Here’s what you need to know:

What is Making Tax Digital?

Making Tax Digital is all about making tax administration more effective, more efficient and easier for taxpayers, through the implementation of a fully digital tax system.

The roll-out of the initiative has already begun. Every small business owner and individual taxpayer now has access to a digital account that they can use to check their records and manage their details with HMRC.¹

Further changes are planned in the coming months and years; you can see a breakdown of the roll-out and timescales below. Software providers are actively engaging with HMRC to help shape this process and simplify the shift for small businesses.

Making Tax Digital is expected to be fully implemented by 2020. By this time you should see the following major changes to the way you manage and report your business taxes:

• Through your digital account you’ll be presented with a complete picture of your business’s tax affairs and you’ll be able to manage all of your liabilities at the same time, in the same place.
• HMRC will collect and process information affecting tax in as close to real time as possible. This should prevent any tax due or repayments owed from building up.
• You’ll no longer have to wait until the end of the tax year to know how much tax you have to pay.

Who does Making Tax Digital apply to?

The changes outlined in the Making Tax Digital initiative will apply to a wide range of taxpayers, including most businesses, self-employed people and landlords, as well as individual taxpayers. However, HMRC has suggested that the initiative won’t apply to “the small minority who genuinely cannot use digital tools”, or to small businesses with an annual income below a proposed threshold of £10,000.²

This threshold would be based on the firm’s income from the previous year.

The benefits of Making Tax Digital

• Know where you stand – with a full picture of your business’s tax affairs in your digital account.
• Save time – by having access to all your business’s tax info in a single place.
• Save hassle – by managing all your business tax affairs online.
• Plan and budget more effectively – with a real-time calculation of how much tax you owe.

What does Making Tax Digital mean for you?

A new way of reporting information to HMRC

The move to a more digital tax system should come as welcome news to the many taxpayers who already choose to report much of their information to HMRC online.

… are currently submitted online

Source: ‘Making Tax Digital’, HM Revenue and Customs 2015 (accessed 11 May 2016).

The shift to digital should also help to iron out some of the issues that can make the current method of reporting information to HMRC frustrating for business owners.
Specifically, Making Tax Digital promises to end ‘bureaucratic form-filling’ and to ‘remove the risk of missed deadlines and unnecessary penalties’.

The end of the tax return

One of the biggest implications for small business owners is the eradication of the annual tax return. By 2020 most businesses, self-employed people and landlords will instead be required to keep track of their tax affairs digitally and to update HMRC at least quarterly via their digital tax accounts, or more often if they’d prefer. HMRC has said that this doesn’t mean you’ll have to complete a full tax return four times a year; you’ll simply need to provide more regular updates online.³

The introduction of a ‘real time’ tax system means that instead of reporting information on tax returns and paying liabilities long after the end of the tax year, you will be able to see a real-time view of your business tax affairs and liabilities through your digital accounts. This should make it easier to understand how much tax you owe and to budget accordingly.

What next?

The upshot of all these changes is that, if Making Tax Digital applies to you, you’ll be required to use digital tools, such as software or apps, to keep records of your income and expenditure.

HMRC has stated that it won’t provide its own software, but will ensure that basic apps and software products are available. However, many businesses and their accountants will choose to use more comprehensive commercial online software.

These tools use the data from your day-to-day business activity to build an accurate picture of your business’s tax data, highlighting any possible errors and offering prompts for information that might otherwise be overlooked. Once your software has compiled the relevant data, you or your accountant will then submit it directly to HMRC, either via a computer or a smartphone.

We will be happy to talk through the options with you and explain how they plan to work with you as Making Tax Digital is rolled out.

¹ (More information is available at https://www.gov.uk/personal-tax-account.)

² Making Tax Digital – Bringing business tax into the digital age, HM Revenue and Customs accessed 15 August 2016)

³ ‘Making Tax Digital: Myth-Buster’, HM Revenue and Customs (accessed 12 July 2016)

Nigel is a sales and marketing consultant, speaker and author. He has been helping several thousand enterprises to improve their sales and marketing results over the last 25 years.

