Entrepreneurs mean business in the Midlands
Inspiration Win a Michelin starred meal for two! — we spoke to some entrepreneurs and got their tips for growing businesses in the Midlands and around the UK.
It's not just London and the South-East that are hotspots for entrepreneurs. According to recent figures, the Midlands is a hive of start-up activity.
Statistics from The Enterprise Research Centre (ERC) — a network of researchers with a core team based at Warwick and Aston Business Schools — showed that Coventry and surrounding Warwickshire were the best in the country when it comes to job creation in 2014-15. More recently, StartUp Britain, the national campaign by entrepreneurs, announced that 17,473 new businesses had registered in Birmingham during 2016 — an increase of 25% on 2015.
Phillip Wood, Regional Head of Midlands, UBS Wealth Management — a partner and financial adviser to entrepreneurs in the region — isn't surprised. “The Midlands is a thriving location, famous for various types of industry,” he says. “For example, the West Midlands is a hub for pharma and healthcare and, historically, the automotive industry. Meanwhile, Nottingham, in the East Midlands, is a hotspot for tech. There isn't just a single, dominant, wealth-creating sector for entrepreneurs. It's a varied picture here.”
Optimistic about business
In January, UBS Wealth Management held an investor forum for clients and potential clients, and asked delegates about business bullishness. “When asked 'Do you feel confident about economic growth in your region?' 76 per cent of the audience responded 'Yes','” says Wood.
Andreas Antona is a well-known chef on the Birmingham fine dining scene, and the owner of the Michelin-starred restaurant, Simpsons. “I've been in The Midlands just under 25 years,” he says. “Birmingham is a powerhouse: a regional centre for industry, manufacturing and large multinational companies. All the other associated businesses — accountants, lawyers, etc — are also here. That was part of the attraction for me as a restauranteur.”
Be true to your vision
Wherever their location, however, entrepreneurs still face the same challenges. Andreas believes the most important thing any new business owner needs is a clear understanding of their own aims and ambitions — and to be true to themselves and their own vision. “You have to be honest with yourself, believe in your values and make sure your staff understand them, too,” he says. “And when you look people in the eye, say what you mean. It's really not rocket science. Know where you want to go, stick to your guns and don't be distracted from your goal. Keep your feet on the ground, be humble — and get on with what you have to do.”
Yet whether you are starting up a business, growing a business, or realising your capital by selling up and moving on, it's also important to accept that, as an entrepreneur you will face challenges — and that mistakes are bound to happen.
Antona says, "be honest with yourself, believe in your values and make sure your staff understand them, too"
Mistakes to avoid in business
So what are the biggest errors made by entrepreneurs, these days? Phillip Wood notes that a common one is leaving money in cash. “We always tell clients that this isn't an option anymore,” he says. “Before the financial crisis, you could leave money in cash and get six or seven per cent in return. Now interest rates are very low and inflation is rising and will probably get close to hitting four per cent this year. If that goes on for a period of time, the spending power of capital can be quickly eroded. So the one thing entrepreneurs can't do is do nothing.”
Mistakes are made when selling businesses, too, mainly because it's a leap into the unknown for many entrepreneurs. “It can be a particularly challenging time,” says Wood. “This is because they've been running their firm for 20, 30, 40 years or longer — and then, suddenly, they've capitalised the value of their asset and they don't know how to proceed.”
Caution around selling businesses
Understandably, some business owners are very cautious at this point, particularly if they are selling a family firm that has been passed down the generations. “That's a lot of responsibility,” says Wood. “So not surprisingly they have questions such as: 'Am I getting the best price for my business? Is this the right time to sell it? Is cashing everything in going to help me achieve everything I want? What do I have to worry about with regards to inheritance tax planning? How do I give money to charity?'”
Yet it's never too early to think about selling your business, stresses Wood — and it's essential to take professional advice about it when you do. For example, many entrepreneurs leave it too late to engage with a wealth manager to think about planning or qualifying for tax relief. UBS can help them get the best for their business working alongside a corporate advisory house that focuses on selling the business for the best price possible, and other professional advisers who make sure that the deal is well-structured. “There are some great corporate finance advisors who are used to dealing with the process and can talk to you about how to get your business ready for sale,” says Wood.
The price and value of investments and income derived from them can go down as well as up. You may not get back the amount originally invested.