The Business Clinic – February 2017

Expert advice on the business of running a garment decoration company

New investment cash and upbeat CBI survey

• In January Metro Bank announced that it had ring-fenced £1 billion to lend to new and existing businesses and commercial customers in 2017.
  The bank says it takes a case-by-case approach to lending. Mark Stokes, managing director of commercial banking at Metro Bank, said: “Businesses are the very bedrock of the UK economy and it’s absolutely vital that lenders do what they can to support their growth.”
• A CBI survey of UK manufacturers at the end of 2016 found that production growth is at its highest level since 2014, with expectations for growth in Q1 2017 remaining solid.

Q&A

I’m looking at leasing a commercial property as a long-term home for my garment decoration business, and I am expecting to spend some money on making the property suitable for my print and embroidery operations. Someone has mentioned security of tenure to me – what is it, and will I have to pay more for it?

Security of tenure refers to the right given by the Landlord & Tenant Act 1954 to business tenants to remain in occupation of premises at the end of the contractual term (that is, the number of years granted) of a tenancy and to apply to court for the grant of a new lease.
The rights will only arise where:

• there is a tenancy, usually granted by a lease (that is, neither a correctly drawn licence nor tenancy at will would suffice), giving the tenant exclusive possession of premises for a term and at a rent;
• the tenant must be in occupation of the premises for the purposes of its business; and
• the rights have not been specifically excluded (that is, ‘contracted out’) from the tenancy.

Accordingly, at the end of contractual term, where the rights apply, a tenancy will continue on the same terms and at the same rent until terminated in accordance with the 1954 Act either by the landlord or the tenant properly serving notice in the correct form.

If a tenancy benefiting from security of tenure is terminated by the landlord then the tenant will have the right to apply to court for a new lease and there are only limited grounds upon which the landlord can successfully oppose the renewal of a lease. In certain circumstances (that is, generally where the tenant is not in default) a business tenant may be entitled to receive compensation from the landlord upon being required to vacate business premises as a result.

Such rights will be particularly important to a tenant who is intending to make a significant investment in the premises occupied, or wanting more certainty, and can be acquired either on the grant of a new tenancy or the acquisition of an existing tenancy.

A tenant should not normally expect to pay more for security of tenure (for example, by way of higher rent); however, in practice that will be a matter of negotiation.

A tenant occupying under a tenancy benefiting from security of tenure must be aware that, generally speaking, they cannot simply walk away from the tenancy at the end of the contractual term. If the tenancy has not been brought to an end by proper service of the correct notice then it will continue as will the tenant’s liability under it – for example, for payment of rent and business rates, and for repair of the premises.

10 TIPS for growing your online business in 2017

01. Ensure your website is responsive and mobile-friendly More customers than ever before are shopping with a tablet/ smartphone and are looking for the best user experience possible – your website should be up to the mark. Being mobile-friendly is seen by Google as a strong factor when ranking a website.

02. Try new things on social media Many garment decorators have a sporadic social media presence, posting pictures of the odd interesting job only when it’s quiet. Embrace social media and post interesting pictures, blogs and articles, run competitions and engage with current or new customers. Think outside the box to give someone a reason to follow you.

03. Write about your business When a customer lands on your website, don’t let them think it’s just another print or embroidery site: make it stand out with some interesting content. Write about yourself and your business: its story, core values and USPs. A website with a bit of personality and lots of interesting content – regularly updated – will boost your search engine rankings too.

04. Blog away Often underrated, a blog is a great way to share your knowledge, expertise and passion for print and embroidery. Writing a blog is also great for social media, with interesting, thought-provoking pieces likely to get followers clicking through to your website. It’s a simple yet effective way to increase traffic.

05. Harness the power of LinkedIn If you aren’t on LinkedIn then sign up: connect with like-minded people and join the discussions; connect with customers and search for potential new customers. Grow a following and promote your business and its qualities, and watch the recommendations and referrals grow.

06. Provide your customers with a simple-to-use site Customers have more options than ever when browsing online so your website needs to be easy to navigate. A complicated website packed full of jargon and with an unstructured customer shopping journey will scare shoppers away. Even a brochure website needs to be clear and concise, and display all the relevant information to help customers make an informed decision.

07. Set up the basics to get seen on Google Google My Business is a simple tool that lets businesses share their information with customers when they’re searching for local suppliers. It’s quick and easy to verify your website with Google, so do it now.

08. Increase sales with email marketing Improve the way you communicate and stay in touch with customers by using email campaigns – a simple way to increase customer retention. Affordable packages with easy-to-use design tools are available.

09. Create a secure checkout for your customer In November’s article we advised on how to take payments online securely and successfully, and what to watch out for. Create a streamlined, system for buying online so as to minimise email exchanges and telephone calls and to improve online productivity.

10. Keep your product range concise and up to date Don’t scare customers away by confusing them with hundreds of garments that are hard to tell apart and are similarly priced. Make their buying experience as simple as possible.

If you have a business question for any of our experts, email it to: rachael@imagesmagazine.com