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Storms Ahead?

Storms Ahead? - Account-ant

“Hurricane a comin’, Stand Fast, Secure the Rigging!”…..

This is a line from Disney’s The Little Mermaid and I thought it summed up at least one side of Forecasting for your business.

When I was growing up I had one Disney movie on tape – It was “The Little Mermaid”. I’m 95% sure I know all the words from that film…. including songs.

So naturally it was going to make it’s way into my blogs at some point! Our toddler even tolerated 30 minutes of it a few weeks ago, and it was pure joy for me….

Yes! I have successfully converted the child to love Ariel, Flounder and Sebastian… my work here is done! 😊

On a more serious note though, as a Small Business Owner, cashflow is the key to success.

Forecasting is a way of looking ahead to see where you will be in the future.

Rachel Account-ant

The London School of Economics have said that the two biggest obstacles facing small businesses are:

  1. Poor financial processes.
  2. Lack of access to funding.

Whilst Albion Centures, a venture capital investment firm, says that only 1 in 5 SMEs believe cashflow is a major concern.

So there’s a difference between what business owners think are issues, versus what the actual concerns may be….

I’m a small business owner, what can I do??

Good Cashflow Management needs a few things (I go into this in more detail on the “Hold Back The River Blog Post), but if you missed it, in Summary;

  1. Processes – Do you have good Accounts Payable, Accounts Receivable, Stock Control & Bookkeeping in Place?
  2. Overheads – Review them regularly – quarterly is good. Cancel down any old subscriptions not in use. Do you have an Expense Budget that you can stick to?
  3. Profit – Is your Margin correct? Are your sales high enough to cover overheads?

But the main thing is ALWAYS LOOK FORWARD… or as Dory says “Just keep swimming” (Disney example again?!)

Why should I bother though?

Forecasting is Important. Period.

It will help you plan future decisions carefully (such as taking on a new team member, launching a new product, opening another office etc), but will also highlight any areas where you may struggle in the future and enable you to prepare for the potential issues.

If you forecast correctly, you will have a better idea of when to invest in new equipment, stock or services, rather than ploughing ahead as if blindfolded like Sandra Bullock in Birdbox… (okay, I’ll stop with the film analogies!).

With this information to hand, you can make decisions. For instance, shortening payment terms to get paid quicker, reviewing credit control, inventory and purchasing processes and potentially looking at your debt structure (is refinancing an option?)

If Forecasting sounds like a plan… and it should!!! give me a call and I’ll talk you through the options.

Lets ride this Hurricane into calmer waters and have a Lookout in that Bird’s Nest, keeping an eye out for Storms and Pirates…

0 In Stories from an Accountant

Hold Back The River

Account-ant - Hold Back The River

As the great James Bay once said “Tried to keep you close to me, But life got in between” he wasn’t actually talking about money but we’ve all had that feeling – where does it all go?!

Am I being robbed?!

Do I purchase things from Ebay in my sleep? I SWEAR I didn’t buy that strange thing that’s just arrived 😉

Getting a bit serious now though, if this is you, there could be reasons why your cashflow is poor and it’ll be easy to fix, this, I assure you!

Poor Cashflow can be a make or break situation, so use these tips to get in shape.

Sales are too Low

If your income from Sales is not sufficient to cover your costs then you might be in hot water. If you need a bit of help understanding whether this is the case, Account-ant is more than willing to help. If you think there is a problem, then it pays to not wait until year end. Let’s nip it in the bud now!

Profit Margin (that’s the difference between what it costs to make vs what you sell at)

There’s loads of ways that this could be improved. Review your materials? Are there better ways to buy them? Are you paying unnecessary overtime in order to make your product?

There’s so many ways to improve this so perhaps that would be the perfect subject for another blog post!

Accounts Receivable (That’s Customers Paying you)

Are they paying you on time? If not, you should send a gentle reminder, followed by a stern reminder if the issue persists.

Accounts Payable (That’s you paying your Suppliers)

Are the payment terms shorter than the terms you give your customers? Could you renegotiate terms with suppliers? Are you entitled to any discounts?


Full shelves but empty bank account means you are buying your stock too early! Can you place your orders a little more timely?

What about stock in process? Are your processes a quick as possible to convert that stock into saleable goods?


This is where budgeting is key. Review every item that is going out of your bank, is it necessary? Can it be downgraded or put on hold? Are you spending lots on fuel? Could a fuel card reduce your overall cost?

These options can all be explored by going through your costs with your Accountant.

Financing your Business

Are you relying on credit cards or overdrafts. Could you refinance with your bank? Are there Grants available (Account-ant particularly loves helping with grants!)

Still a bit worried

Don’t panic, let’s sit down with some coffee and cake and work through it together. It’ll save you time and stress in the long run.