spring 2012 issue nine
THE NEWSLETTER OF NAPTHENS SOLICITORS
Business Roundup Helen Bailey, chair of the Institute of Directors, Lancashire, writes about positive economic signs. page 2
Pension reforms Chris Boyle, Head of Employment, looks at forthcoming changes which will make a difference for companies. page 2
A family success David Hill (left) with Chris Hibbert at the Wood Street property
Napthens supports Fylde Coast property deal Napthens has played a key role in helping to secure the future of a popular restaurant and leisure venue. David Hill, partner in the Commercial Property team, recently acted for long-standing client Henco International, a regional property development company, on the acquisition of the St Annes property. David advised Henco on securing the Tiggis restaurant building on Wood Street. As well as Tiggis the building also houses the former Joya champagne bar and nightclub, more recently known as 21t. The Tiggis group had previously fallen into administration in 2010, with the management team of the St Annes restaurant taking over. However, the restaurant operator, Romano Ruscitti, was only able
to secure short term leases of the building.
to see it rejuvenated in time for the Open.
Tiggis to the rear which now has a separate entrance off Orchard Road.
Now Henco is in talks with Mr Ruscitti to negotiate a longer lease, and talks are progressing to find a tenant for the rest of the site to coincide with other regeneration work going on in the Wood Street area ahead of The Open Golf at Royal Lytham and St Annes this year.
“With Travelodge opening in the town there is a real feeling that good things are happening to the town, and it’s great to be involved in a regeneration project like this. It will be very interesting to see what other work this acquisition by Henco will kickstart in St Annes.”
“We are currently in talks with operators for the former Joya bar and nightclub fronting Wood Street which is available to let.
David Hill said: “The Tiggis building is a landmark location in St Annes, and many people are breathing a sigh of relief that its future has been secured in this way.
Chris Hibbert, director at Henco, said: “Work started on the acquisition over two years ago and so we are obviously pleased that the deal has now been concluded.
“The Wood Street area is an important one for the town, and I know the aim for many people is
“The standard of fit out in the property is second to none. The building has been subdivided with
Bridging the skills gap: sector focus page 4 & 5
“Clearly the number of visitors dropping in to our little town through July will provide a welcome boost in all sectors and it would benefit an operator to be up and running in time for The Open Championship, however it is important for us to look beyond a two week spike in trade and fully consider the long term future of the site.”
in:brief profiles Preston based bespoke soft furnishing company, Plumbs. page 3
Using mediation Resolving disputes before starting litigation with Alternative Dispute Resolution. page 6
Face2Face A new series of features sees chief exec Ian Leigh discuss access to finance. page 7
welcome / round up / legal update:
Business roundup By Helen Bailey, chair of the Institute of Directors, Lancashire alternative or unique way – from people management to reducing waste. This will be an opportunity for their peers to find out more about their experiences and ask those difficult questions. This isn’t about divulging trade secrets, but sharing best practice. It is about coming together for the good of the region we have all invested in. Whilst celebrating the positives, we must also address the challenges and identify ways to overcome them. By bringing business leaders together to engage in discussion and debate around the issues specific to Lancashire that are affecting our economy, we can find ways to overturn these challenges and protect the future of our region.
James Allison, Corporate partner
Welcome to the latest edition of in:brief. In this edition we hear from two businesses which despite tough trading conditions in both their sectors, are flourishing. Plumbs is a soft furnishings and re-upholstery business which has been trading more than 50 years and is now into its third generation of family ownership. We meet managing director Sarah Page and hear of her passion for helping the younger generation make their way into the traditional industries. Leyland Holding Company couldn’t be more different – a business set up as a distribution hub for motor parts, managing director Paul Kirkman reveals it is set to increase its turnover from less than £2m to £25m in a decade. In these pages we also introduce a new feature, Face2Face, which sees a senior member of the team at Napthens, in this case our chief executive Ian Leigh, meet with a leading light in the business community for an informal discussion on a topical issue. In this case we look at access to finance, and it makes for an interesting read. Our double page spread takes an in-depth look at how the region is faring in its drive to bridge the skills gap in the traditional sectors such as manufacturing. We have some high profile commentators which make this well worth a read.
