Category "Business"

Well that went quickly, three weeks where I tried my very hardest not to think about work, check emails, respond to calls from clients and generally spend time on things that were all about me. It wasn’t as easy as I thought and although there was an added distraction in the form of a beautiful Flatcoat puppy I still found it hard not to think about work, talk about work and generally get excited at the thought of coming back.

What I did do though was read, and lots of it. I love reading, it’s my down time, how I relax at the end of the day, my go to thing when I need a distraction; I like just about any kind of book, something that I can lose myself in, something that I can read and it challenges me to think differently, a book that can make me laugh out loud until I can’t get my breath (thank you David Sedaris, your books have been a tonic recently). Whilst I was furloughed I received a copy of ‘Non Bullshit Innovation’ by David Rowan which became my bedtime reading, and what a read it was, it could have only been made better had I had post-it notes at the side of the bed to mark all the interesting sections. It was the first book I had read that gave me the examples to describe why and how we do things at Alpaca; at last I could read about other businesses that felt familiar and that I wanted to be part of.

So, here’s my very short take on the companies whose strategy resonated with me because it’s stuff we are already doing.

As a result of the economic impact of COVID 19 there have been companies out there who have found new ways to do business. Did you know Craven & Co used to make metal & steel wire storage and handling solutions, but nobody was spending money on new catering facilities or shops, however with a few tweaks (well maybe a bit more than a few tweaks) they are now making medical equipment for the NHS Nightingale hospitals. Then there is the Dine Group who provide high end catering to weddings and other large events and also had a ‘Dine Delivered’ product. Much of their market; gone in a day! What they did was to change their business to only supply home dining experiences because folks still had birthdays and anniversaries during lockdown and called it the ‘Lockdown Dinner Box’. What about Masons Gin and Harrogate Tipple who started producing hand sanitiser alongside their Gin? All of these were fast pivots to respond to a rapidly changing market, but if you think these are innovative though, think again! In the book there is a chapter about OP Financial group who switched from being a long term, well established bank in Finland to be a hospital, how exciting is that? It was able to do this because it was a trusted institution that held fast to its core values of a cooperative and instead of trying to do banking better it took a long hard look at what its clients really needed and made that switch.

Reading about Xiaomi (shao-o-mi) is the first time I have been able to understand a company and say, ‘that’s how Alpaca operates!’ Xiaomi is a technology company that designs and builds smart products such as Mi Phones, Mi Smart TV’s and Mi Pads, you get the picture. What it does differently is rather than expanding the business as the technology changes they invest in start-ups and other business to create a portfolio of products, that together create a lifestyle for their consumers. They call it an ‘eco-system’. They describe their strategy as akin to building a bamboo forest; traditional companies are like trees, they take time to grow, they are fixed and when they fall, they fall hard and fast, and we have certainly seen that happening recently, even pre COVID19! Bamboo forest don’t die off, new baby bamboo is always growing fast to replenish it. Alpaca is made up of numerous shoots of bamboo, we have our core product of professional services; we have start-ups that we invest in and support to grow through business advice; there are clients we work with where we take an equity stake rather than a fee (we call it putting our money where our mouth is!); and there are businesses that we purchase and add to our portfolio of services because we know our clients need that type of support. In a nutshell we are creating our own bamboo forest!

At Alpaca we often talk about our service and how we price it for clients. We don’t charge by the hour or the ‘letter’, whatever we charge we do our very best to add value to the client, but what does that look like? Heywood Hill Bookstore has a wonderful literary history and a royal warrant, but they were significantly impacted by the online retailers and just could not complete. Rather than cutting prices or closing the business they realised what they did have, that none of the online retailers had, was a team made up of dedicated bibliophiles who each read up to 200 books a year and understood the importance of matching the right book with the right person. They grew a subscription service where book lovers could choose a subscription based around the type of books they liked and how frequently they wished to receive a book and the staff would select them a book and send it with a beautiful personalised note. The cost of a 12-month subscription for 12 paperback books is £225. That’s approximately £18 for each paperback book, but according to their filed accounts it generated £313,068 in revenue in 2018. Let’s overlay that model with the Alpaca model; we are not cheap, and we don’t pull clients into services they don’t need, for example think about supermarkets where you can buy three books for £10. You end up with two books you want and one you don’t because it’s perceived as a bargain. Or what about online retailers that uses an algorithm to tell you what you need to read next; how many have you bought and not read or wished you hadn’t read it; I know I certainly have. Both simple examples that show how easy it is to waste money and time. At Alpaca we personally get to know our clients, we anticipate their needs, we make valuable connections for them that they didn’t know they needed and those who get it are absolutely prepared to pay for our service! Anyone any ideas how we get a royal warrant?

Four of us at Alpaca have now read the book, and we all picked out different chapters we got the most from or that resonated with us in regard to work we had done; which shows we all looked at this book with a different perspective. Imagine what that looks like for your business when you engage with us? Having a team of Alpacas working together, being innovative but without the bullshit!

Happy reading!

Over the last few weeks, we’ve all had to come to terms with many new sayings, phrases and acronyms;

Social distancing,
Exit plan,
and ‘The New Normal’ …

But if ‘normal’ is now ‘new’ then is it not ‘different’? And if indeed it is different, then how do we know what to do? What is right and what is wrong?

It is not unfair to say that expert advice is hard to come by when none of us have ever been through something like this before? However, Alpaca have been working hard to collate the type of questions and queries we’ve been getting from clients and have pulled together a checklist of things you might want to think about to help get back to ‘normal’ – which isn’t normal at all – it’s new – and different …

Download our PDF below. It is by no means a definitive list of everything, but we hope it helps! And if you need any extra support with something you had not thought of – well you know where we are!

