Bizbites - November 2003

NEW SPAM E-MAIL LAWS AND YOUR BUSINESS
If you send marketing e-mails you need to get up to speed on new e-mail spam laws.
SELF-SUPPORT: IT ISSUES WHEN WORKING FROM HOME
Identify and overcome common IT pitfalls if you work from home
NEW SEXUAL AND RELIGIOUS DISCRIMINATION LAWS
How forthcoming discrimination laws will affect your employees and your business.
GETTING TO KNOW YOUR CUSTOMERS
How recording, analysing and acting on key customer data can boost your business.
BIZTIPS: GETTING PAID ON TIME
Ten hot tips to help your business get paid in full, on time.
DATA BACKUP THAT DOESN'T COST THE EARTH
How best to backup your key business data without breaking the bank.
HOW TO GET THE BEST ONLINE BANK ACCOUNT FOR YOUR BUSINESS
Find out how researching the banks’ online offerings could save you money.
HELP STAFF ACHIEVE A WORK-LIFE BALANCE
The business benefits of helping staff adopt flexible working patterns.
FINDING A BUSINESS ANGEL INTERMEDIARY
Find out how to make the most out of finance brokers and find your business angel.

1.NEW SPAM LAWS — WHAT THEY MEAN FOR YOUR BUSINESS

New regulations on email marketing are due to be introduced in December. So if your business conducts email marketing campaigns it’s time to check you’re on the right side of the law

From December 11 it will be illegal for businesses to send commercial email or text messages to individuals without their prior consent — so small and medium businesses need to review their marketing activities.

Under the Privacy and Electronic Communications (EC Directive) Regulations 2003, you must get the prior opt-in consent of individuals to whom you send unsolicited commercial email (‘spam’) and mobile-phone text messages (SMS). This can be done in a number ways, perhaps by providing a link on your business’s website to a customer registration form, or as a tick-box on your customer literature.

However, you won’t need prior opt-in consent if you send marketing emails to an existing customer. In addition, if your business sends spam or SMS messages to corporate email addresses, you won’t need to get permission. The Department of Trade and Industry (DTI) claims this will allow legitimate business-to-business communication.

Despite these exemptions you should remember that it is prudent to make your existing customers aware of your intention to send them emails. The customer is king and you’ll do yourself no favours if you clog up people’s email inboxes with unwanted emails.

There are also new restrictions on firms using cookies — data packets used by websites to verify a user's identity by storing information about them. The regulations mean that you can use cookies provided the user is given information about them and is also offered the chance to refuse their use. One way of ensuring your business stays within this law is by posting a cookie usage policy on your company website. The DTI estimates that the cost of designing and uploading such an online privacy policy would be no more than £70.

Any business failing to comply could be liable to a fine of up to £5,000 in a magistrate’s court, or an unlimited fine if the trial is before a jury.

To ensure your business receives fewer spam emails, avoid opening spam emails because ‘spammers’ collect addresses and recycle them. You should also consider using one of the blocking and filtering products available both direct to subscribers and via Internet Service Providers.

Small businesses can obtain more guidance on the new regulations from the Information Commissioner, which is to enforce the new regulations. Visit www.informationcommissioner.gov.uk.

The number of people working from home has risen to 2.2m since 1999. If you, or some of your workers are based at home you might need to become an IT manager. Don't worry — it’s not as complicated as it sounds

You should make it a priority to reduce the risk of IT problems by ensuring they are less likely to happen in the first place. There are many ways of limiting your potential sources of IT risks. Visit the Internet security pages of C/Net (www.cnet.com) for help.

Start the process by installing antivirus software to guard against bugs. If you don’t have antivirus software, you can download free packages from www.grisoft.com. If you have a broadband Internet connection you should install a firewall to protect your computer from hackers.

Also ensure you regularly back up all new files to floppy disk. You should also back up any specialist software downloaded from the Internet; this will be a lot quicker than downloading it again. Store these backup CDs separately from your computer, just in case of fire or other disaster.

Look for reliability when buying computer hardware and software. Where possible, use off-the-shelf products with a proven track record — getting support will be far easier than it would with a bespoke package. As a general rule it is worth cutting down on the amount of software on your computer. You should also check what guarantees you have with your equipment and find out how quickly equipment will be repaired or replaced if it goes wrong. Keep any spare hardware and consumables - laser toner and disks — you might need.

But if something goes wrong — don’t panic. If the computer has crashed then close down the software that has caused the crash. If this doesn’t work then reset the machine by pressing control, alt and delete. You should never just unplug the computer as this can damage the hard disk.

