Cash Flow Archives | DMT Solutions

How Procurement Outsourcing Can Ease Financial Pressure

26 February 2024

by DMT Solutions Business Finance Procurement Supply Chain

Procurement outsourcing is rapidly gaining traction as a strategic solution for businesses of all sizes.

Today’s competitive business environment has changed from promotional strategies, marketing channels, and pricing methods, to how organisations adjust their strategies to compete effectively using procurement outsourcing as a strategic tool for Chief Procurement Officers (CPOs), business owners, and finance directors to alleviate pressure, optimise costs, and empower their organisations to thrive.

This blog delves into the benefits, considerations, and steps involved in leveraging procurement outsourcing to ease pressure in-house. Whether you’re feeling the strain of managing a demanding procurement process or seeking to enhance efficiency and effectiveness, this guide will equip you with the knowledge to make informed decisions for your organisation.

Is your business feeling the weight of a demanding procurement process?

You’re not alone. Supply chain issues, one global political crisis after another, rising interest rates, global inflation, and employing the right talent and skillset meant 90% of businesses raised their prices by 10% or more last year.

Whether you’re a procurement department head, a business owner, or a finance director, the pressure to optimise costs, ensure efficiency, and manage supplier relationships can be immense.

In 2024, procurement outsourcing is emerging as a strategic solution to alleviate these pressures and empower your organisation to thrive.

What is Procurement Outsourcing?

Procurement outsourcing involves partnering with a third-party provider such as DMT Solutions to manage specific aspects of your sourcing and supplier management functions.

Allowing your internal team to focus on core competencies, while the outsourced partner leverages its expertise and resources to deliver the following benefits:

Reduced Costs: Procurement service providers often benefit from economies of scale, allowing them to negotiate better rates of up to 75% with suppliers and potentially reduce their overall procurement spend. Additionally, you can save on overhead costs associated with hiring, training, and managing an in-house procurement team.
Enhanced Expertise: Access a team of seasoned procurement professionals. With more than 20 years of specialised knowledge in strategic sourcing, negotiation, and supply chain management. Our expertise can help you make informed purchasing decisions, optimise contracts, and identify cost-saving opportunities.
Improved Efficiency: Procurement service providers utilise best practices and cutting-edge technology to streamline the procurement process. Our services are designed to significantly reduce administrative burdens and free up your team’s time to focus on strategic initiatives.
Strengthened Supplier Relationships: Leverage our established supplier network and relationship management expertise to secure better deals and ensure reliable, high-quality products and services.
Increased Agility: As your business needs evolve, a flexible outsourcing arrangement allows you to scale your procurement resources up or down as required, ensuring you remain adaptable and responsive to market changes.

Is Procurement Outsourcing Right for You?

While procurement outsourcing offers numerous benefits, it’s crucial to assess your organisation’s specific needs and circumstances carefully. Consider the following factors:

The complexity of your procurement needs: If you deal with a high volume of diverse purchases, outsourcing can be particularly beneficial.
Size and capabilities of your in-house team: If your team lacks the expertise or resources to handle your procurement workload effectively, outsourcing can be a valuable solution.
Strategic goals of your organisation: If your focus is on cost savings, efficiency, or supplier management improvement, outsourcing can support these goals.

We cover 15 core business activities including:

Taking the Next Step

If you’re considering procurement outsourcing, we must conduct thorough research on your business costs. Our proven track record, industry expertise, and a clear understanding of your requirements will benchmark your current costs and tender for the best value in pricing, service levels and value for money.

By carefully evaluating your needs and exploring the potential benefits, procurement outsourcing can be a powerful tool for easing pressure, optimising costs, and driving growth within your organisation.

How our process works

Our streamlined process is designed to make business easy.

Provide copies of existing contracts or your business requirements and we’ll handle the rest.

Don’t let your competitors have the advantage.

