norm. We’ll never have utopia of not needing a car and relying on public transport, it doesn’t give you enough flexibility, but I think supplementing a lot of our journeys with public or shared transport is the answer.

Lysander Road, Cribbs Causeway, Bristol, BS10 7FF T: 0117 958 1450 E: bristolaudi@monmotors.com

monmotors.com/audi

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THE 2019 BUSINESS LEADER AWARDS BRITAIN’S MOST PRESTIGIOUS & INFLUENTIAL BUSINESS AWARDS Launched in 2013, the Business Leader Awards has grown year-on-year to become the UK’s most prestigious and credible awards celebrating British business success.

The awards recognise pioneers, innovators and visionaries – the companies large and small who are ‘best in class’, along with the entrepreneurs, founders and leaders who run them.

The energy surrounding the awards is unrivalled – with hundreds of entries, globally recognised judges and a marketing and media frenzy that has seen the awards gain national attention and trend on social media for two consecutive years.

The process culminates in a glamorous awards evening and gala dinner, held at the world-famous Hilton Hotel on Park Lane, London, an exquisite evening attended by celebrities, VIPs and leaders from business, government and education.

Celebrate with finalists and winners at a champagne reception, followed by a 4 course gala dinner and entertainment with a celebrity host.

“The Business Leader Awards is a great way to recognise the UK’s most dynamic businesses.”

Piers Linney, Former Dragons Den star, Investor & Lawyer

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R U O ND Y

D N BRA

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ALIGN YOUR BRAND AND BECOME A SPONSOR OF THESE PRESTIGIOUS AWARDS SPONSORSHIP OPPORTUNITIES • HEADLINE SPONSOR • CATEGORY SPONSOR • CHAMPAGNE RECEPTION SPONSOR • TABLE CENTRE SPONSOR • EVENT PROGRAMME SPONSOR

Sponsorship opportunities are strictly limited. For more information, please call us on 020 3096 0020 or email events@businessleader.co.uk

Date: 21st June 2019, Hilton Hotel, Park Lane, London Issue 6: January - February 2019

AWARD CATEGORIES

TAKE YOUR BUSINESS TO THE NEXT LEVEL BY WINNING A BUSINESS LEADER AWARD

• START-UP BUSINESS AWARD • SCALE-UP BUSINESS AWARD • SOCIAL ENTERPRISE AWARD • FRANCHISE BUSINESS AWARD • RETAIL/E-COMMERCE AWARD • MANUFACTURING EXCELLENCE AWARD

Highly coveted, previous Business Leader Award winners have benefited hugely from being shortlisted for the UK’s leading business awards.

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DEBATE

SPONSORED BY ALLIED IRISH BANK (GB)

Mike Dinnell – Manchester Business Centre M: 07718 323749 | E: mike.l.dinnell@aib.ie

Kevin Goodall – Bristol Business Centre M: 07710 859250 | E: kevin.j.goodall@aib.ie

WHAT ARE THE CHALLENGES FACING THE UK

MANUFACTURING SECTOR? 38

Issue 6: January - February 2019

MANUFACTURING

SPONSORED BY ALLIED IRISH BANK (GB) Mike Dinnell – Manchester Business Centre M: 07718 323749 | E: mike.l.dinnell@aib.ie

Kevin Goodall – Bristol Business Centre M: 07710 859250 | E: kevin.j.goodall@aib.ie

BUSINESS LEADER MAGAZINE TEAMED UP WITH ALLIED IRISH BANK (GB) TO HOST A ROUNDTABLE THAT BROUGHT TOGETHER LEADERS OF UK MANUFACTURING BUSINESSES – TO DISCUSS THE ISSUES FACING THEIR SECTOR. CAN YOU TELL READERS MORE ABOUT YOUR BUSINESSES?

back into your supply chain and working it through.

Richard Tonkinson: “We manufacture bathrooms offsite for use in a range of sectors including hotels, hospitals, apartments and student accommodation.

“Where we can help is that we want to understand your business and get underneath your working capital and find out where you may have cash trapped and supporting the growth ambitions of the business.”

“We’ve taken the business from £2m to £30m turnover in only fourteen years.”

The Panel: Stephen Dilley WBD Paul Falvey BDO Henry Herbert Hobbs House Bakery Paul Richards Aquarian Cladding Mark Lippett XMOS Jason Kirby Stirling Dynamics Chris Smith Marshfield Bakery Lynda Wookey SWMAS Mark Dinnell Allied Irish Bank (GB) Tim Harrop LyeCross Farm Richard Tonkinson Offsite Solutions Simon Howes SWMAS

Chris Smith: “Marshfield Bakery employ 95 people and manufacture around 70 tonnes of flapjacks per week.”

Tim Harrap: “We manufacture 4.5k tonnes of cheese per year, which is significant but still small compared to the big boys. We have been described by our customers as a bespoke cheese maker.”

WHAT ARE THE KEY CHALLENGES MANUFACTURING BUSINESSES ARE EXPERIENCING? Paul Falvey: “As you’d expect the main issue many of them are facing is Brexit and how do they prepare for the various eventualities.

“With Brexit, some businesses are taking the view that there is nothing they can do.

However, we know what the worst-case scenario is – a no deal and World Trade Organisation (WTO) tariffs – so you can prepare and work back from that scenario.”

Mike Dinnell: “Brexit and what the manufacturing sector is going through now is just another name for what it has been through for many years.

“This sector has already had headwinds such as problems with supply chains and political agenda. It’s just a case of getting

Business Leader - The magazine for entrepreneurs & business leaders

Stephen Dilley: “Again, the challenges right now are about Brexit and clients of ours are looking at their operating models where they either import or export to the EU. “Part of this is looking at whether businesses set up an EU footprint and if this should be a franchise model.”

Richard Tonkinson: “We are looking at our supply chain and how we ensure security of it regarding critical components and any imported materials.

“This also means making sure our direct suppliers are holding the stock we need.”

Simon Howes: “We run the barometer of manufacturers and in the latest one we’ve seen the lowest confidence in manufacturing ever and it’s been running since 2009. Businesses intentions for growth, investment, employment are all down at the lowest they’ve been.

“This is because a lack of clarity is resulting in a lack of confidence.

Cont. 

39

DEBATE

SPONSORED BY ALLIED IRISH BANK (GB)

Mike Dinnell – Manchester Business Centre M: 07718 323749 | E: mike.l.dinnell@aib.ie

Kevin Goodall – Bristol Business Centre M: 07710 859250 | E: kevin.j.goodall@aib.ie

put a British stamp on products and export to the US and Scandinavian countries.”

Mark Lippett: “The challenges we’re facing are limited compared to others around the table as we trade in dollars, so we’re dealing at arm’s length from our suppliers. We never bring product into Europe unless our customers are using it.

“One issue has been that partners have been slightly offended and personal interaction did change for a little bit.”

