The Business Exchange Swindon & Wiltshire Edition 37: June/July 2018 | Page 17
CASH IS KING
Purple Lime say “Cashless is King!”
Use the latest technology - our tip for keeping
on top of cash flow...
Cash flow and its importance
in keeping a business healthy,
thriving and growing is something
accountants will discuss with their
clients daily.
The team at Purple Lime,
which takes a fresh approach to
accountancy, is urging business
owners to consider the many ways
of using modern technology to
manage cash flow.
Oli Thomas, co-founder of
Corsham-based Purple Lime said:
“Embracing available technology
helps money to flow seamlessly
and smartly through the business
making it more efficient and
effective. Cashless is rapidly
becoming king – more and more
businesses are stating they prefer
payment by card. It makes life much
easier for the smallest of businesses.
For example – if someone is
interested in your product or
workshop – they can pay there and
then. Done.
“This doesn’t mean there should
not be a personal touch – it simply
means, making life easier for
everyone and keeping on top of
your business’s financial numbers in
real time.”
Purple Lime’s top
tech tips are:
• Automate systems – use tech
to do the chasing, collection of
payment (DD), online or on-the-
move payment services (Stripe for
example)
• Utilise new tech to benefit
from areas like insurance on sales
invoices as they are raised or
apps to assist with credit control
e.g. Chaser
• Quote effectively and clearly
before work commences e.g.
(Xero accounting software
handles quotes well)
• Profile your potential customers
– credit checks etc where
necessary e g. (Satago)
Their top personal
tips are:
• Ensure sales, marketing and
ops collaborate with the credit
control team
• Have strong contracts and
T&Cs, ensuring these are fully
understood by customers
• Build relationships so customers
are more inclined to pay
• Be consistent; friendly, firm
and fair. Angela Ashworth,
co-founder, said: “Businesses
can be profitable but cash is a
separate item so the relationship
between profit and cashflow
must be understood “Monitoring
is crucial as positive cash flow
creates a more valuable company
to investors and or shareholders,
not having to “battle” cashflow
means time is spent on the
right areas of operations, cash
is required to fuel/fund growing
businesses as there is always a
delay between an increase in
“trade” and an increase in the
bank balance.”
Purple Lime suggests
preparing cashflow
statements under three
main categories:
• Operating cash – day-to-day
• Investment cash – where
surpluses are invested for
expansion purposes for example.
• Finance cash – dividends, interest/
loans etc
The team at Purple Lime, based
out of Hartham Park in Corsham
was set up almost two years ago
by co-founders Angela Ashworth
and Oli Thomas – and three other
accountants have since joined
the company. They support
businesses in the role of an
outsourced finance department
and cover all areas of accountancy,
financial management, payroll,
VAT returns, book-keeping, tax
compliance and anything to do with
the financial health of a business.
Purple Lime is a silver champion
partner with Xero.
If you believe the need for ‘once
a year’ compliance is out of date
– call the team for a no-obligation
conversation by emailing:
[email protected]
or call 01249 691360.
PLANNING YOUR PERSONAL FUNDS
FOR THE FUTURE
By Jon Rolfe, partner at Epoch Wealth Management
There has been much discussion on the subject of cash flow
modelling for your business’s prosperity, but have you considered
looking at it for the benefit of your personal finances?
The reality is that many business
owners who are building towards
some sort of liquidity event do so
with very vague ideas as to what
their “magic number” is. Their magic
number is the number they need to
exit for in order to achieve their life
goals, whether that’s to go again,
semi-retire or to fully retire.
Of course, because people are
unable to pinpoint the true cost of
living at some stage in the future,
nor accurately gauge the impact a
different lifestyle could have, they
tend to err on the side of caution and
go for a larger magic number. This will
have obvious consequences, namely
longer in the business getting it into
shape to achieve that number.
The risks to business owners of
staying on the merry-go-round are
many and varied, and will also be
sector specific. Ultimately, however,
the longer you leave it, the greater
the risk in not achieving this (a higher
chance of competition eroding your
market share, changes in legislation
impacting your margin, political
changes affecting your customer base,
and so on).
These are still fairly standard
considerations that you will likely have
given thought to, but what about the
opportunity cost of having not sold
for a lower sum, sooner? If you can
be shown that selling for less will not
compromise your dream life, you can
then start to consider the benefits
– spending more time with the
children when they’re younger, not
flogging yourself for something that’s
unnecessary and generally enjoying
life to the maximum.
When personal cash flow modelling
is done right, it can be transformative.
The right practitioner using the right
tool can really engage you in the
pro cess and allow you to see the
impact of different scenarios on the
attainment of your life goals. From
there, you can make plans – both
business and personal – with much
more certainty and confidence.
@EpochWealth
For more info:
www.epochwm.co.uk
01225 487772
THE BUSINESS EXCHANGE 2018
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