RRK Van Sales Limited were established in Worksop in 2014 by John Knowles. The company has gradually increased turnover since its inception. However, while growth is good, each year saw more and more strain being put on the financial management of the business.
“I have a business that trades as a ‘Used Van Sales’ Dealer in Eastgate, Worksop. I used a ‘Car Dealer Management system’, but never knew how to use it, nor would they tell me my tax liability, and only got this last minute from my previous accountants. I was never sure as to what VAT or Corporation Tax was payable either, and not sure if it was correct.
“Having spoken to Hammond and Co and how they did things, I decided to move. Hammond took care of the transfer from my previous accountants with no problems or fuss, and it’s the best thing I’ve done.”
What was the problem?
With the business growing, John had no information to help understand what his various tax liabilities were at any given time. In particular, he was not able to gauge what his quarterly tax bills were likely to be. The figures only became clear at the last minute, causing issues with cash flow.
There were no systems in place for viewing financial reports. This in turn meant that there was no understanding of whether the growth in business was being matched by a growth in profits.
How did Hammond Fix it?
Hammond and Co set RRK up with a ‘Dealer Management System’ called AutoSales. This new system works in conjunction with the Sage accounting software, allowing clear visibility on all areas of the business’ finances. This provides valuable information around tax liabilities, levels of turnover and overall profitability.
Hammond owner Mark Bates also introduced the concept of a 3 month business review meeting to ensure appropriate tax planning measures are initiated. This ensures that any tax liabilities are minimised where possible to assist cash flow and business efficiency.
Where are RRK now?
RRK continues to grow its turnover and is able to ensure that profitability levels are maintained whilst at the same time having a good understanding of current and future cash flow requirements.