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How to expand a small business

Having worked as a sole trader for a long time, the physical & financial demands required me getting help (horticultural, not psychiatric- yet).Whilst subcontracting seemed the only realistic financial approach to employing someone to start with (as I don’t think a one man band can afford employers responsibilities re holiday pay, pensions, sick pay etc?) the HMRC guidelines make it difficult not to require you becoming an employer.Whilst the resources are out there (businesslink.gov.uk etc), the sad truth of the matter is that I am a gardener, and the admin required to run a small business can be overwhelming, not something I am efficient at or good at.(see previous discussion on SMEs risk employment tribunals due to lack of HR procedures)Is it inescapable that running a small business means non-profitable office time?Or can it work to employ someone to organize the paperwork side of things.What would be the best option for administering a small business – keeping on top of legislation, accounts, payroll, health &safety, terms & conditions, employment contracts, risk assessment, insurance. Surely if I take time off work to manage all this it would be cheaper to employ someone?What sort of person/organisation can provide a realistic option to managing a small business – letting me get on with what I am good at.Any suggestions appreciated!

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  • PRO

    Hi Gareth

    Here is one suggestion... why not employ a student? I don't know what it's like in the UK, but here in SA, students like to get part time employment in their chosen field. As they are often living at home, and only need the job for work experience and pocket money, they are often quite cheap to employ (I know all this because I was one.)

    Try looking for students in garden related studies, who would like to learn how to run a small business. As someone who became self employed without knowing anything about the paperwork, I know that the experience you could give them would be very valuable. You would have to look after them a bit to start with, and teach them how it all works, but office work tends to be repetitive, so they could get on with it and give you time to get on with what you're good at.

    Just a thought,

    Jen

    • Or employ a student to help with garden work which will in turn give you time to do office work?

      Jennifer Mitchell said:

      Hi Gareth

      Here is one suggestion... why not employ a student? I don't know what it's like in the UK, but here in SA, students like to get part time employment in their chosen field. As they are often living at home, and only need the job for work experience and pocket money, they are often quite cheap to employ (I know all this because I was one.)

      Try looking for students in garden related studies, who would like to learn how to run a small business. As someone who became self employed without knowing anything about the paperwork, I know that the experience you could give them would be very valuable. You would have to look after them a bit to start with, and teach them how it all works, but office work tends to be repetitive, so they could get on with it and give you time to get on with what you're good at.

      Just a thought,

      Jen

  • Brilliant - my thoughts exactly.

     

    im in-between office & sites on a daily basis generally.

    i spend hrs . researching, ordering,learning,networking ;), locking up tools , trailers. building storage.

    servicing vehicles. sorting insurances. paying bills .invoicing. banking.

     

    no joke !     who pays for my time ?  clients - surely ...

     

    so £15an hour  does not even cover :  work on site, costs, time and management .....

     

    £25 is coming close.

  • accounts / training / post / filing/ washing vehicles / taxing cars/ payroll / .......................endless
  • PRO Supplier

    Hi,

     

    This is a very difficult time for any sole trader.

    The rules and regulations come thick and fast as soon as you employ someone.

    Employing a student is a severe risk, don't try this on the cheap. Bear in mind that teh national minimum wage is enforcable by law.

    I suggest you join the Federation of Small businesses who can provide help.

    You need to "network" a posh name for having a chat with people who have been through the process and can give you hands on advice.

    Specific bogey men who will cut your nuts off if you try to mess them about  are the tax man , income Tax, NI, VAT.

    Employment law is a minefield all of its own.

    Watch out for Working time directives, Tachograph and drivers hours rules, driver licencing particularly for any drivers and travelling crew members and of course you must remember the Health and Safety man. You should not need a health and safety consultant if you stick to less than 5 employees in the business because no written safety documentation is needed until then. Your customers and in particular the house builders will demand written Health and safety information. policies, risk assessments etc

    Your general record keeping and accounting records need to be very very good to keep all this lot happy.

    feel free to give me a call at Terrain Aeration or e-mail me terrainaeration@aol.com and I will help if I can No fees!

    regards David Green

     

     

  • PRO
    Spot on Rowley, office and admin got be handled internally, at least while you get to grips with taking on more work. 1-2 hours a night at least, I find anyway.

    ROWLY HILL said:

    Good answer Donny.

     

    I have to agree that I personally would not entrust this area of my business to a trainee.

     

    I can understand how you think that admin time is non-profitable but it is a necessary evil and if you get it wrong you could pay a heavy price either with the HMRC or other regulating bodies. Paying a good virtual business assistant could actually save you money!

     

    Taking that thought a step further I would not devalue the work of people who provide this service and I'd expect to pay a professional a rate in keeping with their experience, qualifications and service provision - just the same as we would expect our clients to value us really.



    Donny Bryan said:

    We're also a husband and wife team. Mrs B does all the business side - including writing tenders and managing contracts. Her background is in management consultancy so she knows her stuff.

     

    If you're going to delegate this to somebody then personally I'd want somebody with relevant experience and track record. The potential for mistakes is large and some could be costly. Therefore I wouldn't consider a student for this.

     

    There are a number of virtual personal assistant organisations out there that charge by the hour and have a wide variety of skills including book-keeping. That would be where I'd start looking.

     

    You can also buy HR expertise by the hour from a number of organisations these days - that would be where I'd go for employment contracts, to make sure your people processes are appropriate, etc.

     

    Many legal firms offer free updates on legislation.

     

    You can also purchase the services of a health and safety consultant to undertake a review of your business and suggest improvements.

     

    If you go down any of these routes do check that anyone you commission has professional indemnity insurance in case they make a mistake that you rely on.

     

  • Thanks for your replies. There's certainly a lot to get up to speed on when taking someone on - not least the employee/self-employed sub-contractor issue being discussed in another thread.

     

    The virtual business assistant is an interesting idea, I wonder if there is a company in this field that is clued up on our industry - be useful if anyone knew one. I'de imagine there might be alot of potential customers through this site.

  • Hi Gareth,

    As most people agree, taking on non-family members of staff does come with a large and specialised administrative burden.  We contract out the whole lot to an Estates group - they run several land-based businesses and so, on economies of scale, it is worth them employing specialist and knowledgable HR, H+S, Accounts etc etc, which we pay only a pro-ratae proportion for.  It works for us and works for them and there are lots of similar business around - normally based around large estates that have sought to diversify.  Prob best to look for local estates or similar and see if they are able to accomodate.  Market knowledge would not be an ideal fit, but they do have a good understanding of how seasonality and growing affects accounts and cash-flow etc.  They are also clued-in about Health and safety of chemicals, landscape machinery etc .Grant

  • as a sole trader in my 3rd year of business I asked my accountant about this and his advice was to form informal agreements with other self employed gardeners in my area as the legislation, especially that on pension contributions, would make it prohibitive for me.

    Hope this helps,

    Bern

     

  • The problem is, it doesn’t matter what agreement you come to between you and your worker, HMRC can decide differently and unless you want to take their decision to a tribunal you have to go with what they decide.

    Using the Employment Status Indicator and talking directly to HMRC and businesslink has shown that for a sole trader (in purely garden maintenance), to take on help is a grey area as to whether you have to put them on your payroll, depending on your working relationship with them.

    Its frustrating as the regulations are a disincentive to expanding on a small scale – not exactly the point is it.



    Invicta said:

    as a sole trader in my 3rd year of business I asked my accountant about this and his advice was to form informal agreements with other self employed gardeners in my area as the legislation, especially that on pension contributions, would make it prohibitive for me.

    Hope this helps,

    Bern

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