Although we are out of recession, current economic uncertainty has left many businesses still operating in ‘survival mode’, simply ticking along rather than investing or diversifying. In the past few months however, we have started to see signs of revival. Good news stories are increasing and more business owners are starting to adopt a positive attitude. Just recently the Institute of Directors (IoD) surveyed 1,000 of its members and found that only 35 per cent of business leaders think there is high
This is of course a great indication of things to come, but the optimism will only remain if we take advantage of it now. Now is the time for Lancashire businesses to come together to boost their businesses and the wider economy. The Lancashire branch of the IoD is championing this way of thinking and is urging local businesses to do
the same. We want to champion the region as a great place to do business in order to attract more investment and build a solid business network. By showcasing local success stories and encouraging them to open their doors, other businesses can learn how to improve and, ultimately, grow. We are in the process of establishing a series of panel sessions with organisations that have approached a common business issue in an
Only through coming together will our region truly prosper and take its rightful place as a beacon of good business. Let’s not waste this opportunity whilst it’s within our grasp. www.iod.com
Legal update Workplace pension reforms are high on the Government’s agenda, with changes to workplace provision beginning in October 2012. These changes will include: the automatic enrolment of qualifying workers into a workplace pension scheme; and the duty on employers to make contributions on behalf of their eligible workers.
Implementation The implementation of the reforms will be phased in broadly as follows: • The start of October 2012 for the largest employers with over 120,000 workers • By March 1, 2013 for employers with 10,000 or more workers • For those with less than 3,000 employees the staging date has been deferred and is yet to be confirmed
As ever our in-house experts give their view on important topics, including Chris Boyle who looks at workplace pension reforms, and John Whittingslow at Alternative Dispute Resolution.
• For those with less than 50 employees the staging date will be delayed until after May 2015.
If you have any comments on any of these articles, do let us know. I hope you enjoy the read.
2 in:brief SPRING 2012
or very high risk of a recession this year. Similarly, some 50 per cent are expecting higher revenues for 2012 compared to last year.
This year’s IoD North West Annual Conference is themed ‘leading through change’ and I believe that Lancashire is a place that can set an example to other regions whilst the entire nation goes through this uncomfortable period, yet it is often overlooked.
The employer must enrol all eligible job holders into a qualifying workplace pension scheme with a minimum total contribution starting at 2 per cent and rising to 8 per cent in the next few years.
All eligible job holders aged between 22 and the state pension age earning over £7,475 per annum will have to be automatically enrolled. Opt out A worker can opt out of the pension scheme if they wish. However, they must be enrolled before they choose to opt out. The worker has the right to opt back in when they want, once in any 12 month period. If a worker stops making payments or opts out, the employer must automatically enrol the employee back into the scheme every three years. Employment protection Under the act, an employer cannot offer incentives to workers to opt out of the workplace pension but a worker can opt out if they wish to do so.
burden upon employers. Dealing with the auto-enrolment and opt out provisions will require preparation. Employers will also need to consider whether their current contracts of employment need amending. Additionally, employers who currently have a pension scheme which has only had partial take-up will need to consider what cost the company will face if they maintain the current scheme when auto enrolment comes in. This also raises questions as to whether the scheme is changed which brings its own contractual issues. It is also employers who will have to face the brunt of financial penalties if they breach the provisions of the act, as financial penalties can be imposed by the pension’s regulator.
Impact on businesses This new regime will put an additional cost and administrative
Contact: Chris.Boyle@napthens.co.uk 01772 904279
book review / dealmaker awards / plumbs:
Book Review In the first of a new regular feature, Kay Jackson-Leigh, Director of HR, Risk and Service Quality at Napthens, reviews a book which proves that penguins have some canny business skills to pass on... constructed around a penguin colony in the South Pole. Less than 150 pages long, John Kotter’s short book tells the tale of Fred, a curious bird who discovers a potentially devastating problem in the lives of his colony – a crack in the ice. The book relates the adventures of Fred as he uses his leadership skills to first convince his colony of the danger, then to persuade it of the need to change and become nomadic like the seagulls they see in the area.
Our Iceberg is Melting, by John Kotter, is a simple tale – a fable
During the course of the book, Kotter introduces his eight-step process of successful change including ‘create a sense of
urgency’, ‘building a team’, ‘creating a vision’ and ‘short-term wins’ (for the rest you’ll have to read the book!).
‘management psychology’ and it’s a good starting point for anyone wanting to delve further into change management issues.
We see Fred’s leadership skills on display in managing change and successfully taking others with him on the journey. Clearly this can relate to many business situations and is a useful and thought provoking piece of writing.
As someone who deals with people and organisational issues day-today, I found Fred’s wise ways of interest! I’m certainly planning to read more of John Kotter’s books.