Review

A short call to review your circumstances

Procure

We procure the best suppliers for your business

Impartial

Impartial recommendations and full support

Increase Your Business Profitability: A Step-by-Step Guide

14 February 2024

by DMT Solutions Business Cost Reduction Supply Chain

Business profitability is always at the back of any business owner’s mind.

Every business can improve its profitability. While sometimes a single factor can make a big difference, for most, it’s a steady stream of small improvements that truly lead to success.

This guide will equip you with actionable strategies to increase your profit margins, identify areas for improvement, reduce costs, drive sustainable growth, and implement effective strategies that lead to business profitability.

Boost your bottom line with these actionable strategies.

1. Analyse Your Current State:

Track Key Performance Indicators (KPIs): Identify metrics like sales, costs, and profit margins to measure progress and pinpoint areas needing attention.
Review Costs: Analyse your expenses, including overheads, materials, and labour, to identify potential areas for savings.
Assess Efficiency: Measure how effectively resources are used to identify bottlenecks and areas for improvement.

2. Implement Cost-Saving Measures:

Negotiate with Suppliers: Leverage your buying power to secure better deals on materials and services.
Reduce Waste: Eliminate unnecessary spending in areas like energy, supplies, and inventory.
Optimise Processes: Streamline workflows and eliminate inefficiencies to improve productivity and reduce costs.

Business Profitability - The ability of a business to generate profits from its activities

3. Enhance Revenue Generation:

Review Pricing: Analyse your pricing strategy and consider adjustments to reflect market value and customer demand.
Upsell and Cross-Sell: Offer existing customers additional products or services to increase their average transaction value.
Tap into New Markets: Explore expanding your reach to new customer segments or geographic areas.
Develop New Products or Services: Innovate to meet evolving customer needs and create new revenue streams.

4. Invest in Your People:

Train and Develop Employees: Equip your team with the skills and knowledge to work more efficiently and effectively.
Boost Employee Engagement: Foster a positive work environment to motivate and retain top talent.
Offer Incentives: Reward employees for exceeding targets and contributing to profitability improvement.

5. Leverage Technology:

Automate Tasks: Utilise technology to streamline manual processes and free up employee time for higher-value activities.
Improve Data Analysis: Gain insights from data to make informed decisions and optimise operations.
Implement Digital Marketing: Utilise online channels to reach new customers and drive targeted sales.

Remember:

Start small and scale: Choose a few key areas to focus on initially and gradually expand your efforts.
Continuously monitor and adapt: Track progress, measure results, and adjust your strategies as needed.
Seek expert advice: Consider collaborating with consultants or industry professionals for guidance.

By implementing these steps and adopting a data-driven approach, you can unlock the full potential of your business and achieve sustainable profitability.

Bonus

Checklist for Improving Business Profitability

Seven Cost-Reduction Mistakes to Avoid in 2024 - DMT Solutions

Avoid Seven Cost-Reduction Mistakes in 2024

12 January 2024

by DMT Solutions Business Cost Reduction Finance Procurement

It’s hard to avoid cost reduction in the current economic climate. Organisations face a multitude of challenges, including persistent inflation, supply chain disruptions, and a tight labour market in 2024.

Amidst these headwinds, cost reductions are often seen as a necessary measure to maintain financial stability.

However, knee-jerk cost-cutting measures can have unintended consequences, jeopardising the long-term health of the organisation.

1. Avoid Blanket Cuts with Unrealistic Targets

Unrealistic cost-reduction targets can lead to across-the-board cuts that penalise efficient departments and erode important sources of value. Instead, a more strategic approach involves identifying and prioritising areas where savings can be achieved without compromising the organisation’s core operations or growth potential.

2. Prioritise Sustainable Behaviour Change

Cost-cutting initiatives should not be a one-time event but rather an ongoing process of identifying and implementing sustainable behaviours that will reduce expenses over the long term. This may involve streamlining processes, optimising resource allocation, and fostering a culture of cost consciousness throughout the organisation.

3. Address Complexity to Minimise Overhead Costs

Complexity is often a hidden cost driver, contributing to excessive inventory holding, warranty claims, and slower decision-making. By simplifying business processes, reducing the number of product variants, and streamlining management structures, organisations can significantly reduce overhead costs without compromising their value proposition.

