The cash gap
A UK manufacturer with around £30mn annual turnover and a significant dollar exposure came to us 18 months ago with a familiar problem.
Their cashflow was unpredictable. Not because the business was struggling (revenue was growing, in fact). But every quarter, the cash they expected to have and the cash they actually had were different numbers. Sometimes by six figures.
The real outcome of cashflow perfection
In a single year, this business:
Increased turnover only slightly — no dramatic sales growth
Nearly doubled operating profit from £7.4mn to £13.8mn
Squeezed roughly £14mn out of working capital
Built a new £20mn warehouse — without borrowing a penny
Paid down debt, paid a dividend, and still saw cash balances go up
Cash secrets for every business
How did they achieve this? They didn't find a magic growth lever. They took absolute control of their cashflow.
They changed their product mix. They got better at purchasing. They looked hard at their deposits. They looked at their supplier terms. They managed debtors like the pound notes they actually are, sitting in the warehouse waiting to be collected.
None of it was revolutionary. Every single lever was available to them and is available to every British business. They just made cashflow the priority rather than treating it as a consequence.