The book is simplistic but this ‘quick-read’ format is becoming increasingly popular, and I for one like it. The length of the book is adequate for the key points it is putting across.
IN:BRIEF RATING: 3/5 – ‘good for highlights but you’ll want something more in-depth if you are an experienced manager’
Keith, Head of Corporate at Napthens, was handed the top prize during the glittering ceremony at Ewood Park in Blackburn, in front of 150 members of Lancashire’s professional community.
Plumbs is a true family success story.
Napthens was a double winner at the event after also walking away with the award for Corporate Law Firm of the Year - for the second year in a row.
The fourth generation is now working for the Preston based bespoke soft furnishing company, founded in 1953 by Tom and Bernice Plumb.
Beating competition from a number of regional rivals, Napthens was picked by an independent panel of judges thanks to its work over the last 12 months.
Sarah Page, managing director, is the third generation. Boasting more than 1,000 orders per week of its products - loose furniture covers, curtains and reupholstery - Plumbs now has more than 300 staff at its headquarters, with a team of 147 sales agents around the country, and a network of 210 small manufacturing partners.
Keith said: “These award wins have once again thrown the spotlight on Napthens among the regional business community, and have really helped to reinforce our place as Lancashire’s number one law firm. “Being the first lawyer to be named Dealmaker of the Year is a particular honour for me, and it’s a real tribute to the whole Corporate team that the work we have done over the last 12 months has been held up as the best in the area by the judges.
Its national in-home service has seen the reupholstery side of the business increase 36 per cent in 2011, with a 39 per cent growth so far in 2012 year on year. This is the growth area for the business.
Whoever said manufacturing is dead hasn’t met Sarah Page. Fiercely proud of the company’s roots, she has made sure its manufacturing has remained in the UK, committed to working with traditional knitters and weavers. Sarah is now determined to create a lasting legacy for Plumbs, and has made a commitment for Preston’s
Keith Melling receives his award
Keith Melling has made it a first becoming the first solicitor to be named North West Business Insider magazine’s Lancashire Dealmaker of the Year.
I think the book will appeal to those who don’t normally enjoy reading
A family success
Sarah explained: “Our customers have come to trust our service and to enjoy dealing with our sales team. There is a real sentimentality to it, customers have invested in a good piece of furniture and don’t want to replace it, but would rather reupholster it and bring it to life again.”
Keith named top lawyer
“At Napthens we firmly believe that there is no need to travel to Manchester or Liverpool to find a top quality law firm. There is no substitute for good service, and these awards are further proof of this.”
A Plumbs worker gets to grips with a piece of furniture 2012 Guild. The company has historically supported the last two Guilds. She explained: “I’ve always felt strongly that young people don’t have that many options open to them when it comes to finding work in the traditional craft skills. If your strength is in a craft or skill rather than in academic studies, there often
isn’t much support out there for you. “We have to invest in our traditional skills in order for manufacturing to survive. Most schools simply aren’t able to promote these types of skills, and manufacturing isn’t seen as exciting by the young people, so we’ve stepped up and made a commitment.
“We have said, let’s try and get 20 young people into apprenticeships in the area for the Guild Year. That’s our legacy and one we can be very proud of.”
We welcome your feedback and comments on any of the articles in this issue of in:brief. Feel free to drop us a line at Marketing@napthens.co.uk or visit our in:brief page on our website, www.napthens.co.uk/inbrief.
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SPRING 2012 in:brief 3
sector focus: bridging the skills gap
Bridging the skills gap With unemployment at a record high, it seems astonishing that many companies are recruiting staff from overseas to plug their skills gaps and drive competitiveness. Young people are bearing the brunt of the UK jobs crisis, with more than one in five people aged under 24 claiming Jobseekers Allowance, according to the latest unemployment figures. These statistics also reveal that in the past year, 208,000 British-born workers have become unemployed, while 212,000 foreign workers have found jobs in the UK. Lancashire is especially hard hit by youth unemployment: Preston, Blackpool, Blackburn and Burnley are among 152 local authority areas cited as youth unemployment hotspots in a survey by the ACEVO Commission on Youth Unemployment. A range of initiatives are being developed, in particular apprenticeships, once a major route into skilled employment for many school and college leavers. The Government announced recently that it will invest more than £250m in a new apprenticeship scheme designed to tackle the skills shortage among young people. But how effective will the programme be? Christine Lambe, training director at East Lancashire Chamber of Commerce, comments: “This scheme is designed to engage small and medium sized enterprises (SMEs) and to encourage businesses to invest in developing young talent. “Grants of up to £1,500 are being offered by providers to kick-start the national programme and get apprenticeships back on the agenda for growing businesses. Apprentices can make a significant impact and contribution to a business and help to bridge the ageing work force. It is an agenda the chamber supports 100 per cent.” The national programme has also garnered wide-ranging backing from business leaders, including Sarah
4 in:brief SPRING 2012
Page, managing director of bespoke soft furnishing company Plumbs in Preston. “I fully support the work being done in promoting the apprentice scheme and hopefully good skills will be obtained by individuals,” says Sarah. “I am all for workplace learning. We need to educate children in schools, though, to consider this career route as being on a par with the university option. This will require a great amount of marketing.” In the meantime, employers such as Plumbs must do all they can to recruit individuals of the right calibre to meet their skills requirements.
