< PreviousHS2East Midlands Business Link www.eastmidlandsbusinesslink.co.uk20HMCTS has started to locate moreservices outside of the capital. Clientsare also much more flexible about howthey access their law firm’s servicesnow and the increasing range of remotecommunications make physically beingin the same city as their lawyer far lessimportant.”But that’s not how Tim Garratt fromInnes England sees it. He think the HS2debate is complex, and that it requiresus to think in a different way. He says: “Nottingham is currentlyundergoing a transformation ininfrastructure terms. The extension ofthe tramlines and the dualling of theA453, coupled with ring roadimprovements put us on the map for acity in a mess. But it is a short term painfor long term gain. HS2 has thepotential to do the same – but on amacro scale. Land take is larger and thepotential disruption more significant.And then there is the cost and thetimescale. The costs seem to befrighteningly high and the timescaleridiculously long! “On the face of it the project seems tohave an uphill struggle. But we mustthen consider the reality of rail travel.Our trains are reaching capacity and theworld is getting faster. The north needsa connection with London which is fats,clean and efficient. HS2 would do this.But we should also consider the otherconnections – a 20 minute journey toBirmingham? Less than an hour toLeeds? Finally we should thinkdefensively – if a train station went pastNottingham – we may well be left in aslow lane wilderness. On balance, weneed HS2 and we need it in Nottinghamand we need it soon.”The HS2 concept as it is propose inits revised form at least one cheer, butis that really enough, asks Andy Raynorof Shakespeares. He says: “We praise itas it represents the first majorgovernment investment in internalinfrastructure since motorways began60 years ago… and criticise it because itmisses both the point, and moreimportantly the East Midlands – at leastin phase one.“Look, this isn’t a competition, it hasto work for all. What rail links need, Eastand West Midlands, north and south, isnew rolling stock, great travelling Wi-Ficonnections and to be relieved offreight traffic.”Taylor agrees that there are otherpriorities. He adds: “Having previouslycommuted myself, key areas that needto be addressed include theaccessibility to Wi-Fi on trains, creatingthem into workplaces, the lengtheningof platforms and redressing the balancebetween first and second class seats -essentially a profitability issue for theoperator. Tackling these issues wouldmake a big difference to the quality ofrail travel and its contribution to EastMidlands economy.“Despite this country’s rail servicegetting a bad press at times, I believethat East Midlands Trains currentlyprovides an exceptionally good serviceand I think the company and NetworkRail should be focussing on incrementalimprovements that are both affordableand relatively simple to implement.”Seems that, for the time being atleast, the jury is still out on HS2 in theEast Midlands.THE BIG INTERVIEWwww.eastmidlandsbusinesslink.co.uk East Midlands Business Link 21How have you settled into your newrole? Have you encountered anythingyou weren't expecting?It’s been fast-paced and I’ve had toadapt quickly to the huge range of topics,but it has been hugely enjoyable so far.The mixture of work and experienceshas been fascinating – from meeting withHigh Value Opportunity rail buyers fromSingapore, to undertaking an interviewabout Brazil with local TV, to visitingIberia on an export visit.And there have been a number ofchallenges, from the rush to deliver endof year targets (that we met and for whichI must pay tribute to my predecessorPeter Hogarth), welcoming a new Ministerand communicating his new nationalstrategy , to dealing with key staffmoving on, and learning how overseasposts that span some 110 countrieswork in greater depth.What do you see as the fastestgrowing sectors in the EastMidlands?We know that power generatingmachinery, road vehicles, manufacturingequipment and machine parts are theregion’s biggest exports, accounting forabout 50 per cent of the East Midland’s£21bn exports in 2013.Digital communication continues tooffer a big opportunity for overseas trade.The UK is the second largest onlineexporter in the world and we want tomake sure that we are continuing to helppeople sell online by offering specificadvice. We are currently working on anew digital acceleration project which willgive businesses the support they need.We also provide a service called BizOpps.This tracks new business contracts beingoffered across the