Julia’s Case study – Setting up UK branch of a foreign parent company

European-based parent company set up in the UK following their massive success in mainland Europe. The business model is now moving towards a franchise. Stock is imported from Europe and held in the UK. In the early set-up stages, the UK director was initially still in employment. He has recently started working full-time and has relocated to the business premises. This is giving him and his family a better work/life balance.

The following points cover the main things I did to support the new business.
1) Set up accounting records on Cloud-based software

  • Data is accessible from anywhere worldwide. Online submissions are possible for quarterly reporting to HMRC (for example, payroll/RTI or Making Tax Digital).
  • Expenses can be submitted online, authorised and paid more quickly.
  • Accurate stock records align with purchases and sales. Famous lines are easily identified and reordered.

2)Streamline and automate the bank reconciliations –

  • This highlights any payments or receipts not supported by approved documentation.
  • All VAT activity is recorded, which supports the quarterly VAT Return.
  • Unauthorised activity can quickly be spotted and investigated.

3)Develop budgets and forecasts based on accurate actual data

  • A benchmark is quickly established for the business
  • Comparisons to industry trends or standards are possible.
  • KPI Variances can be monitored monthly/quarterly, understood and actioned.

4)Marketing costs are shared with the new franchisees.

  • Googlewords and Facebook attract new business across the UK and Ireland.
  • Business vehicles are primarily large 4x4s and wrapped with company graphics.
  • Corporate image is encouraged by company clothing displaying the company logo having to be worn.

5)Management Reports are produced

  • Regular reporting to the parent company and the bank is possible with narratives to explain any variances or trends.
  • P&L, Balance Sheet, Cashflow, Debtors and Creditors are commented on so that the relevant actions can be taken.

6)Produce “what If’ scenarios for possible new products or expansion schemes

  • This highlights the effect on the finances of different options.
  • Easily accessible information aids in timely decision-making.

7)Produce data to Get Ready for Investment

  • Confidence in how the local management team run the business is established.
  • Profit and Loss, Balance Sheet and Cashflow forecasts to illustrate to lenders how and when repayments will be made.