If resetting doesn't work you need to have a backup plan — in case you need to meet a critical business deadline — such as the ability to use a nearby Internet café or library. You should therefore always copy files to a floppy disk. You also need to have a backup plan ready to let you access your email in the event that you are awaiting a vital email. Your Internet service provider's website might offer such a facility. With a backup plan place there is less urgency in getting your computer repaired or replaced.

If you have problems with the Internet check your external modem has power. If its not the modem then check there are no problems with your Internet service provider (ISP). You can see if it is working by dialling its number by phone. In the event that all else fails you need to make sure you have a back-up pay-as-you-go account from another ISP. To avoid the hassle of downtime as a result of problems with your phone line, you should consider installing a second phone line.

Make sure you try all reasonable steps to remedy the problem yourself — a phone engineer will charge a hefty callout fee if it’s a simple problem. Likewise, if there is a major IT problem, remember that an IT consultant will often charge a premium rate for an emergency callout. So you should also consider subscribing to an IT management firm that will maintain your IT for an annual fee. Contact UK Online for Business on 0845 715 2000 for more help.

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3. CHECK YOU COMPLY WITH NEW ANTI-DISCRIMINATION LAWS

New measures outlawing workplace discrimination on the grounds of sexual orientation and religion or belief are due to be introduced in December 2003. So it’s time to check your employment policies are up to scratch

From December 2003 new laws will ban workplace discrimination on the grounds of sexual orientation and religion or belief — so small and medium businesses need to review their employment policies and practices.

The measures supplement existing equality legislation on race, disability and gender or marital status. In summary they mean employers must not:

• treat workers less favourably because of their sexual orientation, or religion or belief
• carry out indirect discrimination — using a seemingly unbiased requirement or practice which people of a particular sexual orientation or religion or belief are much less likely to be able to comply with
• subject workers to harassment — or allow them to be harassed by other staff
• victimise workers — or allow them to be victimised by others — because they have made a complaint about discrimination or harassment under the legislation

Harassment may involve the worker’s sexual orientation (real or perceived) or religion or belief, or, it could concern the sexual orientation, religion or belief of someone they associate with.

The rules on sexual orientation will be introduced on December 1, with those on religion or belief coming into force the following day. Workers who believe their rights are being infringed will be able to complain to an employment tribunal.

The key to complying with the legislation is good communication, advises Paul Seath, employment-law specialist at Metcalfes solicitors.

“You’ve got to communicate to staff that these rules are there and people are entitled not to be harassed whatever their sexual orientation or religion,” said Seath. “Revisit your equal opportunities and harassment policies now and update them to take the new rules into account.

“If you haven’t got such policies, now’s a good time to create some. They should set out in layman’s terms what staff should and shouldn’t be doing. Make it clear to staff that any breach of the rules is a disciplinary issue.”

Small businesses can find out more about the measures by reading guidance from employment-relations body Acas, which is due to be published at www.acas.org.uk in November.

And remember: showing you comply with the regulations can bring real business benefits — helping you recruit, motivate and retain the best staff and build a reputation as a fair employer.

For more advice contact Acas on 08457 47 47 47 or visit www.acas.org.uk.

As customers start contacting you by phone, email and the web, it's increasingly important to use tools that keep track of your customers. Customer Relationship Management (CRM) helps you to do this

In today’s competitive environment customers have the upper hand because it is easier than ever for them to switch between suppliers. Companies that are not doing business in the way the customer wants could lose valuable business. As a strategy to retain customers and boost their spending, customer relationship management can help your business to succeed.

CRM is a strategy that helps your business maximize the amount your customers spend. The strategy enables businesses to share knowledge internally about customers to enable targeted sales of products or services.

Unlike large companies small and medium-sized enterprises (SMEs) have not traditionally possessed sufficient resources to implement CRM programs. But CRM isn't just for your larger competitors. Small businesses are beginning to realise how effective CRM can help them to acquire, retain and grow profitable, long-term customers.

“ Over the next 12 to 18 months the number of small firms using CRM is set to take off.” That’s according to Microsoft’s director of Business Solutions, Simon Edwards.

Changes in the IT marketplace mean that CRM solutions are now available for organisations of all sizes. Microsoft is due to enter the market by the end of 2003 with Business Contact Manager, which helps businesses to track the history of a business relationship through its email client, Outlook.

An alternative solution to off-the-shelf software is to use an online database which logs your customer’s information. ACCPAC, a rival player to Microsoft in the CRM market for small firms, has recently launched an online software package for small firms. ACCPAC.com allows users to manage customer history online.

