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Presentation to the UK Weighing Federation

In this presentation to the UK Weighing Federation, Ken Stanbury discusses the importance of being a financially strong and viable business in order to survive the recession. He provides insights on balance sheets, profit and loss accounts, cash flow, and sound business planning. Ken also highlights the perils of cutting prices and offers strategies for increasing sales, reducing costs, and improving net profit. Additionally, he explores the role of market analysis, competitor analysis, SWOT and PESTLE analysis, and marketing and operational plans in future business strategies. Ken also emphasizes the support available from banks, funders, Business Payment Support Services, and Business Link. Resources like diagnostic tools, consultants, manufacturing advisory services, mentoring, and training programs are highlighted as well.

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Presentation to the UK Weighing Federation

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  1. Presentation to the UK Weighing Federation Presenter: Ken Stanbury – Business Support Adviser EMB Limited “SURVIVING THE CREDIT CRUNCH”

  2. Renamed “SURVIVING THE RECESSION” (Banks assure us that they are “open for business” and will support “viable businesses”) Q. “What is a viable business?” A. “A business that is financially strong and has a sound Business Plan”

  3. “Viable Business” • Financially Strong • Balance Sheet • Profit and Loss Account • Cash Flow • Sound Business Plan

  4. Balance Sheet Tangible Assets 100,000 Current Assets Stock 100,000 Debtors 100,000 Cash 2,000 202,000 Current Liabilities Short Term loans/overdraft 100,000 Creditors 100,000 Total Assets less Current Liabilities 102,000 Long Term Liabilities 100,000 Net Assets 2,000 Capital and Reserves Share Capital 1,000 Reserves 1,000 Shareholders Funds 2,000

  5. FINANCIAL PERFORMANCE ANALYSIS Year 2008 2007 2006 Turnover 1,519,382 1,447,031 1,378,125 Growth % 5% 5% 5% Cost of Sales 881,241 810,337 744,187 COS % 58% 56% 54% Gross Profit 638,141 636,694 633,938 GP % 42% 44% 46% Overheads 486,202 434,109 385,875 O/H % 32% 30% 28% Net Profit 151,939 202,585 248,063 NP% 10% 14% 18% Breakeven Turnover 1,157,623 986,611 838,858 Breakeven Gap 361,759 460,420 539,267

  6. Profit and Loss Account • Increase Sales • Reduce Cost of Sales / Increase Margins • Reduce Overhead Costs

  7. The Magic of 1% Turnover 1,534,575 1,519,382 Growth % 1% 5% Cost of Sales 874,708 881,241 COS % 57% 58% Gross Profit 659,867 638,141 GP % 43% 42% Overheads 475,718 486,202 O/H % 31% 32% Net Profit 184,150 151,939 NP% 12% 10% Breakeven Turnover 1,106,321 1,157,623 Breakeven Gap 428,254 361,759

  8. The Perils of Cutting Prices Sales Turnover Gross Margin % Gross Profit Overhead Costs Overhead Costs% Net Profit Net Profit% Breakeven Turnover 100,000 60% 60,000 40,000 40% 20,000 20% 66,666 120,000 50% 60,000 40,000 33.3% 20,000 16.66% 80,000 100,000 50% 50,000 40,000 40% 10,000 10% 80,000 80,000 60% 48,000 40,000 50% 8,000 10% 66,666 80,000 60% 48,000 32,000 40% 16,000 20% 53,333 80,000 65% 52,000 40,000 50% 12,000 15% 61,538 80,000 65% 52,000 32,000 40% 20,000 25% 59,230

  9. CashFlow Opening Balance Total Cash In Total Cash Out Net Cash Flow Closing Balance Jan 1,000 40,000 30,000 10,000 11,000 Feb 11,000 25,000 45,000 (20,000) (9,000) Mar (9,000) 40,000 25,000 15,000 6,000 Apr 6,000 30,000 30,000 0 6,000

  10. Plan Future Strategy • Market Analysis • Competitor Analysis • SWOT • PESTLE • Marketing Plan • Operational Plan • Staff / Skills Review

  11. Business Plan • Documented • Forecasts • Financial Budget

  12. Discuss with your Bank/Funders:

  13. “Real Help” • Bank Support • Enterprise Finance Guarantee (£1.3bn additional lending) • Working Capital Guarantee (£10bn securing up to £20bn of lending) • Capital Fund (£50bn from HMG and £20m from banks for equity funding)

  14. “Real Help” • Business Payment Support Services • HMRC • PAYE • VAT • Corporation Tax

  15. “Real Help” • Business Link Support • The IDB Model • Information • Diagnostic • Brokerage

  16. Business Link Support • Information • Website • Director Briefings • Factsheets • Knowledge Bank

  17. Business Link Support • Diagnostic • Business Support Broker • Financial Performance Analysis • Health Check Questionnaire • Resource Efficiency Questionnaire

  18. Business Link Support • Brokerage • Consultants • Specialist Advisers • Manufacturing Advisory Service • Mentoring • Train to Gain • Leaders First

  19. Some useful websites • www.businesslink.gov.uk • www.businesslink.gov.uk/eastmidlands/realhelp • www.businesslink.gov.uk/realhelp/healthcheck • www.businesslink.gov.uk/realhelp/savemoney • www.businesslink.gov.uk/realhelpredundancies • www.businesslink.gov.uk/realhelp/structure • www.creditmanagement.org.uk/berrguides

  20. More useful websites • Resource Efficiency Questionnaire: https://diagnostic.businesslinkem.co.uk/Public/PublicUserInfo.aspx • Manufacturing Advisory Service http://www/mas-em.org.uk • Mentoring www.mentoringeastmidlands.co.uk

  21. Thank you for listening Ken Stanbury Business Support Broker East Midlands Business Northampton Office Ken.stanbury@businesslinkem.co.uk Tel: 07825 344620

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