Using Xero’s online accounting platform, the fitness procurement specialist FIT Quote achieved a more joined-up approach to its finances, resulting in better control of cash flow and a bookkeeping system fit for an expanding business.
As countless small businesses have experienced, one of the few downsides to fast growth is the not inconsiderable time and cost associated with keeping control of accounts. At the same time, they must also satisfy the demands resulting from more customers and orders.
Based in Darlington, FIT Quote UK is a small, fast-growing supplier of top-brand fitness equipment for the UK market. As its name suggests, the firm operates as a competitive quote-sourcing company. Using its strong industry experience, knowledge of fitness equipment and buying power, it offers well-known health and fitness equipment brands at competitive prices.
After quickly establishing itself as the market leader in the niche field of fitness equipment procurement, FIT Quote gained further industry recognition in early 2012 when it became the official supplier of Lebert fitness equipment. Having secured this important relationship, the business began to expand at an even more rapid rate.
Fortunately, in late 2011 it had already become evident to FIT Quote and Prime Accountants, the firm’s newly-appointed advisors, that FIT Quote’s spreadsheet-based accounting processes had not only become too inefficient but would also soon become unsustainable.
“When we first started the business in January 2011, we felt confident that we could maintain our own records and stay in control of the purchase and sales invoices,” explains FIT Quote founder and managing director, Colin Carter.
“As the business grew and the number of sales and purchases multiplied we started to explore different options.”
With turnover continuing to increase and day-to-day finances becoming harder to juggle, FIT Quote MD Colin Carter welcomed the opportunity to move beyond the manual, Excel spreadsheet-dependent processes that he had previously used to run the company accounts.
“Using a spreadsheet was limiting for a number of reasons, but primarily there was too much scope for human error,” he explains. “We also wanted to be able to link purchase orders to invoices, and we just weren’t able to do that using such a basic method of accounting.”
Despite the firm’s best efforts, previously, the complexity involved in chasing debts and following up on orders had also meant that during FIT Quote’s period of fast growth some invoices had managed to slip through the net.
After just one day’s training, the team at FIT Quote was up and running with Xero. Now, the company’s accounts team has daily insights into the businesses’ financials that were previously impossible to achieve.
For FIT Quote, the cloud-based flexibility in the system was especially important when it came to unlocking the potential of web-based customer interactions.
“We already had the capability to take orders from our website but Xero’s cloud-based system ensured that necessary accounting information could be extracted and processed in a cost-effective way,” says Carter.
“This has allowed us to retain overall control of our finances without having to perform accounting tasks on a daily basis ourselves.”
Since it first began using Xero in late 2011, FIT Quote has achieved a significant saving on accountancy fees without missing out on the important strategic guidance that an accountant can provide. One way this has been achieved is through the automation of previously time-consuming order processing, as well as the increased real-time visibility gained by both FIT Quote and its advisors, Prime Accountants.
Laurence Moore, partner at Prime Accountants, introduced FIT Quote to the Xero online accounts platform, and explains the value that the technology has unlocked for the growing business. “For FIT Quote and countless other fast-growing small businesses like it, the increased financial complexity involved in accounts management limits the overall value that using spreadsheets can have,” he says.
“In automating key processes such as order processing, Xero has allowed FIT Quote to structure its accounts far more effectively, as well as get a real-time overview of its finances at the click of a mouse.”
For entrepreneurs like Colin Carter, this more efficient way of doing business means it has become far less likely that invoices are paid and issued late – or don’t get paid at all: “Before we were introduced to Xero, a lot of the planning for chasing debts and paying suppliers was done in my head and as a result, we are still following up on a few debtors,” he says.
“For this and other reasons, we really like the fact that Xero is a cloud-based system, as it gives us the flexibility to issues invoices, review outstanding debts and send reminders to customers for payment – wherever we happen to be.”
For Gary Turner, managing director at Xero UK, FIT Quote’s journey to leaner, more efficient accounting practices is testament to the fact that online accounting can not only help small businesses take control of their accounts and keep on top of cash flow but also release more time for continued business development.
“Companies like FIT Quote are ideal users of Xero: they get instant gratification by moving from a spreadsheet-based accountancy approach and can see the results quickly,” he says. “As a new business, showing a level of professionalism to your customers through your invoicing process is key. In FIT Quote’s case, online accounting has helped them do just that.”