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Recently, I've had the opportunity to go to a couple of interesting talks on business courtesy of CIMA and every time I've jumped at the opportunity as you never know what nugget of information you may pick up.
Last week I went to a talk by Simon Farnsworth on how to grow a business -something I'm very interested in at the moment. Simon Farnsworth was the CEO of Floors-2-Go and helped the company grow from a small family run business (which I found out was started in the West Midlands) to a PLC and then finally to a management buy out in 2006.
The talk itself was interesting buy not quite what I was expecting (which seems to be the theme of many of these talks at the moment) as it focused mainly on his career since leaving school rather than how to grow a business but it was non-the-less interesting.
One thing that he said amazed him was the fact that many of the businesses he has got involved with didn't even have cash flow forecasts before he started. He said this to a room of chartered accountants, most of whom were aghast (as to was he) to hear this however I for one have rarely had an up-to-date cash flow forecast and in fact it's only been within the past 6 months that I even bothered working on one. Why do I not have a cash flow forecast I hear you ask? Well that's simple; time.
A cash flow forecast is something that as a sole trader you don't really worry about if you've got a good head for figures you should have a pretty clear idea of what's in, coming in, and going out so the sums are easy. Ok as you grow your business and have other employees working with you the going out part may be a little less under your control but you should still have a good idea of what's going on so the time required to keep an up-to-date cash flow forecast is better spent else where i.e. making sure the "coming in" part is growing as large as possible ;)
I can understand why an accountant finds it incredible that an SME doesn't have a cash flow forecast as it is something that's very useful and more importantly allows you to see how much money you can draw from the business. Perhaps it's something you should look at doing once a week or month alongside saving your tax ;)
One thing I felt sorry for Simon about though was how he talked about the business. Since the management buy out he has been removed from the position of CEO and told us about how he had been made to remove nearly the complete board of directors because when you remove a company from being a PLC you have to replace all the non-exec board members (another thing I didn't know). Simon has clearly put his life and sole into the business only to be thrown to the wayside without even so much as a thank you.
There were a number of amusing ditties however from the talk including how Floors-2-Go managed to acquire the renowned orange Ferrari that I've seen around a few times (these were taken at the cinema):
Or how he had an ASBO against him for littering the streets with all the Floors-2-Go balloons and leaflets.
Simon Farnsworth is now CEO of Amber Windows which I couldn't place at the time but I realised there is a big bill board just up the road from here with it on. He seems a nice chap and I hope he can move on from Floors-2-Go but I get the feeling that'll take some time.
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