Over the space of a year we trebled our accountancy fees from one client but much more importantly we helped transform the business.
As it says on our website home page, and we mean this; “it’s about you, not us”.
This is a genuine case study – a real life client, not some made up BS. I know the client would be happy to be mentioned by name because we have had had that big an impact on their business, but I won’t.
This client provides specialist business services and for the first few years we worked with them they were happy with a basic compliance service. We did move them onto Xero which they loved but it was still essentially an accounts and tax return service with advice and support for general queries.
Just over 2 years ago the client got in touch, concerned at how their business was performing. The directors had taken on another director around 8 months before. They had invested additional funds in the business which had all been spent. They’d taken out a loan to provide additional cash flow, but again, that was rapidly being eaten up.
We agreed to have a meeting to discuss how the business was performing.
We met up and went through the latest management accounts, which I had already reviewed on Xero.
They didn’t make good reading and I didn’t pull any punches.
The directors (shareholders) were paying themselves too much.
They had made the cardinal mistake of looking at how much cash was in the bank and thinking that was all available to spend.
They were paying themselves ‘dividends’ which weren’t really there to take.
They had employees who weren’t working at capacity – often clocking off early when the planned work they ‘had to do’ was finished. Doing the bare minimum.
They hadn’t increased prices for some clients since they had started working with them several years ago.
They weren’t reviewing costs regularly.
The business was genuinely struggling.
Things needed to change…
There were tears in the meeting and some angry exchanges between the directors, but everyone agreed that action had to be taken to address the key issues.
We agreed to meet regularly to review business performance and to commit to actions which needed to be carried out to improve the financial performance of the business.
Director drawings had to be reduced.
More personal funds had to be introduced to provide the business with the cash flow it desperately needed.
Team morale and performance had to be improved.
Fundamentally the directors needed to take ownership of the situation.
They needed to take responsibility.
And they needed to be accountable.
They needed to sort this out.
Over the course of the next 2 years they did just this.
We continued to meet regularly, planning and reviewing business performance.
We set clear goals with actions that were needed to make it happen.
These actions were implemented, and change started to happen.
Over a two-year period, this business has:
Increased turnover by 59%
Increased net profit by 206%
Team morale has shot up.
Everyone involved is much happier.
Stress levels have plummeted.
The business now has surplus funds in the business, after providing for all tax liabilities, to enable them to invest in further growth.
And, right now, after the most turbulent 6 month financial and economic period in our lifetimes, the company has had their best 6 months of trading.
I’m proud of the way the directors decided to knuckle down and take control of the situation.
I’m pleased to be working with them as they are a delight to work with, they listen to what we say, they commit to and do what they say they will, and they really value our support and advice.
This client sees our fees as an INVESTMENT in their business.
If you see your accountant’s fees as a COST, well…
…you need to change your accountant.
If you’d like to find out more about the way we work, please get in touch.