Culverwell Consulting

COMMERCIAL PROPERTY ADVICE

Jim Culverwell

Growth vs Scale – do you really want to grow your business or just make more money?

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Many a consultant, coach and guru will promise to help you grow and scale your business, but what does that really mean? What is the difference between growing and scaling and which one is right for you? In this blog we’re going to look at why growth and scale mean different things, and how to use a business plan to inform the right decision for you and your business.

Let’s start with ‘business growth’. Traditionally this means adding in additional resources, such as more staff, or larger premises, to serve a greater number of customers or clients. Whilst growing your business should hopefully result in higher revenues, your expenses will rise as well.

Scaling your business, however, is when you look to increase existing revenue or open up additional revenue streams, without necessarily increasing the resources required. For example, you could raise your prices or create passive income streams. The key difference with scaling as opposed to growing, is that you’re increasing your revenue while maintaining or reducing your expenses.

Now let’s talk about you. Are you in growth mode or scale mode? Here are some top tips to help you find out what your business needs to deliver on your vision:

  • Revisit your business plan. What is your goal for the next 12 months vs the next 36 months? Your business plan should be your north star. Consider whether more growth might be needed before scaling is possible.
  • How much time do you want to be spending in your business? If you’ve been growing for a while, you might have been spending a lot of time hands-on. Could it be time to look at scaling so you can get some of your time back to do things you enjoy?
  • Consider your mission and purpose. Do you have something established you’re looking to reach more people with? Or something new you’re looking to test out? Think about the legacy you want to leave with your business and let this guide you.
  • Think about how you can work smarter, not harder. Whether you want to grow or scale your business, bigger is not always better – especially when it comes to premises! Regardless your business priorities, you should always be reviewing your expenses and trying to reduce them where possible.

Is a premises move on the cards for you?

Adding more floorspace in order to grow is also adding a slug of fixed overhead the business has to pay for each month before making any surplus. Think very carefully before adding overhead and be sure there aren’t other ways of growing your bottom line first. The time to be making that move to a bigger unit is when ‘not having that space’ is holding the business back.

Working from home or a small premises may be fine for you for a while, but if headcount is increasing or another production line is required, you are probably going to need accommodation that is better suited to your needs. If you need support finding the right premises for your growing or scaling business, I can help with the end-to-end premises and lease negotiation process. We’ll do it in a way that works for you, so you get the right premises on the right commercial terms.

Get in touch to book a free mentoring call and understand what your business really needs to deliver on your vision.

 

WFH – the new normal?

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It hasn’t been great for everyone. Many office-based employees have had plenty of practice at WFH over the last couple of years.  Some have loved it others not so much.

Some have perhaps been treading water waiting to get back to normal only to find that the management has other plans.  The office is closing or you’re only going to be welcome two days a week and over time, the intention is that WFH becomes ‘normal’.

Others are back in already or will be soon.  The boss likes to be able to see everyone at work and believes there has been a loss of efficiency.  I have heard some instances where social distancing was being ignored.

As with all things, there is a spectrum of ideas and wisdom on the subject and no one view is universally correct. Every situation is unique and the real answer for most businesses will be somewhere in the middle.

The office environment can be inspiring – the general buzz, sparking off one another and social interaction.  This can foster a culture that is positive and productive. Balance that against removing the time, cost and effort of commuting, the lack of interruptions to the working day and the ability to communicate with everybody and anybody by video call, phone call, email, text and all without having to go anywhere.

However, there are downsides to both scenarios.  Extremes, in most circumstances, do not produce good outcomes.

So, what should a business be looking to do, so they strike the right balance between office interaction and home working?  The challenge is that everyone is different. Each worker, staff member, employee, has different needs, ambitions, requirements, strengths and weaknesses.  It has always been this way but previously we have had a ‘one size fits all’ solution of going to the office every day.  That said, WFH is not new and some businesses have been doing it very successfully for many years.

‘Choice’ is key in drawing some conclusions about how to make the most of your staff and your resources.  Don’t force a member of staff with a difficult or complicated home-life, to work from home and if productivity is not being affected, don’t force the staff member into the office, who is so much happier working from home.

‘Resourcing’ is vital to make your people as effective at home as they can be at the office.  That means helping them find a dedicated area in their home – not necessarily a separate room.  Making sure they have a proper desk and a comfortable seat so that their physical health doesn’t suffer.  They need the equivalent IT hardware, software and support at home, that they would have in the office, including broadband and mobile, so they can work effectively and without disruption.