world and flags themto UK businesses. This will help us workwith any business that is either thinking ofexporting or that would like a little help toenter into more challenging markets, forexample Brazil or China.Why do you think UKTI is one of thevery few government departments tohave its budget increased?There has been some increase but ithas come with extremely high targets,putting us at the forefront of the challengeto achieve £1 trillion exports by 2020 andincreasing the number of exporters by100,000.With this emphasis on trading output,UKTI is recognised as having a crucialpart to play in delivering the growth,including one of our new priorities tosupport MSBs.It’s so important because exporting isvital to boost individual business growthand the economy. Our sister Department,UK Export Finance (UKEF), has also beengiven a vote on confidence recently asyou will have noticed in the Budget. UKEFnow have the ability to provide up to£3bn of export finance guarantees andinsurance to help businesses export. Thisis another example of the Government'scommitment to the agenda.Do you accept you have more to do totry and connect with SMEs in theregion?Our services are specifically geared tohelp SMEs and provide them with theresources they need to sell high qualityproducts and services in internationalmarkets.We have a good relationship with SMEsbut there is always more to do. We workwith 6,000 SMEs regionally, but there area further 8,000 we could work with.We are working with a range of partnersto access those companies – includingpublic and private sector, such as LocalEnterprise Partnerships, Chambers ,business representative bodies like theCBI and IOD, banks and solicitors toname a few. That’s what Export Week isabout – connecting with new businessesacross the region and encouraging themto export.A lot toplay forEast Midlands Business Link spoke to Ian Harrison, regionaldirector UK Trade & Investment (UKTI) East Midlands abouthow the region is faring overseas.Does the East Mids punch above itsweight as far as exports areconcerned?Yes we do. We have fared very wellover recent times, with latest HMRCstatistics confirming we have thesecond fastest growth in the countryand have had a record year with ourexports – moving from some £19bn in2012 to over £21bn in 2013, and for thefirst time in a number of years nowwe’re in the black. It’s a continuingpositive sign for the East Midlands, butwe shouldn't be complacent. There area number of opportunities out there -that is clear. Many of these are drivenby a rising middle class in countries likeChina and India as well as a number ofnew, large infrastructure projects allover the globe. We feel that there is stilla lot to play for.STAFF MATTERSEast Midlands Business Link www.eastmidlandsbusinesslink.co.uk22what is expected. This combined withemployees becoming more aware of theiremployment rights can hit a business hardboth financially and in terms of creating anegative image. The best way to respond to thesechanges is to minimise risk and to managea workforce properly. Disciplinary andgrievance procedures should exist and bereviewed to ensure that they arecompliant. An equal opportunities policywill help to reduce liability todiscrimination claims, which are oftenissued in addition to a claim for unfairdismissal. Policies should be clearlycommunicated to all staff and trainingshould be provided to ensure that thoseresponsible for addressing workplaceproblems are able to recognise an issueand deal with it swiftly before it quicklyescalates. Most importantly, an employershould seek legal advice before instigatingany process.I have noticed that during difficult market conditions,many businesses have been evaluating theirresources to ensure efficiency, cost effectivenessand productivity. This has lead to an analysis ofemployees, how they are remunerated and whatwork is being undertaken. The result has oftenbeen a redundancy process or the introduction ofa more rigorous campaign of performancereviews leading to disciplinary action and in somecircumstances, dismissal. There have been occasions where managerswith little or no training have been delegated theresponsibility of conducting these timeFrom 6th April, the maximum compensatory awardwill rise from the lower of £74,200 or 52 weeks’ pay tothe lower of £76,574 or 52 weeks’ pay. The maximumamount of a week’s pay for the purposes of calculatingthe basic award for an unfair dismissal claim and astatutory redundancy payment will also rise from £450 to£464. This will mean that the maximum statutoryredundancy payment for an eligible