A high growth company with ambitious plans has increased its accounting volume by 40% at no extra cost thanks to Collaborative.

The MD of a group of pharmacies knew that he needed better management information. He was soon to increase transaction volume by 40% and he thought there must be a better way to incorporate that into his business. He was conscious that he must keep costs under control whilst at the same time improve his understanding of the profitability of each of his branch stores.

Additional volume doesn’t always mean additional cost.

He was extremely happy with the current outsourced solution, so he asked us to devise a solution which met his requirements but one which wouldn’t necessarily lead to a complete change.

We could have gone in and recommended that he simply change supplier – but that would not have been the best solution for our client. He needed a permanent resource internally, and would benefit by keeping the current supplier also, albeit on reduced hours.

Collaborative work in our client’s best interest – knowledge transfer is key to a good project.

There were a number of issues with their management reporting. The trade between branches wasn’t recorded accurately. They had no stock system to record receipts, issues, transfers or valuations so gross margin was misleading. The management reports were Sage print outs and didn’t allow for consolidation or rolling forecasts.

Tackle the most important issues first.

The most important job was to install the stock system across all branches. Without an accurate stock valuation, gross margin was incorrect and interbranch transfers couldn’t be recorded and reconciled. When there are a number of branches, each with different people with different skills, this is quite a project. You can not simply install a system and expect people to use it correctly straight away. People often fear change, so any system changes need to be implemented with care. It’s best to involve the people who will be using the system in the installation process so that procedures are built by and around the users, not for them.

Accurate information is crucial to any growing business.

The second job was to ensure that inter branch transfers and stock valuations were incorporated into the management accounts. A finance manual was prepared to ensure that everyone involved understood what they had to do each month to ensure the accounts were accurate and prepared in time.

Your management accounts shouldn’t take days to produce.

The monthly management accounts were then automated using Sage to Excel links. The spreadsheets incorporated KPIs and a rolling forecast (actual + remaining budget). This way the new finance team could produce tailored reports quickly at month end and review the numbers at a glance. A new member of staff was recruited and the current supplier trained on the new spreadsheets so they became self sufficient, able to produce and understand the reports without our help.

THE RESULT

The group can now cope with 40% more volume at no extra cost, has a fully operational stock system which can be used to reduce stock and understand product sales/demand, and a comprehensive set of management accounts which are fully automated and accurate.

To find out how Collaborative can transform your finance systems pick up the phone today and call us on 0845 527 7507 for a FREE consultation.