Here Nigel shares with us his 10 step plan to increasing referrals for your business.

1.  Set specific targets. For example: three referrals a week. If you set targets for other parts of your business, why not set targets for referrals?

2.  Start a chain reaction. If you want more referrals – give more referrals. In Deepak Chopra’s book, ‘The Seven Spiritual Laws of Success’ (Bantam Press), he talks about the Law of Giving: “The universe operates through dynamic exchange…giving and receiving are different aspects of the flow of energy….and in our willingness to give that which we seek, we keep the abundance of the universe circulating in our lives.”

3.  Expand the ‘Reciprocity Factor’. Don’t make just one recommendation: make three.
This is only fair, isn’t it? After all, in business, you are not supposed to single source. Typically, companies get three quotes. You are being more helpful, by providing three options. On the one hand, you will be seen as impartial. On the other hand, you have tripled the ‘Reciprocity Factor’. By the way, where possible, ensure that you tell each supplier that you have recommended them.

4.  Mention to new customers that you will be asking them for referrals, as you get X% of your business by word of mouth. Also tell them that you will earn this by providing an outstanding service to them.

5.  Decide the precise words that you will use when you ask for a referral. Then write the words down. If you ask for referrals in person, you may get nervous – so the answer is to practice saying the words out loud. For example: “Tell me, who else do you know who might like to hear about us? We would like to send them a special introductory offer.” Alternatively, you can ask via an email / via your website.

6.  If you work in a team, train your colleagues in the ‘Art of Referrals’. Discuss referrals in team meetings, in order to remind them of the importance of this area.

7.  Thank your ‘Referrers’ (also known as advocates) personally. A nice idea is to send them a hand written ‘thank you’ note. It may also be appropriate to send them a gift.

8.  Keep records. In your CRM (Customer Relationship Management system), include a ‘flag’ for advocates. If they have done it once – they are likely to do it again.

9.  Make asking for referrals part of the way that you do business. One way of reminding people is within outbound emails, within the signature area.

10. Measure how many referrals you get each month, each quarter and each year. Remember that “What gets measured, gets done”.

If you have any sales, marketing or internet marketing questions, please ask via: www.marketingcompass.co.uk

Published courtesy of Nigel Temple

Unfortunately, few companies use this approach. Instead, prices are usually set using “that’s the way we always do it” processes such as marking-up costs, matching competitors, hallway discussions, and back-of-the-envelope calculations.

Sound familiar? While easy to compute, these methods don’t incorporate the most important component of setting a price — an understanding of how much customers will pay. As a result, these prices have no correlation to what the market will bear. This leads to lost profits.

So how do you find out how much your customers will pay? It’s simple: Ask them.

Of course, you can’t ask customers directly how much they are willing to pay — they’ll likely shade the truth (by giving a lower price) to their benefit. That said, there are a variety of ways to better understand how your customers think about your price. Interview customers, seeking to identify “areas of disconnect” — profit opportunities — where customers view pricing differently than management.

Here are the “secrets”  to better understand how customers think about pricing:

First, position the interview as a customer satisfaction survey. Your goal is to understand what customers like or value about your product or service and gain insights that will better serve them in the future. Customers appreciate being asked how they can be better served and often become chatty.

Next, ask a series of general satisfaction questions and be sure to include the following pricing-related questions:

1. What rival products did they consider purchasing? If customers tell you they do not bother to look at other products, this is a clear signal of an opportunity to raise price. Alternatively, those who consider several alternatives are likely to be more price-sensitive. This question is the start of creating a pricing-related customer segmentation — identifying characteristics of customers who care about price and those who don’t. In a B2B environment where prices are individually negotiated, this segmentation is critical to determining the right price for each customer.