‘Community’, as we have already seen, is important to many workers.  Real friendships and support networks are established at work and these are diluted when people are not together.  The water-fountain conversations are not going to take place unless an environment is created where that can happen. Being in the office will not be about shutting yourself away to work but about meeting, socialising – communicating face to face.  This is also the driver for the culture of an organisation, which needs careful nurturing within a more dispersed group of workers.  Work form home and socialise in the office.

‘Accountability and measurement’ are important not just for managing remote workers but also for the workers themselves, so they can have the confidence that they are adapting and knowing they are seen to be effective.  Letting people know its OK to water the plants in their lunch hour and start the day by taking the children to school, will produce a relaxed and fulfilled workforce keen to put in the maximum.

‘Flexibility and controls’ will help everyone to know where they are and to flourish.  For some, flexible work hours are what make WFH possible.  If you have young children, being able to work in the evenings may be the only way.  On the other hand, if having done a days work, a staff member can’t put the work down and enjoy an evening as they would have, some intervention may be helpful.  Knowing the measurement is there in the background will encourage people into a routine that suits them and delivers what their job description requires.

Managed “office time” enables the interaction that is always going to be important and should not be downplayed.  Calendar software and a regime that sees everyone coming in for as many days as is appropriate, make managing this vital component possible.  Making changes to the floor-space that the new model requires, will take much longer and needs careful consideration and potentially expert help and advice.  Every unused work-station costs thousands on the bottom line and fine-tuning this costly and inflexible resource could take several years, so it’s not too soon to start.

WFH has been a revelation to many, who never thought it was feasible.  It has brought about a realisation that doing things the way we always have, may have been holding us back and that new ways of working can bring so many benefits.  The cost savings a business can achieve through properly resourced WFH are substantial as well as potentially increased staff well-being and productivity.

 

Top tips to survive a recession (from a small business owner who has survived two!)

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As we face (yet another) period of economic uncertainty, many business owners I speak to are asking what they need to do to weather the storm. As a business owners who has been through two big recessions and lived to tell the story, I wrote this blog to share my experiences and some top tips to help you focus on the right areas.

Rewind to 1990

At the start of the recession in 1990, my last but one PAYE job ended quite abruptly and unexpectedly.  Although I enjoyed a pretty much uninterrupted boom (and quite a few bottles of champagne) through my early career, being made redundant came like a bolt from the blue.

My wife and I were expecting our first child, so our financial situation rapidly became unsustainable.  My next job was not in view yet and we were going to lose the second salary very soon. For quite a few weeks I floundered, then I gave myself a talking to and did two things.

Taking action

First, I began volunteering at the Star and Garter Home, then on the edge of Richmond Park.  A refuge for severely injured soldiers, sailors and airmen, they needed unskilled volunteers to give their time.  I suddenly had loads of that and was more than happy to give it. Through meeting and serving these brave and courageous men and seeing the mental and physical trauma some people live with daily, I realised that far from my life being devastated, I was in fact extremely lucky, in so many ways.

The second thing, perhaps prompted – or at least made easier – by the first, was to sell our lovely, Edwardian terraced house in Twickenham and rent a much cheaper property more suited to our circumstances at that time. Still a very pleasant place to live, it became our first family home and the platform from which to relaunch myself.

My next job came because I had helped a major institution solve a serious property problem in East London and they hired me on (initially) a 12 month contract. Over the next five years I was part of a team dealing with a £600,000,000 portfolio of commercial loans, most of which were non-performing in one way or another.  In the end, I was the only one left in that team.

It was fast moving and a fantastically steep learning curve for everyone. Part of my remit was to meet people with failed businesses and loans they could not service, to tell them to stop and to hand back the keys. Don’t judge unless you have done this, but the tough decision I took to match my own commitments with my changed circumstances, promptly and ruthlessly definitely made this easier.

Another recession!

In 2008/9 I was drafted in to work through a very similar debt book with connections to Northern Rock and Lehman Brothers.  That one was about £887,000,000.  Several factors made the strategy and outcomes quite different but that’s another story. I carried out that work alongside my business here, in Hampshire helping business owners renegotiate lease terms with worried landlords. Unsurprisingly, I was quite good at it, and it has to be approached in the right way to get a good result.