employee will risefrom £13,500 to £13,920.The changes were revised to reflect the Retail PriceIndex increase of 3.2 per cent for the year endingSeptember 2013. Where the retail price index is lower orhigher than the previous September, the Secretary ofState is obliged to change the limits by percentage of thedecrease or increase.Angela Shaw, employment solicitor at Lanshaws said:“This will be unwelcome news for employers, particularlyfor those still struggling with a difficult trading period. Itis a stark reminder for businesses to be vigilant whenaddressing workplace difficulties. In my experience,employers often have a genuine reason to terminateemployment but increase the risk of a claim at anemployment tribunal simply because of poormanagement and a lack of general understanding ofA very common problem is where theworkload is simply shifted to anotherperson, often not even in the samedepartment and who will lack thenecessary expertise, training and capacityto deal with the additional workloadImportant new employment law changes were introduced witheffect of 6th April 2014, warns Angela Shaw of Nottingham basedLanshaws Solicitors.Minimising riskSTAFF MATTERSwww.eastmidlandsbusinesslink.co.uk East Midlands Business Link 23managing anyone in this situation, should risk assess therole, monitor the situation carefully and check whetherthere is provision in the contract of employment toimplement such a change or whether it may give rise toa breach of contract claim. This situation could alsoresult in the employee commencing a long period of sickleave on grounds of work related stress which ultimatelymay result in a tribunal claim and the loss of a goodemployee. It is easy to understand how an employercould suddenly find itself subject to more than one claimfor unfair dismissal!”The priority for all businesses should be to take heedof these new changes, to minimise risk in the workplaceand to seek legal advice at an early stage.consuming but vitally important processes. This is oftenthe case with small to medium sized businesses wherethey lack the in house resources to employ someonespecifically for this function.” It is necessary to have a clear understanding of whatoptions are available before deciding on a particularcourse of action and what the implications are going tobe. What will happen to that work? Has it diminished oris it simply being delegated to someone else?“A very common problem is where the workload issimply shifted to another person, often not even in thesame department and who will lack the necessaryexpertise, training and capacity to deal with the additionalworkload. Employers should be wary of performanceTHE BIG INTERVIEWEast Midlands Business Link www.eastmidlandsbusinesslink.co.uk24Sam Metcalf talks to Invest in NottinghamClub interim chief executive Simon Gray abouthow Nottingham can sell itself to the UK andwider world, how he’s adapted from runninghis own business to helping others, and whathe’d like his legacy to Nottingham to be.Simon GrayInvest in NottinghamROUND TABLEwww.eastmidlandsbusinesslink.co.uk East Midlands Business Link 25Where you disappointed to see theRegional Development Agencies(RDAs) disappear?Thalej Vashista: I was. When EMDAfinished I was concerned that we weregoing to lose the people that had theskills to attract inward investment andfunding to the region. However, I lookaround this table today and I can seethree ex-EMDA people here.What I do believe is that inwardinvestment efforts are now disjointed;we’ve lost the gel between the threecities. We’ve got real regional knowledgein the East Midlands, and yet we’rebased around five major city hubsinstead of coming togetherStuart Senior: I do miss them in away. However, we still have greatstructures in place that we can getinvolved in. We get lots of work outLooking fora way inPanel:Linda Leehane, UKTIJason Feehilly, University ofNottinghamAndrew Springhall, BlusourceJens Mullak, INITIan Harrison, UKTISimon Gray, Invest inNottingham ClubJimmy Drew, Marketing DerbyThalej Vashista, Paragon LawStuart Senior, GleedsDavid Williams, GeldardsMatthew Smith, JLL25ROUND TABLEEast Midlands Business Link www.eastmidlandsbusinesslink.co.uk26immersing ourselves in the localbusiness community, and there remaina lot of opportunities that we can buildon.Andrew Springhall: At the time itdisappeared, a lot of people thought wewould miss out. That’s not necessarilybeen the case. However, I think we domiss certain parts of what EMDAbrought, such as its ability to pushinfrastructure projects through.Vashista: If it wasn’t for EMDA, doyou think the likes