“Regarding how Brexit will pan out, 52% of manufacturers believe it will have an overall negative impact against 36% who are saying it will be positive.

“There is also concern about the free movement of people and perhaps to combat this we’re also seeing more businesses looking at automation and robotics.”

Paul Falvey: “We’re also hearing that many businesses are stockpiling and that factories are full, but this isn’t to do with Brexit but because of capacity and rates.

Brexit will only make this situation worse, potentially.”

Tim Harrap: “Half of our cheese is export and half of that is into Europe. Are we sitting on our hands? There isn’t much we can do.

Some clients have been discussing whether we stock more products, but we don’t have the capacity for this as we’re a ‘just in time’ business.”

Chris Smith: “We export significantly to the USA. For our UK operations we cannot ignore the impact potential vehicle delays at our borders may have on availability of

lorries when we need them, exacerbated by a national shortage of HGV drivers with some 18k plus vacancies reported.

“Many of the ingredients we use are grown and processed outside the UK and traded in euros and US dollars, so we must be mindful of currency changes.”

HOW DO YOU FEEL YOU’LL BE PERCEIVED AS AN IMPORTER, POST-BREXIT? Paul Richards: “Many of our European suppliers are almost offended by the decision that has been made and have taken it personally. It’s as if we don’t want to be their friends any more.

“In terms of what our customers are saying – we’re an unusual importer as we import cladding.

“What is significant, is that our Belgian suppliers put the idea of building a factory in the UK on hold due to Brexit.

“They originally saw an opportunity to benefit from the ‘Made In Britain’ label and

“HOW MANY BUSINESSES ARE NOW LOOKING AT THEIR OPERATIONAL DESIGN AND CONSIDERING THINGS SUCH AS AUTOMATION AND ROBOTICS TO HELP WITH THIS?” Mike Dinnell

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HOW ARE BUSINESSES REACTING TO CHALLENGES AROUND SKILLS? Jason Kirby: “12% of our workforce is from the EU and its around same amount outside of the EU. We do have some issues with recruiting outside of the EU as it means visas and it’s a harder playing field to recruit in.”

Mike Dinnell: “We were talking about skills ten years ago and no doubt we’ll still be talking about this in another ten years’ time.

How many businesses are now looking at their operational design and considering things such as automation and robotics to help with this?”

WHAT SHOULD WE DO TO PROMOTE MANUFACTURING AND MAKE IT MORE ATTRACTIVE? Simon Howes: “I was one of the last wave of apprentices in my town and then the factories closed and the ‘dirty manufacturing’ tag came in. The issue I see is that many manufacturers are SMEs and if you’re Airbus or Honda your skills needs are much better looked after. You will have a link up with the college and a ready supply of labour.

“So, how do we aggregate the voice of SME manufacturers and make it meaningful?

Automation is one way but it’s quite hard to automate when you’re making ever changing designs. Some regions also have an issue where key STEM skills migrate out of them and skills are then lost.”

Issue 6: January - February 2019

MANUFACTURING

SPONSORED BY ALLIED IRISH BANK (GB) Mike Dinnell – Manchester Business Centre M: 07718 323749 | E: mike.l.dinnell@aib.ie

“MANY OF THE INGREDIENTS WE USE ARE GROWN AND PROCESSED OUTSIDE THE UK AND TRADED IN EUROS AND US DOLLARS, SO WE MUST BE MINDFUL OF CURRENCY CHANGES” Chris Smith

Chris Smith: “There are good examples of businesses that put recruitment infrastructures in place some years ago and are now reaping the rewards of having a strong pipeline of talent in place.

“We started this 6 years ago when we were just 18 people and we now have 95 skilled staff. Another West Country manufacturer I know of has a member of their team whose principal role is to work with the local community and schools to attract future talent.

Kevin Goodall – Bristol Business Centre M: 07710 859250 | E: kevin.j.goodall@aib.ie

“Working with schools, universities and other providers enables businesses to think ahead and plan to fill future skills requirements.”

automated, or do we stick with the more labour-intensive model? Having the skilled staff is vital, because if you just shoe horn people in it can be a nightmare.

ARE BUSINESSES THINKING ABOUT TECHNOLOGY AND AUTOMATION TO SOLVE RECRUITMENT ISSUES?

“I guess we need to create our own bakery university. Or do we change our business model and bring in more automation? This is a challenge because we’d need to keep updating our machinery in line with product changes.”

Richard Tonkinson: “It would be interesting to see how it works and we can look to put this in place if we have workers – who are concerned about political environment and currency exchange rate.

“They still want to work for us, but they may want to work remotely and technology is allowing us to look at alternative options.”

Henry Herbert: “In our business attracting talent can be difficult, as old bakers would have gone to college and then come to us, but all of that is shut now so the pipeline is challenging. We have bakers coming from French colleges, which is great, but how long is that going to last?

ARE WE SEEING MORE MANUFACTURING BUSINESSES LOOKING TO EXPORT? Paul Falvey: “Not hugely and we wouldn’t always encourage them to do that as it’s not always a sensible business strategy.

Surely you exhaust markets you already understand before you look at expanding into other ones.” 

“Do we grow our business, so it is more

The AIB logo, Allied Irish Bank (GB) and Allied Irish Bank (GB) Savings Direct are trademarks used under licence by AIB Group (UK) p.l.c. incorporated in Northern Ireland. Registered Office: 92 Ann Street, Belfast BT1 3HH. Registered Number NI018800. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.

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REPORT

WHAT IMPACT HAVE THE METRO MAYORS HAD AROUND THE UK?

A

s you’re reading this article can you recall who your elected Metro Mayor is? And are you aware of the powers they have? Most may know the answer to the first but not likely the second and what complicates the answer further is that not everybody will live and work under the system of a Metro Mayor.

But for those that do, the impact is starting to be felt and this new way of governing the regions has brought out detractors and supporters in equal measure.

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SO, WHAT’S IT ALL ABOUT AND WHAT IMPACT HAVE OUR METRO MAYORS HAD? The transfer and delegation of power to the lower levels of government – away from London – is what led to the creation of the Metro Mayors.

In May 2017, six new mayors were elected to lead regional ‘combined authorities’ to assume power from central government over economic development, transport, housing and education.

The areas which were assigned Metro Mayors were the West of England, where Tim Bowles (Conservative) won the vote; in Greater

Issue 6: January - February 2019

METRO MAYORS

Manchester, former Shadow Home Secretary Andy Burnham (Labour) took office; and in the West Midlands former John Lewis Managing Director Andy Street (Conservative) became the leader of the combined authority.

Ben Houchen Tees Valley

In Cambridgeshire and Peterborough James Palmer (Conservative) was voted in and in the Liverpool City Region, Steve Rotherham (Labour) was voted in. Tees Valley Metro Mayor Ben Houchen (Conservative) is the youngest of the six, at just 32 years old.

