Lecture 8 Stash your cash - Looking after the money

Accounting
Invoices and statements


Bills and reminders


Invoice Date, Invoice number total Terms -when it is due.
Business address
Customers address
Items by tem details of service provided
Total amount due


Statement
Busness addres
Customers address
A list of recent invoices you have sent out
Deatils of invoices paid and unpaid
Total amount outstanding


On the reverse -Terms and conditions
Designed to protect your rights and interests
Costs
Delivery arrangements
Payment terms


Credit limits
Your right to charge interest on overdue anoubts and ccliam compensation for recovery of costs
A commitment to quality
Data protection


The statement 


Send out before the invoice id due or before the due date
Send out every month there after
How  much is owed
How long it had been outstanding
A call to action



Accounting software - 
Quick books - simple start
                        Quick book £75
                        Online quick books essentials £19 per mth
                        Bank tree !26
                        Sage £240


Accountant - Chartered (to expensive) or Certified 


What business spend money on
1.start up costs
2. Overheads
3. direct costs


Start up costs
Sepnd cash on equipemt
Design website
Register company name
Design logos - make signs
Decorate premises
Launch party


Funding
Many companoes get a loan to cover these initial expenses
Short term payback each mth over 2-3 years


From
Banks (not likely at the moment)


Crowd funding - Find them online eg opening your project online, not usually have to give shares


Investors and councils
The Arts Council, Creative England (was Yorkshire Forward), Venture Capitalists, Shareholders. Venture capitalists - get a % stake or return in your business.


Prizes and awards
Shell live Wire, Make you mark, BIPP< D&DA


What investors want to know:


What your marketing plan is (50% of your business plan)
How much money your need?
How much money you can invest?
How ill you spend the money?
How will you pay it back
ie how much you forecast to earn




Indirect costs


Untilities
Office supplies
Equipment leases
Part time help
Insurance
Bank chags


These are also know as 
Overheads or fixed costs or the costs of doing business



Direct costs
A cost directly attributable to manufacturing of  aproduct
Or what the customer takes away with them


Eg A bottle of water
Direct costs
Water                 0.25p
Bottle with a cap     
Label
Tray and cling wrap


The overheads or indirect costs all add up


Tangible assets


Assets having a physical existence and that maintain 


Name an intangiable assets
Brand
Reputation
Intellectual property
Goodwill
Trade secrets
Copyrights
Trade marks
The things that give you a intangible asset


What is the difference between cost and price?


Cost - what your spend
Price - What you charge


Capital



The money, property and other valuables which colletively represent the wealth of an individual or business
Capital Assest


Receipts - money coming into the business eg from sales
Payments - Money going out of the business for rent and materials
Cash flow or net cash flow - cash minus cash payments




Balance
The amount of money in an account at any given moment
Profit
The positive gain from an investment or from a business operation after subtracting all the expenses


Loss
A position in which a company's expenses have exceeded it receipts.  A reduction in the value of an investment


Tax


Income tax


Corporation tax


VAT
Council tax


Business rates - Check if you rent if you will pay ontop of the rent




What to do if starting a business


1. Open a seprate bank account for your business
2. Find a certified accountant
3. Find a local solicitor
4. Register your Business with the Inland Revenue


Four online sources


Business Link 
Startups
HM Revenue & Customs
Creative Choices -  David Parrish wrote this book Tshirts and suits.  can download this book for free.

Enterprise lecture -Dont get ripped off

Copyright matters and Intellectual Property rights
You are the only person that has the right to reproduce copies of your work.


Protect your ideas and make a living from your work.


As students we are allowed to use Copyrighted work. Leeds College of Art pays a number of licences to enable us to photocopy books, mags and journals.


Intellectual Property (IP) refers to the creations of your mind. eg
-inventions, literacy and artistic works, symbols, names , images and designs used in commerce.


4 type
Patents
New inventions - electronic, mechanical, medicine, 
first patent no. 385 Henry Mill - Typewriter (QWERTY)
Ringpull can.  Earning $150,00o per day as a result of Licencing it
Patent leather - 1818. wipe clean leather
Trademarks (Logos)
Can be complex devices.  Send image and colour references to the Intellectual prop Office with TM next to it. Indicates under investigation.  Once confirmed can use R
Eg McDonald's, Heinz Beans complex fonts, shapes, colour.  Guinness trademarked glass

A Logo is a symbol image which imbues all the quality and identity of a brand
US and UK strongly policed but not in China


Registered designs
Appears to be new , re-arranged eg Laptop with personalised stickers, Alessi Kettle, when iPhone was launched Patent pending,Registered design, registered trademark of Apple Inc. 
Milly bag 

Intellectual Property website - Graphics, Promotional materials.
Costs £60 per registration
For a font had to register each letter


Copyright


Automatic- Don't apply for or register.  You have to record sign and date the work (Can use the Post office or banks as they are guaranteed to be today's date).