the next decade we will see a big wave of retirement among these employees, which will wash a substantial amount of talent and experience out of the workforce,” says Adam Buckley, head of programmes at the Manufacturing Institute in Manchester. “The big challenge for workplaces is how to replace this outgoing talent and experience.” One Darwen company is tackling the skills gap itself, with a market leading apprenticeship scheme – WEC Group’s Welding and Engineering Training Academy. Formed in 2006, the academy is
“Lancashire has a tremendous history in manufacturing and the traditional trades, and there is some great work being done to promote these sectors as attractive and viable career options.” Manufacturing in particular appears less prepared to deal with the ageing workforce than employers in other sectors. The average age of manufacturing workers is 50, and there is a marked decline in the number of workers under 35. “It’s a ticking time bomb. Over
aimed at providing local people with the skills and qualifications to carve out a career in engineering. So far its students have worked on a number of high profile projects including the manufacture and installation of a new dome for the Darwen Jubilee Tower to replace the
one that was blown off in November 2010; and a £100,000 stainless steel spitfire memorial to commemorate the town’s war effort during WW2 when the people of Darwen raised money to build a Spitfire. Steve Hartley, managing director of WEC Group, said: “The success of any company is down to its employees. By investing in skills, WEC Group is securing a sustainable competitive advantage for the long-term and contributing to the economic growth in the local area. “There is no doubting the contribution made by the apprentices to the growth of the company is significant. Working in various divisions and on numerous projects, the skills they have learnt throughout their time at WEC are invaluable and as the new and exciting projects keep rolling in, they are positioned to continue learning well into the future.” Part of the solution could lie in the changing nature of manufacturing jobs. Recent years have seen the proportion of employees in production and support services falling, while the number of staff employed in professional occupations has increased. Adam Buckley continues: “We expect to see a net demand for managerial occupations while medium to low-level skilled jobs are all projected to decrease in terms of employment share. Approaches being taken include up-skilling the workforce, attracting young talent, investing in automation to compensate for lost skills, and applying retention strategies across the entire workforce, including younger and older people.” Questions have been raised among employers about whether university graduates are equipped with the appropriate skills to enter a working environment. Figures from the
Kimberley Barrett-St Vall
Manufacturing Institute suggest that around 40 per cent of employers believe graduates are not ‘workready’, while 68 per cent say they struggle to recruit staff due to a lack of specialist skills.
