My earlier post ” SaaS, the Holy Grail?” had some interesting responses and made me think about the future of SaaS and the futureof my company as well.

David Terrar, talks about better value solutions for the customers. This I think is an important point, but then David works in the SaaS field himself, with his Twinfield offering. Which by the way I think is most certainly a borderline mid-size company application.

Niel Robertson is very specific about the problems with “Guy’s Stack” and I agree with what he says, up to a point. His whole argument, in my opinion, collapses if you move all these “problem points” into a SaaS model. You will end up with

• companies outsourcing their IT departments,
• nobody cares about, if you use MS-SQL Server or MySQL server,
• Hardware will be shared by application or users,
• applications can easily be customised or tailored by plugins,
• with open APIs even clients could produce tailored code, etc.

At this point Guy is right, deliver the software in a different way and the boxed software value model falls apart. I believe what I sell is certainly a commodity. Open Source software in a SaaS setting must be the ultimate nightmare for proprietary software vendors.

Jeff Nolan, says I am quoting his Bill Gates remark out of context, and then says

… The point was clearly stated in the paragraph that you refer to that if the price of the software is what OSS is competing on then forget it because proprietary vendors have the ability to price their licenses to zero if need be. …

The point is, in my opinion, this remark is completely wrong. OSS is here and has been around for many years, that is proof it works. Linux has been taking business away from Microsoft for a long time, and even Microsoft admits this is a problem. If you tried to out-market Microsoft, that would be a mistake.

We offer our AccountsOffice product for free, why because we could not compete with our competitors and there marketing budged. So I offer one product for free and add unique services and get paid for that.

I would like to see Microsoft charge nothing for their OS, to compete with Linux. The same for the accounting software vendors, with an overhead infrastructure and shareholders, to compete with my FREE product. Their balance sheets would implode!

While I can only talk about SOHO business, I believe others will do the same in the mid-market and large market sector. Twinfield and others do already, but if nobody else will, then give me time, and I will.

Delivery models are important, but I believe the time for artificially accelerated product cycles are over. Big or small vendor, listen to your clients or you will die. Any blogger should know a big marketing budged is not the end to all means.

If I had to take the same decision again about the SAP installation, it would have been different, with half the money and the same amount of work I would have had the same system, 20 % proprietary software, 50 % OSS and the rest PHP scripting and Java. So if I was running SAP/Microsoft/Oracle I would be worried, very worried.

Do I predict the demise of the big boys, no I do not, but they will have to change and it is going to be painful. This is not the first time this is happening either, the telcos had and still have a similar problem with VoIP.

BTW, it was not my intention to upset or even insult anybody, but I think Guy is not “Chicken Little”, for what I believe to be a valid argument. I respect your opinions and share many of them, this is just one we have to disagree about.

Tags: AccMan Pro, AccountsOffice, bad business, Business Development, Business Infrastructure, Business Tool, Client Relations, CPA, Enterprise Irregulars, Entrepreneur, FREE Business Tool, Great Business Idea, Home Business, Homesourcing, IT, Mac OS X, Micro Business, Microsoft, MS Windows, On-demand, OnlineOffice, Open Source Software, Outsourcing, SaaS, Sage Accounting, SAP, SBI, Selfemployed, Small Business, smb, sme, Software as a Service, SOHO, Teleworking, Twinfield, Unix, VAs, Very Small Business, Virtual Assitants, VirtualOffice, VSB, Web Technology, WebOffice, WinWeb

I have been following a discussion in the blog-sphere about software models for the past few weeks. The software models being discussed are on-premis commercial software from the likes of Microsoft, Oracle, etc., then open source software (OSS) also on-premis and SaaS - Software as a Service technology. In this mix the ASP delivery model is mentioned, as a way to deliver commercial software and OSS via the internet.

Should you, the small business entrepreneur care? The answer, in my opinion, is YES and NO!

The Enterprise Irregulars are a group of industry experts who closely follow the software business. They content that the Software’s Sky is Not Falling, and they discuss this from a software industry point of view.

What is not mentioned very often is the CUSTOMER, while worries about software commoditisation are discussed, customers and clients are commoditised. This could not be made more clear then by this statement:

….. I belong to a group of bloggers called the Enterprise Irregulars. We analyze the software industry from a variety of perspectives, that of software company executives, services providers, consultants and investors. Our common denominator is many, many years of watching companies, technologies and customers come and go from fashion in our rapidly changing industry. …..

Anyone read anything about user perspective here? There are some small attempts here, namely by Zoli. But most of the others are more interested in the technicalities of “delivering” or “pushing” the product. While this is a factor, it is not very important to the user.

There are those how still believe, as Bill Gates apparently once said:

…. you don’t want to get into a price war with someone that has more money than you.”

