When you think of rural enterprise in Derbyshire, what comes to mind? Tourism, farming, limestone quarries; these would feature on most people's list. However, last week I found there is much more to rural enterprise than these very visible, well established industries.
The Arc Leisure Centre at Matlock was the venue for a Business Development Workshop aimed at pre-starts and the newly-started run by the excellent Julie White and Nick Platt (www.growingruralenterprise.co....). I have been trading for several months now, but an even split of men and women represented start-up businesses who were yet to trade through to those already making sales. As a Certified Bookkeeper I guess I was the most regular of business ideas present, but the variety of the other attendees was a surprise. There was a musculoskeletal physiotherapist looking to move from his current NHS role in Sheffield and ultimately establish a centre providing an holistic range of therapeutic services in a rural location. Another attendee was looking to establish a drystone walling business which was a significant change in career direction. I was fascinated to learn that drystone walls in Derbyshire have a useful lifespan of about 80 years while in the Yorkshire Dales it is 300-400 years! The longevity of the Yorkshire walls, built from exactly the same limestone, is derived from the close proximity of the bedrock thus affording a much more stable base. Looking from my office window, I see a substantial drystone wall collapse in the field opposite from as recent as last night; I now understand why!
Craftsmanship was very much in evidence with two more of the start-ups. One delegate was juggling a range of commitments with starting a handmade soap making business and was already seeing interest and sales of her products. She was focused on fully natural soaps, though interestingly was already seeing the cost of raw materials rising with the post-Brexit fall in the value of the pound. Another business with an ethical angle was producing jewellery from recycled sterling silver. The owner's ingenious designs were already proving popular but the administrative paperwork associated with the legal use of hallmarked silver was proving quite a challenge.
Two other delegates had established a Community Interest Company with a third partner and were aiming to develop a community arts scene. In common with many arts-centric organisations, they were having to work hard to source funding and to convert the often held view that drama and related arts projects should be free to use, when in fact the value of drama as a teaching or therapeutic aid is well established.
So, what does this have to do with bookkeeping? Recurrent themes arose during the workshop notably: start-up capital, cash flow, generating sustainable income streams and time for the accounts. Although an Accountant or Certified Bookkeeper will not necessarily solve all these problems, they will most certainly help with monitoring the financial position and quantifying the business assets and liabilities. I was interested to see there was little enthusiasm from the attendees for managing their own accounts, even though today's accounting packages make this a viable option for some. That said, it is worth considering the following if you plan on maintaining your own accounts:
- For this to be successful, you need to be interested in your accounts and the process of maintaining them. The minute keeping your accounts up to date becomes a chore, you are on the slippery slope to problems.
- Even if you enjoy bookkeeping, if you are not rigorous in your approach and disciplined enough to spend half an hour a week or a couple of hours a month checking all is in order, you are setting yourself up for problems. This may not be a matter of ill-discipline, more likely (hopefully) that you are just too busy to do them.
- You need to be competent. There are some great, user friendly cloud accounting packages available these days which on the face of it make managing your books a breeze. However, you still need a good understanding of the underlying accounting principles such as the difference between revenue and capital expenditure, whether cash basis accounting or accruals is for you and how to manage expenses correctly. It is far cheaper to hire professional support to do your accounts correctly in the first place than to do it yourself then hire someone to sort out a set of books in a complete mess!
There are, of course, a range of bookkeeping options from doing your own books to hiring the services of a professional. For some businesses, an Accountant is the right option but for many small start-ups, a Certified Bookkeeper is the most cost effective option. For a review of the differences between the services provided by Certified Bookkeepers and Accountants, reference the following post: Bookkeeper or Accountant, It depends. . An intermediate option is to tackle some aspects of your books with the help of a Bookkeeper and leave the Bookkeeper to manage the more complex aspects such as the final accounts and preparing the tax position. A good Bookkeeper will be happy to discuss your needs in detail and agree a package of services that suit your business.
It was encouraging to meet such enthusiastic people with such diverse business ideas and great to see the support that is available for start-up enterprises through organisations like Business Peak District.