sector focus: bridging the skills gap
Traditional skills are the focus for many businesses looking to help bridge the skills gap
“My experience of graduates is that they are prepared for work with a key skillsets,” says Sarah Page at Plumbs. “The issue I really find is that the world of work can be a shock as graduates adjust from irregular hours. In the final year of university they work hard on dissertations and final exams but set their own time frames. Nine ‘til five, five days a week, comes as something of a shock.” Sarah adds: “The key skills gap for school leavers can be the basics of spelling, general maths and organisation skills. I believe the current culture of celebrity also creates issues as young people sometimes think the workplace is all bright lights, when the reality is that they have to start at a low level and work their way up. Enthusiasm and willingness to learn is what employers want.” Kimberley Barrett-St Vall, an employment lawyer at Napthens,
said that in her experience many employers find themselves limited in terms of their recruitment process. Kimberley explained: “A recent survey from XpertHR showed that 95 per cent of employers which faced issues in their recruitment processes blamed the low quality of candidates applying for posts as a barrier. “It is a common complaint by employers that schools are not doing enough to prepare youngsters for work, but equally there are many employers and educational establishments which are doing great things to close the skills gap. “Lancashire has a tremendous history in manufacturing and the traditional trades, and there is some great work being done to promote these sectors as attractive and viable career options. “It is also important to make sure that the right skillsets are matched to
the right jobs. Ensuring employees are in the most productive roles for their skillsets is crucial to success and companies can ensure they make the most of the skills available to them by implementing adaptable working practices. “I often advise businesses of the need to attract the best candidate possible by offering the most suitable working arrangements. These are an effective way of giving businesses the flexibility to tackle skills shortages. “Typically this involves placing staff on temporary or fixed term contracts, to ensure individuals are fully assessed and allocated to the areas where they can add most value to the business process. This will also give employers more time to assess an employee’s skills.” The region’s universities are doing their utmost to ensure graduates are equipped with workplace skills – but
would welcome help to do more, says David Bagley, head of student employability and enterprise at UCLan. “Universities cannot create jobs, but by working together with business we can ensure that new graduates have the qualities needed by employers and that skills are retained in the region,” says David. “All courses at UCLan are required to demonstrate an understanding of employer needs, and many are now being developed with direct input from employers sitting on advisory panels.” The university has built employability into all its higher education programmes and measures carefully what happens to all its graduates when they leave. David adds: “We run specialist employability events and work closely with employers to ensure
graduates have the generic skills needed, but employers will still need to provide recruits with the very specific skills required for individual jobs. Please let us know how we are doing and how we can work together with employers to improve the employability of our graduates.” This call for employers to make their skills needs known to organisations that support and represent businesses is echoed by East Lancashire Chamber’s Christine Lambe. “Demand should be employer led because this will ensure that the programmes and courses required are available locally, at a time that meets the requirement of the business,” says Christine. “It’s essential that both employers and providers work in harmony to provide a high level of knowledge, improved skills and a well informed and educated workforce.”
SPRING 2012 in:brief 5
ask the expert / mediation / leyland exports: ask the expert:
Property Sarah Barnes is Head of Residential Property. She advises on a range of residential property transactions including sales, purchases and remortgage work. Q: I am buying a house jointly with my partner and would like some advice on the best way to make sure that both our contributions are recognised by the law. A. Enter into a legal agreement known as a deed of trust – this is by far the best option for any couple looking to buy a property together. Such a deed is a binding agreement between the joint owners of a property and protects their interests by recording their financial contributions. It may also contain information such as the amount each has contributed towards the purchase price, ownership shares, how mortgage payments are to be split and how to deal with any future sale. Deeds of trust should be entered into when someone is buying a home with a partner or friend as tenants-in-common, or when unequal contributions are to be made towards the purchase. Typically a deed of trust will include: • The contributions made by each person to the deposit • Who pays the mortgage repayments • How the equity is split if the property is sold or the mortgage ends • How much each owner is going to contribute towards home insurance, purchasing costs, maintenance and improvements • A right of first refusal among the owners in the event one party wants to sell • What you might do if one owner wants to sell and the other doesn’t want to • What you do if an owner wants to move out, but still remain a co-owner • Property rules (e.g concerning guests, maintenance, etc) • Payment of bills and taxes • How rental income from a tenant, if any, is divided. Contact: Sarah.Barnes@napthens.co.uk 01772 904353
Legal Update - mediation John Whittingslow, litigation partner and Head of Napthens’ Commercial division, looks at a number of approaches that can be adopted when trying to resolve a dispute before starting litigation, known as Alternative Dispute Resolution (ADR). One of the most important types of ADR is mediation which is a form of negotiation that takes place with the assistance of an independent mediator.
who had been unwilling to mediate before proceedings had been started was asked the specific question by the court as to the reason for that refusal.
The courts will frequently enquire at the end of a trial what steps both parties took to try and resolve the matter. If either party has refused to consider ADR and is not able to give a satisfactory explanation to the court as to why that decision has been taken, then the courts have the power to make sometimes quite draconian Cost Orders against that particular party – regardless of whether they have won or lost at the trial.
The party informed the court that he believed that had he agreed to participate in a mediation it would have been indicative of his guilt and that he would not have been able to demonstrate in a mediation how unreasonable part of his opponent’s case was and that he could only give this demonstration at a trial.
In the recent Court of Appeal case of Rolf v De Guerin one of the parties
Rix LJ stated that the parties’ response to the questions asked by the court about the decision not
A party who succeeds in their claim or defence but has failed to engage in mediation without a legitimate excuse is likely to find themselves on the wrong end of an adverse Costs Order regardless of the outcome of their case.
