At a recent celebration of our Best Practice Exchange competition, James Caan told award-winning firms that there's no better place in Europe to be doing business than Britain
The Guardian Small Business Network – in association with Lloyds TSB – has been asking small- and medium-sized enterprises (SMEs) to share the techniques they have developed to drive their businesses forward. Each small business owner entered a case study into the Best Practice Exchange (BPE) competition. The aim was to collect and share as many examples of best practice across the SME community, awarding prizes to the most innovative businesses and the people behind them.
The 12 winning entrepreneurs from four categories (see below) were invited to a networking event to celebrate their success, along with BPE judges and representatives from shortlisted companies. During the event, the audience was invited to take part in a Q&A session and hear from a keynote speaker: James Caan, famed for his appearances as a panellist on Dragons' Den.
Caan told the audience that there is too much gloom in the media and entrepreneurs must ignore the malaise and push forward with their plans. "I think entrepreneurship is alive and kicking in Great Britain today, this country is a great place for a business to be," said Caan. "We can blame the banks and the economy, but when I became an entrepreneur the biggest lesson I had to learn was that 'it's not what they can do for you, but what you can do for yourself'."
The audience asked Caan a number of questions about the impact of the internet, the eurozone and the economy. He urged entrepreneurs to seek out facts and act accordingly during uncertain times. "You have to plan for what you know. Entrepreneurs often seem to apply this unwritten theory that they are going to achieve 15-20% growth. In my view, if you're going to be forecasting then you should do so for what is obvious and real."
Focus on positives
The troubles in the eurozone, while disconcerting, should not interfere with SMEs' plans, Caan said. The UK's domestic market still contained much potential and business owners should focus on the positives. "When you look at Greece, Spain and Ireland – where would you like to be right now? I think it is Britain. I can see a lot of positives about being in business and being an entrepreneur in Britain."
Many businesses are struggling to find finance for their enterprises, but there were many alternatives and determined entrepreneurs would seek them out, Caan said. "Yes it is tough out there, but no one said being an entrepreneur was going to be easy."
Caan gave the example of the Scottish brewing company Brewdog, which raised £2.2m through its own customers. The Aberdeen-based company has subsequently expanded and now operates 10 pubs in major cities across the UK. "They went on Facebook and spoke to customers in their bars and said, 'look you love our beer, why don't you invest in us?' It raised over £2m for 10% of the company. That's a great valuation", Caan said, which drew some laughter from the crowd aware of his own high-equity stakes in Dragons' Den companies.
Caan said that success in business is dependent on good people and failure is often due to management losing sight of what was important. "We sometimes get too obsessed by the product or campaign and don't think enough about the one ingredient which makes it all work – the people. If you run a business today, make sure you attract the right people and retain them."
He suggested the collapse of high street giants, such as HMV, was due to management not focusing on customers. "Whenever I come across businesses that have had a hard time, if I analyse it, the one single component I come back to is that management lost direction. If you take the recent example of HMV, was that the product or was it management not listening to the market? As a layman, I could have told you the HMV business model doesn't work because who is buying books or CDs in a retail outlet? Nobody. The fact that it survived this long was a shock for me."
Caan also spoke about his work with Start-Up Loans, an £112m government-backed initiative which provides finance to 18- to 30-year-old entrepreneurs. He said the scheme was vital as youth unemployment was unacceptably high and talent was going to waste. "In this country one of the biggest challenges we have is youth unemployment. We have some really smart young people out there who should not be unemployed, but what many lack is that first bit of capital to start the business."
Caan said the scheme was already a great success and believed it could create 100,000 jobs in total. "We launched in September and by the end of December 460 businesses had started. My plan by the end of this year is to have roughly 10,000 new businesses. The programme lasts for three years and we are projected to start about 30,000 new businesses."
Caan's positive and can-do approach to the economic situation won praise from many present at the BPE awards, including those who took part in the judging. "James Caan's speech echoed what we hear from Chambers of Commerce members up and down the country: people are at the heart of every successful business," said Adam Marshall, director of policy and external affairs at the British Chambers of Commerce.
Anthony Thomas, head of SME markets at Lloyds TSB, said Caan's words are backed up by the calibre of entrepreneurs who won the various BPE categories. "I think the big thing I take from today is the quality of the 12 winners. They all have stories which should inspire other entrepreneurs. They are in charge of their own destiny and have been a success," he said. "This echoes what James Caan said about 'go and do it for yourself'."
BPE award winners: words of wisdom
• Bruce Bratley, CEO and founder of First Mile: "We make it very easy for city centre businesses to recycle their waste. Our IT system makes customer services easier to do and ensures accuracy throughout."
• Justin Halfpenny, director of Prima Service: "We exercise a fanatical control of business and operational costs and constantly look for developments so we can exploit them early on."
• Phil Gillard, general manager of SolutionsPT: "As the frequency of change in IT increases, we aspire to help our customers take advantage of this change."
• Malcolm Hall, managing director of Hall-Fast Industrial Supplies: "We have always kept an eye on the markets around us and have used the internet to enable us to launch products quickly and reach new markets."
• Graham Tyers, managing director of Newson Gale: "Newson Gale stops accidents caused by static electricity. We have patented products, but also offer consultancy. It's a niche but it's a global niche."
• Rob Nicholls, co-founder of Plastic Card Services: "Our business model is based around repeat business, so it's essential to develop a strong working relationship with customers. We're responsive to client needs."
Starting up winners
• Sharon Bassett, co-founder of A-Star Sports: "We want to make sport fun for children. Our biggest form of marketing and business building is word of mouth. People come along and they're so impressed that they spread the word."
• Chris Peacock, founder and inventor of handSteady: "The handSteady cup is a product which people use every day. If you can't drink it seriously affects your quality of life."
• Lily Simpson, founder of The Detox Kitchen: "We are nutritionally focused, but my first goal is to get the flavours right. I used to spend 14 hours a day, seven days a week in the kitchen working on the products."
Winning new business winners
• Jack Bedell-Pearce, 4D Data Centres: "One of the things that attracts people to our data centre is that we have a team of really well-trained and professional staff so we get great referrals from IT consultants."
• Linda Frier, founder of Coalesco: "We give away a lot of free information. When new clients are already impressed by how helpful we are, half the selling job is already done."
• Daniel Roche, director of MB Roche & Sons: "We've built up a good reputation over the last 35 years, so growth is about consolidating what we've achieved so far."
BPE awards: judges
The BPE collected examples of best practice across the SME community and rewarded the people behind them. There were four categories: winning new business, exporting, cashflow and starting up.
Entries were passed on to a team of judges which included experienced business leaders and entrepreneurs. The judges were: Adam Marshall, director of policy and external affairs at the British Chambers of Commerce; Simon Duffy, co-founder of Bulldog Natural Skincare; Simon Walker, partner at Taylor Wessing; Lisa Gagliani, CEO of the Bright Ideas Trust; Fiona Walsh, business editor at guardian.co.uk; Stephen Pegge, director of SME markets at Lloyds Banking Group Commercial; and Alison White, head of content at the Guardian Small Business Network.
Report commissioned and controlled by the Guardian. Funded by Lloyds TSB.
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