My top tips

With another recession on the horizon, in a way I know I’m fortunate to be able to say “I have been here before”. So here are my top tips to help you weather the financial storm:

  1. Put your situation into perspective by helping others with bigger problems than you.
  2. Review your business plan in light of changing circumstances and outlook – does it still serve you?
  3. Take the hard decisions early.  I can’t emphasise enough, how important and beneficial that can be.
  4. Be smart with your resources.  Don’t splash out, but don’t make cuts that will hurt you long term. There has to be a business case for every penny.
  5. Don’t be light weight with a heavy weight problem. For example, I see this with many clients renegotiating the lease on their premises.  If you want your landlord to take you seriously, he needs to see that it’s serious and you’re serious.  Put together a comprehensive, forceful and properly argued case (of of course – just call me!).
  6. When cashflow is a struggle, always pay the body that can ruin your business.

Need some help?

If you haven’t questioned what your premises are doing to take  your business forward recently and whether they are “the right fit” in the current climate, then it may be time you did. I have a suite of online courses that could help you discover the key areas you need to consider and change the way you think about premises forever. Not to mention save you lots of hassle, time and money!

Click here to discover more: https://talk-to-jim.teachable.com/

Six top tips to get the best outcome from any business negotiation

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On the face of it, I support business owners to understand, find and negotiate the right commercial premises for their business, on the right terms. Of course, as with any B2B offering, I do much more than that. One of the most challenging, and often emotional, areas I support business owners with is negotiation. While we are usually talking about negotiating their commercial lease, inevitably there are learnings my clients take away from their experience that have implications across the rest of their business too. So in this blog I’d like to give you six key areas to consider to help you get the best outcome out of any business negotiation.

Let’s start with clarity

Before you enter any business negotiation you need to know what you actually need and want, to support your end-objectives. Consider your priorities – what will be essential and what is nice to have? In a lease negotiation I always invite my clients to consider what the landlord will see as a priority, so don’t forget to consider your negotiation from the other side.

Do your research

It is imperative to arm yourself with the facts before you enter any negotiation process and try never to ask questions to which you don’t already know the answer. Look at the subject matter: what do you know already? Where might you need the support of an expert? Entering negotiations blind is often a recipe for disaster, so do your research before you get stuck in.

Know who is on your side

This might not apply in every negotiation, but it is good to take stock of who the main players will be and what motivations they have. Who is acting on whose behalf? The video below gives a great example of the role of the estate agent in a lease negotiation – and it’s probably not what you think!

Fire the first shot

Set your stall out before the other party – this puts you in a position of control. This is one of the key areas that changes my clients’ perspectives on commercial leases entirely. They assume they will be given a list of terms from the agent or landlord and it will be their job to respond, or even that this list is the only option and not even consider negotiation. However, arriving to the negotiation with a comprehensive proposal changes the balance of power right from the off.

Try to leave emotion out of it

Of course, we are only human beings! So when it gets tough and things don’t go our way, we tend to react emotionally. This is where it’s key to take a breath and pause. Allow yourself to return to the facts and calm down before you move forward. I often take my biggest challenges on a walk in the countryside for exactly that reason!

Know your boundaries

Throughout the negotiation, remember where you’re willing to flex and where you’re not. In my work, for example, we are working on a continuum between the landlord’s best outcome and your best outcome as a business owner. Trade-offs are inevitable, but remember what your priorities are and create space to negotiate – don’t box yourself into corner.

Do you need support negotiating a commercial lease for your business?

A free, 15-minute call with me could help you reach a decision that supports the needs of your business as well as saving you time and money. Click here to check availability and book a slot straight into my diary.

Which is best: face to face or online meetings? 

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Where would we be without the ability to work remotely? Those of you who know me well, know I have taken full advantage of online networking and have done a significant amount of my professional work remotely, using Teams and Zoom, to my clients’ complete satisfaction. I’m a big fan! 

Going forward, I do hope this way of working continues, to save time, reduce pollution and traffic congestion on our roads, and to save the money spent on those non-essential face-to-face meetings of the pre-COVID era.  The fact is: a great many meetings can be successfully done remotely. 

That said, sometimes there really is no substitute for being in the same place at the same time. I have recently returned from Africa as part of my work for The mudhouse Children’s Foundation, having had that belief reinforced momentously. Here are just a few of the experiences I had.

For context, I am a trustee of a very small charity doing important work to help the Maasai tribes of Northern Tanzania.  The region is North of the Ngorongoro crater, which some may have visited on Safaris.

Our mission is to help introduce education to those tribes who live too far (over two hours’ walk) from a government school.  By finding a willing sponsor here, we can send just one child from that village and the education they receive spreads throughout the community.  The whole community benefits and they are more grateful than I can explain (or than you can imagine, unless you have been face to face with these people).  There is much, much more to say about this but it is not the main point of this piece.