Steve Rotherham City of Liverpool region Andy Burnham Greater Manchester Dan Jarvis Sheffield City Region

The following May, Dan Jarvis (Labour) was elected the Sheffield City Region Metro Mayor. A North of Tyne Combined Authority will appoint an inaugural Metro Mayor later in 2019, following a vote in areas of Newcastle, North Tyneside and Northumberland. There is a ninth combined authority in West Yorkshire, but as of yet, there is no Metro Mayor.

James Palmer Cambridgeshire & Peterborough

NOT INTENDED TO REPLACE OR TAKE CONTROL The Metro Mayors were not intended to replace or take control over city and regional councils – or any other form of local government, and each region was assigned different sectors to focus on.

In the case of Burnham’s Greater Manchester region, his office has control over the regions £6bn healthcare budget, whereas Street’s West Midlands combined authority has been assigned £8bn to improve adult skills and apprenticeships amongst young people.

DIFFERING POWERS AND INFLUENCE Despite the fact that the Metro Mayors have clearly got different goals and agendas, some have assumed some of the powers given to city mayors – but they have also got their own set budgets.

The 30-year investment fund differs for each region, though.

West Midlands was assigned the largest budget at £1.1bn – £250m of which will be focused on transforming the region’s transport links and local networks.

Tim Bowles West of England Greater Manchester, Liverpool City and West of England were all assigned a £900m budget, while Cambridge and Peterborough were assigned £600m, with Tees Valley receiving £450m.

Akash Paun, Senior Fellow at the Institute for Government, believes that Burnham’s Greater Manchester region has benefitted the most from the devolution deal.

He said: “The Metro Mayors were all given different devolution deals, as there were differences in the capacity and influence they could have. Naturally, that has meant that Andy Burnham has been able to have quite an impact across a wider range of

“IN ORDER TO DELIVER THE HIGH-GROWTH, HIGHWAGE, LOW-WELFARE ECONOMY WE ALL WANT TO SEE IN THE TEES VALLEY, WE’VE BEEN DEVOLVED A POT OF MONEY TOTALLING NEARLY £500M TO INVEST IN LOCAL PRIORITIES.” Ben Houchen Business Leader - The magazine for entrepreneurs & business leaders

Andy Street West Midlands policy areas. He is the only one who has been given powers in areas of policing – he replaced the police commissioner as part of this role.

“The Greater Manchester deal includes involvement in social and healthcare integration at the level of the working health programmes. You can definitely say that Greater Manchester is the most developed devolution deal. That is not to say that the other ones haven’t had success – they are just in a different place in terms of the devolution development.”

HISTORY OF COLLABORATION This region in particular inherited a bigger administrative capacity due to a longer history of joint working between local authorities and other public sector partners in the region.

As the most politically-famous amongst the seven, Andy Burnham has used this to his advantage.

Cont. 

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REPORT Professor of Public Policy at the University of Manchester, Francesca Gains echoes Paun’s assessment of the region.

She comments: “Andy Burnham had a decisive start to his term of office, with deft public announcements on tackling homelessness and appointing a female deputy, Baroness Bev Hughes, to run the policing and crime portfolio as well as Sir Richard Lease, powerful leader of Manchester City Council, as Deputy with responsibility for the Economy.

“Almost immediately after the election, the GM metro mayoral governance arrangements came under extreme pressure following the Manchester Arena bombing and were robust enough to cope with the initial crisis, as well as the necessary follow up and fall out.

Subsequently, although somewhat impeded by both the continuing impact of austerity measures and the uncertainty of Brexit, Mayor Burnham has made progress in three areas.

“Firstly, in galvanising a conversation across the North on transport investment needs to support business growth. “Secondly, in ensuring focus on the needs of the local economies of the outer boroughs making up the GM Combined Authority.

Andy Burnham Dan Jarvis

“Finally, in working with the business community and anchor institutions, such as the Universities and the health sector, to establish a local industrial strategy with a focus on green growth technologies and artificial intelligence and data driven infrastructural support.”

HAS THE DEVOLUTION OF POWER BEEN A SUCCESS ACROSS ENGLAND? Steve Rotheram

The Prime Minister Theresa May herself described the initiative as an idea that, “will help to deliver a stronger economy and a fairer society – where wealth and opportunity are spread across every community in our United Kingdom, not just the most prosperous places in London and the South East.”

But, has this happened?

During their initial three-year terms, the mayors had a set of goals that they needed to achieve in order to unite their respective combined authorities.

“DEVOLUTION IS ALREADY MAKING A BIG DIFFERENCE – I’M RAISING THE PROFILE OF OUR REGION WITH CENTRAL GOVERNMENT AND WE’RE GETTING MORE INVESTMENT.” Tim Bowles

Tees Valley Metro Mayor Ben Houchen’s electoral campaign had several primary focusses, however, the most public one was his ambition to give control of Durham Tees Valley Airport back to the public. He achieved this in December 2018.

Ben Houchen Andy Street

Among his other goals were to increase job creation; investment into growth areas and improve the local economy. He also plans to increase the number of apprentices and those in higher education.

James Palmer

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Houchen comments: “In order to deliver the high-growth, high-wage, low-welfare economy we all want to see in the Tees Valley, we’ve been devolved a pot of money totalling nearly £500m to invest in Issue 6: January - February 2019

METRO MAYORS local priorities. Because I’m elected by local people, they now have a say who controls this fund because I’m accountable to them.

“And the Government is continuing to support devolution. Just look at the last Budget where our share of the Transforming Cities Fund expanded to £75.5m – this only happened because we have an elected Metro Mayor.

This gives us even more cash to invest in transforming public transport.”

With a diverse and complicated list of goals, the Metro Mayors have created a bridge to central government to speed up the process of getting the necessary funds to areas of the regions.

It is down to this direct contact that Houchen puts his regions’ success down to.

He comments: “Thanks to our devolution deal we now have access to the corridors of power and I regularly meet with ministers and Whitehall officials to discuss delivering our priorities. We’re a region on the up, and businesses and organisations across the area are talking up the Tees Valley as a fantastic place to invest, work, live and visit.

“Since taking office, I have secured an additional £235m, with more to come. We have an indicative £30.5m devolved adult education budget in the pipeline, so we can transform and tailor our adult education offer to provide the skills we need to succeed.”

HOW DO OTHER REGIONS COMPARE? Much like Houchen’s Tees Valley region, Tim Bowles, West of England Combined Authority Metro Mayor was empowered to combine different branches of government together.

Tim himself has also managed to secure in excess of £170m in extra funding, following his election.

He was tasked with economic growth – and as of December 2018 – the West of England CA is the only region that delivers a net contribution back to the Treasury.

Tim has also been given instruction to improve transport connectivity; create more affordable homes; help small and local businesses grow; and increase the number of apprentices and those in higher education.

