Natalie Lightfoot reveals how she makes sure her store is the best it can be
Cash is king. The age-old saying that means a good cash flow in a business is crucial for it to remain strong.
It’s where everyone wants to be, but if you take your eye off the ball it can change very quickly.
To keep track of this I always make weekly cash flow sheets to foresee any potential problems. Every retailer does their sales at the end of the night, but as a precaution I take all the figures from them – credit card and cash takings, commission from services – and compare them weekly.
There’s no point waiting for your profit and loss sheet, even if you do it once a month. That doesn’t tell you when you are able to invest or take on new staff.
Cash does not necessarily mean physical notes and coins. Times are changing and we’ve seen digital payments increase by 5% over the past year in our store.
These come with their own cost, such as merchant charges, but we support it. Why would we refuse?
It’s up to you to negotiate the best deal on merchant charges and ensure your profit margins support that.
It can also be confusing handling money in store when it’s not yours. The Lottery, PayPoint and Western Union all drive footfall and bring cash into the business, but it’s not ours. The risk is that banking it incurs charges. There are banks that offer free banking limits, but there are other ways to get around it. Self-fill ATMs are a great way to offer an additional service, as well as directly transferring money into your account.
Poll your cash machine daily and this will help transfer money from services to your bank safely, while minimising bank charges.
Focusing your energy on making a simple cash flow statement can help you know if the money is coming in fast enough for what is going out. It’s great that you can make a 50% profit on certain items, but it’s a problem if they aren’t turning over quick enough to ensure you meet your expenses on time.
Convenience stores need to grow to survive, so while we look for the next best thing to invest in, always keep an eye on the fundamentals as this gives you the confidence to be the best store you can be.