Alpaca new normal guidance

So, I’m conscious there is a real risk of “too much Richard and Alpaca” at the moment (something my wife is all too familiar with).

However, with a LOT of clients asking the same questions and a desire to help as many as possible, here’s my best take on the position as we see it.

NB: I have a 3 year old with chickenpox sat with me as I write this, so if I’ve made any glaring errors, sorry-not-sorry.


Ok, let’s just focus on Company Directors for now. Essentially, if you’ve been using the standard tax planning approach of “low salary, top up with dividends” you are currently… stuffed. Can’t really think of a softer way to put it.
I’ll deal with the obvious points in bullet form to get through them fast:

But I’m essentially a freelancer

Not for the purposes of this scheme, even if you’re one of the c.900,000 sole Director companies in the UK. If you’re on the payroll as a Director, you’re employed, not freelance.

So I can furlough myself, and claim…?

You can, and you can claim 80% of the salary that went through payroll. Probably about £575. If you’ve been on the minimum to tick over the NI threshold, that ain’t gonna help you I’m afraid. However, if you do make that choice, you can’t do any revenue-generating work for your business whatsoever.

A-ha, well I’ll just increase my salary before the rules kick in then

Nope, they’ve thought of that. Your salary will be the one on your payslip as at 28 February 2020.

Oookaay, but what if my salary genuinely varied over the last 12 months?

Essentially you use your “average” salary over the past 12 months or if it’s higher you can look at the corresponding month from last year (let’s say your salary on payroll was higher during the first half of last year, you can use March ‘19s figure for March ‘20’s pay).

Am I being punished for something?

This gets political so I’ll shy away a little, but reading between the lines I can only assume the Government is afraid of being seen to reward “fat cat” company directors. I know, I know, there are 2m limited companies, almost 900,000 of those don’t employ anybody, and most of the tax planning was a legitimate strategy NOT designed to exploit the rules but simply to manage income within the rules. It’s definitely a gap – probably one the Chancellor intended.

Ok so let’s move on, is there another way around?

Nobody has said it explicitly, but I guess the suggestion is that you go off and “get yourself a Cybil” (the Coronavirus Business Interruption Loan) but even that’s tricky. If your business was a bit wobbly, the banks might not accept the lending case. You’ll have seen in the press that some banks are also insisting on personal guarantees, which won’t help your stress levels right now.

Hang on lads and lasses, I’ve had a great idea… I’ll get a Coronavirus Loan, and pay myself from that!

Ah but… Oh it keeps going, the word we’ve had from banks is that they’re not happy seeing Directors take “drawing” from the loans – and technically it’s not clear whether the businesses will be making profit to do so in these straitened times.

You could, I suppose, take the loan and put yourself on a small salary through payroll. If the bank squeaks, show them this blog and explain that you find yourself stuck firmly between Scylla and Charybdis. Answers on a postcard if this works. I wouldn’t try and pay yourself any more than the £2,500 furlough cap though, or you can expect HMRCs’ retrospectoscope to catch you one day.

To shut or not to shut…

Some of you (like me) will also be considering your position as an employer. If I furlough, I effectively close down a business which IS still trading, just more uncertainly than it was last month. So I’m put in a position where the Government says “stand by your employees” but to do so I have to take a loan, personally guarantee it, and potentially not pay myself.
Nobody told me there would be days like these.


Always, but these are very surreal times and we really can’t say for certain whether any of these might work for you. You’ll have noticed this is a guest blog from the team at Alpaca – we work very closely with TLC and other organisations, like Entrepreneurial Spark, to encourage innovation and clever thinking.

I make no apologies for the next few thoughts which are one fag packet short of a complete picture.

Take the loan and put yourself on payroll – you’re not going to be able to furlough but if you’ve cut everything else and want to keep trading, I can’t see why this wouldn’t be allowed.

Do you have SEIS status – or COULD you? If you don’t know what this is, drop me or your TLC contact a line. It is a tax-advantaged status designed to encourage investment in uncertain businesses, to promote entrepreneurialism. Surely this counts? If not, I’d welcome somebody from HMRC telling me what we’re supposed to do to survive.

Sell something – not as flippant as it sounds. Many businesses, even little ones, will have a couple of trading companies. If one has a bit of cash in it, could you sell it intra-group and benefit from Capital Gains Tax relief? Could you sell shares to a family member?

Consider leveraging other assets – Ok you’ve probably already thought of this but there are loads of other lenders out there and many have specialisms. Some like property, others machinery, some will invoice discount. Don’t assume just because your bank says no that there isn’t another funder out there. Again, shout if you want signposting or support.

Get creative – collaborate, merge, JV, innovate – let somebody else take the fight to the Government and get your thinking cap on. Do you have a deadly rival who suddenly seems a lot more cuddly? Two rival businesses, one has a great finance function but poor sales, another has the inverse – go join up. Switch up your business model, find new clients, innovate.


Sure – go find an Alpaca and have a chat. We ALWAYS find another angle. Now’s your chance to be bold, because what other choice do you have. The platform is burning and you need to react. The winners will be the ones who adapt fast. You can moan about the unfairness of it all when we’re on the other side. For now, this is gonna hurt.

As Rocky said, “If I can change, and you can change, we all can change” (oh yeah, there’s a Rocky quote for EVERY business situation).

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