2. What do they think about your price: too high or too low? Don’t probe too much — simply ask and listen. Some interviewees will discuss at great length while others will clam up. Take what you can get on this question and move on.

3. Ask what other features they would like to be added to the product. These insights will help companies better understand what customers value — and what they’re willing to pay a premium for. This can lead to innovation: new add-on offerings as well as good-better-best versions.

4. Ask what they like and don’t like about your pricing strategy. This open-ended question provides interviewees an opportunity to discuss pricing.

5. Ask if they like the way they purchase your products or if there are other ways they would prefer to buy your product. Most companies sell products using à la carte pricing — pay per transaction. But there are many other innovative pricing techniques that can be used to sell a product (e.g., two-part, all-you-can-eat, guaranteed future price, success fee, rental, lease, etc.). If customers prefer a different method of setting prices, be open to meeting their needs.

Answers to these five basic questions lay the foundation for new profit and growth pricing initiatives.

So what do you think? Does your company charge what the market will bear? Are you wary of asking customers pricing-related questions? What other questions would you ask?

The idea has germinated and some steps have been taken, you’re confident that your business idea has enough shape to be shown to a few customers and friends. Maybe this is day five, or maybe it’s month five. At any rate, you are now ready to take your work outside of the safe confines of your office.

So, what are you going to tell these potential customers? Please, don’t just give them the demo and “see what happens next.” Your meeting has to have a point.

You give it a point by figuring out who you are. View it through this lens: Is your product a painkiller or a vitamin? The differences are critical to establishing your baseline messaging. First meetings, like first impressions, can set a critical tone going forward.

The Painkiller

A painkiller is a product or service that solves a business problem. Painkiller discussions, then, tend to look back. They start with probing questions, including:

• Do you have the pain?
• How big is the pain?
• Do you want to lessen the pain?
• What have you done to address this pain in the past?
• How much have you spent on pain relief?

Your entire talk track needs to be about producing answers to these questions. Why? Because if you don’t ask the questions in some form, your potential customers might not even understand that they have a problem. And that makes you unnecessary. If your customers don’t recognise the pain and want to make it go away, a demo of your wonderfully conceived solution will kill your meeting.

The Vitamin

A vitamin is a product or service that juices some segment of a customer’s business. So vitamin discussions are more of a look forward, and the relevant questions could be:

• Do you have enough leads for your campaign?
• Is your website converting enough visitors?
• Is your management team communicating effectively?
• Are you leveraging your assets across key selling channels?

Vitamins inspire you to dream of better days. They are innately positive; they send you down “what if” talk tracks.

That’s fun, but it has a danger of its own: A vitamin is more a want-to-have than a need-to-have. And it can be hard to sell something that a buyer merely wants. That’s why your questions need to be designed to reveal everything possible about your potential customer’s strategic goals. Ultimately, it will always come down to the question of whether your solution fits their needs.

So, what are you, a painkiller or a vitamin?

This warning is not intended to cause you panic but we cannot over-stress the importance of taking these steps immediately. This is because the UK’s National Crime Agency (NCA) has taken temporary control of the communications used to connect with infected computers, but expects only a very limited window of opportunity to ensure you are protected.
There is a set of links at the bottom of this page to tools that will check your computer for the presence of this malware. If you do nothing else. please use one of these tools immediately.

The threat
Cyber criminals are constantly devising new types of malware to commit financial theft, fraud, identity theft and other crimes against ordinary people. The proceeds of their crime are also used to fund further organised crime. This latest threat is particularly insidious as it uses two different types of malware to infect your computer in order to commit these crimes:

1. A virus known as Gameover Zeus, GOZeus, or P2PZeus
This is a type of aggressive malware which infects your computer so that it can effectively be ‘taken over’ by the criminals. It can be used for a number of different criminal activities such as viewing your files, monitoring your bank accounts, sending emails in your name and even using your webcam to physically spy on you.