With low set-up costs and simple charging models, this new generation of CRM tools also mean that it is a lot easier to show a return on your investment. But what are the keys to CRM success for SMEs?

Small businesses have to determine what internal processes need improvement so as to better serve customers. This should be done before hunting for CRM technology. Also, you should ensure that you have got management backing for the CRM project. It is also necessary to involve the support representatives, IT staff and others in the strategy and decision-making process. By forming a team of the key users who represent the various functions of the business, you can encourage success.

A solid CRM plan is needed for the effective execution of CRM technology. As an SME, there are advantages over the big firms when it comes to CRM implementation, such as a simpler training process for staff.

1. Investigate the credit-worthiness of customers before giving them credit. Find out who they are, and whether they have the money to pay you.

2. Build a relationship with the person responsible for paying your invoices. Do not be afraid to ask for payment — after all, it is your money.

3. Tell customers what your payment terms are up front, and get them agreed in writing. If you only inform them afterwards, they are unlikely to pay promptly.

4. Ask all customers to confirm orders in writing, so no one can claim they didn’t order it. Make sure the person ordering the goods is authorised to do so.

5. When supplying large organisations, ask for an order number. Quoting it on your invoice should speed up the payment process considerably.

6. Make customers aware of any additional charges they will have to pay — such as postage — when they place their order. Most people will refuse to pay more than the amount agreed at the time of purchase.

7. To cut down on mistakes, send an acknowledgment to every customer. Include details of the order, price, delivery and invoice addresses, payment terms and expected delivery date.

8. Get a signature when delivering goods to a customer. Proof of delivery is essential because it stops customers claiming they did not receive their order. Customers who collect from your premises should be required to sign.

9. Include a packing note with your deliveries asking customers to check the contents and contact you if anything is missing or damaged. This lets you sort out problems quickly, and means customers will have no reason to delay payment.

10. State on your invoices that you reserve the right to charge interest on late payments — even if you do not intend to do so. Check you have the correct invoice address, and send out invoices promptly.

Imagine what would happen if the data on which your business rests was lost. Think of the expense of replacing key data — none of which is likely to be covered by insurance. The importance of backing up data should not be under-estimated

The business case to protect critical data is clear — seven out of 10 small firms go out of business within a year if they experience a major data loss, according to the DTI. Sixty per cent of all business data is held on PCs — so just one stolen laptop could do serious damage to your business.

Data recovery tools and services do exist but they can be expensive, and, it is unlikely you will ever retrieve all of the lost data. Moreover, customised set-ups and passwords may be impossible to retrieve. The most efficient insurance against disaster is to implement a robust data backup system.

The backup process copies important information onto magnetic tape or other disks. You need to make sure vital data is backed up on a regular basis. Whether that occurs daily, every few days, or weekly depends on how much data you can afford to lose.

So how do you back-up your computer data? Businesses with just a few employees and a handful of laptops don't need complicated backup software —copying files to removable media is fine. A good choice for small and medium-sized enterprises (SMEs) is the Digital Audio Tape (DAT). A high density DAT tape can store up to 16Gb of data — which is adequate for SMEs with up to 50 employees each using PCs.

For the growing SME saving data can seem like an ever-growing chore, so you should concentrate on backing-up just your recent work, file templates and contacts — you don't need to save everything. Large SMEs should implement a system for daily, automated backups. One effective method is to add an additional hard drive to the server just for backup. You should also consider using cloning software — such as DriveImage for Windows — to copy the primary drive to the backup drive.

The ‘when’ and ‘who’ of backing up is just as important as the ‘how’. You should define who is responsible for backing up your business data, and mark out how often it is to be done. Make two employees aware of the backup procedure and rotate responsibility between them. The policy should state where backups are stored and how long they will be kept.

Remember that back-up tapes may contain confidential information so keep back-ups securely, off-site. Someone should also be responsible for spot-checking backups from time to time, especially for reusable tapes and recordable CDs.

Banking online can help you manage your firm’s finances more effectively, at times that suit you. But how do you go about choosing the right account for your business?

More and more small businesses are switching on to the benefits of online banking. It enables busy owner-managers to deal with finances more efficiently and keep a constant eye on their firm’s financial position.

And making and receiving more payments electronically can save you money, as it cuts down on cash-handling charges.

But how do you ensure you get the right account for your business? The first step is to think carefully about what you want to achieve through banking online.

‘Produce a shopping list of the things you want,’ says Brian Capon, spokesman for the British Bankers’ Association (BBA). ‘Is your business one where ingoing and outgoing payments can be made electronically?

‘Do you want to pay cheques in? Do you want access to a branch? Even if you’re a shop paying in a lot of cash and cheques, you may still want to do some of your banking on the Internet.