Contact: John.Whittingslow@napthens.co.uk 01772 904272
Leyland Holding Company Ltd has seen stunning growth in the last decade, with consolidated turnover climbing from £1.8m to a predicted £25m. Its UK workforce has grown from just eight to 160, and the group of companies is made up of ten divisions including a business manufacturing agricultural bulk storage systems and a marketing company, Stone Create Limited. The success of the Leylandbased business is down to an impressive acquisition trail and a desire to diversify in order to remain competitive. Napthens has advised MD Paul Kirkman on a number of legal issues over recent years, from commercial property to employment and litigation. Formed in 1993 from the ashes of transport giant Leyland DAF, the business was set up as an exports hub servicing various distributors and dealerships in Africa.
When the Leyland assembly plant stopped manufacturing the Comet in 2000, meaning the company effectively lost its key product, the business was forced to focus on the parts supply business. Now, through acquisitions, the business is selling more than £1million per month of truck and bus parts.
6 in:brief SPRING 2012
This Court of Appeal case gives clear guidance to the lower courts that they should expect litigants to seriously consider and engage in mediation or other forms of Alternative Dispute Resolution.
The Leyland Comet was a very robust vehicle for the environment and climate, and the company was selling between 10-15 trucks a month outside Europe.
The Court of Appeal did not hesitate in concluding that these reasons were not satisfactory or reasonable.
to mediate did not “…seem to me to be an adequate response to a proper judicial concern that parties should respond reasonably to offers to mediate or settle and that their conduct in this respect can be taken into account in awarding costs.”
The numerous acquisitions started
in 2002 with Manchester-based Gardner Parts, which was bought from Gardner plc. In 2003 it added Bentall Rowlands, a Scunthorpe based manufacturer of agricultural silos, to the group. Since 2006, it has added and developed current trading divisions: Leyland Bus Parts, Amipart and Leyland Hose & Silicone Services. After a failed Indian JV at the start of 2010 the company started production in its own factory in India mid way through 2011. More recently it has added a marketing company, Stone Create Limited, to service group inward facing and commercial outward facing web, SEO, marketing, design and PR requirements. Paul Kirkman said: “When the assembly plant stopped the Leyland product, we were forced to innovate, and we concentrated on the parts supply side of the business which is now what we are best known for at Leyland. “Now, 12 years on, we have ten divisions in a number of different sectors, and are breaking all previous sales records. We have a great team here, and there is a real positive air about the business. “We are all looking forward to what the next 12 years have in store for us.” www.leylandholding.com Paul Kirkman of Leyland Holding Company Ltd
face2face / a day at the races:
FACE2FACE: Access to finance Face2Face is a new feature which discusses a burning business issue of the day. In the first Face2Face, which took place at Shaw Hill Golf Club, near Chorley, Napthens’ chief executive, Ian Leigh, met Jonathan Smith of Chorley based Kingsley Asset Finance to discuss access to finance. banks with regard to restructuring debt and bridging finance.” IL: “What about Government influence? Could the Government be doing more to encourage lending other than Project Merlin which has been good to help the balance between the needs of businesses and the banks’ appetite to finance their growth?”
Racing into Bolton Napthens’ Licensing team has played a key role in bringing greyhound racing back to Bolton.
JS: “Whilst the overall, £190bn target of Project Merlin was achieved by the banks, the commitment to lend to SMEs (£76bn) fell slightly short. “In truth, the banks are stuck between a rock and a hard place in that whilst they are being asked to lend out funds, they are also conscious not to incur any further bad debts. “Business owners may need further help from the Government and this could take the form of tax incentives and grants for training and investment.” IL: “So, instead of looking for external sources of finance how can business owners release cash from their company? From understanding the issues affecting cash flow to invoicing more quickly, there’s lots that can be done.”