2. Ransomware known as CryptoLocker
CryptoLocker is a virus which criminals use to prevent you opening any files – effectively locking down your PC – before issuing you with a ransom demand. If you pay the ransom, there is no guarantee that it will be unlocked. Once your computer is locked, it is effectively rendered useless as you cannot access your email, files, photos, music or bookmarks.

How computers get infected
You probably receive many emails claiming to be from your or another bank, a government body or other official source, urging you to check your account, claim a refund or other action. Many of these are phishing emails containing links to bogus websites, or attachments which you are told to open, which actually contain malware hidden in what is known as a Trojan. In this case, the criminals have also stolen or hacked email lists and can make it make it appear as if these are spam emails coming from a friend’s email account.
In this particular attack, the act of opening the attachment in such an email automatically ‘tells’ the Trojan to download the Gameover Zeus and CryptoLocker from a server normally located abroad, of which there are thousands which exist purely for criminal purposes.

How does the attack work?
If Gameover Zeus cannot ‘find’ enough on your computer to make a profit for the criminals, CryptoLocker will take over, effectively lock down your machine and demand a ransom.

What you need to do NOW
Your internet service provider (ISP) may have sent you a letter or email warning you about this threat. They will know that your computer is infected because the NCA, working with other law enforcement bodies around the world – has taken over thousands of the criminal servers and examined the records. You must follow the advice on this page straight away. Even then, if your computer has been locked down by CryptoLocker, it is too late.
Remember that making sure that updating your operating system and software are good habits to get into so you should be doing this on a regular basis.

Important warning about emails
Cyber criminals will also exploit this situation by sending out further phishing emails claiming to be from your ISP or a law enforcement agency, urging you to click on a link or open an attachment for the remedy. You could also receive a similar email which appears to have been sent by a friend, family member or colleague, but which has actually been sent automatically by a computer infected with the malware and ransomware. Read some advice on spam and scam emails at www.getsafeonline.org/protecting-your-computer/spam-and-scam-email

Scan for and remove Gameover Zeus malware and CryptoLocker software
Free tools have been specially developed and made available to you by a number of internet security software companies. You can use any of these tools regardless of the make of internet security software you normally use.

Symantec
https://www.symantec.com/connect/blogs/international-takedown-wounds-gameover-zeus-cybercrime-network
F-Secure
F-Secure Online scanner (Windows Vista, 7 and 8)
https://www.f-secure.com/en/web/home_global/online-scanner
F-Secure Rescue CD (Windows XP systems)
https://www.f-secure.com/en/web/labs_global/removal-tools/-/carousel/view/142
Kaspersky
https://support.kaspersky.com/viruses/utility#kasperskyvirusremovaltool (if you think your computer is infected with malware)
https://support.kaspersky.com/8005 (WindowsUnlocker utility for if your computer is infected with CryptoLocker)
Sophos
https://www.sophos.com/VirusRemoval (Windows XP (SP2) and above)
Heimdal Security
https://goz.heimdalsecurity.com/ (Microsoft Windows XP, Vista, 7, 8 and 8.1.)
Microsoft
https://www.microsoft.com/security/scanner/en-us/default.aspx Microsoft Safety Scanner (Windows 8.1, Windows 8, Windows 7, Windows Vista, and Windows XP)
McAfee
www.mcafee.com/stinger

Trend Micro
www.trendmicro.com/threatdetector
(Windows XP, Vista, Windows, Windows 8/8.1, Windows Server 2003, Windows Server 2008, and Windows Server 2008 R2).

Report a loss
If you think you have lost money through malware such as Gameover Zeus and CryptoLocker, you should report it to Action Fraud at www.actionfraud.police.uk or by calling 0300 123 2040.

Few managers would disagree with that statement, which we found on the website of PPD Consultants. The engineering-services organisation asks four questions to address the “to meet or not to meet” dilemma:

1. Is there a clear purpose for the meeting?

Strong examples: (a) to reach a decision; (b) to brainstorm for solutions to a problem; and (c) to promote a sense of accountability (by creating a public forum where one’s work is on display for all to see, so people push harder to deliver).
Weak example: to gather status-only reports for areas of little activity.