of Capital Oneand Experian would’ve come to theEast Midlands?Linda Leehane: I worked on theCapital One investment when I was withEMDA. We won against bids fromCardiff and Cork. So, you could say thatEMDA had something to do with theirdecision to come to Nottingham.Senior: I found the differencebetween certain RDAs quite marked.The north east version had a verycohesive approach to what was needed.Ian Harrison: I’d agree; in the northeast they have a long history of workingtogether.Senior: I think we have a culturalissue in the East Midlands. We need topitch ourselves collectively, rather thanas single cities.David Williams: We need to move onfrom EMDA. Short-term fixes don’twork, and it feels like the economywe’re living in is “real”.Matthew Smith: I think mistakes weremade at EMDA; it was often the victimof its self-imposed criteria and becamevery uncommercial in a low-valuemarket. There were missedopportunities.Jimmy Drew: There is collaborationbetween the three cities. At MIPIM, forexample, we worked very closely withDerbyshire County Council andNottingham City Council. Leicestercame and set up their stand oppositeours. We do realise that we have towork together to promote the region asa whole.Simon Gray: That sort of thing workswell at MIPIM. We worked well withJohn Forkin at Marketing Derby. I’msaying: let’s have been morecollaboration. It will have an economicimpact.Jens Mullak: When I talk to Germansabout England, most of the time theysee the country as London, Birminghamand Manchester. It’s up to the EastMidlands to get the focus away from theWest Midlands.Gray: When the RDAs disappearedthere was a period of downtime, andthe teams dispersed. It’s coming backtogether now, but investors find it veryconfusing. What we need to do is thinkabout the customer.Jason Feehilly: Global investors seecity councils as a marginal decisionwhen it comes to choosing where tolocate. They often decide which city ismost recognisable to them.Harrison: The reason to get rid ofEMDA was based around policy. Theresult has been a difficult set ofarrangements, and I’m not surprisedthere has been some competitionbetween East Midlands cities. However,it’s encouraging to see some dedicatedvehicles emerging.Williams: We have to deal with thereality. There is an element in the regionwhich never signed up to EMDA. I thinkthe Local Enterprise Partnerships have avery difficult job, as there are parts ofthe region which just doesn’t want to beunified.Leehane: The East Midlands doesn’thave a definite image, and it needs one.Williams: The private sector didn’tfeel like it was included in any decision-making in the time of EMDA. The LEPhas got to the private-sector led else itwill get dragged into the same problemareas that EMDA suffered from.Senior: An as area, we don’t seem toknow what we want to be. There’s noconfidence. We don’t come together.What can make that happen?Springhall: We’ve got the bestopportunity to do that about to happen.HS2 will quickly park arguments aboutDerby or Nottingham - Toton is half waybetween. We should be groupingtogether to force the HS2 argumentforward until HS2 arrives.Senior: HS2 should be builttomorrow.Harrison: The HS2 board had aROUND TABLEwww.eastmidlandsbusinesslink.co.uk East Midlands Business Link 27meeting at the East MidlandsConference Centre a few weeks ago,and I was pleased to say that the regionwas cohesive on the issue. Thechallenge now is maintain momentum.Have the LEPs fulfilled their brief,or are they pretty much toothless?Harrison: It varies hugely across thepiste. They tend to have to work withintheir means.Williams: I’m not sure what weshould expect. D2N2 is one person, andone person can’t change a region alone.LEPs need more resources to make anyreal impact.Smith: I think it’s about asking wherethe resource is going. There is a highlevel of private sector involvement inthe LEPs and this is a good thing. It’scertainly better than piling money intoregeneration projects that nobodywants and that won’t work. Thereshould be a focus on location andwhere businesses want to be. Asagents, we can go out and sell theregion, but what do we have on offer?We just don’t have the stock. We alsohave to facilitate the growth on thecompanies already in the city. EY isloading up the van next door, andKPMG has only extended its lease for 2-3 years.Nottingham could do well. There arehigh levels of youth unemployment inthe city and we need to attract the bigemployers to move here to providejobs. Springhall: We should be pullingtogether now – and talking our regionup. We should pick the HS2 message upand take it