He comments: “The role of Regional Mayor is very different from that of a City Mayor or Council Leader. My role is to work across council boundaries to plan for future growth.

I’m here to look at the bigger picture to improve people’s lives – homes, jobs, skills

Tim Bowles

and transport. The councils came together to fight for devolution because they could see the value in this new way of doing things, looking beyond council boundaries to benefit all of us who live and work in the region.

“I also work closely with the other regional Mayors across the UK to make sure our voices are heard at national level and we meet regularly to talk about key issues for our regions and make representations to government.”

Tim continued: “Devolution is already making a big difference – I’m raising the profile of our region with central government and we’re getting more investment.

“This is being invested in those things to make all our lives better – better skills and job opportunities, more homes, better transport. We’ve made a really good start but there’s much more to be done.”

WHAT HAS BEEN ACHIEVED? The mayors’ regions account for nearly 42% of Britain’s GVA (gross value added), and the role of the combined authorities has provided the opportunity for government to capitalise on local expertise and overall leadership of an area to grow the UK economy.

As the scheme is still in its infancy, many changes to the combined authority and metro mayors job roles could happen. More power and funding could become available, and other regions could also look to bring in their own Metro Mayor.

Following their initial three-year stint, they can stand for election as many times as they like, with each term then lasting four years.

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“HOWEVER, WHAT YOU CAN ALREADY SEE IS THE METRO MAYORS PROVIDING A MORE COHERENT AND A STRONGER VOICE FOR THEIR CITY REGION” Akash Paun

Paun believes that despite being in its early stages, the Metro Mayor scheme has been a success.

He said: “It is still early days for the Metro Mayors – it is a whole new model of government. In terms of the big impact on infrastructure, public services and economic growth, at a regional level – you wouldn’t expect to see a huge amount of that after two years.

“However, what you can already see is the Metro Mayors providing a more coherent and a stronger voice for their city region in national debates and in negotiations with central government. That was something that was missing before. It was one of the main reasons why people originally supported this model.

“There were countless people that didn’t like that model but it does give them that single point of accountability and a single strong voice in public debate and working out deals with the centre.”  45

“Home Grown is going to take the British eccentricity of Home House into a business club environment. It won't be stuffy, it will be fun and full of bright people who want to meet other bright people both professionally and socially.�

Sophie Chaney - General Manager at Home Grown

ADVERTORIAL

New club for entrepreneurs, investors and business leaders launches Business Leader Magazine can report that Home Grown – a new private club for high-growth entrepreneurs, investors and business leaders is now open for applications.

The first applicants to join the club will be known as Founders, a cohort of members who will shape the ethos and lay the foundation of the Home Grown community.

Opening in April 2019, this unique new private members’ club - from the team behind the renowned Home House – is welcoming applicants spanning all sectors and industries, from beauty and banking through to fashion and finance.

Home Grown is dedicated to growing businesses by blending the values of a luxury club with a strong business aesthetic and unrivalled networking opportunities.

A carefully curated events programme is at the heart of the membership package. Business talks from Rockstar entrepreneurs, leadership seminars, pitching events, a ‘How to...’ series and invite-only ‘entrepreneur-meetinvestor’ dinners are just some of the activities designed to help members develop their businesses and connections.

Recognising the desire for sessions focused on wellness, and social engagement, there is also a range of activities from sound meditation and yoga brunches, to the Home-Grown Sipping School – a drinks club for those wanting to explore the world of wine and sharpen their palette.

Home Grown will be located at 44 Great Cumberland Place, Marylebone, London, across four Grade II-listed five story Georgian townhouses.

Other members benefits include: • A collection of beautiful facilities, aimed at the luxury business user, including a Restaurant, Study Café, Bar and a series of drawing rooms and lounges • A programme of 20 events a month, geared towards addressing knowledge and skills gaps in your business whilst providing a platform upon which to make the right connections • Elegant central London private meeting and dining spaces • Networking with high growth businesses, performance business leaders and investors • Access to a community of investors and growth funds • Community of specialist advisors and professional services at your fingertips • Beautifully appointed executive bedrooms from £155 per night • International co-investor community and dedicated investor specific events • Opportunities to meet investment ready businesses • Discounted central London parking facilities

You can apply to be a Founding Member at www.homegrownclub.co.uk.

Those signing up early will see the £299 joining fee waived.

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47

SPECIAL FEATURE

TLT BENEFITTING

FROM WESTON COLLEGE SUPPORT

Since working with Weston College, we have seen a reduction in the time it takes for someone to start their apprenticeship.

This has helped to get them up and running sooner, boosting our ability to deliver work for our clients.

WHO ARE TLT? We are a UK law firm with six offices across the UK. We have over 1000 staff and over 100 partners, 60 of whom are leaders in their fields.

We support our clients with legal services in three distinct areas. Advisory: helping with strategic and day-to-day legal issues, Disputes: helping prevent and, where needed, manage conflict, and Transactions: helping organisations expand, restructure or sell.

We’ve also offered permanent positions to a number of our apprentices upon finishing their programme, which allows us to bring on staff with the skills we require and make a long-term investment in their career with us.

We’re known for our supportive and flexible approach. This helps us maintain longlasting relationships with many of our clients.

HAVE YOU FACED A SKILLS SHORTAGE? We are a growing firm – so are always looking for good people across a range of levels and areas of expertise who can support us in delivering an exceptional service for our clients. Roles vary from working in our specialist legal teams through IT and projects to marketing and HR. One area where we have found a particular skill shortage is experienced Legal Secretaries. We believe this is a culmination of secretaries not moving jobs but also with that role diversifying into either a PA focused position or document management/admin role.

HOW HAVE YOU DECIDED TO COMBAT THESE CHALLENGES? We’ve invested in bringing in staff at a junior level and have run in-house training and development programmes to get them to the experience level we need. We do this by not only providing training but also day to day support and supervision in the work place.

We also started to work with Weston

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College due to their reputation, location and the range of courses they provide. They currently support us with level 2 and level 3 apprenticeships within our volume business teams. The roles that they currently support vary from apprentice office assistants to apprentice case handlers.

Over the last 12 months we have successfully recruited around 11 apprentices through Weston College on a range of level 2 and 3 apprenticeships.

WHAT DO WESTON COLLEGE OFFER TLT? Weston College offer us a range of courses to suit our needs across both legal and nonlegal teams. We currently have apprentices undertaking level 2 and level 3 courses in business administration and customer services and are looking to expand our apprenticeship offering to other courses in 2019.

Weston College are also close to our Bristol headquarters and on hand to support with the recruitment and delivery of the onsite training required for each apprenticeship

HOW HAS THIS PARTNERSHIP HELPED YOU ADDRESS PROBLEMS? We are driven to broaden access to the legal profession and developing student career aspirations. This is something which can be difficult to achieve. One way in which we do this is through offering apprenticeships which offer alternative routes into the legal profession.

