RTA Business’ Top Five Tips For Boosting Creativity

The best, most lucrative businesses are built on creativity, and without it, you’re never going to attract a buyer and make a tidy profit. This is why RTA Business, this week, has decided to list its top five tips for boosting creativity!

The Importance of Creativity

A business isn’t built on knuts and bolts alone. You need a product and that product has to be capable of generating a significant amount of revenue over the long term. That’s why you need to be creative. You need to have the capability to dream up a product so useful that it’s capable of attracting a sustained customer base. No easy task.

It’s doubly important if you’re looking to build up your company, only to sell it off for profit one day. A buyer won’t be interested in a firm that merely stays above water. They want to buy a business that will make them a lot of money; the more profit avenues you can dream up, the more attractive your business will be when you decide it’s time to sell.

The Creative Top Five from RTA Business

However it’s easier said than done to get creative – that’s why writers so often have writers block, it’s all about inspiration, which isn’t something you can automatically tap. However, you can help stimulate your mind along the way with these top five tips:

1      Observe the World around You: How are you ever going to dream up a new product that will sell well if you don’t know the world you’re selling it to? Observe your customer base and let them inspire you.

2      Seek out a Little Help: Other people have fresh life experiences to bring to the table that you don’t. Use that different perspective to spark your own imagination. They may know something that you don’t that makes your impractical idea work.

3       Embrace New Experiences: Get out of your comfort zone. Travel to new places, listen to music you never have before etc. If you open your mind, you never know what you may encounter that will give you that ‘profit margin changing’ idea.

4    Get Imaginative: You need to think outside the box, and to do so, you need to ask ‘what if.’ Take a scenario and ask what the wildest possible outcome could be. You’d be surprised what practical ideas often come from the wildest of situations. Take the internet as an example!

5       Be Brave: This is the best possible tip we could give you, don’t be afraid to take risks. Do you think people like Mark Zuckerberg and Steve Jobs got to where they are by playing it safe?

The Benefits of a Profit Boost!

Sometimes in selling your business, milestones mean everything. When you announce major profit gains, it can make your business look so much more attractive to a potential buyer and this week RTA Business Consultants outline why.

It’s an obvious conclusion to reach isn’t it? The more profit you are making, the stronger your business, the more opportunity there is for growth. Even then, there are levels of degree when it comes to how influential profit margins are with potential buyers.

The Differing Benefits of Profit

There are two types of profit boost- gradual and spontaneous. Both have value in any strategy to attract a buyer to your business. A gradual rise in profit margins suggests a long term business model that is perfectly positioned to make money sustainably. This is an attractive to a buyer because it shows them that purchasing your company will provide them with a secure opportunity to grow their own venture.

The benefits of gradual profit rises are obvious, however the benefits of spontaneous profit boosts are not to be ignored either. A company will see a spike in profit levels usually after the introduction of a new product or service that has diversified their business.

There are benefits to this type of profit rise too, and it all relies on timing. Timing is a key issue – when is the right time to sell your business? If you put it on the market just after a profit spike, it shows buyers that now is the perfect time to buy your business and capitalise on your heightened profit capability.

LG Electronics: A Case Study

We can see how this plays out in the case of LG Electronics. The technology company recently reported a profit jump of more than a staggering 300%! Consequently net profit at LG Electronics measured 93 billion Korean Won in the first quarter of 2014. It stood at 22 billion Won the previous quarter.

Notably, this profit boost came at a time of great change for the electronics firm, as strong demand for its smartphones and TV’s were responsible for sales. Plans to expand its product range and introduce its new G3 smartphone later this year are set to keep profits high.

It’s important to remember that because of this news, LG shares rose 2.9% to 71,000 Won in Seoul this week. We see a direct correlation – a bump in profits made the company much more valuable in the blink of an eye.

If this exploration of profit margins should remind you of anything, it’s that timing is everything when you are looking to sell your company. At RTA Business we always suggest waiting for the time you can make the most money from selling your business.

Crafting an Effective Business Leadership Style

If you ever hope to sell your business, you need to make it attractive to potential buyers first, which means you need to show its capability for profit and expansion. One of the best ways to foster these qualities in your business is to craft an effective business leadership style. So how can you go about that?

There’s an old saying that applies here; cut off the head and the body will follow. The head of the company is vital to its success; they are its face, its decision maker, its resource provider etc. Everything falls apart if that leadership is taken away.