The last time Microsoft was really successful was when it gave the “Internet Explorer” away. OSS is still here, so if you give it away, like we do with AccountsOffice, then there is NO price war, or is there?

I hope for the big boys that they are better then this, because if they are not, then time is really up. What the software industry is really worried about is loss of control over the customer. With the advent of SaaS technology, and the “pay monthly, no contract, cancel anytime” philosophy, the boxed vendors are in trouble.

And that is the reason why you should care. When you buy any “boxed” software product you have paid all your money upfront. So if you need any help then you’ll have to pay again, and again. There is a whole industry out there that is all about installation and support. Very expensive support.

SaaS changes that dynamic fundamentally, the software vendor will have to earn your money every month again and so has to make sure you, the customers, are happy. That forces the software vendor to think about support from day one of the product cycle, not at the end of it, if at all.

Having had the “pleasure” of installing SAP in my previous company, I learned all about support, installation and pre installation planning and the cost of it. By the time we were finished, the software part was “cheap”!

So is SaaS only for small business, you be the judge of that in light of these horrendous installation costs. And let me be clear about this, they do not only correspond to customization.

A few weeks back I was encouraged by an interview Dennis did with Sage’s Paul Sobart, when it is mentioned:

Service and support represents the powerful glue where we can provide customers with the right level of expertise

Bravo, almost right, it should have been:

Service and support represents the powerful glue where we can provide customers with the right level of expertise and we can learn from our customers how to make our product better and more relevant

While I am only interested in the very small business aspect of all this, I can’t help to think that mid-size business and even large corps. are also interested in these issues.

Could it be hurricane season for the software business?

And this is why you should NOT care!

This little fairy is in the open! SaaS vendors with any fore-site have long moved on from this discussion, with concepts like our Small Business Infrastructure. They see no need to “push” to clients, but to “partner” with clients.

It is happening as I write. For me the unrivaled strength of the SaaS model is the ease of collaboration, deployment, and cost effectiveness and the fact that I have to deal with my “partner customers” all day. This is yielding benefits for my clients and for my company.

I have never heard of a company, who’s aim it was to run an IT department.

BTW, combine this with OSS, and I think Guy had a point! We are using OSS components and offering 24/7 live support for these components too, and so do others!

Tags: AccMan Pro, Business Development, Business Infrastructure, Business Start Up, Business Tool, Client Relations, Enterprise Irregulars, Entrepreneur, FREE Business Tool, Home Business, Homesourcing, IT, Micro Business, Microsoft, On-demand, OnlineOffice, Open Source Software, Outsourcing, SaaS, Sage Accounting, SAP, SBI, Selfemployed, Small Business, smb, sme, Software as a Service, SOHO, Teleworking, VAs, Very Small Business, Virtual Assitants, VirtualOffice, VSB, Web Technology, WebOffice, WinWeb, WOW, Zoli’s Blog

“What is Small Business Infrastructure?” is the question put to me these days more and more, and “Why do we need it?” is the next. So I will centre a lot of my future posts around this issue.

In the last 10 years the internet has changed our daily lives in every respect, be it personal or business. To “google” is now a verb in the Oxford Dictionary, we spend billions online and stay in touch with our friends via email, chat and VoIP.

Starting, running and growing a small business has also changed, especially with the introduction of SaaS - Software as a Service. Utilising this kind of technology to build a complete Small Business Infrastructure™, is only a small technological step, but with big consequences for small business.

Small Business Infrastructure™ simplifies starting, running and growing a small business, no matter what kind of business you have, home-based, mobile, small office, or high street.

It is a myth to believe that you will get everything right when you start a new business. Small Business Infrastructure™ allows you to run your business full-time or as a side business, while you still work full-time, all this with an over-head budget of about £ 50 - 75 per month, while you test the water and keep your job. No need to borrow money and give your house as collateral, rent an office or hire staff.

Even when you made a good start, growing a business is always a dangerous time, renting offices and employing staff, puts an enormous burden on you business finances. You need to plan for these and find out how you can minimise the financial dangers to your business.

A highly integrated, low cost Small Business Infrastructure™ centered around the entrepreneurs is needed to:

• Remove business start-up barriers, by dealing with government red-tape;
• Create a safe “Business by Trail and Error” environment, and allowing the entrepreneur to realign and change business processes and models to develop a successful business, or even start again, without risking his/her financial future;
• Providing a low fixed cost infrastructure and a “pay as you go” outsourcing environment;
• Utilise existing business expertise in form of business advisor accountants, to minimise small business mortality, due to business planning mistakes or unrealistic goals;
• Use SaaS - Software as a Service technology to integrate all the above for real time advice, including 24/7 live support;
• Utilise SaaS as a conduit to provide big business services to small business at large volume pricing;
• and leverage open source software as competitive advantage for small business, where the SaaS vendor provides 24/7 support for the open source software.