We are able to attract a wide range of talent into the business from a variety of backgrounds by taking on apprentices. We feel that apprentices positively impact our business by bringing a range of skills, a fresh outlook and enthusiasm.

WHAT ARE THE COMPANY PLANS FOR FUTURE GROWTH? We have grown by over 60% in the last five years and have ambitious plans for the future too. With advances in technology driving rapid change in the legal sector, there are huge opportunities to transform what we do.

We are therefore looking at how we can grasp those opportunities through initiatives like our cross-firm Future Law programme.

This is an exciting time for the firm and our people.

Issue 6: January - February 2019

It’s what we bring together that sets us apart

For the last 100 years, as a dynamic, award-winning professional services firm, we have provided a comprehensive range of audit, accounting, tax, wealth and advisory services to a wide range of sectors.

Whether you are a SME, owner-managed business, large FTSE business, public sector organisation, charity, school or private individual, we have the capability and capacity to meet your needs.

To find out how we can help you or your business, please visit:

bishopfleming.co.uk or call 03333 21 9000

Bath | Bristol | Exeter | Plymouth | Torquay | Truro | Worcester

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REGIONAL REVIEW

WHAT NEXT FOR THE LONDON TECH SCENE?

L

ondon has long been Europe’s leading hub for technology innovation and investment, and even with the gathering storms of the Brexit deal on the horizon, the capital’s tech scene looks set to continue its impressive growth.

With over 187,000 tech companies achieving a combined reported annual turnover of £292bn, London tech businesses, from start-ups to international powerhouses, have benefited from the many advantages the capital affords.

What is also eye-catching about these impressive numbers though, is the fact that the annual collected turnover of these businesses has grown 16% year-on-year in the last three years.

There are also near to 1.3 million people that work in the tech sector in London, and this number has risen 15% year-on-year in the last three years.

Start-ups and incubators The lifeblood of the tech system are startups that are either developing a piece of tech or software to disrupt a sector – or pioneering tomorrow’s world, today.

These start-ups face the same struggles as others do in different sectors – funding, staff, office space – but what are the specific challenges and appealing factors for starting a tech business in London?

In 2018, London start-ups contributed £11.4bn to the UK economy, and gave employment to almost 40,000 techies across the 33 London boroughs where they are based.

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Many of these start-ups are based in 50 plus accelerator programmes and shared office spaces that are spread throughout the city. These programmes provide a vital resource for tech start-ups.

One of the most prominent and wellrespected tech communities is Level39.

Based in the heart of London’s business centre – Canary Wharf – this incubator has over 1250 leaders in cyber security, fintech, artificial intelligence, blockchain and retail tech based at their offices.

Almost 200 member companies call the space home – all of which are considered ‘fast-growth tech companies’.

Asif Faruque is the Head of Content at Level39: “We give them the space, support and community to get to market faster and grow their business.

“We’re owned by the Canary Wharf Group, so we have a world-leading property company backing us – providing the high-quality real estate, infrastructure and security that these businesses need to operate. A company will typically join Level39 with a handful of employees – in time, and with our support, we see these businesses grow, bring in new clients and expand to new markets.”

What Level39 has done is utilised the best elements of what London has to offer. One of their most prominent clients is computer security service, Cybsafe.

Marketing Manager at Cybsafe, Rebecca Bourke, comments: “Level39 has definitely

been a contributing factor to our success.

We’ve had access to mentors, investors and regular networking events. The flexible infrastructure and access to world class talent has been a game-changer for us.”

Why choose London?

The capital has always been a melting pot of great and diverse talent from other cities and countries. This has always the case throughout both turbulent and prosperous times.

Just as it was during the first three industrial revolutions, London has become the European leader during the ‘Digital Revolution’ – or Industrial Revolution 4.0.

Issue 6: January - February 2019

LONDON TECH CITY

THE TOP LONDON BOROUGHS BY TURNOVER

Toby Kress is the Head of Accelerator at Accelerator London – an innovator programme run by the London Metropolitan University.

For the last 15 years, it has been the home for tech start-ups in Shoreditch – an area of London that now boasts and annual tech turnover of over £3bn.

Camden £58.1bn City & County of the City of London £38.7bn City of Westminster £58.6bn Wandsworth £20.7bn Hounslow £19.0bn Hillingdon £19.3bn

SECTORS BY TURNOVER Digital Technologies Life Science & Healthcare Other Scientific/Technological Manufacture Other Scientific/Technological Services Publishing & Broadcasting

Cont.  Business Leader - The magazine for entrepreneurs & business leaders

£61.9bn £10.2bn £19.2bn £62.5bn £138bn Source: Techmap London 51

REGIONAL REVIEW

He comments: “London is the dominant force for tech in the UK. A lot of that is to do with its sheer scale. To start a business, you need to get customers, they need great people to work for them, and they need capital – London is the only city that has got all of those at a high enough level to support a big tech ecosystem.

“Availability of finance is crucial to startups, and the majority of funding that goes into tech start-ups in the UK comes from London. That is because the growth funds are here, the VCs, the private equity companies are largely London-based. Tech companies can then tap into that in order to scale-up. Capital is crucial to businesses and being located near to centre of the UK’s financial sector is vital for these tech companies.”

“Along with its proximity to academic institutions and major corporates – these combine to make London a leading tech hub, globally.”

Whether it is an incubator, start-up or investor – there are common themes as to why London has risen so far ahead of other UK and international cities from a tech growth perspective.

Flavia Richardson, Portfolio Manager at Funding London – a SME investment company – believes that one of the other main strengths the city has is its availability of funding.

Asif agrees with this sentiment. He comments: “Having the finance, government and technology districts close together has made London an attractive place for startups to consider setting up base.

She said: “London is still the epicentre of the European Venture Capital market, as most funds are based here. Out of the $5.2bn (£4.1bn) invested across Europe in Q3 2018, $1.7bn (£1.3bn) have been invested in the UK, of which $1.4bn (£1.1bn) in London.

“In the morning, you can be having a meeting with the regulator, followed by lunch with a major corporate and then closing off with an evening event at a university. It’s that kind of variety and accessibility which makes London an attractive city for startups who wish to build their network and make new connections.

“It continues to attract technology entrepreneurs and skilled talent. It benefits from top-ranked universities and research centres pushing the agenda for innovation.

The City and the high density of financial institutions and corporate headquarters are the bedrock for fintech and a key advantage we have compared with the continent.

“HAVING THE FINANCE, GOVERNMENT AND TECHNOLOGY DISTRICTS CLOSE TOGETHER HAS MADE LONDON AN ATTRACTIVE PLACE FOR START-UPS TO CONSIDER SETTING UP BASE.” Asif Faruque

“The current status is a privilege and is not unchangeable. The government, the investment sector and interest groups must design measures to sustain a worldclass ecosystem for entrepreneurship and innovation.”