This was our first trip for two years (I, personally, have not been for two and a half years – a substantial part of a young child’s life).  The need to be there, on the ground, in the same space as the people we help and as those who enable that all to happen, was demonstrated to us in some amazing ways.

First a young child already under sponsorship and performing brilliantly in school, suffered a trauma I won’t detail here but because of which, they remained at home and didn’t return to school.  By being on the ground in the same space as those who could enable the child to return to school, which the child wanted greatly, we were able to achieve exactly that, and they are now back where they want to be and already justifying that work.

Also being sponsored by a generous UK citizen, is a girl with a badly deformed hand.  She also excels at school and is incredibly resourceful with what she has at the end of her left arm.  Surgery would transform the hand and of course, her potential.  While we were there we arranged for the girl to travel to a hospital, where once a year, surgeons fly in from overseas to carry out pro bono work on children whose parents are too poor to afford such treatment. This amazing little girl has now had an operation and is already in recovery and rehabilitation.

Finally, we have a sponsored child who is deaf and has – to our knowledge – never spoken nor made any sound from their mouth.  One of us on this trip is a retired teacher of the deaf and, using long established techniques, helped this child use their voice for the first time and form words, and also to learn sign language for the first time.  All the children were taught sign language to help their friend, which they took on board enthusiastically.  Again, the potential this opens for this third sponsored child is huge.

Yet another aspect of our work is to raise funds here in the UK to end the practice of cooking on open fires on the floor of the mudhouse (a practice of necessity due to a lack of resources for any alternative but which causes respiratory tract problems and sadly many children suffering burns). Instead we have raised funds here in the UK, for installing a small stove and chimney to take the smoke away.  The benefits include a smoke free mudhouse and a much safer environment for the children. We were very pleased when reports came in that the fires are found to be more efficient, cooking and boiling much more quickly and using substantially less wood.  This helps the forests and the women who gather firewood.

Whilst inspecting the installed stoves shown to us by proud owners, however, it became apparent that they weren’t all performing as they should and that simple maintenance and care was not being carried out as needed.  This could never have been spotted without physically seeing the mudhouses and the stoves.  Additional training on use and care has now been set up and soon all the little stoves will be doing their jobs beautifully.

What did I take away from this trip? Firstly, I can’t help but be reminded that sometimes complex problems are best solved with a simple solution! Replacing open fires with stoves and chimneys has had a huge impact on the communities we help. 

Although this is a principle I live and breathe in my work back home, seeing a simple solution actually make a meaningful difference to someone’s quality of life gives this concept a whole new level. The temptation to reinvent the wheel is often very strong in business, but the wheel was one of our greatest inventions, after all!

And of course, my main takeaway is that being face to face with the children we are sponsoring, and seeing their progress, is a humbling reminder of the power education has, to change lives for kids and their communities. The potential that offers them in their lives is genuinely priceless. Being physically present gave us a much deeper connection with the tangible results of what we seek to achieve as a charity. 

Sometimes there really is no substitute for being face to face.

https://www.mudhousechildren.com/

 

Major changes to the planning system you should know about

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The government has produced some dramatic changes to the planning system which may affect you or one of your contacts.  The changes are intended to ease the blockage caused by the need for a change of use and to help the economy. This may have unforeseen consequences – we shall have to wait and see.

The changes took effect on 1 September,  without much fanfare for something so huge. They enable business premises to adapt more easily to other uses. The highlights for business owners and operators are these:

Class E: (Commercial, business and services) brings together:

  • shops (A1),
  • financial and professional services (A2),
  • restaurants and cafes (A3) and
  • offices (B1).

In addition, and of great significance, Class E includes such uses as:

  • gyms
  • nurseries
  • and health centres (D1 and D2).

Previously, businesses such as a physio, dentist, chiropractor/osteopath, gym/fitness centre, would have all needed a change of use.

Other uses like B8, storage and distribution, B2, heavy industry and the C classes, residential, are unchanged.

So, you can see it is a real mix up of uses that were previously separate and this will change the look of town centres gradually but spectacularly.

I work closely with Bell Cornwell Planning consultants who have produced a very clear and succinct briefing note.  Click here to go to the page.

The change of use previously presented an obstacle to moving premises but this change in legislation widens options for your business if you are thinking of a move.

I would love to talk through the commercial property implications and effects for your business – as far as we can know them – and I would be happy to refer you to Rebekah Jubb at Bell Cornwell to answer your specific planning questions.