In lean times, cashflow beats profit for businesses
WITH the deadline for leaving the European Union just a week away, Welsh firms are asking if they have enough cash reserves to cover all eventualities, and even turn Brexit into an opportunity. Every business knows profit on the balance sheet doesn’t always mean cash in the bank, and if orders slow down or delayed payments creep up, they need a plan to access credit or liquidise assets. So, in this market, will digital emerge the hero for companies with fewer options to release cashflow?
According to Cardiff University’s latest digital maturity survey, firms from all sectors are seeing evidence that moving online is beneficial to their business. The report doesn’t explicitly reference cashflow, but many gains outlined in the research do help directly or indirectly to improve reserves. And many examples of this can be seen first-hand from companies that have taken advantage of the free digital training Superfast Business Wales (SFBW) provides.
Commercial cleaning firm, Apollo Wales, employs a significant number of staff to clean domestic and wellknown commercial properties such as Tesco and Barclays Bank, across Wales, England and Spain. So, adopting a full range of digital options made sense. Over 12 months, it increased revenue by 200%, reduced staff turnover and the subsequent costs of rehiring, improved cash flow. It also reduced the time spent chasing outstanding payments by two days a week using Kashflow – an award-winning, cloud-based, easy-to-use accounting software.
“We no longer spend two days a week chasing outstanding payments,” said Chris Birch, Apollo Wales.
On a smaller scale, Treorchy village shop Wonder Stuff saw takings leap by a third since installing an EPOS system that also integrates Amazon’s mobile app seller.
Alison Chapman, Wonder Stuff, said: “Initially we used a manual till, recorded our sales in a logbook and guessed, sometimes wrongly, what goods we needed! Now we analyse sales trends and receive alerts to replenish stock, so we buy regularly but in smaller quantities. It’s reduced the time we spend on stock management by 20% and minimised the items we hold on site by around a quarter. And with less stock lying around and more sales coming in our cashflow is in a much better state.
“Takings grew by a third and stock management time was cut by 20%.”
Gain confidence and adapt with help from Superfast Business Wales
Any small business which wants help in navigating modern technology can get in touch with Superfast Business Wales to access free workshops, one-to-one advice and a wide range of guides, other success stories for inspiration and the recently-published Software Essentials.
■ Search online: Superfast Business Wales.