< Previous East Midlands Business Link www.eastmidlandsbusinesslink.co.uk G F TOMLINSON R egional contractor G F Tomlinson has been appointed as an approved partner on the new £750m Regional Construction framework by SCAPE, which is one of the UK’s leading public sector procurement authorities. The four-year framework will invest in the public sector across the Midlands and East of England, helping local authorities and organisations deliver ambitious, community-focused construction projects. Following a competitive selection process, the Midlands-based construction company is one of eight contractors chosen to deliver up to £750m of new investment for the public sector, via SCAPE’s Regional Construction framework, with G F Tomlinson being appointed to undertake projects up to £7.5m across Nottinghamshire, Lincolnshire and Rutland. G F Tomlinson’s 15-year relationship with SCAPE has seen the company deliver more than 500 projects valued at £240m on previous iterations of the framework. Through this ongoing collaboration the company has also provided communities with positive social, economic and environmental impacts including 82% of local spend and 89% of local labour achieved within 40 miles of each project, and 98% construction waste recycled and diverted from landfill. The construction firm recently completed two projects, which were procured through public sector procurement authority, SCAPE and its Regional Construction framework, including a new £2m waste and recycling centre at Tattershall in Lincolnshire and refurbishment work on Staffordshire’s historic Tunstall Town Hall – giving the building a new lease of life as it reopens its doors this autumn. With a broader value range of up to £7.5m on the new framework, more public sector projects can benefit from the range of services provided by G F Tomlinson, including early input on design development, risk management, cost certainty, construction delivery and post completion support. G F Tomlinson has a strong focus on sustainability and social value and the SCAPE framework allows for the delivery of four key areas of investment, including: employment and training, sustainability and environmental protection and support. In particular, inspiring individuals into the construction industry from local schools, apprenticeship opportunities, commitment to local spend and the use of local labour and supply chains and helping public sector clients achieve their decarbonization targets. Speaking on the 15-year relationship with SCAPE, managing director at G F Tomlinson Chris Flint said: “We’re delighted to have been appointed to the framework, continuing our long association and success with SCAPE. The framework allows us to continually focus on delivering high quality, value for money projects across the Midlands, ensuring social and sustainable values are considered to support the local communities. “In addition to providing communities with the prospect of job opportunities and apprenticeships, the framework has agreed to a ‘net-zero ready’ lifecycle, assisting communities in achieving their net-zero ambitions as an effective response to the current climate emergency. “We are extremely proud of the work already undertaken within SCAPE’s frameworks during our partnership and cannot wait to continue to raise the bar and deliver tangible benefits to our clients and the wider community.” Theatre Royal Nottingham 20-21.qxp_Layout 1 06/09/2022 10:22 Page 1Tower Gardens Pavilion, Skegness www.eastmidlandsbusinesslink.co.uk East Midlands Business Link G F TOMLINSON John Simons, group procurement director at SCAPE, said: “The next four years represent a pivotal time for public sector construction across the Midlands and East of England to deliver infrastructure that empowers local communities and generates regional economic growth. “After receiving positive feedback from clients, we’ve enhanced the framework to provide our public sector colleagues with the tools to not only deliver value-driven infrastructure in their areas but support their journey toward a net zero built environment. “Aligned with SCAPE’s 15-year heritage of empowering local authorities to achieve their infrastructure objectives, the direct award framework is designed to achieve value for money, drive sustainability and deliver a local economic impact on every project.” Mark Robinson, group chief executive at SCAPE, said: “As we continue to play our part in delivering infrastructure projects across the region that are more sustainable and strengthen local communities, our new framework will help our clients meet their goals and allow local contractors to build long-term relationships to grow their business. “The addition of a new lifecycle contract form as part of the framework’s ‘net zero ready’ offering is testament to SCAPE’s commitment to supporting clients with energy conservation and the operational efficiency and performance of their assets. “The new framework will act as a vehicle for contractors to champion greener infrastructure and upskill their teams to be able to deliver on the sustainability ambitions across the Midlands and East of