The Growth Strategy for a Wholesale Business - In this guide were going to take you through the process of how a wholesale business grew sales from $20 million of the $55 million with 12 years. Using this strategy they were able to generate growth almost self-sufficiently without the use of significant bank loans or debt funding. The company has now reduced its net debt and operates with consistent profits.

1. THE GROWTH
STRATEGY
FOR
A
WHOLESALE
BUSINESS
BASIL ZAFF MBA

2. The Growth Strategy for a
Wholesale Business
In this guide were going to take you through the
process of how a wholesale business grew sales from
$20 million of the $55 million with 12 years. Using this
strategy they were able to generate growth almost self-
sufficiently without the use of significant bank loans or
debt funding. The company has now reduced its net
debt and operates with consistent profits.
Founder of Secure CFO
BASIL ZAFF
5.6 - THE GROWTH STRATEGY FOR A WHOLESALE BUSINESS 2

3. The company generated significant IT improvements which generated success with
growth:
Integrated third party logistics inventory system including manual picking list
and delivery note systems. Accurate inventory placement for warehouse in
stock takes creates efficiency and improves customer satisfaction.
Introduced a new automated invoice preparation system or e-mailing
customers, sales and agents across the company.
Automated the process of calculating percentages on freight.
Integration of new sales agent tools and representatives. When an order is
received, it gets uploaded to one common accounting system ensuring that
agents don't have to look of data in stock levels on multiple pieces of software.
Creation newbie to be e-commerce site which insurers common accounting
system and up-to-date stock levels. E-commerce also improves the delivery of
new stock and track inventory rates with greater accuracy. The sales on the
site accounted for 8% of the total company sales.
Integration of existing orders systems with EDI sales system used by many
major retailers. Sales orders no longer had to be entered manually.
Automation of import stock costing processes.
Implementation of a major software upgrade that took place over a weekend
for zero downtime.
Implementation of new data mining and analysis tools for sales
representatives, office staff and marketing professionals to analyze sales in
greater detail.
Assistance with two successful mergers in which full function for integrated
into an existing system for use on the cloud. Entire import process resulted in
no loss of sales or productivity.
Founder of Secure CFO
BASIL ZAFF
5.6 - THE GROWTH STRATEGY FOR A WHOLESALE BUSINESS 3
IT Improvements:

4. Founder of Secure CFO
BASIL ZAFF
5.6 - THE GROWTH STRATEGY FOR A WHOLESALE BUSINESS 4
Accounting Improvements:
The finance department enhanced itself in a wide range
of ways to generate growth as well:
Improved customer payment collections reducing total owing 22% down to 5%
over 90 days. The generated $500,000 worth of extra cash flow.
Imported banking receipts into the accounting system.
Implemented a personal property securities register to ensure customers
accounts could be tracked properly. The success of this system with highlighted
when a customer that was $900,000 in debt when approached for liquidation
which resulted in $500,000 in cash and stock recovering over half the debt.
Crosschecking against the D&B accredited application occurred and its directors
and officers were reviewed to avoid potential bad debt.
A stop supply listing was updated daily to see the number of accounts on stop
supply. This began at the start of the month and fell as a result ensuring that
account that owed money were highlighted accordingly and logged as soon as
they occurred.
Implemented a new system for automated e-mailing statements at the end of the
month and at critical points for customer billing. Customer payments and cash
flow increased significantly as a result of the automation.
Implemented new debt arrangements with several long-standing debtors that
saved the chance for legal action and claims court and allow the customer to
continue buying goods. There was an overall reduction in the debt owed as a
result of these new arrangements.

5. Founder of Secure CFO
BASIL ZAFF
5.6 - THE GROWTH STRATEGY FOR A WHOLESALE BUSINESS 5
Stock Controls:
The company implemented a series of regular inventory procedures including:
Full warehouse counts
Rolling aisle count on a weekly basis.
Quarterly counts of stock levels on items stocked under 20 units.
Daily stock delivery variance counts.
Monthly clearance list including stock analysis reports and buying reports. All
reports were managed internally.
Financial Controls:
New financial controls were introduced to improve cash flow:
Regular examination for daily cash flow management was taken on under a new
process.
Operating cash flow management budget for six and 12 month basis was that
out and the process provided the opportunity to take cash flow issues and avoid
losses.
A weekly management report dashboard including margins, cash position,
debtors, sales orders, purchase orders and support exchange coverage was
placed out to all management. Dashboard were compared against the previous
year to see trends and to enable management to identify issues quickly.
Monthly management accounts were prepared by the seventh working day of
each month with comparisons against the previous month and the same month
of the last year. Detailed variance reporting identified issues with sales and
profitability and delivered charting and graphs that clarified trends in data.
Formalized expense authorizations were initiated to prevent fraud.
Examined previous ATO audit over an 11 year period to cover all expenses and
ensure that the refundable adjustment amount was zero.

6. An extended terms offer was implemented for the business and this is how it was set
out to work:
The business was seeking new ways to increase sales and their market share
without having to severely discounted stock or reduce its margins.
As a retailer they had a set amount that they needed to spend the season on
their stock called the open to buy figure. If the supplier has a larger share of the
open to buy market there will be less available for the competition and an
increase in market share.
The business had a series of significant cash reserves with 3% per annum in
interest and they determined that operating in an overdraft of 12% over two
months would result in a 2% discount on their stock if they were to over
purchase.
Founder of Secure CFO
BASIL ZAFF
5.6 - THE GROWTH STRATEGY FOR A WHOLESALE BUSINESS 6
The extended terms offer:

7. The business ran through two major seasons with the larger season from July to Dec
and the smaller season from Jan to June.
In January they launched a program for new orders with customers who were on
good credit extending the invoice dates for qualifying customers. Deliveries in
Jan were invoiced on 1 March. Deliveries in Feb were invoiced April 1 and
Deliveries in March were invoiced on May 1. Customers would have up to an
additional 60 days to pay for the stock in this ensure that the company was able
to sell their stock without having to rely on debt to finance new purchases.
The program was launched at the mall or season in January and followed up
with a trade fair in April.
The extended credit resulted in an increase of $5 million in sales and repeat
customers.
The promotion was repeated over the next two years and led to an increase in
season sales.
The change resulted in an offer competitors could not match with their cash flow
and offer customers loved.
The sales staff was also fans of the promotion because it made their jobs easier
and increased commissions through the flexibility.
Founder of Secure CFO
BASIL ZAFF
5.6 - THE GROWTH STRATEGY FOR A WHOLESALE BUSINESS 7
The extended terms offer:

8. Do Something About It Now.
All we do here at SecureCFO is design, build, and run accurate accounting
systems for innovative creative agency organizations. If you're interested
in understanding more about how we might be able to assist you, here's
what you ought to do next:
Get Informed.
Go to https://securecfo.com/start-here/ to discover what we look for in our
customers, what we do, and how we do it.
Get Clear.
Arrange a Zoom call with us. Together we'll take a deep look at your
existing accounting system, what's working, what's not working, and what
actions you require to take now.
Do something about it.
If we believe we can help, we'll inform you. If we can't help but another
person can, we'll tell you that too. Then we'll work with you to create an
action plan for you to put in place the accounting system you require.
SecureCFO Group, LLC
info@securecfo.com
5.6 - THE GROWTH STRATEGY FOR A WHOLESALE BUSINESS 8