During the last eighteen months some businesses have obviously struggled during the Covid crisis but there are also many businesses who have flourished, and some are saying their company has never been so busy.
We have spoken before in these blogs about this but after a meeting yesterday with a very successful architects’ practice, we have realised that despite being extremely busy it is easy to find that certain areas of businesses have been neglected.
When we say neglected, we do not mean that in a particularly bad way it is just that things are happening so quickly the managing director can not keep up with the rate of change.
The firms core business is doing well, and they are just about keeping up with the amount of business being introduced. However, there will become a time very soon when they will need more staff and that may mean that they take on the wrong person or must turn business away as they have not had the time to find the right person to fit in with the team. Obviously, they could turn to a recruitment agency which saves a lot of the managing directors time but at a cost.
However, when you add up the managing director’s time whether in or out of normal working hours suddenly, the cost of a recruitment agency is looking more economical. Then factor in the cost of business lost due to the lack of staff or critical personnel being taken away from their paying work then it is virtually paying for itself.
The reason for our meeting was the fact that some invoices had become outstanding, and this was entirely due to the MD’s lack of spare time and his inability to carry out basic credit control which had let these invoice fall overdue.
You may well say should the MD being chasing invoices but taking on a company to purely do credit management will seriously help the businesses cashflow, make the company more efficient as the key employees are not tied up collecting money and it also creates the impression that the company is far bigger than it is with a very organised back office to support the main operation.
When we carry out credit control for a company we act as their internal team under no circumstances do the clients realise that it has been outsourced.
With pro-active credit control there is a significant reduction in late payments and outstanding invoices allowing the directors to make better decisions and forecasts fort their business.
How do you concentrate on your key business and not let all the background noise get in the way?