“Can you save me money?”
Words: Richard Starkey, Business Control
If there's one question that I get asked more than any other, it's: 'Can you save me money?' Most people ask this in the hope that we can help them pay less tax, and while we often can do that, it's not where you'll get most value from us. At Business Control, we take a holistic view of your finances, and by 'pulling levers' in every area of your business, you'll usually be able to run a much more efficient operation. And where there are efficiencies, there are cost savings to be found. Here's how it's done...
Boost your bottom line
It’s the stat that really matters, and all sorts of variables have the power to push it up or drag it down. Some you’re bound to know about. But others tend to slip off the radar, and there are a little-known few that you might not even know about.
Speed up your cashflow
If time is money, pace is profit. One way you can speed things up is by collecting debts faster. Ask yourself: what’s your Days Sales Outstanding (DSO)? This is the metric that measures how long it takes for customers to pay for products or services. Is it better than the industry standard? What could help reduce it? These are the kinds of questions we can answer for you.
Monthly management accounts
The foundation of any efficient business is accurate and up-to-date financial information. Clean, monthly management accounts allow you to make sound decisions based on real-time data. With precise financial statements, you can identify trends, monitor performance, and respond to issues promptly. This clarity not only aids in daily operations but also in long-term strategic planning.
Quarterly Forecasts and strategic adjustments
For many of our customers, we complete quarterly forecasts. While building these, it often becomes apparent that certain plans may need adjusting. And who knows what else that might reveal. It could turn out that the extra head you were planning to hire isn’t the best financial call, and that actually, you’ll claw back more in tax relief if you add that extra vehicle to your fleet asap.
Gross margin: digging into the details
Your gross margin tells a vital story about your business. We break down the components of your costs, identifying areas where you can trim expenses or make changes. This deep dive ensures your pricing and cost management strategies boost your profitability and keep your business on track.
Keep more money
Convention states that: to make money, you’ve got to spend a bit. But it might not be as much as you think. Wages, for one, probably make up a big slice of your overheads. Talent doesn’t come cheap. When setting salaries though, a little less can sometimes be more – are you paying your directors the payroll or dividends that work best for their personal tax scenarios?
Let’s say your business is a landscape gardening firm. Trimmers are a vital piece of kit, and you need to buy several units. Understandably, you’ll want to go for a make and model that’ll do a great job without having to splash out more than you need to. But have you added reliability and how that could impact maintenance and replacement costs to the equation?
Whatever kind of business you run, you’ll have assets of some kind or another to maintain. Consider the longer-term picture and you’ll reap the rewards eventually.
Marketing ROI: make every penny count
Marketing is a significant investment. So, it’s definitely worth tracking costs and revenue from your campaigns to measure their ROI. With this data, you can pinpoint improvements to maximize the effectiveness of your marketing spend, ensuring you get the best possible return on your investment.
Tax updates: stay informed, stay compliant
The tax landscape is always changing. Our ‘Tax Matters’ blog and web page can keep you updated with the latest information, so you can quickly address any tax-related questions. This proactive approach helps you stay compliant and take advantage of new tax opportunities.
Director compensation: optimize for tax savings
Talking of tax, are your directors compensated in the most tax-efficient way? We help structure payroll and dividends to minimize tax liabilities while staying compliant with regulations. This personalized approach can ensure maximum savings and financial benefit for your directors.
Just a taster
Those are a few key areas where accountants like us can help you find opportunities to save. It’s worth noting that every business is different, and yours will have a combination of money saving opportunities shared by no other. So if you really want to find out what savings you can make, let’s have a conversation.
Check out the rest of our blogs periodically to get the very latest insight and information from the Business Control team.
