The best business advice, opinion, news and expertise in Greater Manchester and further afield.

Friday, 26 October 2012

Friday Guest Blog

By Phil Cusack, newly-elected President of Greater Manchester Chamber of Commerce

This position – President of the largest Chamber of Commerce in the country and in my city region as well - could be nothing other than a great honour. I am surprised and hugely flattered that you have asked me to do it. Particularly so since we have just had such a capable, articulate and intelligent thinker as Martin Douglas as President. I believe that he has helped to move us forward as an organisation and I would like to offer my personal thanks for his two-year term of office.

I’m sure I’m going to need support from Neil Smith as Vice-President and I know that he’ll continue to do whatever he can to ensure that this Chamber of Commerce is pointing in the right direction to help its members.

Not that there is really a question about this with David McKeith as one of the most competent Chairmen I have ever worked with as well as a tirelessly effective Chief Executive in Clive Memmott.

What I’m really saying is that I believe that there is an outstanding team here. This Chamber of Commerce is going through huge organisational and structural change at the moment and all the signs are that the changes are being handled sensitively, efficiently and in a way which I believe will result in a stronger and sustainable Greater Manchester Chamber of Commerce.

Martin has taken corporate social responsibility forward as one of his key themes – we need to continue this with just as much enthusiasm. We need to help Chamber businesses to work in the community but we also need to clearly communicate the practical and lasting business benefits to them of doing that.

As I know Martin does, I also believe that our affiliation with the British Chambers of Commerce is critically important in taking us forward in areas such as further developing our already successful international trade service and lobbying Government at the highest levels on issues that are of critical importance to businesses in this region such as investment in hugely needed infrastructure. The BCC’s objective of encouraging Government investment in roads, rail, aviation, ports, digital infrastructure and skills development must resonate strongly in a region such as ours and must be wholeheartedly supported by this Chamber working closely in tandem with them.

I will not for a moment though pretend that things are going to be easy.

I cannot see our economy returning to pre-2007 levels of economic activity and growth for many years. Past global banking difficulties are now manifesting themselves in the crisis we are now seeing in the Euro-market and there is a slow-down in the Asia Pacific economy. Both of these will improve over time and we can expect to see some gradual growth – indeed, we know that non-oil GDP is now growing again, albeit slowly and there are still signs of cautious and guarded confidence in and around this City.

But in this part of the world, the engine for growth is going to be the non-financial business sector. Our job is to make sure that economic growth happens and that the business sector in our city-region is in the best possible condition to make it do just that.

So it is a key ambition of mine to help to ensure that we do two very simple sounding things – support the small and attract the large.

Small and medium sized businesses need to know that we are here to help them grow, develop and remain healthy. We need to carry on the immensely successful work we have already been doing in this area across Greater Manchester. In addition though, we need to get across the message that we can work with large businesses to allow them to be heard loudly and clearly at the highest levels of Government and to develop mechanisms to allow them to work best here, to make the best business contacts here and to collaborate to build business models which match some of those seen in the leading second cities in Europe and the rest of the world.

This is going to be my leading theme – to help this Chamber to be fully recognised as the foremost private sector organisation in Greater Manchester for large national and global businesses to work together , to share ‘best practice,’ to celebrate successes and to gain direct access to Government to press those issues which affect them most and to encourage those changes which will help them as businesses most. I would like us to create a ‘top table’ that they cannot afford not to be at.

I can’t make any great promises at this stage but one I will make is that I will do my absolute best for this Chamber and for its members during my term of office.

Friday, 19 October 2012

Friday Guest Blog: ‘Why didn’t you ask me first?’

By Mike Gibson, Connectivity Associates Ltd

I took a call the other day from a chap called Mr Angry of that lovely little village of Upper Gumtry. He’d bought a nice piece of farmland with the intention of building himself a house, but Traffport Council refused permission and Mr Pickles had just dismissed his appeal. He’d spent all his pension money and was back where he started.

‘Why didn’t you ask me first?’ I said. I’d have told you not to buy the site because it’s in the Green Belt and the floodplain of the River Irksum, where there’s no chance of getting planning permission for a house. Then we could have found a more suitable site, I could have got you planning permission and you’d still have money left to build your house. ‘I’d better get back to work,’ he said.

It was a sunny morning when the phone rang and Mr Arkwright’s voice filled the room. ‘I need your help’, he said. ‘Salchester City Council have told me the planning application for my factory extension needs a planning statement, a design and access statement, a transport assessment, a ground contamination report, a flood risk assessment and a bat survey and there’s every chance they’ll refuse it!’