4. Protect Innovation Investments

Aggressive cost-cutting measures can drain resources from high-impact innovation projects, potentially hindering the organisation’s ability to adapt to market changes and maintain a competitive edge. It is crucial to strike a balance between cost reduction and innovation investment, ensuring that the organisation has the resources necessary to drive future growth.

5. Embrace Digital Transformation

Digital technologies offer a multitude of opportunities to reduce costs, improve operational efficiency, and enhance customer experience. Investing in digital transformation initiatives can help organisations achieve cost savings in the long run, while also gaining a competitive advantage in the digital era.

6. Negotiate Fair Contracts with Vendors

In today’s competitive landscape, it is essential to negotiate favourable terms and conditions with vendors to ensure that the organisation is not overpaying for essential services or technologies. Carefully assess the value proposition of proposed solutions and negotiate not just prices but also terms and conditions to protect the organisation’s interests.

7. Assess Risk Management Impact

Cost-reduction initiatives should not come at the expense of the organisation’s long-term viability. By considering the potential impact on cybersecurity, supply chain performance, and employee morale, organisations can avoid rash decisions that could expose them to significant risks.

Conclusion

In conclusion, navigating the current economic challenges requires a thoughtful approach to cost reduction that prioritises strategic decision-making, sustainable behaviour change, and a balanced approach to innovation and cost management.

By avoiding common pitfalls and focusing on long-term value creation, organisations can emerge from the current economic climate stronger and more resilient in 2024.

Contact us if you would like a Free Cost-Audit of your business to help you reduce business costs and overheads.

The Advantages Of Joining The UK’s Largest Buying Group - DMT Solutions

The UK’s Largest Buying Group: Advantages of Joining

6 December 2023

by DMT Solutions Business Cost Reduction Finance Procurement

Joining the UK’s largest buying group will help businesses navigate the ever-evolving landscape of business. Staying competitive requires more than just innovation and strategy; it demands a keen focus on optimising costs and maximising efficiency.

As a business owner, navigating the complexities of procurement to reduce overheads and streamline operations while striving for growth can be a daunting task.

That’s where DMT Solutions steps in. Leverage the strength of the UK’s largest buying group to offer unparalleled advantages to UK businesses of all sizes.

Joining the UK’s largest buying group for free presents a compelling opportunity to achieve significant savings across a wide range of business expenses.

Harnessing the Power of Collective Buying

Buying groups, also known as procurement consortiums, are organisations that aggregate the purchasing power of multiple businesses to negotiate better deals with suppliers. This collective bargaining strength translates into substantial discounts and cost savings for businesses.

As the UK’s largest buying group, we have an extensive network of members and established relationships with suppliers and are uniquely positioned to secure exceptional rates and terms for our clients.

A Comprehensive Range of Cost Savings Opportunities

The benefits of joining the UK’s largest buying group extend far beyond traditional procurement categories.

The group leverages its expertise to negotiate favourable deals on a diverse array of business expenses, including:

Utilities: Reduce electricity, gas, and water costs.
Payment Terminals: Secure better rates on card machines and transaction fees.
Corporate Social Responsibility: Enhance sustainability practices while gaining cost-effective solutions.
Waste Management and Recycling: Optimise waste disposal and recycling processes at reduced costs.
Water Rates: Negotiate lower water bills for commercial and industrial premises.
Business Rates: Access expert advice and support to minimise business rates payments.
Courier services: Optimise shipping and logistics expenses with discounted courier rates.
Insurance: Secure comprehensive coverage at competitive premiums.
Fuel Cards: Enjoy lower fuel costs for your company fleet.
Vehicle Leasing: Obtain favourable terms on vehicle leasing and rental agreements.
Green Energy: Transition to renewable energy sources at reduced costs.
Office Supplies: Streamline procurement and benefit from bulk discounts on office essentials.
R&D Tax Credits: Maximise tax relief by identifying and claiming eligible R&D expenditures.
Cleaning Supplies: Secure high-quality cleaning products at competitive prices.
Postage and Packing: Optimise postal costs and access discounted shipping services.

