Established in 2009, SourceDogg's CEO, Alan Phelan, leads a team that provides a unique procurement solution for businesses in both the SME and the large corporate sectors. SourceDogg's Microsoft Azure-based proprietary application provides the user with a means of managing business spend, controlling contracts and finding the right suppliers.
Drawing on relationships with global procurement professionals and consulting, Alan and his team have developed and implemented a software platform which is both intuitive and powerful which serves clients working in sectors as diverse as construction, manufacturing, retail and financial services in Europe, the USA, the Middle East, Australasia and South Africa.
The challenge now is to build volume from a core of international clients to a truly global business. As an innovative approach to developing the business model SourceDogg has signed partnership agreements with procurement consultants in a number of different countries and the rate of signing partnerships is growing very quickly - which is fast giving SourceDogg a global sales footprint.
SourceDogg allows consultants to offer their clients tailored solutions based on SourceDogg technology - a one-stop app store for procurement services and knowledge. This allows clients to bespoke the software with local content and services. The company is currently recruiting between five and 10 sales and support staff per month to meet demand.
Mark Kennedy, Senior Partner, Mazars says: SourceDogg is one of an exciting group of new Irish companies who have commenced business in the teeth of a recession. Focused on a global market the company is seeking to provide a truly innovative, technology based expert solution to companies in a range of sectors.
Like all start-ups in this category, the company will face three key challenges. First, can it resource company development - both in terms of financial resources and the rapid acquisition of skilled individuals. The company has succeeded thus far, building a passionate but small entrepreneurial team of about 60 staff. Secondly, the company must expand this team without upsetting the dynamic culture which has driven the company up to now.
Thirdly, the focus on global markets means that the product will be tested in a range of cultural and sectoral settings. The ability to build tailored solutions to meet client needs on the back of a single robust platform will require continuing investment in technical enhancement and a sensitive analysis of customer needs.
The solution to each of these challenges lies in the ability of the management team to maintain focus on those elements of the business that deliver value to the customer, while carefully controlling resources.
Paul Mee, Partner, Mazars, says: A company of this nature with its plans to expand globally will inevitably face international tax issues. The issues that need to be addressed are the appropriate form of structure for international business and VAT.
As regards structure there are several possibilities. The first is that the activities in other countries do not create a taxable presence in those other countries, in which case all profits are subject to tax in Ireland only.
The second is that the activities in other countries do create a taxable presence, in which case those profits are taxable in those other countries. If the latter, then consideration must be given to the option of operating as a branch, in which case the profits are taxable in Ireland as well as the other country - but with relief being given in Ireland for the foreign tax paid or the option of operating as a company.
If the company route is chosen, then the company profits are subject to tax in that other jurisdiction only. It is worthwhile noting that Ireland is a good location for holding foreign subsidiaries as tax-free sales of the subsidiaries are possible. Careful planning of VAT compliance is also important. For any company at this stage of development, early planning of tax structures can bring benefits long into the future.
Gerry Vahey, Partner, Mazars, says: A company in the position of SourceDogg should, as it is engaged in developing software as part of its service offering, consider the availability of the research and development tax credit.
This R&D credit effectively provides for a 25pc cash benefit on qualifying expenditure on qualifying research and development activities which can be used against the company's corporation tax liabilities or refunded over a three-year period.
It can also be used as a mechanism to remunerate key employees in a tax efficient manner.
One of the key issues facing businesses is the attraction, incentivisation and remuneration of employees.
One of the ways in which SourceDogg could achieve this is by implementing an equity participation plan which can take the form of share options, free or discounted shares or what is called a phantom share scheme.
A phantom share scheme provides an employee with the same economic benefits as shares without the administration cost of issuing shares to the employee.
These types of incentives can assist in attracting, retaining and incentivising employees, and are worth considering.
Sunday Indo Business