Art, literature, music, animation, film, games.


Can you certain Digital methods


Examples
Every book has a ISBN number
Record - Ownership with identifying number.


Fairey vs Associated press


Photograph copied by Shepherd Fairey - Copies Photo and used Barack Obama's logo 'hope'. In court for three years.

Sarah Palin v Heart (Organisers had a licence to Broadcast).  Heart were offended that they may be associated with the Palin campaign.


Jonny Cup Cakes v Urban Outfitters.
                V Benny Frying Pan (SE Asia) rips off all t-shirts as wanted to do legitimately but Jonny wouldn't.


Rubber stamps can be Copyrighted with fair use rights
Sampling of music and film can be used.


How to secure your copyright 


Add the symbols copyright year and your name then publish on blog, or site deviant art.
If many keep a index/log book of them all with Date logged, id no.. descn and location.


Patents last 20 years - inc medicines 


Trademarks and logos - For ever/ renew every 10 years


Design Rights

• up to 25 years
• Renew every 5 years

Copyrights
Until 70 years after death so can be assigned or bequethed


Star Wars - George Lucas gave up his salary at Fox for a share of box office revenue and merchandise rights.


The Andy Warhol Foundation - establised before his death.  He bequeathed his copy right to the foundation.


Peter Pan - JM Barrie - Bequeathed the rights to Great Ormond Street Hospital. Due to end 1999 but government changed ruling to Not for profit organisations.  Sequel Hook. 


Deviant Art
Will licence Art work for free


CSL 
AOI  Association of illustrators.

Intellectual Property website

Own-it

Enterprise lecture 6 - Don't just get the job!

How to start a business/set yourself up.


Todays climate may have to set up as fewer opportunities and also a lot of support to set a business up.  The risk is lower.


87% of creative industries are organised with 10 or less people.


Disclaimer 


Start a business can mean become a Freelance designer, 'collective', creative commune, or practising artist



Jonny Cup cakes and Bongo boy How to start a business - YOUTUBE video
Issue discussed:


Why start a business - be passionate/ driven
Collaboration - Disney, Warner Brothers - Aim high
4 PS- Product - t shirts
Price  reguar and limted editions
Promotion - USA tour
Place - Fantasy bakery on stroids


Getting ripped off - copyright matters


Marketing
 See slide 2 for rest


Getting started


Starting a business...they think it takes luck, a clever idea or just knowing the right people. Thats not true.  Its about you.  Mark Boulton - Web Designer


Personality is important


www.growing business.co.uk - advice:

• do what you love
• Start your business while you are still a student or employed.
• Don't do it alone.
• Write a business plan
• Do the research
• Get pro help
• Get legal and tax issues right first time.

www.sybmagazine.com

• Come up with a good business idea
• Write a business plan
•   
•    
•    

www.betterbusiness.co.uk

www.bytestart.co.uk

Why are you starting a business

Company structure

Skills - Collaborate if you neeed more skills

Funding

Competation

Markeplace

Business pan

Staff

Seek profesional advise

Biggest cause of failue - find out so you can avoid

What is a business plan?

- A business plan is a written statement of where you going to go and how you are going to achieve it.

See diagram - Mission and value/ activity and skills required - what problems are you going to solve and how are you going to make things better.

Money, Financeneeded, Budgeting and money management systems

Resources and equipment needed ( Overheads)

Marketing - 4ps

Monitor your Competitors


In short - If you want to invest oney or ask for investment need to know:


What are you going to do?
What is the value proposition?
What resources you need?
How much it will cost to get it started?
How will you pay for it?
Who are you target customers?


Business plan - why we need one?

• Focus your efforts
• Set some clear objectives - to review in a year
• To enable you to track your growth
• To raise finance
• Attract collaborators - partners  

Www.freelance.com

Where to find a business plan:

• Banks
• Download on Barclays
• The Arts Council Grants - if will benefit people/social project
• www.businessball.com - informal 
• www.businesslink.gov.uk - now disbanded but can still use resources

Funding?

• By helping others to get grants - Assist Not for profit, community organisations.  Get a grant to do the work you can do i.e. Website design, branding
• Crowd funding - Websites inviting people to invest small projects - Chose correct project website.  Need a business plan 
• wedidthis.org.uk - Crowd funding website
• Cooperative - Film makers, graphic designers, photographers small investment from each collaborator.