England.” With offices in Derby, Newark and Birmingham, The Tomlinson Group, which was formed in 1892 by George F Tomlinson, works across the Midlands and Central England dealing with a multitude of different types and sizes of projects up to major multi-million- pound developments. From its early beginnings the Tomlinson Group has grown into a leading, well- respected construction firm with an enviable reputation. For more information on G F Tomlinson visit www.gftomlinson.co.uk The new Tattershall Household Waste and Recycling Centre Tunstall Town Hall, Staffordshire 20-21.qxp_Layout 1 06/09/2022 10:22 Page 2 East Midlands Business Link www.eastmidlandsbusinesslink.co.uk FOOD & DRINK INDUSTRY I t’s hard to think of an industry that has been pulled around more in recent years than the food and drink industry, and maybe only the pharmaceutical sector has faced worse. The lockdown played havoc on distribution centres and manufacturing plants, forcing companies to adapt in awkward and difficult ways. Then Brexit struck, robbing many food producers of foreign labour that filled in at key times of the year. The employment market has since been problematic, granting more power to employees and leaving many companies shorthanded at a time when they were supposed to be recovering from the pandemic. The food and drink industry will never be one that truly dies out, and it has proven the most resilient of all in the face of crises like the credit crunch, the pandemic and beyond. Now, however, the cost of living threatens to have a new impact on an industry that has already been beleaguered, and while it will not be the end of all things, it will mean yet more adaptation. As people struggle to make ends meet and energy costs (and inflation) rise, difficult choices surrounding food are being made by consumers in the region and beyond. This is problematic for manufacturers of high-quality and high-price food, while conversely being a major boon for those that produce own-brand or budget options. It might be too reactionary for companies to look at price-dropping, especially if their brand or related costs make such untenable, but supermarkets are ever responsive to the needs of consumers, and it seems likely that shelves will begin to stock lower-priced goods in an effort to deal with the shortfall of disposable income. This will force yet more adaptation, and the only obvious ways to go are to make goods cheaper or sell them in more places through exporting. The impacts of Brexit are keeping the UK in the spotlight for the state of its Volatile markets The food and drink industry faces fresh pressure from the cost of living, driving consumer buying behaviour toward cheaper, long-lasting foods. With the UK economy struggling, it might be time to look toward exports. 24 Á 22-25.qxp_Layout 1 06/09/2022 10:24 Page 1www.eastmidlandsbusinesslink.co.uk East Midlands Business Link FOOD & DRINK INDUSTRY © stock.adobe.com/HASPhotos 22-25.qxp_Layout 1 06/09/2022 10:24 Page 2 East Midlands Business Link www.eastmidlandsbusinesslink.co.uk FOOD & DRINK INDUSTRY food and drink imports and exports; the country’s Government is striving to take advantage of the opportunities created by the UK’s independent trade policy and ability to establish new trade deals around the globe. New research from the Food and Drink Federation (FDF) shows positive progress, with exports and imports of food and drink with non-EU countries skyrocketing above pre- pandemic levels for the first time. The Trade Snapshot, examining developments in the first quarter of 2022, indicates that food and drink imports have recovered well, and are over 13% higher than in 2019, while exports to major markets including the USA, Australia, Canada, Japan, and the UAE exceeded pre-pandemic levels. Indeed exports to non-EU markets have reached a record £2.3 billion, the highest value recorded in Q1, whereas imports from non-EU markets have witnessed robust growth, rising 16% since 2021 to £4.3 billion. Food and drink exports to the EU however are still greater at £3 billion, though this is below pre-Brexit and pre- pandemic figures, yet up on the first quarter of 2021. Imports from the EU meanwhile for the start of 2022 sat at £9.2 billion. Though the US remains the country’s largest non-EU partner, the FDF highlights Canada as a pivotal ally for the UK. As a key source of ingredients used by UK manufacturers, imports from Canada rose 5% while exports to the country are flourishing, up 26% on pre- pandemic levels. India too looks to have increasing importance, with exports to India up more than 25% compared to pre-pandemic levels. The country also remains a large import partner - particularly for agricultural goods - accounting for £172.5 million. 