“That was the question I kept asking myself through the Spring of 2009.  I was busy preparing my presentation for the launch of my new company, Savvy Business.  I knew the story backwards, of course, so that was no problem.  The only thing I couldn’t decide was – where did it start? 

 “Well, officially, it was in July 2008 when we launched the first version of savvybc.com; but, really, it was when I first had the idea in April 2007 – although, no, actually it was when I made my very first legal podcast in August ’06 … or was it 2005, when I first found out what a podcast was …?

 “I finally decided to pick up the story in 2006, although in fact its roots go back much, much further – all the way back to a pushchair in 1969 – and beyond.”

 I wrestled with a similar issue when it came to the starting point for the book.  In the end, I went way beyond that pushchair, to 1939, when Mum became an evacuee and Dad a POW. 

 Why?  Because my parents perfectly illustrate one of the main themes which runs through the book, my speaking engagements and life in general – the choice between being a survivor or a victim.  Yes, I did say ‘choice’.  We talk about someone being a “born survivor” don’t we, but are they?  Are survivors, or victims come to that, born or made?  Wearing my ex-noncommittal-lawyer’s hat, maybe I should say I don’t know – it’s probably a bit of both; but actually, my own experience has shown me we often have more choice in the matter than we know and sometimes become ‘victims’ simply because we don’t know all our options.  I used to see myself as a victim – someone to whom life happened; someone stuck in the backseat on her own journey, while other people drove.  These days, I do my best to happen to life – and I’m definitely behind the wheel!  The change was my choice and one I’m so glad I made.  It led directly to that “EUREKA!” moment  at 5.00am on 6^th November ’09, to the book and everything which looks set to follow.

Earlier in the week, we had the latest figures from ITV, showing a 2.7 billion pound loss in 2008 converted into a profit of 25 million in 2009 – significantly less worse!  Traditional advertising revenues were on the slide before the recession bit and the improvement (or should that be ‘negative deterioration’?) is due at least in part to changes in the kind of advertising offered – specifically, the increase in ‘spot’ ads – directly attached to programmes.  These are supposed to catch the viewer who has drifted away during the ad break – or whizzed through the ads while watching via Sky+ or similar.  Then there are whole segments of viewing sponsored by one advertiser – so their ad pops up at the beginning and end of every part of every show in that segment. 

It’s quite comforting, in a way, isn’t it, to know that even a massive global industry like advertising has to move with the times, to adapt to changing technologies by coming up with innovative ways of reaching their target market?

As for the negative dressed as a positive – or is it the other way around? – I find that less comforting.  In fact, I find it quite disconcerting.  As we climb out of recession, whatever industry we’re in, if we’re scared to look forward with confidence – and to admit that’s what we’re doing – aren’t we in danger of missing the next opportunity?  Any thoughts?

As you’ll have gathered, I was genuinely baffled about the business case for some of the specific cuts proposed by the BBC Strategy Review, published on Tuesday. I focused on 6 Music in my last post, but the axe is also hovering over the Asian Network (another small digital radio station) and various web services.

So when I heard that the BBC’s Head of Strategy was going to be interviewed on Radio 4’s “The Media Show”, I pricked up my ears. A-ha! I thought. Now we’ll get some answers!

Well, no, not really.

Nothing I’m about to say is meant in any way as a slur against John Tate – I wouldn’t want his job for any salary – especially at the moment. As he pointed out in his interview with “Media Show” presenter, Steve Hewlett, the report was very much a team effort.

He emphasized that the core purpose was to streamline services, to “do fewer things better”, put more money into high quality programming and put content back at the heart of everything. Well, that’s great – but it still didn’t answer my question – why streamline by removing small, relatively low-cost niche services for which the wider market doesn’t have an obvious replacement?

Previously, said Mr Tate, the BBC had been able to “do both” – create new services whilst maintaining the existing offering. Now, he said, it was becoming a choice of “either/or”. Ok, I get that. Most of us in business during the recession have had to make those decisions. Just one small problem: the emphasis of the report seems to be on maintaining and improving existing services at the expense of new ones – but these proposed cuts are aimed at existing services. Is it me, or is that a straight contradiction?