The boroughs by numbers The many positive attributes that London offers has led to several of the boroughs stepping ahead of many global cities, in terms of turnover and success.

At the height of the financial crisis in 2008, the London tech sector had a combined turnover of just over £150bn – meaning that in a decade, these companies have improved their figures by over £100bn.

Couple this with double the amount of employment levels across the city within the same time period.

As seen in the infographic, the City of Westminster is leading the way with an annual turnover of £59bn, followed by Camden (£58bn) and City and County of the City of London (£38bn).

These figures can be put in perspective to see just how far ahead London is when it is compared to other major UK cities.

UK tech hubs such as Manchester, which boasts an impressive array of companies such as UKFast, LADbible Group and AccessPay currently stands at an annual turnover of £3.2bn.

Couple this with the university towns such as Cambridge, which stands at £2.4bn and Oxford (£1.8bn), it shows the attraction London has to take the next generation of academic elite to the capital.

Nearby areas of Reading (£13.6bn) and Newbury (£7bn) showcase that the close proximity to the city has given them the

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Issue 6: January - February 2019

LONDON TECH CITY

chance to grow faster than many of the larger cities throughout the UK. Other notable tech hubs such as Bristol (£7.9bn), Southampton (£2.1bn) and Portsmouth (£4.7bn), have seen large growth areas and accelerator programmes of their own, but are still a long way behind the capital.

To understand the scale in which London is ahead of the rest of the UK, the borough of Southwark (£8bn) has over double the turnover of the whole of Scotland (£3.9bn).

What’s next?

So, London has established itself amongst the world-leaders in tech innovation and financial success, but what does the future hold?

If this exponential growth continues throughout 2019, the predicted value of the London tech scene will break the £300bn threshold.

Flavia concludes: “London represents a world hub for capital, entrepreneurship and innovation. It is reliant on a continuous flow of exceptional talent, and in the coming months, the uncertainty in the political sphere will determine the approach large and small organisations will have to adopt.

The tech sector will be most affected.

Restrictions on immigration or stringent visa rules will negatively impact growth.

“Venture Capital funds will continue to reside and invest in the London market though. However, we assess that in 2019 we will observe a drop in the number of deals, with potentially a reallocation in favour of later stages of development.” 

“THE GOVERNMENT, THE INVESTMENT SECTOR AND INTEREST GROUPS MUST DESIGN MEASURES TO SUSTAIN A WORLDCLASS ECOSYSTEM FOR ENTREPRENEURSHIP AND INNOVATION.” Flavia Richardson

TECH TRENDS THAT ARE GOING TO TAKE THE WORLD BY STORM IN 2019 2018 saw the launch of the world’s most powerful tablet, the rise (and possible fall) of bitcoin and the introduction of 5G. Chris Costello, director of technology retailer Sync, tells Business Leader readers what the top tech developments set to change the world in 2019 are.

5G MOBILE 5G has been on the agenda for some time, and while 2018 saw initial testing of the new super-fast internet, 2019 is the year 5G goes mobile and mainstream.

Although the iPhone won’t be 5G until 2020, we are predicting this will be a key battle ground for service providers and device manufacturers alike, as companies look to get a head start on their rivals.

NO STOPPING THE START-UP According to research from Tech Nation, a new digital tech job is created every 50 minutes and this is set to increase to record levels in 2019.

This agile way of working will see a trend towards smaller and more powerful mobile devices, allowing start-ups and SMEs to work effectively on the go.

GENERATION TECH 2019 could be the year we see tech companies such as Microsoft and

Business Leader - The magazine for entrepreneurs & business leaders

Google working together with the UK’s education system, to ensure our graduates are future proofed against the rapidly changing demands of the modern workforce.

EXTENDED REALITY – THE NEXT STEP IN VIRTUAL, AUGMENTED AND MIXED REALITY In recent years, trends towards Virtual or Augmented reality have been viewed as a “nice to have” rather than a key aspect of the digital landscape.

2019 is set to be the year when this changes with the growth of Extended Reality or XR, the umbrella which brings AR and VR (and Mixed Reality) together under one term.

We expect more major tech companies to begin to roll out concepts and products in 2019. XR could completely change the way the advertising industry reaches existing customers and targets new audiences with 2019 being the year that change truly begins.

INTELLIGENT TECH Artificial intelligence (AI) has been gathering pace and crucially moving into more practical day to day functions. AI and machine learning is now bringing us to the point where apps are evolving into something bespoke to the individual user.

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BLM FAST-TRACK

“WE MADE SOME BRAVE DECISIONS DURING THE LAST RECESSION” Meet the national recruitment firm on course for half a billion pound turnover

F

or BLM’s latest ‘Fast-Track’ feature, where we profile high growth business, we look at Resource Solutions Group (RSG).

The UK’s recruitment sector is worth a staggering £35bn to the economy, and Resource Solutions Group (RSG) is one of the companies at the forefront of it.

Self-proclaimed as a ‘recruitment services company’, RSG has been established since 1975, but over the last decade has seen its turnover more than quadruple from under £100m during the financial crisis – to over £400m last year.

RSG’s journey to this financial success has seen the expansion out of its headquarters, with a further ten offices opening across the UK and Ireland.

The company specialises in supplying both permanent and interim placements for clients, predominantly within the leadership space.

Although the company’s heritage is within the IT sector, RSG has constantly evolved and adapted to the needs of its clients and now fills roles within the large corporate environment for leadership, project management and business-centric careers.

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Four brands under RSG Within RSG there are four brands that operate.

Sanderson specialises in the provision of IT, business change and professional services.

Resource Management are experts in the provision of RPO (Recruitment Process Outsourcing) and MSP (Managed Service Provider) solutions. First Person Executive is the research-based executive search and headhunting arm of RSG, whilst Intelligent Consulting is the interim recruitment arm of the business.

Mike Beesley is RSG’s CEO and has been with the company for 39 years. He was part of the team that bought the company from its original owners for a nominal fee in the early 1980s.

It was under Mike and founder Keith Dawe’s stewardship that the company was put on a trajectory of impressive growth.

Growth through the recession Although RSG has been an established player for over 30 years, when the 2008 recession hit – no businesses were safe.

However, it was during this time that the company made some bold decisions that were the reason why they have experienced such exponential growth over the last decade.

Mike explains: “We went through a big, strategic refresh ten years ago and we took some incredibly brave steps, in light of a complete economic meltdown – everything was collapsing around us.

“What was happening in the market, gave us that opportunity to take a ‘helicopter view’ of the business and we knew there was only one of two things that were going to happen – we were going to survive, or we weren’t.

“That wasn’t peculiar to our business – it Issue 6: January - February 2019

RSG

“WE WENT THROUGH A BIG, STRATEGIC REFRESH TEN YEARS AGO AND WE TOOK SOME INCREDIBLY BRAVE STEPS, IN LIGHT OF A COMPLETE ECONOMIC MELTDOWN – EVERYTHING WAS COLLAPSING AROUND US.” Mike Beesley Maximising opportunities And Mike realised that the company was also not taking full advantage of the prospects that were available.