Ian Leigh (right) with Jonathan Smith meet to discuss a key business issue
Ian Leigh (IL): “The current hostile economic situation is proving a challenge for businesses to access finance from banks. Where else can they look? For instance, many of Napthens’ clients have turned to options like asset based lending, mezzanine finance on a limited basis, and private equity. Jonathan Smith (JS): “Accessing finance from traditional lenders can be a lengthy and often frustrating process. However, various options are available to businesses other than bank lending. “Invoice finance and factoring are now a popular option. “Once seen as the lender of last resort, the last five years have seen the market become much more competitive and this type of facility can be an effective way of funding a business as turnover increases. It tends to be a much speedier process than applying for a traditional bank overdraft, as the factoring company will use the debtor book as security and the business owner may not need to offer up traditional ‘bricks and mortar’ security.” IL: “Regional funds are playing an increasingly important role. Rosebud, FW Capital and the North West Fund are just a few examples. Other options may be leasing and social lending websites such as Funding Circle. It’s important to look at each
client’s requirements individually.” JS: “Certainly. Increasingly, private equity houses would look to invest money into promising businesses, however this may involve business owners sacrificing equity and, as such, an element of control within the business.
this prohibitive and there is therefore gradual acceptance of the trend towards short term finance.” JS: “Short term finance tends to be quite expensive and business owners need to match cash outflows of the business with realistic cash inflows. Paying off debt too aggressively is often the downfall of
“Business owners may need further help from the Government and this could take the form of tax incentives and grants for training and investment.” Other options may include seeking investments from friends and family or grants that may be available through various government schemes.” IL: “Demand still exists for longer term finance, though lenders’ capital requirements can make the cost of
many profitable businesses. “The requirement for short term finance needs to be mitigated by careful planning if possible. Options available may include tight credit control, offering discounts for early payments, managing supplier payments effectively, speaking to
JS: “Business owners need to focus on certain areas to ensure that they are running a tight ship: good credit control, effective stock control, protecting the business from bad debts by insuring against customer failures, matching cash outflows with realistic cash inflows, selling off under-utilised assets or stock and releasing funds tied up in business assets via sale and leaseback arrangements will all assist with cash flow issues.” IL: “What tips or advice would you give businesses looking to source funds for investment or expansion?” JS: “Evaluate the return of any investment and ensure that the returns generated justify the investment and be sure that the funds cannot be better utilised. Don’t jeopardise the business by overtrading which is often the downfall of many profitable businesses. If possible, fix interest rates which would give the business consistency.” IL: “I would add, always get professional advice to help ensure financial arrangements are properly structured within your business, and understand the terms and conditions of the finance.” More information on Jonathan’s company, Kingsley Asset Finance, can be found at www.kingsley-finance.co.uk
Greyhound racing returns
The popular Bolton and Westhoughton Greyhound Track closed in December 2011, and was left without a tenant following a reported £30,000 of investment into the venue last year. Now Kevin Brown, a local businessman with a background in the sport, has taken on the lease from owner Ian Holden, and is bringing greyhound racing back to the area. Malcolm Ireland, Head of Leisure & Licensing, advised Mr Brown on obtaining the necessary gambling and alcohol licenses to allow the small track, which has a capacity of 200 spectators, to reopen. The local authority recently granted these licenses, giving the venue the green light. Malcolm said: “Kevin has worked hard to return the track to operation and he is very passionate about the sport. There is a real desire in the area to see racing return to the track, and I’m delighted we have been able to secure the necessary licenses.” Mr Brown, also a past owner of Ashcroft Travel in Widnes, believes he can make a success of the track . He added: “The sport is the most important thing. The track built up a great following over the past few years, and I know there are plenty of people who have been waiting for greyhound racing to start again.”
SPRING 2012 in:brief 7
Oli joins Blackburn employment team The Employment team at Napthens has recently expanded with the appointment of well-known expert Oli McCann. Oli, a solicitor with 15 years’ experience in employment law, joins as a partner from Taylors where he was a partner and Head of employment. Based in Napthens’ Blackburn office, he acts primarily for East Lancashire businesses, ranging from blue chip clients with more than 10,000 staff to smaller owner-managed companies, charities and education establishments. He advises on all HR and employment law issues faced by businesses, and offers clients a particular expertise in restructuring, redundancy and collective consultation, TUPE issues, unfair dismissal, discrimination, whistleblowing and data protection. Oli said: “I am delighted to join the Napthens’ team. The firm’s core values and principles mirror my own, in particular a desire to provide a client service which is second to none.”