Steve Hewlett asked if the previous digital expansion, which produced 6 Music, the Asian Network and a lot of the new web services, had actually “backfired” by diluting the offering from the core channels? After all, the report talks about taking new comedy back to BBC2 (from BBC3), along with high end factual and cultural material (from BBC4). Mr Tate disagreed though. Far from backfiring, he said, all those new digital channels had “created more space” for great programming – space which the review seems to recommend should now be reduced. He went on to say that BBC2 had changed since the introduction of 3 and 4 and the plans contained in the review included “taking it back” to some extent. Contradiction alert?! He said the place for digital media had changed. Well, yes, very soon it will become the only media we have.

On the subject of 6 Music, he said the station has “a big and loyal fan base”, but that the “listener hour” cost is relatively high, the average age of the core listenership is 37 – “Right at the heart of the target audience for commercial radio” and 85% of those listeners also listen to other BBC stations. Aside from the cost, none of that convinces me of the business case. Just because the average 6 Music listener is part of the target audience for commercial radio doesn’t mean commercial radio is serving them; and as for 85% listening to other BBC stations, I don’t doubt it. I don’t know about you, but I’m a multidimensional person who can’t get all her needs met from any single source, radio or otherwise. I want different things at different times and I find them in different places – but that doesn’t lessen the importance to me of any individual source.

Mr Tate said the choice was between growing 6 until it became the third national pop station, alongside Radios 1 and 2, or closing it and redistributing the programming. With respect to the authors of and contributors to the report, who must have done a huge amount of background work, I think they’ve missed several points here – especially the one about the radio village. That’s what 6 and the Asian Network were set up to be and now they risk being destroyed because that’s what they’ve become. It all boils down to the question: what was the measure of success set out when these networks were set up?

There’s always going to be some conflict between minority entertainment and commercial principles and between commercial principles and listener-funded public service broadcasting. We expect psb to serve minorities, but as we all know, those services have to be paid for – by the majority. It’s a really difficult balance, but one I don’t think this latest report has managed to strike. What do you think?

Discount: Defined here in relation to the discounting of Commercial Paper – typically Bills of Exchange. Where a future dated Bill of Exchange has been accepted by the drawee [the one who's due to pay - see below], it may be possible to discount the Bill. A Discount House [or bank] may agree to advance the bulk of the face value of the bill, thus helping your cashflow. Discounting can be with or without recourse [see Recourse, later on]. Usually only bank endorsed bills will be discounted without recourse [except for some specific agreements - usually restricted to larger, multi-national
businesses].

Drawee: The party on whom a Bill of Exchange is drawn, i.e. the one who is buying and has to make payment.

Drawer: The party who draws up the Bill of Exchange – the seller.

Drawing: In terms of Letters of Credit, a drawing is the presentation of documents for payment/acceptance under the Credit. Depending on the terms of the Credit, a drawing may be for part or the whole of the value of the Credit.

Due Date: The date on which payment of an accepted Bill of Exchange or a drawing under a deferred Letter of Credit becomes due. [A deferred Letter of Credit is one where there is a credit period between presentation of documents and payment, but no Bill of Exchange has been called for].

Duty: Import Duty may have to be paid on certain imports into the UK. Generally, there is no duty on goods that are already in free circulation within the EU. For goods imported from outside the EU, rates depend on product and Country of Origin. Duty rates are always based on the CIF value of the goods [regardless of which Incoterm was actually used for the contract] and VAT is added to the CIF value. Care, rates can and do change regularly and at short notice. Customs Duty is different, and applies to specific goods irrespective of their origin, for example, cigarettes, alcohol, etc. coming into the UK. For both types, it is usual
to have to pay the relevant duty amount to HMRC before goods are released [but see Duty Deferment below].

Duty Deferment: For regular importers, it may be possible to obtain a Duty Deferment bond from your bank and lodge this with HMRC. The effect of such a bond is that goods are released quicker and you pay the duty in arrears. There is a cost insofar as the bank will view this as a contingent liability and may require security and will almost certainly charge you for its issuance. Also, the bond must cover an average 2 month’s value of imports.