He comments: “The reality was that we didn’t necessarily need new business, we just needed to look at the business that we already had and work out what it was that we were actually selling to them. We did that through a rebrand –have one single brand, which underpinned the company’s strategy.

RSG doesn’t trade – the trading brands do.”

This galvanised the team at RSG, and delivered a consistent and united message to the market.

Research by Deloitte states that a company has a 7-8% chance of selling something new to a new customer, compared to a 70-90% chance of selling something new to an existing customer – something the RSG team began to utilise.

Mike explains: “What we had wasn’t a shortage of existing customers. We just weren’t maximising that opportunity. We then drove in this culture that relationship management should have an open black book within the company. When you look at traditional recruiters in the employment space, it is full of people in rooms who are on the phone trying to make cold calls to a lot of people. We couldn’t be further away from that. What we are doing is nurturing the relationships that exist.”

‘Brave decisions’ Another self-professed ‘brave’ move made

by RSG during the recession that instigated their exponential growth was to not make any of the staff redundant.

Cont. 

was the same for every entrepreneurled business at the time. Our fate was somewhat out of our hands. Once we got that opportunity back to direct where our business wanted to go, we worked on the premise that what we wanted to do was reshape the company to make it ready for the next ten years.

What we did ten years ago has had a huge impact on this business from a growth point of view.”

In 2007/2008, RSG haemorrhaged around £40m off the top line figures and took the business below £100m turnover. Ten years later and they have more than quadrupled the size of the business.

One of the initial observations that Mike and Jon Ball - Managing Director - made at the time of the recession was that the brands within RSG were not only competing with the market – but also amongst themselves.

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55

BLM FAST-TRACK

Despite the fact that the company’s contracts with clients halved, and placement opportunities had gone through the floor – no members of staff were let go.

Jon comments: “There were some tense moments, but we stuck to it. We had worked through recessions before – and Mike told us that the market will return. He and Keith said that when it does return, we will be recruiting for our clients, while our competitors would be recruiting for their own businesses. In the 22 years I have been working here, it is the most impressive thing I have witnessed.”

The result of this was that the company had continuity throughout the turbulent times.

The message was clear and the results were incredible.

Jon continues: “To get that vote of confidence and to be given the belief that when the market returned we had an army of very hungry consultants, was pivotal to the success of the business.”

Mike said: “It felt we had a lead on the competition. They didn’t have the customer base and staff resource that we had. It wasn’t just the resource, it was the knowledge-base that gave us that advantage. It is a testament to many of the

RSG

staff back then, as many of them are still here today.”

Alongside the company’s exponential growth, another impressive factor is the fact that many of those staff that helped kick-start the financial success have now stepped up to management positions and helped open up new offices across the UK. National expansion In order to have the necessary infrastructure in place to deal with strong year-on-year growth, the company knew they had to be available in regions outside of the South West.

“WHAT WE HAVE EXPERIENCED WHEN WE ARE IN A LOCATION IS THAT EVERY YEAR YOU CAN GROW AND GET BETTER PEOPLE INTERESTED IN WORKING HERE. ” Jon Ball

The Bristol office is the largest of the eleven, with around 180 staff, covering all areas of the business – legal, compliance, finance and IT. The other UK offices are more customer-led and have the delivery team that works with the regional clients.

Mike comments: “We knew that we needed to expand the business geographically.

Despite the fact that we are Bristolheadquartered, we are very much a national business. The South West market is important to us, but actually our big growth markets are London and Scotland. We have offices in Glasgow and Edinburgh – Scotland is a massive market for us. We now have eleven offices across the UK.” Growth in the UK has been purely organic, with an emphasis on expanding opportunities with current clients, alongside meeting with new brands in new cities. The Edinburgh Office was the first outside Bristol, and last year it achieved a £36m turnover by itself.

RSG’s mantra with new office openings has underpinned their successful growth.

As Mike puts it: “It’s about walking into an organisation and being welcomed, rather than our competition who are trying to kick down doors.”

Future growth plans Despite exponential growth, RSG are still looking at continuing their impressive path they have forged in recent years – where they have doubled their turnover in the last three years alone.

In terms of growth in the UK, RSG’s current offices are being tasked with forging an even brighter future.

Jon comments: “Every office is currently growing, and more profitable than the previous year. Some offices are doing a fantastic job, some of them are growing but only doing an ‘ok’ job. Some are still growing, but under-performing.

“What we have experienced when we are in a location is that every year you can grow and get better people interested in working here. Every year your client engagements deepen, and every year your client database deepens.” 

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Issue 6: January - February 2019

SPECIAL FEATURE

‘Inspire’ set for regional growth in 2019

B

usiness Growth specialists Inspire are dedicated to working with fast growing businesses across the South West, providing them with the right connections and advice to help them thrive.

Having successfully launched in Wiltshire and Bristol over the last two years, Inspire are now looking to help SMEs further afield in 2019.

The Wiltshire company’s Business Development Director, Henrietta Brown, talks to BLM about how she joined the company as Head of the Elite network in Wiltshire, how she headed up the move into Bristol, and how she is repeating that challenge with the upcoming launch into the heart of the South West.

How did you join Inspire?

I started my career in banking and real estate, where I reached a senior level, before starting up and growing my own commercial lending brokerage and subsequently qualifying in recruitment. I worked with Inspire’s CEO Rob Perks 20 years ago at NatWest and stayed in touch over the years.

Rob knew the skills I had and asked if I could come in, in May 2016, to deliver the launch of our Elite programme in Wiltshire in October of that year. I lived in Sussex at the time so would come down for a few days a week and my purpose was to get a good number of business leaders to the launch, but it was a massive success instantly and I was offered the role to head up our Elite programme and relocate to Wiltshire. I then went onto launch our service into Bristol, which involved building up a partner network before delivering the launch in March 2018.

What is your current role?

I was promoted onto the board as Business Development Director in 2018 to head our growth across the region. For me to be able to do this, we grew the team in Wiltshire, so we now have relationship managers looking after our Elite clients there. We have also recently appointed someone to head up our Elite programme in Bristol, so I am currently handing over the clients I’ve gained there.

I now lead our expanded customer facing teams and I am responsible for their training and development, as well as our higher-level business development strategy as we grow into new regions. I will lead our launch into the heart of the South West in the Spring.

How challenging will the move into the South West be?

Moving into a new area is always challenging, however we build a strong infrastructure with partners and stakeholders before we launch to make sure we understand the landscape as well as we possibly can. We will be focussing on Exeter, Plymouth, Taunton and Bridgwater, and due to the vast geography, it will be a staged launch in May. We have

Business Leader - The magazine for entrepreneurs & business leaders

already started developing a stakeholder network and are looking at collaborating with key and organisations in the area. Our partnership with the Goldman Sachs 10,000 Small Business Programme has also helped our expansion too, which means we can bring this valuable, fully funded resource to more ambitious business leaders in the South West.

