Lost profit costing companies millions
July 30th 2007

Failure to control profits and losses is costing the British cleaning industry a staggering £105 million a year, a new report has said, but taking some simple measures could slash this cost.

The study by business analysts Plimsoll Publishing finds that:

• 36% of companies are making a loss

• 14% are losing money for the second year running

• 3% of companies made less than 3% return on investment

Of the 157 companies covered, 116 would make more profit under new ownership, resulting in £105m extra revenue in the industry as a whole, the report estimates. At the moment, that money is being simply thrown away because of companies’ failure to control their losses and manage their businesses more effectively

“These results prove just why the cleaning services industry is hot with takeover talk and speculation about future ownership," explains the senior analyst on the project, David Pattison. It’s certainly no surprise that trade buyers and private financiers are taking a close look at the industry – some of these businesses have huge potential that is not being realised.”

The good news is that simple changes can transform the performance and value of a company including:

• Cutting out unprofitable sales. In some cases, a 10% drop in sales could actually improve profitability

• Looking again at unnecessary stock levels and keeping control of trade debtors to free up cash

• Reducing borrowing to improve profitability

To order the full report and get more information on how to make your business more profitable, just  click here Quote reference PR07 for a 20% discout.

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