2. Should we meet now?

It may be logical to postpone the meeting if required information is missing or a critical team member is unavailable. Don’t be too quick on this trigger, however; you don’t want to cancel necessary meetings.

3. Is there a better alternative?

Information-only debriefs, such as status updates, can be done through e-mail or other means. If the topics only involve two or three members, then an informal subgroup session may be wiser than an all-hands-on-deck meeting.

4. What if the meeting is not held?

Before postponing a meeting, consider: What would not be accomplished? How would team members react? How would senior managers react? If people are telling you that nothing would be missed (or implying as much by their absence or lack of interest), then you have your answer, which should lead you to either cancel the meeting or find ways to improve it.

Small businesses rarely have small problems or big budgets. I’m always on the lookout for technology that would make our lives easier. Unfortunately, clunky user interfaces and non-existent support means apps are often more trouble than they were worth.

Here are a few apps that I can’t live without. These five are easy to use apps are cloud-based and scalable, this means they can grow along with your company. The best bit is that each app has a free or nearly free version for businesses just starting out who need to control costs.

Zendesk

Zendesk simplifies and streamlines customer service. The app consolidates all customer communications like email, social media, websites, and even phone into individual “tickets” that all your team can access and respond to. You can automate standard responses, store customer histories, and create product forums where customers can interact and answer each other’s questions.

Zendesk offers a special “Starter Plan” for up to three users for $20 per year. Regular monthly plans start at $24 per user.

Google Drive

File-sharing is an important part of a growing business, and Google Drive makes it nearly fool-proof. Multiple users can collaborate in real time, creating, editing, and commenting on documents in the cloud. Revisions save automatically, and more importantly you can access your documents from any device. All of this represents a huge productivity leap over the old-fashioned approach: attaching documents to emails and sending endless versions back and forth in a game of email ping pong.

Individual users get 15 GB of free storage. Monthly business plans start at $5 per user and include 30 GB of storage.

Evernote

Say goodbye to post-it notes. Evernote is an indispensable vacuum cleaner-style app that sucks up all of the random data you encounter on the Internet and in your real life. Whether it’s excerpts from websites, photos, voice memos, documents, or handwritten scribbles, it all gets stored in the cloud as individual “notes.” You can then sort, tag, edit, and even share these “notes” with colleagues. All of this information is in turn accessible across all of your devices and syncs automatically.

Individual users can upload up to 60 MB of content per month for free. Evernote Business ($10 per user per month) offers 1 GB per month

MailChimp

While social media has proliferated, old-fashioned email marketing remains a critical way to reach clients and build connections. MailChimp is a no-nonsense, intuitive tool for creating email lists and keeping track of which customers are opening messages and clicking on links. You can easily import contacts and even segment your lists so subscribers receive only relevant emails. MailChimp also includes basic A/B testing features, for comparing which subject lines and send times work best.

Free users can send up to 12,000 emails per month to up to 2,000 subscribers. Unlimited plans start at $10 per month.

HootSuite

HootSuite is a valuable tool. Several million people and thousands of small businesses use HootSuite to manage their social media communications. A web-based dashboard lets you access dozens of social networks in one place. You can set up streams to monitor keywords and specific followers, as well as access detailed analytics reports showing who’s reading and responding to your posts.

HootSuite’s free plan allows tracking for up to 5 social profiles. The $8.99 per month pro plan offers tracking for up to 50 profiles and advanced analytics.

All five of these apps have healthy, growing user bases, which means they’ll be around for a long time, rolling out regular updates to keep things fresh and stay relevant as your business expands.

By using all or some of these apps, your business life will take a huge step forward in productivity and efficiency, and you’ll wonder how you ever managed without them!
And yes I do pay in $’s, the US is ahead of us in innovation when it comes to business apps.