I’m not sure if I should admit this as a sound specialist, but I start the day with “Breakfast” on BBC1. I enjoy a bit of quiet time before the working day gets going, catching up with the news while I eat my porridge. That said, it wasn’t very quiet this morning, because one item had me growling at the screen with frustration!

You might have noticed mentions in the news of the recently published review, commissioned by the BBC’s governing body, the BBC Trust. The report recommends a move towards a more disciplined, streamlined organisation, which makes more efficient use of licence-payers’ money. No, that isn’t what had the dog staring at me, wondering what I was growling at.

What frustrated me was the discussion this morning around one potential cut the corporation is considering – the closure of 6 Music. Now, I have to say up front, I’m not a regular listener – although all the publicity of the last few days and the passion of those who are regulars has made me curious, so I will be checking the station out very soon. My objection, though, is with the arguments put forward by the BBC representative – whose name I missed and can’t seem to find on the website! She said that if the closure happens, the innovative programming on 6 is likely to be absorbed by Radios 1 and 2, both described as “mainstream” networks. So what’s wrong with that?

Where do I start?

Firstly, 6 was set up to serve a niche market – people interested in new music and also some of the stuff rarely heard on the mainstream networks – and never on commercial radio. By definition, a niche audience is likely to be smaller than a mainstream audience

So, secondly, when the review says that 6 needs to grow its audience without losing its USP, I have to wonder about the measure of success the BBC is applying here. Yes, a small niche can be made bigger, by marketing, PR etc, but at some point, if it keeps growing, it stops being a niche and becomes mainstream.

That brings me to my third point – Radio 1 serves a niche – a young audience. Radio 2, on the other hand, tries to be all things to all people. Some individual shows try to do that, like the Chris Evans Breakfast Show; but the station does serve minority audiences quite successfully, by providing niche programming within its schedule. It’s certainly a very different station from the one my Dad used to listen to in the car when I was a kid, which was definitely targeted towards the “older” listener, but I would argue that it still has an image issue and trying to incorporate content currently carried on 6 into the Radio 2 format risks losing the audience, or a large part of it.

Fourthly, the saving made by the BBC by axing 6 Music would be around nine million pounds a year – very small fry in corporation terms. BBC3, which provides new comedy etc to a tv audience, costs eleven times that, but is apparently secure (at the moment) – reinforcing my belief that even within our public broadcaster, radio is the poor relation.

Finally, as a discussion on 5live asked recently, “What is the BBC for?” Personally, I thought it was to provide programmes which the commercial sector doesn’t or can’t. If that’s so, surely 6 Music is a perfect case in point. Commercial radio effectively has two customers – the listener and the advertiser – and both have to be satisfied. That’s not exactly the environment for innovation – quite the opposite. I’m not saying all commercial programming is bad, just that as everything lives and dies by the numbers, it can’t afford to take too many risks. The BBC, on the other hand, is supposed to serve licence fee-payers – you and me, in other words. The rights and wrongs of that system are a whole other discussion, but while it’s with us, shouldn’t we be able to expect it to provide us with services we can’t find elsewhere?

BBC Chairman, Sir Michael Lyons, says that if the review’s proposals prompt “massive public protest”, they will be rethought.

I’ll leave you with these thoughts: How massive is “massive” and can 6’s niche audience, deliberately created by the corporation, shout loud enough to be heard? Wouldn’t moving 6’s programming to Radio 2 be like uprooting a village community which is based on and loved precisely for its quirky individuality and dumping it down in the middle of London?

CMR – Convention Merchandises Routiers: These are the conditions for the international movement of goods by road.

Collections: Again, held over from Issue 10. A bank collection is the collection of trade debts through the banking system whereby documents relating to the shipment of goods are passed through the banking system and exchanged either for payment or an acknowledgement of acceptance [usually by means of a Bill of Exchange] for payment at a fixed future date. Both buyer and seller must agree to this course of action at the start and, unlike Letters of Credit, there is no undertaking by the bank to pay. It is generally felt that this is a more secure method than open account trading.

Confirmed Letter of Credit: I will cover this when we look at Letters of Credit, later in the series.

Consignee: The party to whom goods are sent.