22-25.qxp_Layout 1 06/09/2022 10:24 Page 3www.eastmidlandsbusinesslink.co.uk East Midlands Business Link FOOD & DRINK INDUSTRY © stock.adobe.com/Rawf8 Negotiations are currently underway with both Canada and India over ambitious free trade deals and present significant export opportunities, with demand soaring in India for example in the health, organic, fortified and ready-to-eat packaged food sector, while a rapidly growing middle class forms prime possibilities for UK exporters. When it comes to the other option – that of reducing costs – it might be even trickier. Food manufacturers have already been squeezing everything they can out of their companies since before the pandemic and during it, and this was supposed to be their recovery period. While technology continues to perform well in the industry, and trade shows are this very month highlighting the latest innovations in automated production lines at the PPMA in Birmingham, the capital costs of these new machines may leave many feeling out of pocket. While it is true and understood by many that you need to invest to become more efficient, the industry has faced a barrage of difficult economic events in the last half a decade, and there is only so much adaptation any one company can afford to enact. Seeking help with exports may be the only real solution for many who cannot market their goods at “cost of living” prices here in the UK. The Department for International Trade holds many seminars and events to help instruct manufacturers on how to export their goods overseas, including advice on picking a market and how to break into it. Far be it for a regional magazine such as us to advocate marketing outside the region, but it may well be what is best for food and drink companies in the area. The UK is just too volatile a market right now. 22-25.qxp_Layout 1 06/09/2022 10:24 Page 4 East Midlands Business Link www.eastmidlandsbusinesslink.co.uk TAX Time to focus your energy on managing the cost of living… James Pinchbeck, partner at Streets Chartered Accountants, presents useful advice as businesses battle the cost of living crisis. F ew, if any of us, will have experienced the current economic conditions that have led to unprecedented cost of living hikes and inflation at a 40 year high, with further increases more than likely. The skyrocketing increases in energy prices, leading to eyewatering increases to both domestic and business energy costs, are not the only contributor to the current situation and rising prices for goods and services. The conflict in Ukraine, along with labour shortages, wage pressures, frustrated supply chains and growing food scarcity with the prolonged hot weather and lack of rain leading to crop shortages are all contributing to rising costs. Whilst businesses have shown resilience in managing the impact of the pandemic over the last couple of years, they now find new challenges ahead. Many businesses are still reporting strong order books and customer demand still seems strong. An economic downturn is though predicted, not least by the Bank of England for next year, as consumers and businesses tighten their reins and seek to manage the situation. Getting ahead of the curve is invariably the trick for any business seeking to deal with the situation. There is a real need for business leaders and owners to assess how their organisation is and might be affected and to look to put plans in place to manage the same. There is a well-used adage that cash is king, certainly a focus on your cashflow worthwhile, as the loss of one could have an impact on your own business. Whilst a focus on finance is key, there are a number of other aspects that you may need to take into account. Like you, your staff are no doubt looking at how they manage the situation, many will be concerned about how they are going to cope. This could lead to increased anxiety and health issues and potentially reduced productivity, even absenteeism. Being aware of this and looking to help where you can no doubt will be beneficial to one and all. Employers are also likely to see pressure on pay, as employees seek pay rises, along with potentially staff leaving for higher paid jobs. Unfortunately, like economic down turns, the current situation is likely to give rise to increased fraud, theft and cyber- attacks. It is therefore important that proper and robust systems and processes are in place for early detection, management and avoidance. To manage the situation, businesses really need to ensure that they have timely and accurate financial information. Certainly, with the development of online/cloud-based accounting applications it is possible to have such information, even in real time. However, there might be a need to ensure the information provided is what you need and that action is taken as appropriate, rather than ignored or kicked down the road. What is measured can and tends to be managed. for the year ahead is a great place to start. Reviewing forecasts and considering the demands on cash, along with perhaps changes to the timing of income and expenditure will be key. It may also be beneficial to consider your availability of working capital, perhaps the need to defer capital spend and/or review the facilities you have in place to weather the storm. It might be time to review your funding model, to see if your cost of finance could be reduced and/or additional facilities put in place. Certainly, if you don’t already do it, monitoring of cash within the business needs be a timely, perhaps