From this we can also argue that a business has no hope of ever becoming profitable if you don’t craft an effective leadership style. For those people who have never been in positions of leadership before, this can be a tall task. This is why RTA Business Consultants has compiled this list of top tips you can use to become an effective leader.

Delegate

No man is an island and no one can ever do it alone. This is why you need to learn how to delegate. Effective delegation proves that you trust your workforce and that you rely on them to help grow your business. It creates a more positive work environment and increases productivity.

Think About Who You Hire

In order to delegate you need to make sure you are hiring the right people. One person who fulfills the job specification is worth ten people who partially fill it. Look for people who are problem solvers and who you can work with. You can only be an effective leader if you have the right ‘tools’ to work with.

Express Yourself

One of the worst offences you can make as a boss is to present your expectations in an unclear way. It slows down productivity, lowers your profit margins and makes you look like a weak leader who isn’t capable of communication. Always be clear with what you expect from employees.

Foster Respect, Not Friendship

Whilst you want to have a good working relationship with your employees, you don’t want to get too pally with them. At the end of the day, you are the boss, and establishing a certain professional distance reminds your employees of your position within the company. If people think you are a push over, they won’t listen to you.

Open Your Ears

We can’t stress this enough, always listen! Think of it as a creative process. Your employees bring fresh experiences and perspectives to the table that you can use to expand your business. They might know something that you don’t, or they may have an insight that you haven’t considered. 

What Does the State of the Union Mean for The Economy? - RTA Business

Tuesday 28^th January saw US President Barack Obama give his annual State of the Union address to the American people. Considering America’s role as the lynchpin of global trade, what does the State of the Union mean for the global economy?

The State of the Union speech was a tradition started by American founding father George Washington. Although it has been dropped and revived, the State of the union speech is now an American tradition. It acts to lay out the President’s agenda for the year. It acts in a similar way to the Queen’s speech at the opening of Parliament.

So what does Obama’s speech tell us about the global economy? Critics and pundits are already commenting on how Obama’s speech was one that was politically charged. It certainly was; Obama made it quite clear that he is going to bypass a Republican House of Representatives wherever he can to get his agenda passed.

This was the key overarching theme that we should be interested in. Obama has had enough of being blocked at every turn. His anger has been ignited particularly by the House’s reluctance to raise the national minimum wage.

This was the central issue as far as global economy was concerned and it played out in several ways. It is a key issue because a higher minimum wage would increase American spending power. America as the world’s largest economy is crucial to helping the global economy expand by injecting money into it. More spending by America leads to more room for business growth; strengthening economic activity around the world.

This played out directly and indirectly. Directly Obama raised the minimum wage for federally contracted workers to $10.10 an hour; a significant increase that will broaden the spending power of numerous low level government workers. It gives the American economy a cash injection.

The indirect approach was used by Obama to urge Congress to raise the national minimum wage and to urge state legislatures to do the same. He’s unlikely to get anywhere with this message with the Republican controlled House, however he could with the states. 20 of them have already done so off their own backs and with a crucial election year coming up, more may do so.

At RTA business we reckon this has a direct effect on business acquisition. A stronger global economy means more room for growth, which traditionally leads to both an expanding pool of potential buyers and rising values for business’ on sale.

Global Economy Hits Turning Point

The World Bank has announced this week that the global economy is at a “turning point” in the face of stronger global growth forecasted for 2014. What does this mean for the industry of business acquisition?

RTA Business has learned that this week the World Bank, the overarching global banking regulator, released a report on the state of the global economy. Specifically it highlighted forecasts stating that richer countries are “turning a corner” in the wake of the damage caused by the financial crisis.

This is expected to have a knock on effect on developing economies, as strengthening western finances should facilitate stronger investment.

However the World Bank warned that growth prospects in such economies “remained vulnerable“ to the expected ramifications of the withdrawal of the economic stimulus package by the US Federal Reserve.

The stimulus package was a programme set in place by the US Federal Reserve to shore up the country’s economy in wake of the 2008 financial crisis. It involved bond-buying and aided in the development of emerging economies such as India and Brazil.

However, stronger US job growth saw months of speculation on when the scheme would be tapered back; this had ramifications on markets across the world. Now the Reserve has started scaling back its monthly bond-buying scheme, which was formerly set at $85bn (£52bn) a month. This has caused fears that it could see global interest rates rise, which could alter the flow of money in and out of emerging markets.