Consignor: Also known as the shipper; the party despatching the goods.

Consignment (1): The underlying goods sent by the consignor to the consignee.

Consignment (2): Care – if goods are exported subject to consignment, the exporter will only receive payment on completed sales. Any unsold may be returned to the seller, at the seller’s expense. Can be high risk and expensive.

Containerisation: The use of sealed containers into which goods are packed for shipment.

Convertible Currency: A currency that can be freely bought and sold for other currencies at will, e.g. Sterling, US Dollar, Euro, etc. Exporters must ensure that payment for their goods will be in a freely convertible currency. Note, however, that this may not necessarily mean that funds will be immediately available, if the country concerned still uses exchange control.

Correspondent Bank: A bank that operates in its own Country the business of a foreign bank.

CPT Incoterm: Carriage Paid To [named place]. The seller clears the goods for export and pays for delivery to a named place. The goods are deemed to have been delivered, and the responsibility for them passes to the buyer, once they have been taken by the seller’s carrier.

Customs: Generic term for HMRC. Whether you are importing or exporting, you must follow HMRC regulations, which are complex and detailed. If you use a freight forwarder or shipping agent, they can undertake much of the customs procedures on your behalf but, like tax returns, you are still ultimately liable for the accuracy, etc. of all declarations.

Customs Commodity Code: Also known as CN Code. An 8 digit code required for all goods to be exported outside the EU. Imports from outside the EU have a 10 digit code. These must be entered on the relevant documentation and are available from HMRC via their publication known as The Tariff.

At 5.00am on 6th November 2009, after yet another sleepless night, wondering why I seemed to be working my socks – and various bits of my anatomy – off just to stand still, I stood in my kitchen, coffee pot in hand and it hit me – no, not the coffee pot – the revelation! THE ANSWER! “EUREKA!” The lights went on and I saw it all – where I’d been going wrong, how to put it right – and more!

“So that’s my core skill! I thought, amazed – “I know how sound works!” Here I was, more than a year and a half after my decision to make the leap – and leap it certainly was – from law into business podcasting, finally realising that I know how sound works. Yes, I am a bit slow – especially at five in the morning!

The truth is, I knew how sound worked, how people used it and what it could do if they used it properly long before that moment – I just didn’t know that I knew. As I poured that much needed first cup of coffee, pieces of a jigsaw which had been floating around my head for nearly two years, never quite forming a picture, suddenly clicked into place and I saw the image clearly – the image of my business, how it came to be and where it could go. I spent the next several weeks redesigning services to fit that picture.

Before 6th November, the most positive response I had to my marketing efforts tended to be, “I’m really interested in what you do, but I don’t get it.” Now it’s, “I’m really interested in what you do – when can we talk?” Like most of the changes I made to our offering, it’s a small shift on the face of it – with a huge impact.

Nineteen years ago, someone said, “You should write a book” – but I was only twenty-three then and probably knew even less about life than I did about writing. So although I gave it a go, it didn’t happen. In November last year, I was planning a series of books about starting and running a business; but after that 5.00am “EUREKA!” moment, they were pushed aside by something else which insisted on being written “NOW!!!” From a pure business perspective, the timing was all wrong. I should have waited until we were truly out of recession, until the company was more established. In fact, I probably should have waited until I retired, but this book would brook no argument – the words fell out faster than I could type! The baby was coming, whether I or anyone around me liked it or not!

It started life as a practical guide to business podcasting, against a background of my experience as a lifelong media junky and obsessive communicator; but it evolved into the story of my forty-year apprenticeship in sound – the foundations on which my company and everything we now do is built. It also tells the very personal story of my development of the “womble” principle – of which, more later.

I finished the book last Thursday evening. Over the next couple of months, as I prepare for publication, I’m going to tell you a bit about how it came together and some of the things I learnt from writing it – because I did learn. Two people, both dear friends and close colleagues, have been slightly less than fulsome in their support for the project. I think that’s mainly because they’re applying cost/benefit analysis principles, looking at the amount of time this kind of undertaking demands, against the likely financial return. On that basis, I’ve just “wasted” three and a half months of evenings and weekends – but I know I haven’t. Even if no-one else ever reads the finished product, it was worth writing because it helped me work out what I’m about, how I got here and where I’m going.