What apps do you use in your business and couldn’t live without?

Accountants help you keep an eye on major costs as early as the start-up stage, a time when you’re probably preoccupied with counting every paper clip and postage stamp. Accountants help you look at the big picture.

In fact, perhaps no other business relationship has such potential to pay off. Nowadays, accountants are more than just bean counters. A good accountant can be your company’s financial partner for life, with intimate knowledge of everything from how you’re going to finance your next forklift to how you’re going to finance your daughter’s university education.

A general accounting practice covers four basic areas of expertise:

1. Business advisory services
2. Accounting and record-keeping
3. Tax advice
4. Auditing

These four disciplines often overlap. For instance, if your accountant is helping you prepare the financial statements you need for a loan, and he or she gives you some insights into how certain estimates could be recalculated to get a more favourable review, the accountant is crossing the line from auditing into business advisory services.

The best way to find a good accountant is to get a referral from a business colleague, maybe even in the same industry. Don’t underestimate the importance of a FCA (chartered accountant). This title is only awarded to people who have passed a rigorous training and examination process.

The first step in setting the stage for a successful search is to take an inventory of what you will need. Given the level of fees you are prepared to pay, you must decide where your responsibility stops and where the accountant’s begins.

Once you have compiled your documentation and given some thought to your expectations, you’re ready to interview your referrals. Two or three candidates is a good number to start with. For each candidate, plan on two meetings before making your decision. One of these meetings should be at your site; one should be at theirs. Both parties need to know the environment the other works in.

During the ensuing interviews, your principal goal is to find out about three things:

Services
Most accounting firms offer tax and auditing services. But what about bookkeeping? Management consulting? Estate planning? Will the accountant help you design and implement financial information systems? Other services an FCA may offer include analysing transactions for loans and financing; preparing, auditing, reviewing and compiling financial statements; and representing you before tax authorities.

Although smaller accounting firms are generally a better bet for entrepreneurs, they may not offer all these services. Make sure the firm has what you need. In addition to services, make sure the firm has experience with small business and with your industry.

Personality
Is the accountant’s style compatible with yours? Be sure the people you are meeting with are the same ones who will be handling your business. At some accounting firms, partners handle sales and new business, then pass the actual account work on to other partners.

When evaluating competency and compatibility, ask candidates how they would handle situations relevant to you. For example: How would you handle an HMRC investigation seeking verification of vehicle expenses? Listen to the answers, and decide if that’s how you would like your affairs to be handled. Realise, too, that having an accountant who takes a different approach can be a good thing. Be sure that the accountant won’t pressure you into doing things you aren’t comfortable with. It’s your money, and you need to be able to sleep at night.

Fees
Ask about fees upfront. Most accounting firms charge by the hour; fees can range from £50 to £200 per hour. Quite often the fees depend on the service being provided. However, there are some accountants who offer a fixed fee spread with monthly payments. Figure out what services you are likely to need and which option will be more cost-effective for you. Get a range of quotes from different accountants.

Try to get an estimate of the total annual charges based on the services you have discussed. Don’t base your decision solely on cost, however; an accountant who charges more by the hour is likely to be more experienced and thus able to work faster than a novice who charges less. At the end of the interview, ask for references or testimonials, particularly from clients in the same industry as you.

After you have made your choice, ask for the terms of the agreement in an “engagement letter” that details the returns and statements to be prepared. This ensures you and your accountant have the same expectations and helps prevent misunderstandings and hard feelings. All professional accountants should be doing this as standard.

Make the most of the accounting relationship by doing your part. Don’t hand your accountant a shoebox full of receipts. The better you maintain your records, the less time your accountant has to spend, and the lower your fees will be. Ask your accountant if they provide accounting software, good accountants will have several cloud solutions available.

