Reach for the Sky: RTA Business on the Art of Innovation

The amazing news that Google is attempting to build an honest to goodness self-driving car, only highlights the need for creativity and ambition in business, and this week, the RTA Business blog will explore just why you need to reach for the sky if you hope to make a substantial profit on the sale of your business.

It’s not as easy as showing a potential buyer your profit margins and waiting for them to sign on the dotted line. Buyers want to know that they can use your business to build on profit margins in the long term. If you’ve developed a lucrative, innovative product that fills a gap in the market, they’ll be biting your hand off to gain access to a veritable gold mine. This is why you need to reach for the sky.

Google: A Case Study in Ambition

Google is the perfect case study to highlight the benefits of ambition. They’ve practically constructed their entre brand through sheer ambition. Time and time again, Google have attempted the improbable, or at last the inadvisable (such as introducing Gmail in a saturated market) and they have seen success that has spurred them on to new heights.

They’ve become so popular because they find gaps in the market where they can make the most money - they find the practical opening then ambitiously shoot for the stars to fill it. The numbers back it up. Since it was first created in 1998, Google, according to Forbes, has become worth a staggering $382.47 billion.

RTA Business Asks: Will the Self Driving Car Work?

So is the self-driving car a step too far. It’s certainly an ambitious project; a car that will have a start/stop button, but no controls, steering wheel, pedals etc. If it’s possible, and that’s a big if, we at RTA Business believe that it could be Google’s next highly successful project.

Google Co-Founder Sergey Brin explained why to the BBC, stating that it aims to "improve people's lives by transforming mobility". The amount of people this could benefit is sky high – disabled people, older people, people who can’t drive, blind people etc. There’s so much potential.

This is why you need to reach for the sky if you ever hope to sell your business. Find that gap in the market and truly fill it, and you have a gold mine on your hands, a gold mine buyers will flock to acquire for a tidy sum!

OECD Revises UK Growth Forecast

The Organisation for Economic Co-Operation and Development (OECD) has revised its forecast for UK economic growth this year, upping the figure to account for a strengthening financial situation. At RTA Business, we recognise that this puts you in a stronger position when you decide it’s time to sell your business.

Various reports have suggested that business leader confidence is stronger than ever this year, due to national economic recovery and expectations that growth will return to pre-recession levels by this summer. This latest report is set to further persuade business leaders that now is the time to buy your business.

The OECD Forecast

This week the OECD released its latest forecast for UK growth, in what was an upward revision of previous estimates. In November, the Paris-based organisation claimed that in 2014 the UK economy would grow by 2.4%. Now they’re suggesting that the country’s economy will expand by 3.2%. This contrasts with an OECD average national estimate of 2.2%.

There are several factors that led to this revision of OECD growth estimates and each individually and collectively suggests an economy in full-fledged recovery. This month the services sector, which has dominated in recent quarters, rose for the 16^th straight month, sterling rose to a five and a half year peak against the dollar, and economic growth rates have continued to impress.

It’s important to note here that UK growth has outstripped forecasts for not only the US and China but every country in the G7.  Furthermore, global growth is expected to measure 3.4%.

RTA Business Comments

These figures suggest one thing - that it could be the right time to sell your business, and here’s why. First, the fact that the UK economy is set to expand this year, means that buyers should have more capital and when they have more capital coming in, they tend to want to spend that to create more – what  better way to do so than to buy your business?

Secondly, these figures should boost buyer confidence in the strength of the UK economy, meaning they’ll be surer that they’ll be able to profit from your business after they’ve bought it. Finally, these figures suggest that UK companies are in a stronger position than their foreign rivals, which further boosts business leader confidence.

At RTA Business we realise that these numbers indicate one thing- you are in a particularly strong position to sell right now.

We’ve hit the National Borrowing Target!

News has filtered through and been hailed by economists this week that the UK government has managed to reach its annual borrowing cut target. What benefits could this bring to those who are looking to sell their business in the current economic climate?

National borrowing rates directly affect businesses. This is because, the more the country borrows, the more prices, taxes etc. go up. This effects a company’s bottom line and weakens their position when trying to persuade a potential buyers of the benefits that said company can bring to their own bottom line.

A Victory for the Budget

It has been reported that the nation’s government borrowed a sum totalling £107.7 billion in the previous financial year. This may seem a lot, but in fact it was significantly lower the £115.1 billion borrowed by the country the year before.

So what have the government set as the target for national borrowing rates? In the budget the Chancellor suggested that for the full year, the budget deficit should measure £107.8 billion. This means that not only has the national economy narrowed the gap, but it has done so by £0.1 billion than it expected to; always good news!

Specifically, the numbers quoted on the issue by the Office of National Statistics (ONS) suggests that leaving out fiscal interventions, borrowing fell from £11.4 billion in March 2013 to £6.7 billion for the month this year. Furthermore February’s data was revised from £9.3 billion to £8.8 billion.

A Psychological Boost

Figures like these have both physical and mental effects for UK economic growth, and one is as important as the other. Howard Archer, chief economist at analysts Global Insight commented on the issue:

"While in reality, it made little difference whether the chancellor just hit or just missed his fiscal target for 2013-14, the fact that he did make it provides a psychological boost for the government and it may support belief that he can hit his longer-term targets."

At RTA Business, we recognise that the psychological effect this will have on buyers will help you in your quest to sell your business. It will further convince them of the sustainability of the economic recovery, which will give them more incentive to expand by buying your business.