Tags: Accountants, Accounting, Bookkeeping, Business Development, Business Idea, Business Infrastructure, Business Mentoring, Business Start Up, Business Tool, Cash-Flow, Client Relations, Data Security, E-Commerce, Entrepreneur, FREE Business Tool, Great Business Idea, Home Business, Homesourcing, IT, Micro Business, On-demand, OnlineOffice, Outsourcing, SaaS, SBI, Selfemployed, Small Business, smb, sme, sme-blog, Software as a Service, SOHO, Teleworking, United Kingdom, VAs, Very Small Business, Virtual Assitants, VirtualOffice, VSB, Web Technology, WebOffice, WinWeb, WOW

I am happy to report, that WinWeb has won the ” Small Business Service Provider of the Year 2006” award, by Start your Business magazine.

There will be a two page editorial about our Small Business Infrastructure, which should be on the news stands next week. It is clear that the magazine awarded not only WinWeb, but all our Business Advisor Accountant Partners and our Solution Partners as well. I am very proud and grateful to share this award with everybody concerned.

We have included the good news on our new website, just launched today.

Dennis has written about all the other news items about WinWeb, and mentioned IRIS AccountsOffice. What a great name, even if I have to say so myself. One can only hope that IRIS will follow in the FREE accounting software tradition and FREE 24/7 live online support for all clients, so long and indeed forever associated with this name.

Tags: Accountants, Accounting, Badger Hakim, Bookkeeping, Business Development, Business Infrastructure, Business Mentoring, Business Start Up, Cannon-Moorcroft, CharterGroup, Client Relations, Data Security, E-Commerce, Entrepreneur, Evenlode Network, Holden Associates, Home Business, Homesourcing, IRIS Accounting Software, IT, Micro Business, On-demand, Online Shop, OnlineOffice, Open Source Software, Outsourcing, Selfemployed, Small Business, smb, sme, Software as a Service, SOHO, Teleworking, The Prince’s Trust, United Kingdom, VAs, Very Small Business, Virtual Assitants, VirtualOffice, Web Technology, WebOffice, WinWeb, WOW

I will start this, the eighth of our bite sized start up guides by saying VAT has to be one of the most complex areas of UK taxation and as such professional advice should be taken at all times, don’t try and ‘go it alone’.

There are two types of VAT registration - compulsory and voluntary.

Compulsory - once your turnover exceeds £61,000 (From 1 April 2006) you are required to register with HMR&C for the purposes of VAT. It should be noted that your turnover may exceed £61,000 within months or it may be over a rolling twelve month period. In these situations you need to inform HMR&C within 30 days at the end of the month in which the value of your turnover exceeds £61,000.

Another compulsory registration would be if you have bought a business which is a going concern that is already VAT registered.

Voluntary - in certain circumstances it is possible to register on a voluntary basis even though your turnover is less than £61,000. It should be pointed out that this is not suitable for everyone and professional advice should always be sought before registering on a voluntary basis.

Other voluntary registrations maybe if your turnover is zero-rated (no VAT is charged on sales) yet expenses you incur have VAT on them, again, take professional advice first.

How often do I have to do my VAT Return?

VAT Returns are generally completed every three months. However, you can now use the annual accounting scheme. With this scheme you pay monthly or quarterly installments towards an annual VAT bill and at the end of the year you submit a single annual return and any balance due. The annual accounting scheme is only available if your turnover is under £1,350,000.

How is my VAT accounted for?

The following methods are available to you and your business to account for VAT:

Invoice basis - under this method you declared VAT on sales and reclaim VAT on expenses based on the invoice dates, irrespective of when those invoices are paid.

Cash accounting - under this method you only pay the VAT over on your sales once you receive the money, and likewise with expenses, you can only reclaim the VAT once you have paid for items. This method has a limited, once your turnover exceeds £660,000.

Flat rate scheme - VAT is calculated as a flat percentage of your turnover. The percentages are decided according to the trade sector your business operates in.

Retail schemes - If you sell direct to the public you may not be able to issue a VAT invoice for each sale, in which case there are several retail schemes available that may help.

Can I do my VAT online?

You have the choice on how you return your VAT to HMR&C, you can either submit it on the traditional paper form or use the new online facility. The advantages with the online system is you are given longer to submit your return, an extra 7 days in fact, you also get those extra 7 days to pay your VAT.

There is more help available on VAT by visit the Value Added Tax section of the HMR&C website.

There is also a Frequently Asked Questions section.

Remember, the above is only a bite sized guide to give you a helping hand, take professional advice at all times.

Tags: Business Start Up, HMR&C, VAT, Value Added Tax, Entrepreneur, Self Employed, Small Business, SME, OMB, Bookkeeping