Gifts that don't work are consumables and gifts that don't present the brand in meaningful way. Sweets, mineral water and hand gels are examples of bad gifts. Fashion accessories are also a no, no unless you have the coolest brand in the world. Who is going to wear a t-shirt with some dull B2B engineering brand on it? Not me!

The best gifts are unique gifts that relate to 'your' industry/sector. Measuring devices for engineers, kitchen utensils for chefs, kit bags for physios etc.

1. Profitability

Gross Margin
How much profit is being made on the turnover achieved? If the gross margin is not as is required, it is likely that your gross profit (what are left after direct costs) is too low. It could also be that you are selling your products too cheap (discounts).

 Gross Profit
--------------  x 100%
    Sales

Net Profit
This is similar to the above but now considers how much profit you are making after the costs of running the business. If this is not as required again you may be selling too cheap, or direct costs are too high, or the overheads are too high in proportion.

Net Profit
-----------  x 100%
   Sales

Mark Up
Mark up is often confused with gross margin. It is an expression of how much you are adding in profit to what you are incurring as cost.

Gross Profit
--------------  x 100%
Cost of Sales 

Return on investment

     Net Profit
--------------------      x 100%
Capital Employed 

2. Liquidity

Current ratio
What is the relationship between how much you have in current assets (those available this year i.e. cash, stock, debtors etc.) and how much you owe this year.   

Current Assets
----------------------    = Results in a figure such as 3:1
Current Liabilities

Quick or acid test ratio

This is similar to above except that it assumes that stock cannot be sold quickly to meet any debts.

Current Assets Less Stock
------------------------------  = Results in a figure such as 1.5:1
     Current liabilities

The number of forms you will need to complete will depend on your own particular circumstances. Most businesses only need to complete one form. Exceptions include partnerships where one extra, simple, form listing partners details is needed and registering a group of companies.

Most applications for VAT registration can be completed online. All other necessary VAT registration forms are available to download from the HMRC website.

• Standard rate - 17.5 per cent
• Reduced rate - 5 per cent
• Zero rate - 0 per cent

The standard rate of VAT is the default rate for goods and services unless specified otherwise.

Examples of reduced rate items include:

Domestic fuel and power
Installation of energy-saving materials
Residential conversions
Women's sanitary products
Children's car seats

Examples of zero-rated items include:

Food - but not meals in restaurants or hot takeaways
Books and newspapers
Children's clothing and shoes
Public transport

If you are registered for VAT generally you charge VAT on your business sales and reclaim VAT on your business purchases. The difference between the VAT you charge and the VAT you are reclaiming is the amount of VAT you must pay to HMRC.

If the value of the VAT you reclaim is more than the value of the VAT you charge, then HMRC pays you.

If you are not registered for VAT, you do not charge VAT on your sales. You still pay VAT on your purchases and you cannot reclaim this VAT.

You usually account for VAT on a quarterly basis by filling in a VAT return and submitting it to HMRC. You then pay HMRC the excess of your output tax over the VAT you can reclaim as input tax. If the input tax you can reclaim is more than your output tax, you can reclaim the difference from HMRC.

More on VAT in the UK here >>