Innovation is all about the creation of improved products, processes and services; research and development (R&D) is the process by which these new ideas come to life.
For your business clients, innovation could mean not just building something new, but in updating or upgrading something that already exists. It boosts growth, and increases their chances of being able to adapt in an ever-changing world.
Successful innovation is indeed vital to a company’s success. But what are the drivers behind it? Here we take a look.
1. Marketing the business
There are various tactics companies use to help them stand out from the crowd, with innovative, creative ideas being a key one. After all, people are only going to remember a business if it does something a little different, rather than being just another face in a sea of choices. Innovative ideas can give the company a unique selling point (USP) and a better chance of being remembered. This could be by creating a very unique brand, or by launching a quirky promotion for example.
As soon the unique character of a business has been established, it’s then time to advertise it. A highly personalised, innovative and catchy marketing campaign will do this, and hopefully draw in plenty of repeat customers.
2. Cutting down on waste (and costs)
Innovative ideas can assist in reducing business waste. This could be around wasted materials, or perhaps from long-winded, long-established ways of doing things where an overhaul might be beneficial. Once efficiencies have been made, longer term goals can then be focussed on, rather than always taking a reactionary stance. The trick is to constantly look out for ways to reduce waste, in whatever form it takes. Not only will this lead to money and time savings, it also offers a competitive advantage - not to mention the greener aspects of efficiency, like reducing the company’s carbon footprint.
3. Making more profit!
This follows on from the point above. At the heart of any business is the desire to make money and thrive. This is often easier said than done, but innovation is the key to long term growth and - ultimately - increased profits.
4. Heightened productivity
Similar to point number 2 above, increasing productivity is not just about working harder, but smarter too. Innovative companies are driven to always ‘do more with less’ and to become ever more efficient and productive. This where creative new processes come in, and new strategies put in place to check various areas of business productivity at regular intervals. The important thing here too is in regularly testing the products, processes and services that a company creates. It’s easy to become a little complacent and take the approach that ‘if it ain’t broke, don’t fix it’ - but that can be a killer for a company long term. Innovation is the driving force for change.
5. Improving employee relations
Cultivating an innovative culture in the workplace helps to stop employees losing interest and instils pride in the company’s products. It creates a more stimulating, dynamic working atmosphere that in time can help reduce staff turnover and increase productivity.
An innovative, open way of doing things often means employees feel they can speak out about their ideas and challenges going forward. They’re more likely to feel they have a stake in a company’s success, and can give valuable insights into what the company is doing well and where improvements can be made.
6. Increasing customer satisfaction
Customer satisfaction is of the highest importance if a company is to retain its customers and gain new ones. This is particularly true in modern times, where social media and online review sites mean customers can put their experiences in the public domain at any time.
Innovation in customer service involves thinking not about what stakeholders in the company want, but what the customer wants. How easy is the company’s product to use? How does it improve the customers’ life? Achieving such knowledge could require a little ‘thinking outside the box’, as well as a fair amount of research and experimentation. Customer satisfaction is also something that needs revisiting very regularly, so that changes can be made quickly if required.
Have any of your clients undergone innovative R&D work recently?
If so, they could well be entitled to R&D Tax Credits.
Unveiled by the government in the early 2000s, R&D Tax Credits are designed to financially incentivise companies to innovate and grow. It’s not hard to see why the government is so keen to promote the scheme too; innovative organisations can work on the development of major global issues like poverty and climate change. They also create jobs, therefore boosting economic growth. Innovation also allows new products and services to be marketed more quickly, and to benefit a much wider audience.
R&D Tax Credits can be claimed by companies large or small, as long as it has taken steps to make a technological or scientific advantage in their field. There’s no minimum spend, and claims can average £50,000 - can your clients afford to miss out?
Get in touch with the R&D tax relief experts at Tax Cloud
Part of providing a top class service to your clients means spotting opportunities for them to make tax savings. However, many companies (and accountants) have never actually heard of R&D tax relief, even though it’s now been around a long time.
Applying for R&D Tax Credits is also notoriously tricky. In order to best assist your clients in this very niche area of accounting, it’s highly recommended you work alongside R&D tax experts such as ourselves. The Tax Cloud portal for accountants (with its separate arm for businesses) allows you to make an optimised R&D tax claim on behalf of your clients.
Of course, the team at Myriad Associates (the name behind the portal) are also on hand for anything you need. To discuss any aspect of R&D tax relief, call us today on 0207 118 60456 or use our contact form for assistance.
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