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Tips for surviving the hard times

publication date: Apr 24, 2008
 | 
author/source: Jonathan Harvie
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harveThis market is hard work. I have no idea how long it will last but the one thing you need to do is to keep those positive thoughts going. So here are a few of the things I’d be looking at right now. 

Lead from the front 

In this market you need to lead your troops from the front. Your staff will take their tone from you. If you remain driven, positive and cheerful (however you feel inside) they are more likely to remain positive. If you wear your troubles on your sleeve staff morale will suffer. Your business will suffer accordingly. 

Make your advertising different 

It seems strange to me that there is so little advertising that is even remotely creative. Page after page of properties boringly shown. A fair number of the photographs could have been taken by a five year old! A little thought would go a long way towards improving the presentation of the houses you are selling. A little creative thought would help distinguish your brand. 

Make your website the best 

How often do you look at competitors’ websites and compare them critically with your own site? How does yours compare? Do you have all the “add-ons” that make the site really easy and useful? I still see websites that are Neolithic! Vendors and applicants are a sophisticated bunch these days. You have no excuse not to try to keep ahead of the pack. 

Manage vendor expectations 

Vendor expectations are like a supertanker; they take a long time to change direction! To achieve sales you need you need to manage vendor expectations. I have one client who has the management down to a fine art. As they say “It’s the way you tell them”. 

Remember the old adage… 

Well it’s not really an old adage but I am sure it is true all the same, “stock is vanity sales are sanity”. It may make you feel comfortable in this market having lots of properties on your books but each one of those properties will cost you money until you sell it. Far better only to take on those properties that are realistically priced with a motivated vendor. You know you can sell those. Having fewer properties on the books means that your staff can spend more time on each. 

I’ll bet more sales result. 

Golf club subscriptions are out. You need to remove all personal expenditure from your business. Spouse’s cars need to go. The one thing you can’t afford to do is to weigh down your business with non business expenditure. If you need to trim your personal expenditure to help the business get through, do it and do it now. 

The fallacy of composition 

When you look at cutting costs don’t just look at the larger costs. Of course reducing these will help. You also have to look at cutting out the smaller costs. £100 saved here, a £100 saved there, the savings will soon add up. 

Be tax effective 

Tax is both a personal cost and a cost to the business. When cash flow is tight you really need to look at ways in which you can save tax. This will include choosing a tax efficient trading structure and ensuring you receive your income in a tax efficient form. There are still ways and means! 

Plan for the upturn 

Some of you will be kicking yourselves because you didn’t try and sell your businesses last year. OK, so you missed the bus but in due course another one will come. You need to plan for the future. Hard times will give you the opportunity to acquire other businesses that have not prospered. 

Lord Rothschild once said that one should “always to leave something for the next man”. So when the next cycle comes round remember one thing – always sell a little early! 

Jonathan Harvie is a Chartered Accountant, an Associate Member of the NAEA, a partner with Hazlewoods LLP, he heads a team of tax and business advisers, specialising in advice to Estate Agents. This article has been prepared as a guide to topics of current financial and business interest. We strongly recommend you take professional advice before making decisions on matters discussed here. 

No responsibility for any loss to any person acting as a result of this material can be accepted by the author. 

For more details contact Jonathan Harvie on 01452 634800 or email jh@hazlewoods.co.uk