‘Remember to look ahead at what you’re likely to need over the next two years or so. Then it’s a matter of shopping around. You’re buying a service — so go and talk to people.’

Once you’ve identified what you want from online banking, you need to weigh up these requirements against the potential costs.

Many major banks offer a range of basic Internet-based banking services free to customers with standard business accounts. These typically allow you to perform tasks such as checking balances and viewing statements, transferring money between accounts, paying bills, ordering cheque books and managing standing orders.

If you have more complex needs, some banks also offer a range of more advanced banking features. These could include making same-day payments in the UK through the CHAPS (Clearing House Automated Payment System), originating and amending direct debits electronically and making international payments.

To access these features you may have to pay a set-up fee and monthly charge — perhaps around £10 a month for each account — in addition to your standard bank charges. They’re often available through what’s known as PC banking — where you install special software on a single desktop PC which enables you to connect to your bank’s network.

Remember: as with any account, you shouldn’t be afraid to negotiate on fees and charges. Ask your bank about ways of getting them reduced.

For more advice contact the British Bankers’ Association at www.bba.org.uk/public/smallbusiness

8. BETTER BALANCE FOR STAFF CAN BENEFIT YOUR BUSINESS

New figures show employees in the UK working longer hours, with businesses seemingly ignoring calls to adopt more flexible working practices. But the benefits of encouraging a better work-life balance among staff shouldn’t be underestimated

Government calls for employers to improve their staff’s work-life balance appear to be going unheard — with small firms proving particularly reluctant to adopt more flexible working practices.

Those are the findings of a recent study by the Chartered Institute of Personnel and Development (CIPD), which found one in four staff in the UK now work more than 40 hours a week — compared with one in ten back in 1998.

This increased workload comes despite the introduction earlier this year of legislation requiring employers to seriously consider requests to work flexibly from parents of children under six or disabled children under 18.

The CIPD says that small businesses in particular struggle to marry the business benefits of improved staff morale against short-term productivity losses when staff take time off.

It’s worth recognising, however, that these benefits can be significant. Enabling staff to develop a better balance between work and their home lives can:

? improve productivity in the longer term by making staff more motivated
? reduce absenteeism
? boost staff retention
? help you recruit better staff by improving your reputation as an employer

So how can you go about introducing more flexible working practices — from job-shares and annualised hours to home-working and shift-swapping — to your business?

First of all, you need to look at your business’s requirements and how you meet the needs of customers. What staffing levels do you require at different times, and what are the implications for your people?

Once you’ve done this you can talk to employees about their hours of work — perhaps through interviews or anonymous questionnaires — and see how these can be dovetailed with your business requirements.

Flexible working requires careful management. In particular it can be helpful to measure performance in terms of employees’ output rather than looking at the number of hours they work. It’s also worth considering drawing up a formal, written policy to ensure you implement flexible working fairly.

For a copy of the Acas publication Changing Patterns of Work, visit www.acas.org.uk/publications/b09.html or call 0870 242 9090

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9. FINDING A BUSINESS ANGEL INTERMEDIARY

More and more companies are seeking the
help of ‘business angels’ to grow their business.
Finding the right intermediary or broker is vital
to making them a success

Business angels invest in companies they believe have high growth potential. If your company looks to have a bright future over the next three to five years — but needs to raise capital — you could be seen as an attractive investment opportunity.

Unless you have personal contact with a potential investor you trust, you will require the services of an intermediary. Intermediaries come in all shapes and sizes. They can be found in the public and private sectors and include Business Links and experienced angel agreement brokers.

Before you start searching for an intermediary, decide what you are looking for. It should be someone trustworthy and with a good track record in brokering successful agreements. The intermediary’s services should include advice on putting together the best pitch to a potential angel. Decide if you want someone local or perhaps an intermediary who specialises in your area of business.

The next step is to identify potential intermediaries. Your local Business Link will probably have its own angel network. Another excellent port of call is the National Business Angels Network (NBAN). The NBAN is an independent body set up by the DTI and it has contact details of all known angel networks in the UK.

Visit the network’s website www.bestmatch.co.uk or by telephone on 020 7329 2929. The NBAN has details of potential angels, intermediaries and companies seeking angels. It also identifies intermediaries by region and business specialities. The charge for registering with the NBAN is £225 for companies and £125 for investors.

Remember — it’s a grown-up world out there. Angels want the best possible return from your business — which is why it is essential to find a fair, professional intermediary who understands your business and will protect your interests.

The Barlow Andrews Partnership is a member of the Institute of Chartered Accountants