Case studies
We work with businesses of all shapes and sizes and the one thing that still fascinates us is why some businesses succeed whilst others do not. Over the years the one firm conclusion we've reached is that owners of successful businesses do things differently, and, above all, if they find that something isn't working they're not afraid to change it. After all, if you keep doing the same stuff, you're going to get the same results, don't you?
Mamma Mia!!
One of our clients, an Italian restaurant owner in the south of Manchester, came to us a while ago with a familiar problem. Her takings had steadily improved over the three years she'd been open, but her profits were sliding and she was starting to have some difficulty paying her bills.
We knew the problem certainly wasn't the quality of her food or the excellent service from the other members of her family who worked in the restaurant, in fact on the face of it their business should have been doing very well.
Together we worked out that to get her back to the required level of profit, she needed to achieve an average sale per meal of £15 at a gross profit of 70%. By getting her to focus on these key figures and to measure them on a daily basis (easy by the way!), she came up with some very inventive ideas to get her customers to spend a bit more per head with her, and increased her gross profits by changing to more competitive suppliers and controlling her portions better.
The business was back on track and thriving, but to this day our client still measures her key figures weekly, because she knows that if she gets those right, everything else will fall into place.
Taxing problem:
No one likes large tax bills, but there again, high taxes generally mean high profits. We like our clients to make big profits, so provided that they're paying exactly the right amount of tax and no more, then we're happy too!
We've acted for the two directors of one particular company since they took the plunge, left their jobs and started out on their own. Through skill and hard work they've built up a very successful business that they can be proud of.
Whilst working through their pre-year end review together it became apparent that a fair chunk of their profits were going to fall within the main rate of corporation tax rather than the Small Companies rate.
By changing the mix of dividends and bonus for the two directors, the company came out of the main rate banding, resulting in a total saving between company tax and personal tax of £16,000.
This type of tax planning isn't rocket science, but it highlights the importance of looking forward rather than looking back.. After all, it's pointless locking the barn door after the cows have got out!!
And on the subject of cows...
We know an absolutely brilliant agricultural engineer. He'd worked in a big marine diesel engine company for 20 years and what he didn't know about diesel engines wasn't worth knowing.
He'd taken a redundancy package and bought a repair and servicing business in deepest Lancashire with a lovely cottage next door. Problem was he'd been hard at it for two years and was losing money hand over fist.
When we sat down with him, we were amazed to find he was personally clocking up nearly 60 hours per week. He hardly had any time to spend with his wife and kids, and when he did he was too tired to have any fun. We were even more amazed when he told us he billed his labour out at £40 per hour, he should have been raking it in!
But what we actually found was that of the 60 hours he was working every week, he was only billing 25 hours. The rest of the time he was giving away free advice to the local farmers and getting involved in stuff that he could easily delegate.
Once he'd got over the shock, he hired an apprentice and a part time receptionist and closed of his workshop area to the public. As a result, his billing increased to 36 hours per week, he was soon back in profit and his weekends are now spent with his wife and kids. We set a simple system up for him to monitor his weekly progress and to give him focus on the really important things that were driving his business.
Bottom's up!
A new client came to us recently with a familiar problem. He'd just finished his budgets for the coming financial year, and he realised that if he just added a percentage to his costs for inflation as usual, he'd struggle to remain competitive in the current financial climate.
We helped him examine all his costs individually from the bottom up and suggested that he ask himself and his team some searching questions about each one. As a result he's been able to reduce his budgeted costs by 14% for the coming year, and his profit projections are back on track.
Just like the examples above, we've helped hundreds of small businesses achieve outstanding results, but what services do we actually offer? Click below