Tricia Morrison steering in the right direction
Me and my... Yachting
As a newly qualified solicitor, Tricia spent five days at an intensive sailing school at Cumbrae, Largs, a haven for lovers of the water. She passed her RYA Dinghy Level 2 sailing certificate and gained her passion for the activity. It was after she met her husband Tim that the bug began to well and truly bite. Tim had previously owned a motor cruiser on the south coast, but Tricia used her powers of negotiation and persuasion to convince him that sailing was to be preferred over the engine. The pair took part in a week long Competent Crew course, sailing to France and the Isles of Scilly, and soon after began to spend
Preston: 7 Winckley Square, Preston, PR1 3JD DX 714572 Preston 14 Tel: 01772 888 444 Fax: 01772 257 805 Email: Preston@napthens.co.uk
time each year dedicated to sailing holidays, first taking part in flotilla holidays as part of a small group of boats accompanying each other on voyages to destinations including Greece. After five years it was time to set out on their own and the couple started bareboat chartering. The pair also made a passage from Largs, Scotland to Gran Canaria as crew on a 40ft boat. This two week passage included a week at sea without sight of land – or a shower - a storm off the coast of Portugal, and encounters with whales and a Portuguese naval destroyer. Tricia has now passed a RYA navigation course and holds her Day Skipper and Coastal Skipper tickets. Next on her horizon is the RYA Yacht Master, a real badge of honour in the sailing world.
Blackburn: Greenbank Court, Challenge Way Greenbank Business Park Blackburn, Lancashire BB1 5QB DX 745450 Blackburn 12 Tel: 01254 667 733 Fax: 01254 681 166 Email: Blackburn@napthens.co.uk
Chris Boyle, Head of Employment, added: “Oliver has already become a valued member of our team and his expertise provides a real boost to our commercial offering in East Lancashire. A member of the Employment Lawyers Association, Oli has been recognised in the legal industry bible Legal 500 as ‘a name to note’ in the employment law sector.
Under new leadership
Tricia Morrison is Napthens’ Head of construction. An expert sailor, Tricia is never happier than when ‘messing about in boats.’ As a sailor, Tricia has a natural advantage that has stood her in good stead among her fellow yachters – she doesn’t get seasick.
She explained: “The yacht master qualification is a mark of excellence and only the best people have it. “You are required to impress an independent examiner from the RYA. They take you through the worst conditions and situations they can find. It’s not like taking a driving test – you certainly don’t expect to pass the first time! “I am also keen to take some survival at sea courses. The more you sail, the more you are aware that unexpected things can happen when you’re out on the sea. It’s a big responsibility skippering a boat, and that’s not for everyone. “A hard day sailing is always a good day but the quieter days of gentle sailing and settling up for the night at a quiet anchorage provide the balance for a perfect pastime.”
Blackpool: Libra House, Cropper Close, Whitehills Business Park, Blackpool, FY4 5PU DX 745260 Blackpool 20 Tel: 01253 622 305 Fax: 01253 295 591 Email: Blackpool@napthens.co.uk
The Residential Property and Rural teams at Napthens have welcomed new leadership after Sarah Barnes and more recently, Andrew Holden were promoted to heads of departments. Sarah, who joined Napthens in 2009, has taken over from Simon Ainsworth to lead the Residential
Property team. Simon, also Head of Napthens’ Private Client Division, will now concentrate on developing this division’s strategy. Andrew Holden takes over from partner Geoff Tomlinson, who will continue to play an important role within the Rural department.
Help for local charities During 2012, Napthens’ staff are raising funds for four Lancashire good causes. Earlier this year staff at each of the firm’s four offices picked a charity to support. In Preston, the chosen charity this year is Cash for Kids, the charity of radio station Rock FM. In Blackburn staff will raise funds for Breast Cancer Research.
Chris Boyle, Head of the Charity Committee at Napthens, said: “Every one of these charities does some fantastic work in the local area. “Past years have seen Napthens raise some vital funds for good causes and I’m sure 2012 will be no different.” For more information on Napthens’ chosen charities, take a look at the following websites:
Easterleigh Animal Sanctuary has been chosen by the Blackpool office, and the North West Air Ambulance by Chorley.
Funds are being raised throughout the year by a series of events and activities such as sporting competitions.
Chorley: 10-12 St Thomas’s Road, Chorley, PR7 1HR DX 18412 Chorley Tel: 0845 260 2111 Fax: 01257 260 096 Email: Chorley@napthens.co.uk
www.napthens.co.uk Napthens LLP, registered office: 7 Winckley Square, Preston, Lancashire PR1 3JD. Napthens LLP is a limited liability partnership registered in England and Wales: OC325775. The term “Partner” indicates a member of Napthens LLP who is not in partnership for the purpose of the Partnership Act 1890. A list of members is available from our registered office.
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Published on May 13, 2012