A Collaborative Approach to Cost Reduction

As the UK’s largest buying group, we take a collaborative approach to cost reduction, working closely with members to understand their specific needs and identify areas for potential savings.

The group’s team of experienced procurement specialists provides personalised guidance and support, ensuring that members maximise value.

Additional Benefits of Membership

In addition to substantial cost savings, joining the UK’s largest buying group offers a range of additional benefits, including:

Access to exclusive deals and promotions.
Up-to-date market intelligence and industry insights.
Risk mitigation strategies to protect against supply chain disruptions.
Networking opportunities with fellow business owners.
Expert advice on regulatory compliance
Additional revenue stream by recommending our services to business owners.

Empowering Businesses to Thrive

The UK’s largest buying group is committed to empowering businesses to thrive by reducing costs and enhancing efficiency.

By leveraging the group’s collective buying power and expertise, businesses can unlock significant savings of up to 75%, reinvest in their core operations, and achieve their strategic goals.

Conclusion

Joining the UK’s largest buying group is a strategic decision that can transform a business’s financial landscape.

By joining the UK’s largest buying group for free, many of our customers have avoided inflationary pressures and kept their prices the same as last year.

The savings businesses make from cost reduction have enabled businesses to grow, employ new staff, save jobs, invest in marketing, buy new stock, remain competitive and invest in Corporate Social Responsibility without having to increase spending money.

By harnessing the power of collective buying and tapping into the group’s expertise, businesses can secure substantial savings across a wide range of expenses, fueling their growth and propelling them towards sustainable success.

Slash Your Business Costs and Boost Your Bottom Line

8 November 2023

by DMT Solutions Business Cost Reduction Finance Procurement

In the face of rising costs and economic uncertainty, UK businesses are facing a pressing challenge:

How to maintain profitability while minimising expenses.

At DMT Solutions, we understand the unique pressures faced by UK businesses, and we’re here to help you navigate these challenges and emerge stronger.

Our team of experienced cost reduction experts is committed to helping businesses like yours identify and eliminate unnecessary overheads, streamline operations, and unlock hidden savings opportunities.

Identifying the Hidden Costs Draining Your Profits
Many businesses are unaware of the extent to which unnecessary expenses are eroding their bottom line. From bloated software subscriptions to inefficient energy consumption, these hidden costs can accumulate over time, silently siphoning away the profits you’ve worked hard to earn.

DMT Solutions takes a comprehensive approach to cost reduction, meticulously examining every aspect of your operations to identify and eliminate these hidden drains.

Unleashing the Power of Automation

In today’s technology-driven world, automation is not just a buzzword, it’s a necessity. DMT Solutions helps businesses harness the power of automation to streamline repetitive tasks, reduce human error, and free up valuable time and resources. By automating mundane processes, you can empower your employees to focus on high-value activities that drive revenue and growth.

Negotiating with Vendors: The Art of Savvy Savings

When it comes to vendor negotiations, many businesses feel powerless, often settling for unfavourable terms that eat into their profits. DMT Solutions brings expertise and leverage to the table, skillfully negotiating with vendors on your behalf to secure the best possible rates and terms. We understand the dynamics of vendor relationships and know how to extract maximum value for your business.

Optimising Your Software Landscape: Eliminating Wasteful Subscriptions

In today’s software-driven world, it’s easy to fall into the trap of subscribing to multiple applications, many of which go underutilised or are simply unnecessary.

Conduct a thorough audit of your software landscape, identifying redundant subscriptions, outdated programs, and underutilised features. Optimise your software portfolio, eliminating unnecessary expenses and streamlining your operations.

