MONEY SHOP Happy
2019 everyone
from David Gummers, Financial Plumber. I
thought it would be a good time to look back, as well as looking forward on what is likely to happen over the next 12 months.
If you were an alien looking down on the UK over the last 12 months what would you have made of it? People have not been spending as much as usual as they are concerned about how the big issue will play out, i.e. BREXIT. Retail cannot help but be affected by the fact that uncertainty always tightens the wallet!
So what can we control: First purchasing, in tough economic times it is worth buying more from in stock and less forward orders. I am aware this makes it harder for suppliers. I would, however, say that being overstocked at present just plays havoc with the cash flow. While on purchasing, if you are able to pay in discount terms this pays
your bank charges. It is also worth remembering the discount offered for prompt payment is built into the pricing policy of the company. The good suppliers will know what percentage of their customers pay in discount terms. This is a 2 way favour, the supplier likes good payers and the retailer can save about £3,000 a year on £100,000 of purchases. Turning to other costs, without sounding too much like a price comparison
site, on every utility, negotiate and try to reduce your costs. Loyalty is no longer a virtue. It is easier to check, although it will take time on Gas/electricity as you will need to know your annual usage. But, you will save money! On Credit card Merchant services switch regularly as this can save lots of
money, as the bulk of purchases are paid by debit and credit card. Most offer 3 months free rental as an inducement, so you save £50 before you start on the percentage. Telephone rental is key, as most firms do not charge for calls in the UK.
There are also things like international favourites for those who buy from abroad. Insurance is another area where you can save, by checking who is offering
the best deal, only proviso on this check that they will pay out if something goes wrong. Never except the first quote. I have known people save £300-500 for the same cover, this is a really competitive industry. Always answer questions fully and honestly as any wrong information, however, accidental can invalidate a policy.
40 • FOOTWEAR TODAY • JANUARY 2019 My father was with the same bank throughout his business life, as there
was a friendly bank manager, these days that is not the case. I moved my bank in 2014 and since then have saved close on £1,000! If I switched now, unless the banking was free, the most I could save would be £90 a year! The only time I would revisit this would be if the price were to increase, as time should not be wasted on negligible savings. Another area where money is wasted is on travelling to trade shows etc., this is an area where people should be organised, like Bonfire night and Halloween. Trade Show dates are known well in advance. Book the hotel early as generally
the rates at the Travel Lodge and Premier inn are priced on supply/demand (other good hotels do exist). Save the posh hotels for when you have a holiday as these places are just for putting your head on a pillow. Set a budget for food as well, you do not need to have fast food but neither do you need a Michelin star restaurant either! Every pound you spend at a trade show is a cost on the price of the shoes.
I do not want to be a killjoy but try to be sensible. This also throws up an interesting question, which I will not answer. If you have your team as either a retailer or a supplier, should you all go
out together in the evening, as a team builder, or should you allow people to do their own thing at night? In conclusion, while not wanting to be pessimistic about the next 12 months, I do think things will get easier, as all these peaks and troughs are cyclical. It is more important than ever to ensure that you are as ruthless on costs
as possible. Wishing you an amazing year of wonderful selling and only lovely customers walking through your door in 2019.
If you would like David to look at your business costs, he promises that if he cannot save you any money you pay him nothing. But for every pound he saves, you pay him 15 pence.
If you want to learn more, email David on david@fdickinsonfootwear
.co.uk,
call 01229 580654, or visit www.fdickinsonfootwear
.co.uk
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