What are the biggest challenges facing SMEs today?

The most frequent ones we find are access to funding and finance, finding the right people with the right skills, and having access to like-minded business leaders.

What we have tried to do at Inspire is build our business around all these things we know that businesses are finding troublesome, so that we are people who stand in the middle of all the noise and can point them to the right support and advice that they need.

For more information on how Inspire can help your business, visit www.inspirebiz.co.uk or telephone 01225 355553.

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SPECIAL SME FEATURE

MEET THE FAST-GROWING COMPANY SUPPLYING

SIR JAMES DYSON, GORDON RAMSAY & GARETH BALE

I

f a business is to be judged by the company it keeps, then one ambitious business is on course for a very bright future.

Designex Cabinets Ltd – which is part of the £10m strong East Manor Group – supply built to order glass display cabinets which have become so synonymous with quality that the company counts Sir James Dyson, Gordon Ramsay and Gareth Bale as customers.

The company was founded in the early 1990s and taken over by Tim Farr and Barry Newman in 2002. They ran the company for fourteen years, before it was bought by Jerry Webb in 2015 – who is Chairman of the East Manor Group, having previously been Managing Director of CDW Systems Ltd – a manufacturer of high-end aluminium windows and doors.

Jerry bought the company due to the products being made of aluminium and glass, material he had been involved with since 1987 – working for and running various businesses in the industry.

Ambitious The East Manor Group is a holding company that includes CDW Systems Ltd and Clearway Doors & Windows Ltd. Designex is benefitting from the group’s

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resources and growth as well as the product’s unique characteristics.

Phill Tonks, who is Production Manager at the company, explains: “What is driving success of the product is that the owner designed and patented the unique corner post that we still use to this day and it gives the cabinets superior strength.

“The product also has a certain esteem, as its original owner focused solely on supplying display cabinets for antique dealers – which ensures the products have retained a certain charm and look that is distinctive.”

Phill says that alongside the glass cabinets, the company also manufactures and supplies wall mounted cabinets, table top cabinets, slim line tower cabinets and storage cabinets.

Target sectors Whilst antique centres and dealers remain a key sector for the business – Phill and Jerry have expanded the business significantly over the last couple of years, a move that has seen the business boost turnover by 65% compared to the previous year of trading.

Amongst the other key sectors, Designex targets are small to medium sizes companies, private collectors, jewellers, auctioneers, school, colleges, sports clubs, hotels, company boardrooms and reception areas, sports clubs, dentists, clinics and salons.

It is the private collector side of the business that has seen the growing demand from notable names purchasing cabinets from Designex.

Chef, restaurateur and TV personality Gordon Ramsay, bought a cabinet to display books in one of his London restaurants; whereas inventor and businessman James Dyson purchased cabinets to display large model yachts in his house.

And most recently, Gareth Bale purchased a wall mounted cabinet to display the boots that he wore when he scored the overhead scissor kick during the Champions League Final 2018, when Real Madrid beat Liverpool 3-1.

His boots are on display next to a replica Champions League Trophy on the wall of Gareth’s ‘Elevens’ bar in Cardiff.

Business vision Believing that the product they offer is second to none, Phill says that he is predicting year on year growth for the business through developing new business in its current target sectors.

Phill concludes: “The future is bright for the business and the sky really is the limit because there are so many destinations for our product and we’re seeing demand grow significantly. There’s no doubt that Designex will become a significant contributor to the East Manor Group, which is growing fast and creating employment and opportunities.” 

Issue 6: January - February 2019

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59

MY WORKING DAY

TIM MERCER,

CEO, VAPOUR CLOUD

A

s the leader of a company, you are there to set an example, to lead and inspire a team of individuals to achieve a series of business goals.

But, how do these business leaders go about their daily routine?

Business Leader spoke to Time Mercer, CEO of Vapour Cloud – a West Yorkshire-based cloud-first digital transformation specialist within the telecommunications sector, about his working day.

What time do you usually wake up?

It depends on my work schedule – or children! If it’s an office day, I wake up about 5.30am, as I try to drive from Doncaster to Halifax to get into the gym before work. If I don’t have any client meetings, the children normally dive onto my bed about 6.30am.

What do you typically have for breakfast?

I try and eat as healthily as possible.

Poached eggs on brown toast is a favourite, always with strong coffee.

What is the rest of your morning routine before you start work?

I exercise when I can before work, otherwise I’m checking on emails before the school 60

run and then I’m straight in to meetings.

What is the first thing you do at the start of your working day?

I check my emails as soon as I wake up, and make sure there are no incidents on our platform or services, as a number of our clients work 24/7.

How do you prioritise your day’s work?

Ordinarily, I try to plan my working day the night before, unless I’ve got a meeting with clients – I’m thinking about that way in advance! I love being out seeing clients and I complete more miles than our salespeople.

So, they become the priority unless we have a P1 fault that needs my input – which is rarely the case as we have great people.

Every day is different.

Do you plan meetings or are they a waste of time?

I plan as much as I can, but I’m not strict with agendas. The agenda does dictate how much I prepare though. My team usually provide the insight I need beforehand, and we discuss all aspects either on the phone or via video call, in advance.

Do you have a working lunch or is it good to take a break?

I always take a break and sit down to eat.

When does your working day finish?

I try and be home to put the children to bed for 7pm, and have to factor in around an

hour’s drive back. I sometimes log on later if I really need to, but I do my best to eat dinner with my wife so we’ve had a chance to catch up before trying to watch some sport!

How do you prepare for the next day’s work?

Again, it depends on where I am and what I’m doing. I drive or catch the train a lot, so preparing the where/what/how/when takes time. I try and get enough sleep, but I am a bit of a night owl – I find the best time for thinking is when everyone else is in bed!

Favourite piece of technology?

Perhaps surprisingly, I am not a big gadget person. I naturally need a phone and have a Google Pixel 3.

How do you switch off?

With my children and enjoying sport, whether they’re playing it or I am! I also have two dogs – Hungarian Vizslas named Red and Vesper.

Best piece of advice you’ve received?

I once got told I was too “spikey” for the corporate world – I apparently spoke my mind too much and was told I should have fallen into rank and listened more. I resigned – thank you! If it wasn’t for that pure nugget of feedback, Vapour would never have been born!

Issue 6: January - February 2019

Discover the UK’s fastestgrowing businesses.

Beauhurst is the professional platform for rich information on the UK’s most ambitious companies.

CEO and Founder

Equity fundraising 1 July 2014

£9.5m £40.6m pre-money

Equity fundraising 17 September 2016

£93m £179m pre-money

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