We undertook a process of expansion, bought new assets, increased our product lines, but with turnover increasing our profit levels and our bank balance were falling.
What was going wrong?
We called in John, who immediately sat down with us and talked through our business model and our accounting system and explained how he could help.
- He implemented a system of monthly management accounts, so we had up to date information on which we could act more quickly.
- He looked at our cashflow, made some projections and helped us restructure our finance.
- He assessed our products and showed that a part of our range was loss making once we took overheads and the cost of new assets into consideration. Though our customer base had increased, it had not grown enough to offset the cost of the expanded range.
The advice we received sounded strange – ‘Do less to achieve more’. Sell off some of the assets, they were costing more than they were bringing in so realise the cash, to help get the finance down. Cut down on the range of products available so only the profitable ones remain.
We remember saying “we’re short of cash, surely reducing our turnover is the last thing we should be doing?” He spent time with us and explained his reasoning in a clear and understandable manner.
He was right. Once all the action had been taken, we made more profit, worked less hours, and reduced our stress levels significantly. Our business is thriving again.
We were delighted with John’s knowledge, his understanding, and the clearness of his message. He knew we probably would not want to be told to cut our turnover, but he told us any way.
We will fully recommend John to anybody who needs help with their business and accounts.