around the world.Senior: A lot can happen in 20 years,though. For me it’s a tenant issue.There’s been no throughput in the lastten years.Drew: We have had the same issuesin Derby. Pride Park has sucked thesuits out of the city centre.How can we solve these problems?Feehilly: We need to pool ournetworks.Springhall: We also need to anengaged public sector. The City Councilis the most engaged it’s been in yearsand that’s a welcome change.Gray: It’s about collaboration – butcollaboration at speed. We can’t affordto move slowly as the economy grows.The Budget andgood news forexportersThe government says that it wants UK exports to reach £1 trillionby 2020 and for 100,000 more UK companies to be exporting bythe same date, says David Griffiths, managing director of SterlingCapital Reserve.Ambitious targets but these will be helped with the amount of governmentcredit available to sup-port overseas sales doubling to £3bn. The rate chargedon that credit has also been cut. There was also an increase on loans available for foreign buyers to purchasegoods and services from UK exporters, increasing from £1.5bn to £3bn.It is encouraging stuff from the government but one wonders how many firmsare even aware of these schemes. Exports have grown recently but last yearthose sold to the traditional BRIC countries apparently amounted to less than ourexports to Belgium so more must be done.Indeed, The Office for Budget Responsibility expects exports to grow by just2.6 per cent this year and by an annual average of less than 5 per cent from nextyear, which makes his targets look somewhat ambitious. However, it is a step inthe right direction. Awareness and a similar ambition amongst businesses andtheir financial advisers will be crucial.In generalAs brokers, we source funding from various sources including invoice finance,single debt finance, stock finance and increasingly peer to peer lending.However, in many cases SMEs can provide their own solution (or at least acontribution) to their own problem.Working Capital is the cheapest source of finance available to SMEs as it isfreely available; the issue is managing it in the most efficient way. The trick is tominimise stock and debtors and to maximise creditors and cash. However, thisis easier said than done.Stock holding is an art, holding too much is inefficient and akin to putting“cash in the attic”, but holding too little is dangerous, as inability to supplyorders will lose customers, profit and cash.However, how many SMEs have stock that “may sell one day”? Most areguilty. What they should be doing is liquidating obsolete stocks, sometimes evenat a loss, as cash is king.Debtors need to be minimised through efficient credit control. Ensure that alldocumentation is supplied with invoice - SMEs can’t afford to give customersany excuse to delay payment. Delaying payments is part of the other guy’sworking capital equation, don’t give them any reason to do so.The equation is simple: you can increase cash by reducing stock and debtorsor increasing creditors. FUNDINGEast Midlands Business Linkwww.eastmidlandsbusinesslink.co.uk28FUNDINGwww.eastmidlandsbusinesslink.co.uk East Midlands Business Link 29Bank lending:perception versus realityMost banks are now saying that they have the liquidity and appetite to lend.Yet many businesses still find it challenging to access finance. What is thereality? Gerry McPake, senior banking manager at Allied Irish Bank inNottingham has the answers.I can say unequivocally that Allied Irish Bank (GB) has thecapacity and most importantly, the desire to lend. We aredemonstrating that fact by actively supporting the growth ofbusinesses across our UK network through medium or long termcapital finance, including via our East Midlands office inNottingham. We work closely with businesses to fully understand the proposalwe are being asked to support. Together, we discuss and examinebalance sheets and cash flows, we look at the quality of themanagement team, we review past performance and forecasts, wechallenge those forecasts, we consider the borrowers’ experienceand security, we look at succession plans and we discuss "what if"scenarios. In some circumstances, proposals we look at may not be right forus or the customer in the long term. However, other fundingoptions may still be available and we will take businesses throughthese to make sure they are looking at the appropriate options tosuit their needs. At Allied Irish Bank (GB), the message in private is 100 per centconsistent with what we say in public. We are ready and willing tosupport sound business proposals.Next >