Not always one income stream

How do you get organised? 

Work alone, team, colaborate?

Organisations - Meredith Belbin - British team management author

http://www.mindtools.com/pages/article/newLDR_83.htm

Charles Handy

Power Culture - eg Owner managed - Restaurant, family business.  Can be difficult to work in these kind of business, can be unpleasant.

Role Culture - Large organisations - hierarchies eg College, PLCs, Councils

Task/matrix culture - Collaborators/freelance come together eg Holywood making a film.,  Interior designers, Festival

Person culture - eg a dental practice - for dentist with their own clients they need shared services such as cleaners, receptionists, Solicitors, Design practice

How will you organise your practice?

What skills do you need to get the job done?

Income streams 

• Private commissions
• Freelance design work
• Workshops, part time teaching
• Royalties from book sales - subject passionate about
• Professionals seminars

Why I started a business - video

Jeff Bozoz - No regrets staring Amazon

What status?

Legal status determines how much tax you pay - what are t=you going to do with your profits - In pocket - self employed

                        - SHare - Cooperative

                        - Charity- Social enterprise

Look at hyperlinks on power point

  

Sole trader

Partnership

Limited Company

Limited Liability Partnership 

Public Limited Company

Can determine how the business iis run

Whetehr you can get investment

Companies House

Businesslink

Social Enterprise Coalition - Not a legal status

Cooperatives Uk

Taxation in the Uk

Tax allowance £7475

tax bands

0-35000 20%

35001-150000 40%

Over 150,000 50% 

Applies to everyone

National Insurance Contributions - State pension, aspects of NHS, rescues people

Without this we would have to have private dental, medical insurance

Self employed £2.50 per week

Class 4 7000 to £42,475 pay 9%

Self employed also pay class 1 -  3.7%

Sole Trader obligations

• Keep records safe
• Separate personal from business expense
• Private and business use of car
• Responsible for any debts

Partnership

• Run by two or more people
• Share of profits
• share of debts
• share need not be equal
• Responsible for any debts

Limited Company

Directors and shareholders liability for debts is limited to a % of ownership.

Annual meeting

Approve accounts

Register with companies house

At least two employees - Can do as sole trader and put your wife/husband as 1% shareholder.

Startup have a £10,000 tax free threshold

Liabilities

NIC payments

Corporation tax payments

VAt payments

Corporation tax 

21% ,£300,000

VAT registered

More than £70k

Charge extra 20% on all invoices to customers.

5%

Zero rated - water supplies, Food in restaurants, Passengertrasnport

Exempt -  Needs an act of parliament to change

You hav

Eye to eye: Richard Branson interview.e to register charge 20% more and can claim the VAt back on everything you buy.  No advantage if you do not buy a lot of goods.

Lecture 5 - 10 steps to a future you

From the works of some great thinkers.
Stephen R Covey - successful self improvement books - 7 habits of highly effective people


Lawrence Kholberg Psychologist Behaviour and success


Karl Hopkins Local Leeds. work with young creative businesses, investor Secret millionaire, ND in Graphic design at LCA


1. Proactivity


Natural aptitude of human beings.


Animals 


Stimulus -> response


Humans 


Stimulus -> Choice -> Response


Develop strategy's to protect ourselves, make things easier


In business  


Expand your sphere of influence from family, friends, community
to more contacts, work placements, push the boundaries to the Circle of concern.


Use your value statement, let people know what you want to achieve.


Three environments


Internal - Your skills, your resources, your lifestyle
Micro - Your networks of friends and associates,
        Your competitors and other practitioners
        Your Suppliers
        Your community
        Stakeholders 
Macro - Cant influence as much
        World market conditions


2. Project
Develop a vision of yourself in the future
Create a principle centred personal mission statement
Extend the mission into long term goals


                      Business Vision
                            |
                  Priority Management
                    |              |


              Business plan       Life plan    


The more developed your vision the more chances you have of achieving this.


'Begin with the end in mind' - Karl Hopkins (planned to set up Design Agency in London to sell in the future)


3. Provide


Clear explanations to people
Speak in their language not yours
Talk about the benefits not processes


Gurus: Quote from slide 


Think: Who you are talking to
Create - Clear messages
Inspire people with your creativity


Example of sound engineer who does not mention what he actually can do to change someone's busines, not good enough to say which tools use.  need to explain how you can add value.