In an article for the BBC World Bank group president Jim Yong Kim commented on the affects this could have. He commented that "growth appears to be strengthening in both high-income and developing countries, but downside risks continue to threaten the global economic recovery."

He elaborated on this, saying that "the performance of advanced economies is gaining momentum, and this should support stronger growth in developing countries in the months ahead. Still, to accelerate poverty reduction, developing nations will need to adopt structural reforms that promote job creation, strengthen financial systems, and shore up social safety nets."

So what does this mean for the industry of business acquisition? A strengthening economy naturally means that more people will be willing to sell their businesses as prices rise. This will lead to a stronger, more robust market. These suggestions, if governments decide to set them into place, could also foster a more beneficial environment for business acquisition.

What has been clear for a while is that the world is moving out of the Great Recession and into sustained recovery. However in order to sustain this recovery we need to be cautious.

Is The Source of Retail Economic Growth Shifting?

A survey released this week suggests that the UK experienced a record amount of online shopping this Christmas. At RTA Business this has made us question whether the source of retail economic growth is shifting online.

Retail has always formed a major element of economic growth. This is one of the key reasons politicians give when they attempt to slash taxes; that more income means more spending which means more cash injected into the economy.

Furthermore this is a tactic governments and big business themselves use when attempting to shore up the economy and rescue their profit margins. Following the 2008 economic crash the government developed several schemes such as Help to Buy and the Green Deal designed to inject fresh cash into flagging markets.

Christmas is the Superbowl of shopping. The commercial nature of the season, the idea of gift giving, inspires the general public to shop. Businesses know this, and as such ad campaigns and special offers are put in place like never before.

However this last Christmas revealed some surprising details. Retail giants such as Sainsbury’s, Morrison’s and Tesco sold significantly less than usual during the lucrative season. Considering that many of these large retailers make a significant portion of their profits at this time, this is a somewhat worrying conclusion.

However online sales were stronger than ever this Christmas. Overall there was a 19.2% growth in the rate of internet purchases over the Christmas season. In contrast UK retail sales rose by just 0.4% on a like-for-like basis.

In more detail; online shopping accounted for 18.6% of the total of sales not involving food in the closing month of 2013. This was an almost 2% increase from 16.5% in 2012.

The survey was conducted by the BRC and the group’s Director General Helen Dickinson spoke to the BBC on what their results could mean. She said that "this Christmas we've seen innovative retailers using click and collect and other approaches to make a virtue of both their website and their physical shops. And that's something we see growing in importance."

At RTA Business we understand the point Dickinson is making, business growth in the modern world happens online. Online sales platforms are emerging in importance; customers appreciate the convenience. It is likely that as online platforms evolve in sophistication, it could affect the very way we measure business growth.

For more information about RTA Business Consultants, visit our website or follow us on Twitter.

Economic Growth Higher than Expected

The team at RTA Business Consultants were pleased to see that economic growth in the UK is increasing at a higher rate than previously expected. Great news all round for businesses, buyers and sellers!

The Office for National Statistics (ONS) released figures that indicate a 0.8% increase in gross domestic product from July to September. This is a significant increase on the figures from the previous quarter. Estimated annual growth has increased from 1.5% to 1.9%, which suggests the long term economic plan for the country is working.

However, further reading of the ONS data reveals that the trade deficit has increased sharply from £6.2bn to £20.7bn in the third. November also saw a significant increase in public sector borrowing from £15.6bn to £16.5bn since last year. These figures call into question whether or not the government’s current recovery strategy is entirely sustainable.

On the other hand, unemployment has fallen to 7.6%, which is the lowest it’s been since 2009. This means there are now 30 million people in work. Similarly, the housing market has begun to revive, which in turn improved the country’s earnings on stamp duty.

Retail spending has increased by 2% since last year thanks to an increase in shoe, clothing and textile purchases. Interest rates are likely to stay at their 0.5% record low however, since inflation is currently holding steady at 2.1%, just 0.1% higher that the Bank of England’s 2% target.

While this is quite a mixed bag of figures, RTA Business Consultants are pleased to see a modicum of positive growth. For more posts like this, follow us on Twitter, and for a full range of our services, visit our website.