Business121 Small Business Newsletter #53

In this week's Business121:

1. The Nobel Peace Prize and entrepreneurship
2. How long should a Business Plan be?
3. Top 10 Business Plan Mistakes to Avoid
4. Business Plans for Business Angels - Two-Part Guide
5. Why Business Planning is not just for Start-Ups
6. Staying out of Trouble in Software Development and Technology Contracts
7. Comprehensive UK Small Business Statistics - 2005
8. Rise of the teentrepreneurs
9. Britain's Biggest Enterprise Challenge Returns
10. One in five CVs include significant lies
11. ‘We’d rather watch paint dry than invest in IT’ say UK businesses
12. New paternity rights could leave dads holding the baby
13. Law firm warns employers of £600m cost of new age laws

The Nobel Peace Prize and entrepreneurship

It's not often that the Nobel Peace Prize has a strong link to entrepreneurship but this year's winner of the renowned award certainly does.

Muhammad Yunnus and the Grameen Bank, which he founded, were awarded the honour last week for their pioneering use of tiny loans, dubbed 'micro-credit' to help millions of people to help themselves out of poverty.

The story really is a heart-warming tale. Yunnus had been studying in the US and upon returning to his home country during the Bangladesh famine in 1974 he discovered that many villagers, the majority of these women, were in severe debt to money-lenders.

He tried to persuade a local bank manager to give them credit, but the banker said that he couldn't lend money without a guarantee. But, of course, none of the poor villagers could offer any collateral.

They were caught in a vicious circle, and to break out of it they needed a loan. So Yunnus set about lending to the neediest people in Bangladesh, enabling them to start up small businesses without collateral.

He started, by lending 856 taka (about £15) to a group of 43 villagers which allowed them to buy the raw materials to make bamboo stools. Within a year they had repaid his loan in full, and had a thriving business.

After seeing the success of his early loans, Yunnus founded the Grameen Bank to increase the work. Grameen - which means "village" or "rural" in Bangla - now lends to 6.6 million people, 96% of them women and has lent over £3 billion in total.

The average loan is about £100 and anyone can qualify, but the bank has a novel approach to lending. Those seeking a loan are put in groups of five, once two members of the group have borrowed money, the other three must wait for the funds to be repaid before they can get their loan.

The bank says that this method encourages social responsibility. With a 99% repayment rate, they seem to have an interesting point.

Through Yunnus' efforts and those of the bank, poor people around the world, especially women, have been able to buy raw materials, livestock cows, or even the mobile phone they desperately needed to haul themselves out of poverty.

Muhammad Yunnus and the Grameen Bank have improved the lives of millions of people over the years. But this hasn't been done by 'giving', it's been done by 'lending'. This approach has encouraged the recipients of the loan to tap into their entrepreneurial spirit and to create a better life for themselves and their families.

With such a clear example of the benefit of stimulating the inherent entrepreneurialism in people, this country's politicians should take note.

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How long should a Business Plan be?
Page count is not a good way to measure length. A 20-page plan with dense text and no graphics is much longer than a 35-page plan broken up into readable bullet points, useful illustrations of locations or products, and business charts to illustrate important projections.

You should measure a plan by readability and summarisation. A good business plan should leave a reader a good general idea of its main contents even after only a quick skimming, browsing the main points, in 15 minutes.

As we all know, putting together a business plan can be a time-consuming process. Luckily, to speed up the process and to make it a little less painful we have a range of helpful articles on the site including;

Top 10 Business Plan Mistakes to Avoid
What makes a good business plan? Here are are 10 mistakes you should avoid making when writing your business plan.

Business Plans for Business Angels - Two-Part Guide
A short, two-part guide to writing a business plan with business angels in mind.

Why Business Planning is not just for Start-Ups
One of the greatest misconceptions about business planning is that a business plan is useful only for start-ups.

You'll find many more business planning articles on Bytestart

Staying out of Trouble in Software Development and Technology Contracts
Any technology contract should allow the software developer and customer to develop their relationship over time, but many don’t. There are a number of areas that should be taken into consideration in each and every contract to avoid problems arising and make the most of the relationship – for both the supplier and customer.

Comprehensive UK Small Business Statistics - 2005
The Small Business Service has published Small and Medium-sized Enterprise Statistics for the UK in 2005. Here's a summary of the main statistics, trends and key graphs.

Rise of the teentrepreneurs
Your children have been glued to every episode of Dragons’ Den and one day rush home from school in great excitement telling you they would like to be entrepreneurs and start their own business. They are certainly not alone. According to a survey of 1,500 young people, 89% said that running their own business was the most appealing career choice.

James Scoltock of The Times reports on how they can get advice.

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SMALL BUSINESS NEWS
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Britain's Biggest Enterprise Challenge Returns
Teenagers and twentysomethings across the country are being called upon to compete in the UK’s biggest ever live and simultaneous enterprise challenge - on 13th November 2006. The one-day enterprise competition has been specifically designed to foster teamwork, kick-start imaginations, and unleash creativity for developing money-making ideas.

One in five CVs include significant lies
20% of CVs submitted for job applications include significant lies, such as omitting County Court Judgements, not declaring directorships and disclosing inaccurate academic qualifications, a new survey shows.

‘We’d rather watch paint dry than invest in IT’ say UK businesses
Many small business owners consider the prospect of buying an IT system so intimidating, they would rather buy a house or get married – often regarded as two of life’s most demanding experiences – than invest in new technology

New paternity rights could leave dads holding the baby
New rules which give men the right to six months’ paternity leave, some of it paid, could lead to a role reversal in many households, says a law firm.

Law firm warns employers of £600m cost of new age laws
A leading law firm is urging employers to protect themselves from the estimated £600m additional cost to business of new age discrimination legislation.

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