Embracing Energy Efficiency: Saving Money, Saving the Planet

Business energy costs can be a significant burden, especially for those with large physical spaces. DMT Solutions helps businesses implement energy-efficient practices, reducing consumption and lowering utility bills. We identify areas of energy waste, recommend cost-effective solutions, and guide you through the implementation process.

Partner with DMT Solutions: Unleash Your Profit Potential

At DMT Solutions, we’re not just about cost reduction; we’re about helping businesses achieve their full potential.

We understand that every business is unique and we tailor our strategies to your specific needs and goals.

We believe that every pound saved is a pound earned, and we’re dedicated to helping you secure the financial freedom you deserve.

With our expertise, dedication, and unwavering commitment to client success, we’re confident that we can help you unlock significant cost savings, boost your profitability, and propel your business to new heights of success.

Don’t let unnecessary costs and overheads hinder your business growth. With our proven strategies and unwavering commitment to client success, we’re dedicated to helping businesses like yours streamline operations, eliminate wasteful expenses, and achieve the financial goals they deserve.

Contact DMT Solutions today for a free cost review and embark on a journey of cost optimisation and profitability enhancement.

Together, we’ll transform your financial landscape and unlock the true potential of your business.

Benefits of buying power for a Small Business - DMT Solutions

What are the benefits of buying power for a Small Business?

8 November 2023

by DMT Solutions Business Cost Reduction Finance

Buying power should be a priority for UK small businesses that have been hit the hardest in the last few years by Brexit, Covid-19, the Ukraine war raising the price of goods and inflation.

Although the business outlook looks aggressive, businesses need to remain resilient and confident to overcome the next few years.

As a small business, we understand the hardship companies face when getting the best deals from suppliers. Many suppliers will look favourably and offer deals and discounts towards companies that spend more money. For those organisations that do not spend as much or are less frequent in usage, they struggle to find a supplier that can offer preferential rates, which costs time, resources and money – which is why many small businesses lose out in the buying stakes.

Not being able to command discounts from suppliers makes it harder for SMEs to compete against competitors.

The pandemic combined with tighter margins and rising costs, forced many small businesses in the UK to shut their doors for good. From 2021 to 2022, there were 581,824 dissolutions in the UK, an increase of 32.9% compared with 2020 to 2021, the highest number of dissolutions on record*.

Forward Thinking

In order to strategically advance our position and the circumstances of our clients, we became a part of the UK’s largest buying group with the buying power of an FTSE 250 company.

As a business, by joining the buying group, we were able to reduce many different business costs and overheads, making us more competitive and enjoy superior rates and deals that were not available on the open market or to our competitors. 🙂

There are several benefits to having buying power:

Discounts and better pricing: With robust buying power, our buying group are able to negotiate better prices or discounts on the products or services a business would traditionally use, such as insurance, energy, and payment terminals. The amount of money businesses have saved over the years has amounted to hundreds of thousands of pounds.
Greater flexibility: Having buying power can also give you greater flexibility in your purchasing decisions. For example, you may be able to purchase in larger quantities to take advantage of bulk discounts or longer payment terms to improve your cash flow.
Improved bargaining position: Buying power gives us a better bargaining position when negotiating with suppliers, thus helping you get more favourable terms and conditions, such as better warranties or more flexible delivery schedules.
Increased efficiency: By purchasing the products or services you need at a lower cost, you may be able to improve the efficiency of your operations and increase your profitability.
Stronger relationships: Building deeper and stronger relationships with suppliers can also be a benefit of having buying power. Stronger relations help secure more favourable terms and conditions and receive better service and support from your suppliers.

Review Time

Now is the perfect time to review your general expenses and uncover potential opportunities for savings. Here are some areas to focus on:

Fixed Costs – These are your regular, predictable expenses consistent throughout the year. If you receive any notifications of changes, take the opportunity to evaluate your options. Consider whether you can find a better rate elsewhere or adjust your sales plan to accommodate these costs.

Variable Costs – Expenses that fluctuate with usage can often be negotiated. Don’t hesitate to have a conversation with your supplier to maintain a fair price or secure a volume discount.