‘What are you proposing’, I asked. ‘An extension to my production area, right in the middle of my complex where it can’t be seen by anyone and where it won’t affect any car parking or circulation space’, he said. ‘How big is it?’ I asked. ‘950 square metres he replied’. ‘Then what you’re proposing is permitted development – you don’t need planning permission for it’, I said. ‘I should have asked you first’, was his blunt reply. I’d made his day.

Mr Smoothie knew all about planning – or so he thought. He’d told his architects what he wanted and instructed them to submit his application for a retail scheme in a conservation area. He assumed Rochside Council would love his scheme, they’d always said they needed more shops and, after all, he was only going to demolish ten buildings. Then he called me. ‘They’re recommending my application for refusal’, he said, ‘What can I do?’ ‘First’, I said, ‘Let’s look at the relevant planning policies and see if your scheme complies with them and, if not, we can revise the scheme or provide the necessary evidence to justify what you’re proposing’.

Together, we justified the amount of retail floorspace, revised the scheme to retain some of the buildings and avoid the loss of a protected tree and justified the loss of other buildings on grounds of public benefits. I then met with the Chief Planning Officer and a chap from English Heritage. I came back to tell Mr Smoothie that his application would now be recommended for approval. ‘I should have asked you first,’ he said.

So, if you are proposing a new development, be it a new building, a redevelopment or a change of use, please come and ask me first.

mike@connectivityassociates.com

Friday, 12 October 2012

Friday Guest Blog: How Limited Liability Partnerships Work


By Sonio Singh, Partner in the Corporate Department at Davis Blank Furniss

Limited Liability Partnerships were introduced in England and Wales in 2001 as a means of combining the flexibility of partnerships together with the protection of limited liability for their members. Although LLPs are still not used as widely as a corporate vehicle, they are particularly useful for professional partnerships including firms of solicitors.

The primary features of an LLP are that it is a body corporate (albeit taxed as a partnership) and therefore a separate legal entity to its members. Accordingly, the members of an LLP have limited liability in that in most circumstances they do not need to meet the LLP’s liabilities. However, an LLP has the management flexibility of a partnership and the members can freely agree profit share, decision making as well as appointment and retirement issues.

The Limited Liability Partnership Regulations 2001 contain provisions relevant to the assignment of an interest in an LLP, subject to the consent of the other remaining LLP members. The transfer of shares in an LLP also appears to be permitted by Section 7 of the Limited Liability Partnership Act 2000. However, there does appear to be an absence of a statutory definition regarding the “share” of an LLP.

Whilst an LLP Agreement will detail the members’ financial and corporate rights and duties - such as rights to profit/capital and an obligation to contribute capital/attendance and voting rights - there is little certainty regarding this issue. However a “share” in an LLP would appear to encompass these rights and duties.

Although the law is not definitive in this area, if an LLP member is seeking to transfer all their financial & corporate governance rights and duties, the usual course will be for an incoming member (“transferee”) to be admitted at the same time as the transferor leaves the LLP – in accordance with the LLP Agreement. The retiring member would then receive a repayment of their capital contribution together with their share of any profits simultaneously to the new member making a contribution to capital.

Whilst the statutory regulations state that the consent of all the members of the LLP is required for the admission of the incoming member, a comprehensive LLP Agreement will usually contain clear provisions on the exit of a member from the LLP, their financial rights and other restrictions. There is also a duty to notify the Registrar of Companies regarding the change in the LLP membership.

A more unusual scenario is where an LLP member is seeking to assign their share in the LLP to someone who will not necessarily become a member. The usual course is for the assignor to continue as a member of the LLP and to exercise voting rights etc in accordance with the directions of the assignee acquiring the share.

This is not necessarily a clean solution and the assignor will have concerns that they continue to have contractual obligations pursuant to the LLP Agreement and statutory obligations without reward. The solution may therefore be to obtain the consent of the members to the assignment of not only the financial interests in the LLP but also the managerial interest.

Limited Liability Partnerships continue to remain a specialist area and detailed advice is required if an LLP vehicle is appropriate for tax or legal purposes. A robust and detailed LLP Agreement is – of course - essential in these cases.





Friday, 5 October 2012

Partly Political Broadcasts

By Chris Fletcher - Policy and Communications Director at Greater Manchester Chamber of Commerce

Following on from the Lib Dems in Brighton last week and ahead of the Conservatives in Birmingham it was Manchester’s turn in the political spotlight this last week with the city playing host, again, to the Labour Party Conference.


