It’s been a few weeks since the last blog. When the Eyjafjallajökull volcano began disrupting air travel, we had a number of cancellations. We then had a few days when vehicles were simply parked up and didn't move. (We took full advantage and went on a photo shoot, preview on our Facebook page) Then, people who needed to get home began to contact us.
The next few weeks took our business in a different direction and pushed our turnover up to a record high. The journeys we completed were out of the ordinary as people needed to reach train stations, ferry ports and airports in other countries. We even took seven passengers to Madrid.
Now this is all well and good but, our business model relies on us sub-contracting work to a network of people. Normally it’s just a few journeys and that is never a problem.
Our network of drivers are paid on a fixed day every month so they never have to wait too long. It is one of the key factors in our growth model. It is how we build such a reliable and motivated network - if our customers need vehicles at short notice, we can arrange it because our rates and payments to drivers are so good.
When we invoice customers we simultaneously pay our drivers and then wait for customers to pay us - they effectively use our credit - it’s how we make profit and keep everybody happy.
However, when you need all of your vehicles and each one completes a high value journey; this has an impact on cash flow. The last six weeks have been incredibly busy and just like last year we have to monitor our cash-flow – unlike last year though it is not because we have a decrease in turnover, it is because we have a substantial increase!
We recently took on new customers; extended some payment terms for others; and took on more work from some existing customers too. The combination of all this has been a large increase in our outgoings and a very real need to monitor our bank balance!
Luckily we have a lot of systems in place to constantly update us but, this was not necessarily an issue we planned for or ever experienced before.
We needed to be a little bit creative and look more carefully at our forecasts and plans. At the same time, it is an issue which swallows a reasonable chunk of time on top of a time when you have a lot less time. All in all though, a very positive issue to have and one we are very pleased to deal with.