Investment – If you need to drive your business forward with external help or new technology, research the costs and plan for it. Helping you focus on your sales goals and plan ahead to achieve them.

By joining our buying group for free, businesses can save up to 75% on their business costs and overheads.

With such huge savings, businesses can reinvest their capital into their company for growth, saving or creating more jobs, marketing, expansion, buying more stock, and so much more.

By anticipating your future expenses, you can ensure that your sales and profits will cover them. This forward-thinking approach will give you the confidence that you’re on the right track to reach your business objectives.

If you would like to cut your business overheads, then Contact Us for a free, no-obligation business review.

*Source: gov.uk

Cashflow - Businesses Feeling The Pain - DMT Solutions

Cash Flow – Businesses Feeling Pain

27 April 2023

by DMT Solutions Business Finance

Introduction

Cash flow is the lifeblood of any business. It is the amount of money that flows in and out of the business, and it is essential to its survival.

A healthy cash flow means the business can pay its bills, invest in growth, and weather unexpected expenses. However, when there is tight or negative capital, businesses can experience real pain.

The Importance of Cash Flow

Cash flow is critical for businesses because it affects their ability to operate and grow. A positive turnover enables a business to:

Pay bills and meet its financial obligations
Invest in new equipment or technology
Hire new employees or give raises
Expand into new markets or geographies
Take advantage of unexpected opportunities

Causes of Cash Flow Problems

There are several reasons why a business may experience cash flow problems, including:

Slow-paying customers
Overhead expenses that are too high
Unexpected expenses, such as repairs or legal fees
Seasonal fluctuations in demand
Inefficient or ineffective cash management practices

The Impact of Cash Flow Problems

When a business experiences cash flow problems, it can have several adverse effects:

Unable to pay bills or make payroll
Late payments to suppliers, which can damage relationships
Reduced ability to invest in growth or take advantage of opportunities
Increased stress on business owners and employees
Possible legal or regulatory consequences

Strategies For Improving Cash Flow

There are several strategies that businesses can use to improve their funds:

Offer early payment discounts to customers
Negotiate better payment terms with suppliers
Reduce overhead expenses, such as rent or utilities
Increase prices or offer premium services to increase revenue
Implement more efficient cash management practices, such as forecasting and budgeting

The Role Of Financing

Financing can also play a crucial role in helping businesses improve their liquidity. Some financing options include:

Short-term loans or lines of credit to cover unexpected expenses
Factoring or invoice financing to access cash tied up in accounts receivable
Equipment financing or leasing to spread out the cost of expensive equipment
Merchant cash advances or revenue-based financing to access capital based on future revenue projections

Risks and Considerations

While financing can be an effective way to improve capital, there are also risks and considerations to keep in mind:

High-interest rates or fees may make financing more expensive than other options
Depending on the type of financing, it may require collateral or personal guarantees
Taking on too much debt can hurt the business’s credit score and future borrowing ability
Failing to repay financing can lead to legal or financial consequences

Case Study: A Business in Pain

XYZ Company is a small manufacturing business struggling with cash flow. They have several slow-paying customers and have had unexpected expenses in the past year, including a broken piece of equipment and a legal dispute with a supplier.

As a result, they have been unable to invest in new equipment and postponed expansion plans.

Solution for XYZ Company

To address its money problems, XYZ Company could consider several strategies, including:

Offering early payment discounts to customers to incentivise faster payments
Negotiating better payment terms with suppliers to improve financial resources
Reducing overhead expenses by renegotiating rent or utilities
Applying for a short-term loan or line of credit to cover unexpected expenses
Factoring their accounts receivable to access cash tied up in unpaid invoices.

Conclusion

Cash flow problems can cause real pain for businesses, but some strategies can help. It’s vital for businesses to regularly assess their cash flow and take action when necessary to ensure their financial health.

This may involve implementing more efficient cash management practices, exploring financing options, or making difficult decisions to reduce expenses.

By taking a proactive approach, businesses can improve their cash flow and position themselves for long-term success.