4 Prioritise


Put first things first
Keep a proper balance
Stick to your personal missio


As a student IS the focus on results, time,


5. Presents


Think - win/win
Seek outcomes and relationships that are mutually beneficial
Do a favour to gain a favour


Only work with people who will benefit you in the long run.  Think about how they are benefitting from your experience


Carl Hopkins - Young coffee company - Coffee Kloog
Albion Street
Free coffee and business advise
Women only, Network
He got in return a vision of young evolving businesses as potential investments


Also Enterprising Britain


Kohlberg's theory


Characters / mover through stages


Pre-conventional Child like I want Why should I Nobody listens, short term  Dependent


Conventional -  I would be happy to, your needs, I understand, negotiate, medium term - Independent


Post-conventional - We can, together, mutual benefit, long term - effect communities working in teams, changing for everybody -  Inter-dependent


6.Pause
Pause to listen - give all your attention.  Give yourself to the moment
Empathise, walk in someone's shoes
Don't re-iterate or interpret - just listen
Do you really know how they feel or are you just saying how would you feel? 
To learn new unexpected things
Seek first to understand before you seek to be understood
Learn from your differences


7. Proven
Consistency
Intergrity
Reliability


Successful brands 


7. Proven


Trust certain brands as you associate experiences/tastes as consistent and proven. 



EG Channel
   Coca-cola
   Frank Gehry -  Architect


Seek to achieve Consistency, Integrity and reliability in your practice.


Examples of proven brands
Steinway Piano
Andy Goldsworthy - Sculpture
Jimmy Choo Shoes


8. Partner
Achieve through collaboration
Synergy multiple talents
Work with other experts outside your field to achieve greatness


EG James Dyson, Antony Gormley, Michelangelo, Everist expeditions.


The Hollywood model
Every film is a project. Avatar took 1000's of people working freelance.  All people have creative input


9. Pitstop
Technology/ changes really fast moving
- Sharpen up - bolt on
- Rest - renew, revitalise, inspire
- Explore - Challenge, excite


10. Propel


- Extinguish your fears
- Exude confidence
- Instill faith


STOP SAYING YOUR ONLY A STUDENT - NEVER JUST


Recommend reading - 7 habits of highly effective people - Synopsis










   

How to successfully promote yourself in six easy steps

The lecture was delivered from a Freelance design or small agency perspective.


The 'noisy' market - the average person receives on average between 5000 to 6000 messages per day.


Framework number one


Marketing/Communication matrix by Murray & O'Driscoll


Use this as a checklist

The Internet is not a method in itself but rather a 'place' or conduit to market yourself.

Step 0 is to do nothing!

1.  Get their attention

A memorable business card - networking at trade fairs, events '  Important to say what you can do.

• Advertising
• Events
• Radio interviews
• write articles
• Run a blog - news feeds, a conduit of info.
• Exploit social media
• Publicity

2.  Build their interest - need more info.

• Websites
• Portfolio
• Info. packs
• Catalogue
• Curation - vents, credited for organising
• Exhibition- interact

3.  Convince them of your authority, authenticity and professionalism

• Artist statements - values
• Recommendations
• Testimonials
• Awards
• Community engagement - Charitable, be visible, trustworthy
• Professional bodies

4. Make your offer irresistible - mirror their own values by understanding their values 

• A proposition
• Pricing stratgy - discounts, long term
• packaging - extra service
• Try before you buy
• Recommendations
• Differentiation - Who you are, chemistry

5.  Close the sale 

• Put all questions to them and allow them to convince themselves
• convenience - Make more
• But it now - is there a reason?
• Right place, right time - work through this
• Delivery - Can I make it any easier for you?
• Personal selling - face to face
• Interactive website - High investment

6.  Reinforce 

• After sales service show that you care, phone them for feedback
• Advertising
• Public relations - remind existing customers yo are syll there
• Longevity
• Merchandising - Clever  to keep you in people's minds
• Maintaining contact
• Building relationships

 Jonny Cupcakes World tour video - A US brand of t shirts

"Re-cooling' the brand

A - Attention

I - Interest

D - Desire

A - Action

Who are your customers?

Tailor your service to a market - target your market

An example Selvedge Magazine detail where their customers are and what they do

Can control who you are advertising to for example on Facebook.

Try to minimise spam and tap into latent demand in the market e.g. a supermarket you may go with a specific list but visual stimulants 

Personalise advertising

People and their lives are complex so becoming more difficult to target advertising.

Market Segmentation

Look at media usage of customers

What websites, trade mags, newspapers, understand their behaviour.

Business to business

Make it personal, direct communication to right person.

Media usage

Use the the correct conduit

EG

Do your businesses drive to and from work , airlines, networking and broadsheet papers.

Consumer segmentation

• Demographics
• Geographical facts
• Lifestyle choices
• Media usage - right place,right time.
• The Internet - watched monitored processed