daily activity, along with the management of debtors and creditors. The cost-of-living crisis is undoubtedly having a significant impact on margins, with input costs seemingly changing on a daily basis. As a result, greater attention should be given to managing margins with regular reviews helping as much as possible to ensure margins are maintained. There is a need to keep a keen eye on pricing, especially for those quoting or contracting for work. It may be difficult to honour future prices, so do ensure your terms allow for management of any increase in costs. With some indication that business failures and insolvencies are on the upward trajectory and the risk of bad debts are on the increase, more close management of your aged debtors and rigorous debt collection must be on the cards. A focus on suppliers too could be 26-27.qxp_Layout 1 06/09/2022 10:25 Page 126-27.qxp_Layout 1 06/09/2022 10:25 Page 2 East Midlands Business Link www.eastmidlandsbusinesslink.co.uk FINANCE © stock.adobe.com/BillionPhotos.com lifelines lifelines Financial 28-30.qxp_Layout 1 06/09/2022 10:26 Page 1www.eastmidlandsbusinesslink.co.uk East Midlands Business Link FINANCE I t’s a simple process – a seller provides an invoice to the buyer of goods or services and that buyer then pays within the specified time. Yet for thousands of businesses, this seemingly simple transaction is scuppered by late payments. According to research undertaken by Xero, the cloud- based accounting software platform for SMEs, nearly fifty-two per cent of all invoices issued by small businesses are paid late. Perhaps unsurprisingly given the economic uncertainty of late, fifty-one per cent of small business owners said the problem of overdue payments has gotten worse over the past three years. Figures from the Federation of Small Businesses, meanwhile, found that late payments cost the economy £2.5 billion every year. This might become worse in the coming months thanks in no small part to the state of the economy, rising inflation and an overall worsening of many company’s cash flow positions. Invoice financing is the simplest means of releasing cash tied up in a business’s outstanding invoice. In short, it sees a business sell its invoices to a third party who will advance some of the funds it is worth up front for a cut. Thousands of businesses rely on this kind of financing to maintain a healthy cash position, whilst others use it to take back control of cashflow issues stemming from late and unpaid invoices. Perhaps the biggest draw is that businesses can be paid most of an invoice within forty- eight hours instead of the typical thirty-to- ninety-day period. As with all forms of financing, however, there are things to consider – namely the kind of invoice finance a company requires. From invoice discounting to spot factor, there’s different options, so finding the right one is key. It’s also important to look at individual providers themselves, as some will insist on managing credit control themselves which could, understandably, alienate some customers. Combined with small business loans, invoice financing can have a powerful effect and literally keep businesses trading. Invoice financing is far from the only solution businesses can utilise to maintain cashflow. Asset-based finance, for example, is a specialised method of providing companies with working capital and term loans that use accounts receivable, inventory, machinery, equipment and real estate as capital – essentially, any loan to a company is secured by one or more of that company’s assets. This option is commonly used to pay for expenses when there are gaps in a company’s cashflow, but it is also frequently used for start-up financing as well as refinancing existing loans, financing growth, mergers and acquisitions, as well as management buy-outs and management but-ins (more on those later). Although it’s not suited to meet every business requirement, it can prove useful for those that have stretched their credit limits with vendors and reached lending capacity at the bank. Private equity, on the other hand, is where investors provide long-term equity capital investment in a company in return for either share, a percentage stake in the business and, in some cases, a seat on the board. The draw for businesses is that private equity can be used to finance MBOs, or to provide equity capital to support growth plans. Although many businesses might be loath to dilute their ownership, private equity does offer a good option of raising capital for businesses that aren’t ready to list on the stock exchange. For those looking for capital quickly, it’s important to bear in mind that securing private equity is often a time-consuming process and securing funds isn’t always guaranteed. Another form of private finance is an angel investor – a high net worth individual The state of the economy, rising inflation and the cost of living have all made payment of bills tricky, which is expected to cause a culture of late or unpaid invoices. We look at the options available to businesses in this situation. 30 Á 28-30.qxp_Layout 1 06/09/2022 10:26 Page 2Next >