As many small and medium-sized enterprises discover the hard way, the key to long-term business success lies in doing the basics well. Keeping the accounts straight may seem like a boring back-office necessity, but a good accounting system gives managers the information they need to make decisions and can support the effective operation of the business. A poor accounts system can make it difficult - if not impossible - for a business to run the way it wants.
For Hayes Garden World, poorly integrated accounts packages which did not support multi-site operations were blocking its plans to grow - and making it hard for the existing business to compete.
Hayes had cobbled together a solution when it took over a second garden centre site in Leeds by setting up another independent system, kick-starting it with copies of product data from its main site. However, each system then had to be maintained independently, with the same data keyed in at each site. Paul Fisher, Hayes' IT manager says, "Our expansion plans meant it was not sustainable to continue to have separate systems."
Even worse, because front-office functions such as electronic point of sale were not integrated with the main ledgers, more labour was involved in keeping the two aspects reconciled. The result was that "we did not necessarily trust the information on the old system because we could not drill behind the figures to see how they were arrived at," says Fisher.
It was clear the company needed a new accounts package. Hayes took advice from other members of the Tillington Group, a buying and marketing consortium for garden centres, and also talked to the project managers who would be implementing the systems on behalf of resellers, as well as the sales people, before it made its choice. "You need to speak to someone who knows what the product can and cannot do and the effort involved in making what you want to do happen," Fisher says.
Based partly on the experiences of other members of the Tillington Group, Hayes chose Navision Financials, implemented by reseller Alpha Landsteinar, for its multi-site capabilities, ability to import data easily from Hayes' existing systems, and flexibility. "We wanted something that would meet our needs now and in the future - when we do not quite know what those needs are," Fisher says. "So it had to be fairly configurable." He adds that the software also had a robust design, making it easy to use and to maintain. "Our people are trained in plants, not IT," he says.
Hayes simplified the switch to the new system by not bringing across any historical data, simply starting afresh at the beginning of the new financial year. As well as minimising the data transfer challenge, it also gave the accounts department a clean slate to restructure the chart of accounts, creating a structure that would support the business more effectively as it moved forward.
However, Hayes still needed to load its end of year position into the system and a key challenge was to reconcile data on the 80,000 different product lines stocked in each garden centre. "We had to ask, is this bag of compost at this price in Ambleside the same as this bag of compost in Leeds at the same price?" Fisher says. "We were able to do that partly by matching barcode information, but we did have to match a lot of data manually. Alpha Landsteinar helped speed up the process by writing a matching program that used business logic to narrow down our choices in each case."
The transition took less than a month. "It was probably faster than I would have chosen to do it in hindsight," Fisher says. "Just before and immediately after going live, we were still working out how the system worked. You should not underestimate the size of a project like this. When something has such a big impact on your company, it is important to have enough resources, including enough training for staff. We did not devote enough attention to training, which would have saved us some problems down the line."
Despite a few teething troubles, the new system has allowed Hayes to take a huge leap forward. "It gives us more control over what is going on," Fisher says. "We have better visibility of stock, with a better handle on purchasing, stock movements and write-offs. Before, there were big gaps in the management information we had and this system has helped to plug them. And because data is updated constantly between sites, we can be more responsive in spotting trends."
He says the system is much more configurable, "So if we want to launch a promotion - such as linking products to give a discount when they are bought together or running 'buy one, get one free' offers - we can change the system to support that. The old system could not be reconfigured at all." The new system has no problem coping with the diverse range of products sold - from plants to furniture, gifts, kitchen equipment and toys - and can handle sales for the wholesale and landscape divisions as well as the retail business.
Eliminating the need to re-key data and being able to run a single centralised accounts system has made the accounts function much more efficient.
The system will make it easy for Hayes to deliver on its expansion plans. "Adding a new store to the accounts system would take no more than a couple of hours." Fisher says. "It is organised in dimensions, so we simply need to stick in a new dimension to represent the store. That is one of the key reasons we chose the software." Hayes is proving it is easy to implement the system at a new site by rolling it out to a new warehouse in Ambleside, linking it to the central server using a virtual private network running over a broadband radio link.
About the company
Hayes Garden World's roots as a traditional plant nursery go back about 200 years. Today, the company employs about 160 people, and has a turnover of £12m. It now operates two garden centres, at Ambleside in the Lake District and at a site in Leeds acquired about five years ago, as well as a wholesale garden company based in Kendal and a landscaping business operating from a second site in Ambleside.
About the project
Hayes Garden World needed an accounts system that would give its management team greater confidence in the information it was using and allow it to expand without having to replicate its accounts department at each new site.
The solutionNavision Financials, implemented by Alpha Landsteinar, running on Windows 2000 Terminal Services, with sites connected through leased lines to a central server.
Faster access to data, with drill-down to detail giving greater confidence in figures
Highly configurable, allowing promotions to be set up quickly
Cost savings from better stock visibility and elimination of data re-keying
Support for multiple sites from a single database, with rapid deployment to new sites.
Click here for Part One of the SME supplement >>