It’s a good idea to meet with your accountant periodically. Review financial statements and go over any problems so you know where your money is going. This is where your accountant should go beyond number-crunching to suggest alternative ways of cutting costs and act as a sounding board for any ideas or questions you have.

A good accountant can help your business in ways you never dreamed possible. Spending the time to find the right accountant, and taking advantage of the advice he or she has to offer, is one of the best things you can do to help your business soar.

The rise of social media has been so rapid that it’s easy to feel left behind. And it’s not just a personal scene any more – many businesses are using sites such as LinkedIn, Twitter and Facebook to attract followers and fans.
If you run your own business, social media offers you the chance to spread the word about what you do. It enables you to build a reputation, forge new relationships and bring in new business.
But if you haven’t taken the plunge yet, you’re not alone. According to research by specialist SME insurer Hiscox (2012), only 57% of small businesses currently use social media to support their marketing efforts.
And research by The Neilsen Company has found that 53% of adults who engage in social networks are active followers of a brand.
It’s never too late to start – there are exciting opportunities for most businesses on social media.

The Sage guide offers advice on how to spread the word using social media, including:

• How social media can help your business
• Choosing the right channels for you and your business
• Balancing business and personal
• Finding your followers
• Reaching out to your customers

Download the guide (1.5MB pdf)

New interns, with their expectations and beliefs that they have all this superior knowledge gained by earning a 1st in their degree. Or perhaps you have more technical interns that have earned A*’s in their engineering classes. Either way, interns are great, and I highly recommend that you hire one or two or three.

But do you know what is even better? An apprentice.

What’s the difference? Well, the Dictionary.com definition of intern includes the word “apprentice,” so on the surface it seems like they are very similar. They are both people, usually young, who want to learn a career. But the big difference is the amount of time involved.

If you remember from your history classes, young boys (and occasionally girls) were apprenticed to experts in everything from barrel making to medicine. The apprentice stayed with his “master” (not a term I’d like to resurrect) for years. How long does the average intern stay around these days? Three months? Four? or one summer.  Often, University students try to gather as many internships as they can during their time in higher education. But, what about the apprenticeship model?

Did you learn the ins and outs of your job and your business in three months? Probably not. In fact, we generally tell managers to give new hires a good six months to settle in and add benefits to the company. (It’s one of the reasons the cost of turnover is so much greater than just head-hunter fees. Hitting the ground running is very unusual.) But we expect interns to gain great understanding in a short period of time.

An apprenticeship is different. With that, there’s an understanding that the relationship between apprentice and mentor (better word!) will go on for years. The apprentice learns to do what the mentor does, not just general things about being in business.

This seems clear cut when it comes to plumbing (a profession that still has apprenticeships), but instead of using this system for other areas, we rely on universities to train people. This is utterly illogical, as many professors haven’t spent much time in the actual business world. Why would we expect them to train our future employees? I’m not knocking education, by the way. Logical thinking, technical knowledge, and the ability to write are all valuable things. And some stuff just requires lots of memorisation. (I don’t want my doctor stopping to Google if I’m having a heart attack).

But, what if you started hiring apprentices? (And yes, you have to pay them.) The reality is, even if you’re not benefiting at the beginning, you’d be benefiting by the end. What if you brought on a college student with the understanding that he or she would work for you for 10 hours a week for the next four years? And that this person would not be in an entry level job sorting mail and filing excess paper, but would sit beside you in meetings, and learn to do what you do. Not just general knowledge about your business, but what it takes to do what you do?

Think of how that apprentice could be light years ahead of his or her counterparts when graduation comes about? The knowledge of how to handle a problem, how to put together a proposal, what goes into finding a manufacturer, and what a pain it is to find good insurance for your company, would be invaluable to the apprentice.

And it would be invaluable to your company. The apprentice’s ability to contribute will become greater than any string of interns, all at a reasonable price. And when your apprentice finishes the apprenticeship, you can either offer a permanent job or another company will be happy to snap up a new grad with four years of real experience.