60 Seconds with Steven Cohen

You’re in a lift with Steven Cohen and have just enough time for two questions. Shoot.

Q: I hear a lot about business intelligence (BI) and underneath all the hype it sounds promising. Yet, I never hear it mentioned in the context of small business. What’s the situation?

I sympathise. A lot of hype was created around business intelligence (BI) and people love to complicate things (where there’s mystery, there’s margin!). In reality BI is quite simple and also very relevant to smaller businesses. BI is just software that helps you quickly get the information that’s already in your accounting system, out in summarised form. This lets you spot trends and make connections.

Let’s say you have 10 000 invoices in your system. A list of them wouldn’t be helpful, but imagine if you could ask: show me what items customers within a specific demographic purchased. Show me what items were the most profitable. Show me my top ten customers either by quarter, month or year. BI gives you these answers in seconds. The ease of asking and getting answers makes managers more inclined to become more creative in the questions they ask.

The Pastel Business Intelligence Centre module is an affordable BI solution for SMMEs. It pulls the information straight from your accounting system and populates easy-to-use, graphical, Excel-based reports.

Q: Things are getting tighter and I want to improve my cash flow. I know it sounds ridiculous, but often I’m so busy running the technical side of my business, I don’t get around to sending out invoices on time. Help!

You are not alone. One of the common mistakes business owners make is not invoicing and collecting debt on time. It is a serious problem and you need to act swiftly. Even if you are always engrossed in your workshop, studio, shopfloor or kitchen, do just this: set fifteen minutes a day aside for basic cash flow management. Study your cash flow forecast, set someone up in your business to contact your customers and send invoices and monitor that it gets done. Remember, you’re not the only supplier trying to collect money from a customer. So follow the old rule: the person who calls the most gets paid first.

The next step is to automate the process, but be sure to choose a practical, hands-on software solution. Buy a cash flow and debtors management system such as Pastel Cash Manager, that can generate lists of overdue invoices and e-mail them to your customers. Make sure it can track all the promises made and categorise all the reasons for non-payment. This helps you identify and quantify reasons for non payment so you can take action. It allows you to measure your cash flow precisely and eliminates the typical, messy, scribbled notes on your customer age analysis.