Thursday, 30 October 2008

When is a business viable?

In today's credit crunch and businesses going to the wall it was interesting to get a local authority's interpretation of "viable" when applied to small businesses. Apparently after trading for three years and making a profit every year a business located in the countryside was deemed not to be viable by Hartlepool Planning Committee as the profit made was only £5,000 a year. As someone who has been involved in business for over 20 years I think three profitable years trading shows a fair degree of viability, especially when establishing the business from scratch. After investing many thousands of pounds in a business it is not unusual to make no profit at all for the first couple of years, its called investing in the future!

I suppose if you are sitting in your local authority post with your public sector pension to look forward to then you wouldn't get out of bed for only £5,000 a year, which incidentally is about the same as my Councillor's Allowance. Does that mean I'm not "viable" or "sustainable" as a Councillor? Admittedly if I had to live on it for the rest of my life then I'd struggle but then I'm not building a political career which will ultimately lead me to bigger money, unless of course I managed to get elected Mayor then I'd make more than £5,000 a month!

So when is a business viable? If making a trading profit in these current times doesn't count then I dread to think how many none viable businesses there are out there. Of course all he has to do is put his prices up until he makes more money doesn't he? Local authorities might just be able to hike Council Tax on the basis that their customers have no choice but to pay whatever is demanded but unfortunately its not that simple in the competitive world of the private sector. If the price goes up too much the customers go elsewhere. Ah just imagine if you could do that with Council Tax. Sorry you could say, I'm paying my Council Tax to somewhere else this year, they've offered me a much better deal! Bring your rates down next year and I might switch back to you!


  1. steve,I hope all is well I heartily agree with your sentiments.

  2. Hartlepool borough council planning committee contains some of the most "unviable" people ever brought together in one place except the council chamber during a council meeting.
    Councillors are elected on party political grounds in most wards where Labour always vote Labour, Conservatives always vote Conservative and Lib Dems attract those who have no views except those prevailing at the time.
    The result is that HBC has a collection of people who by and large (you and one or two others excluded) are there, not for their brains and experience, but because they belong to the "Party".
    Hartlepool Council is a herd of donkeys with a monkey in charge.