Controlled assessment 2017 - Task 3 (1.3)
‘Which is the most appropriate method to improve net cash flow that the business you have chosen could use?’
For this assessment I have decided to identify what is the most appropriate method that my business could use to improve their net cash flow. I decided to choose this task as I am able to use my business knowledge of ways in which a business can improve their cash flow and have a good relationship with the owner of the business I have chosen; therefore, I will be able to get all the information needed to answer this task. The business I have chosen is called Barnet Gallery.
Introduction to Barnet Gallery
Barnet Gallery is the name of the company that I have chosen to answer this task. Barnet Gallery is a small business that has been open for 33 years offering knowledgeable advice and supplies related to arts and crafts. The business also offers framing services which are done to a very high standard. The shop sells Art supplies such as; brushes, paints, pastels, pencils, pens, picture frames and canvases as well. The businesses’ annual turnover is £180,000 with a net profit before tax of £58,000. The current monthly cash flow is £15,000.
Since this business has been open for 33 years the owners have high knowledge about the items that are frequently bought and the goods that are not bought often, which helps to see which items sell well. Barnet Gallery is open 6 days a week from Monday to Saturday at 9.30am to 5.30pm. Since the shop is open on Saturday it helps introducing new customers as many similar businesses not usually open 6 days a week. This will help the owners increase their sales which will improve their cash flow to a certain extent depending on the expenses of keeping the shop open for an additional day. The business is a family run business which is beneficial to a good net cash flow as It keeps staff wages to a minimum.
The shop is situated in Barnet and has a great location since it is along the high street making it easily accessible for their customers to enter the shop. Furthermore, there is on street parking available for customers to use to get items to and from the shop. There is also a nearby secondary school (QE Girls) which is beneficial to improve cash flow as students will be more likely to purchase art and school supplies from their business. Additionally, by keeping their shop open till 5.30 pm students from QE Girls and students living in Barnet will be able to get school supplies after school as most schools will finish at 3.30 pm.
The business attracts a wide range of people from artists, people who want to purchase paintings, frames or art supplies. The business offers a wide range of products and services such as paintings, blank canvases, brushes and framings. There are hardly any businesses in the Barnet area that offer such a wide range of products and services, therefore; making it a unique selling point which will help improve net cash flow.