Two recent landmark court rulings could lead to some individuals facing significant retrospective tax bills, as outlined below.

UK Citizens living abroad as Tax Exiles

Thousands of UK citizens living abroad as tax exiles could find themselves facing a retrospective tax bill stretching back as far as the previous six years, following
a recent Court of Appeal ruling.

The case involved businessman Robert Gaines-Cooper, who has lived in the Seychelles since 1976. Despite the fact that he had adhered to previous HM Revenue & Customs (HMRC) guidance by spending fewer than 91 days in the UK on average each year, the judges ruled he had nevertheless maintained ties with the country.
The Appeal Court said that the 91-day rule did not actually establish non-residency, and ruled that the UK had remained the ‘centre of gravity’ of the defendant’s life
and interests.

The ruling means that thousands of UK tax exiles could have their lifestyle scrutinised by the Revenue, with factors such as the number and length of visits to the UK, any economic and business ties, and ongoing connections such as membership of UK banks or sporting clubs, being taken into consideration.

Contractors using Offshore Tax Schemes

Meanwhile, contractors who have used or are continuing to use offshore tax schemes could be the target of a new clampdown by the tax authorities.
The warning follows a ruling by the Royal Court of Justice, which recently dismissed an application for a judicial review in the case of a self-employed information technology contractor who sought to challenge a £100,000 backdated tax demand from HMRC. The judge ruled that the backdating of the demand did not breach human rights law. The Professional Contractors Group has warned that HMRC may now retrospectively apply the tax legislation as far back as 1987, when the relevant legislation was first introduced. Those targeted could have to pay both the fines and the backdated taxes.

It is thought there may be 2,500 taxpayers exploiting such arrangements, with around £100 million of income tax at stake. We can advise on all your tax planning needs – contact us today for a tax planning review.

An incoming Government must concentrate its efforts on reducing the budget deficit,
and should scrap the planned increase in national insurance contributions (NICs),
according to the British Chambers of Commerce (BCC).
The latest monthly survey from the business group revealed that 41% of companies
believe reducing the deficit should be the Government’s number one priority, while
many also believe that an increase in NICs represents the most damaging tax rise
that could be imposed on them.
36% of those surveyed felt that a VAT increase would be the least damaging to their
business, compared with just 6.6% who selected NICs as the more favourable option.
Meanwhile, the business group has used the Treasury’s Tax Ready Reckoner to calculate
that increasing VAT by 1% to 18.5% would raise an extra £4.5bn in revenue, compared
with the £5.1bn that would be netted by a rise in NICs. The BCC argues that the difference
between the two sums could be offset by targeted spending cuts.
David Frost, BCC Director General, said, ‘Companies have and will continue to play
their part in creating wealth and jobs, generating economic growth and driving recovery,
but the right environment needs to be in place’.
‘Raising a damaging tax on business, like NICs, will be counter-productive. It will
mean fewer jobs and less tax revenue in the long-term. While businesses fully understand
the need to bring down the UK’s deficit, they are clearly saying that using VAT would
be a less damaging way to achieve this.’

These are picking up now, as expected. Not comprehensive, but the following may be of interest. This month, I’ve tried to look for some that are not Country specific, but instead look at some of the other issues which often come up when looking overseas at a new market for the first time.

UKTI are currently running a series of day long workshops on Routes to Markets – looking at different options in different countries. These go on until the end of next month. They are not free, but could provide useful information. See www.uktradeinvest.gov.uk
Specifically, the London UKTI team are holding a series of workshops on the likes of IPR & Licensing; 7 routes to an overseas market; acquisitions & disposals; agency/distribution; as well as several trade missions – India, South Africa, etc. Go to www.uktilondon.gov.uk for more info.
On 24th February, Essex Chambers are holding an afternoon event focusing on exporting to Poland – details from www.essexchambers.co.uk.
UKTI/FCO can also advise on the multitude of trade fairs that are coming up across Europe and further afield, together with useful information on travel/safety/other issues associated with specific countries and regions – check their websites – www.ukti.gov.uk and www.fco.gov.uk.