With a significantly smaller “secure zone” than recent years, which allowed traffic to continue to flow through most of the City Centre and apart from one or two key speeches, for many people it would have been very easy to have missed this completely. Whether this is a good or bad thing is a debate for another time.

Whilst our focus is definitely on business issues, a key part of the work we do brings us into the political world from time to time. When we have members complaining about red tape or skills or business support we have to make sure we represent these views to the decision makers and ask for change.

So, from time to time I find myself wandering the corridors of power armed with the latest feedback from members on the issues that are having most impact on them.

But it doesn’t all revolve around Whitehall. Whilst much of the decision making goes on there (and beyond), it is important that we don’t forget that we have some very influential people on our doorstep.

Over the last 12 months the Chamber has begun a series of quarterly briefings for Greater Manchester’s MPs. It is a great opportunity to brief our local MPs, from all parties, on the issues we are working on for our members as part of Action For Business. The most recent briefing took place on Thursday in the surroundings of the Library at Manchester Cathedral and we took the opportunity to send through, beforehand, a selection of comments from members that have been made at our Action For Business Forums in the last few weeks.

We covered a wide range of subjects from issues around support for business following the disappearance of the RDA to wider economic issues and looking at some key areas for action going forward. One area of particular importance was around infrastructure investment and the role of the construction sector. Something we will be picking up at our next Property & Construction Lunch on 23rd November.

Look out for more information on our work with MPs in November’s 53 Degrees. Before then if you want to start to play your part in highlighting those local and not so local issues that are affecting your business make sure you come to one of our Action For Business Forums, book here: http://www.gmchamber.co.uk/stories/chamber-news-talk-business-do-business-action-for-business .

Whilst we can never guarantee that we can change the world for business, and we never would, without those initial conversations with our members we would be left with nothing to say when the opportunities come around to put the case for business to MPs, Ministers and others.

Chris.fletcher@gmchamber.co.uk

Friday Guest Blog: How to Beat Stamp Price Hikes

By David Hymers - Managing Director, Totalpost Services Plc

The cost of second class postage jumped by a massive 39% this year. Despite this, many businesses still rely on stamps rather than utilising franking machines.

I’ve worked in the postal industry for 40 years and from experience I know that businesses can make massive savings through utilising franking machines, however the savings possible have become more pronounced over recent years as the price of stamps has increased rapidly.

For example, companies that send as few as 8 second class standard letters per day will make a saving of £1.52 per day or an annual saving of £395.20p when using a entry level franking machine compared to using stamps. This saving can increase if the item is a large letter or packet. And this will offset the cost of the franking machine within a year.

Companies that send more mail than this will see increased savings very quickly. Royal Mail increased the minimum saving on franked mail from .07p in 2011 to .16p in 2012 to encourage customers to take advantage of the benefits with franked business mail.

Franking machine users receive a discount on every item of mail sent, saving 19p on every second class letter and 16p on every first class letter. This means a first class franked letter is now cheaper to send than a second class stamped letter.

We often help businesses that feel locked in to a franking machine contract. Each situation is different, but businesses don’t need to feel trapped as there are many options to enable customers to get onto a better lease.

For example, we dealt with one business that had been paying 500% more than they should have been for a low-level franking machine. Instead of paying £80 per quarter they were paying £80 per month and had been doing so for three years. We advised them on their options for getting out of the lease contract which include offsetting the settling cost or negotiating a rebate.

When embarking upon a franking machine contract businesses should be asking for a breakdown of costs on the lease, service costs, re-crediting charges and the ink.

One scam that we often see is where companies don’t tell businesses about the maintenance (which is required by Royal Mail regulations). Businesses then receive an inflated bill for maintenance that they were not expecting.

We also help companies that have an existing contract but require maintenance of their mailroom machinery. We have been handling mailroom maintenance contracts for a wide range of businesses of all sizes for many years.

Consumable costs can also be expensive, but there are good quality alternatives available. For example we manufacture our own alternative cartridges which have been approved by Royal Mail. Customers can save between 25% and 50% by using alternative cartridges in their franking machines.

It is useful to note that the use of alternative compatible franking machine cartridges is totally acceptable. In 2005 the Office of Fair Trading ruled that the use of alternative Royal Mail approved cartridges would not affect the machinery warranty in any way.

In summary, businesses that send out paper mail can make massive savings by using franking machines, particularly when also using approved alternative consumables and we are keen to help businesses realise these savings.

For more information visit www.totalpost.com or call 0845 4900 360.