Homalocks UK Ltd

“With the current state of the manufacturing sector, the ability to adapt quickly, innovate and use technology to our advantage is essential. Access Business Intelligence makes all this possible.”

Homalocks UK Ltd is a small manufacturer of metal and thermoplastic accessories for leather and travel goods, stationery, clothing and industrial products. In common with the vast majority of companies in this sector, Homalocks has been through some challenging times during the past two years. With many customers moving their operations offshore (to China in particular), there has been considerable pressure on turnover and profitability.

Access Accounting has been providing the company with business and accounting solutions since 1999. Having experienced considerable cost reductions and increases in efficiency through the use of this software, Homalocks naturally turned to the same supplier for additional help… seeking to ramp up competitiveness another notch.

Business intelligence, delivered by the Access Executive Desktop, has provided the answer. This fully integrated (on-screen) reporting system has enabled Homalocks to identify new market sectors, maximise sales to existing customers and – perhaps most importantly of all – to establish where its marketing strategy was falling short.

Managing Director, Paul Gillingwater, remembers back to when he first selected Access Accounts Horizons. “We needed a mid-range package with enormous scope; order processing, stock control, multicurrency transactions and a simple solution for Intrastat reporting were just a few of our requirements. At the same time, it had to be very competitively priced.”

Paul continues, “With only four personnel, it was essential for this system to increase our efficiency by automating as many processes as possible. Our accountant recommended Access, based on what he had read in an accounting journal.” The choice was a good one: “Access immediately did what we needed it to and, because it was so easy to use, changing systems caused us very little disruption.”

Turning prospects into loyal customers

To entice new customers, Homalocks follows the principle of selling by sample. Access Accounts is used to manage this activity from beginning to end.

When a new prospect calls in or is found following a sales drive, details are entered straight into the Access prospect manager module. At the same time, an estimate is raised in the sales order processing module, corresponding to the sample that is to be sent to the prospect. When the sale is agreed, the ‘prospect’ record converted into a ‘customer’ record and the ‘estimate’ is converted into a Pro Forma invoice. None of this requires any re-keying.

The new order is then created, an invoice is issued to the customer, payment is received and the order is shipped out. Holding all this information in one central location – the accounts – enables the company’s open-office policy to work effectively.

Paul explains, “The precise status of an individual prospect enquiry can be viewed by anyone, at any time. And because the system handles conversion from one record type to another, we don’t waste time re-keying. This has greatly reduced admin requirements on sales transactions.” Full history on customer transactions has also proven beneficial. “This helps our sales people to ensure that they are selling the right product to the right customers.”

Using business intelligence to maximise orders and increase profitability

Paul continues, “Executive Desktop has enabled us to set up a number of preconfigured reports for our sales staff, containing the kind of analysis we need to drive up sales and profitability. Because these business summaries are portable, staff can also have access to much needed information when they are sitting in front of customers.”

On a daily basis, sales staff are emailed a report detailing customer sales by Period to Date and Year to Date. They are also sent a debtors list, a summary of prospects, a copy of the order book and details of stock movements – information that enables them to view purchasing trends, see how sales are progressing… and make sure they sell to people who will pay on time.

The Customer Sales Overview report is particularly useful. It gives a snapshot of a customer activity, identifying whether sales are increasing or decreasing. Significantly, staff can even drill-down into the underlying data, to see exactly which products are contributing to the customer’s profile.

Paul explains, “Let’s say that our customer is a briefcase manufacturer. From the Customer Profile Report, the sales person can see the volume of handles we are supplying, and whether there is a positive or negative trend. Knowing what we are selling to each customer also enables us to address what we are not selling… why doesn’t our briefcase manufacturer also buy his locks from us? Executive Desktop gives us the information we need. We can get an excellent feel for the whole potential product base for each customer – quickly and effortlessly.”

“Our warehouse also has access to the order book report. Here, the information is used to identify new instructions, see which orders are still pending and consolidate deliveries. This increases our efficiency and improves our customer service. Aside from which, savings on delivery costs quickly add up.”

Increased purchasing efficiencies and cost reductions

Purchasing from foreign suppliers is administered entirely through the Access purchase order processing module. Using multicurrency and Euro functionality, Homalocks can fully account for transactions in foreign currencies. The system automatically calculates exchange differences and re-values bank balances, creating even more administrative efficiencies. Intrastat reports can be raised at the touch of a button for all import transactions.

Paul comments, “One of the biggest benefits of the purchase processing module is the ability to track part deliveries. Production orders are very common in our industry. We may order 10,000 units, but they arrive in shipments as they come off the production line. Access manages this easily – saving us hours of searching for product shipments.”

Having built up a purchasing profile, Homalocks is also able to see purchases by period, rather than just by cumulative total. Paul explains, “We can now see the highs and lows in our purchasing pattern. This has enabled us to forecast our purchasing requirements, make blanket, bulk orders and have stock fed in by period. This has had a tremendously positive impact on our cash flow.”

Integrated stock control for greater competitiveness

With 2,300 product lines, efficient and accurate stock control is essential. Integrated sales order processing and purchase order processing means that stock arithmetic is dealt with automatically. Paul outlines the benefits. “Prior to Access our sales order processing was integrated to stock, but purchase orders were not. This led to around 5% of products not being accounted for. We wasted a great deal of time searching for input errors and recalculating stock levels. We even resorted to rolling stock takes, due to the simple fact that there were so many errors. With Access, if the system says a stock item is there, we know it’s there. We now conduct just two stock takes per year and, because the system is so accurate, each one takes less than two days.”

In late 2000, the market changed considerably: customers began demanding ready-made assemblies, not just components. Homalocks changed its strategy accordingly, choosing to sub-contract assembly work – a change that needed to be reflected in the company’s stock control methods. Implementation of the Access Bill of Materials module enabled Homalocks to track stock across multiple locations – including stock that was held with the sub-contractors.

As components went out, stock movements across locations were adjusted; and as final assemblies were created, stock holding was updated to include the new, ready to sell products. “Prior to the Access BOM module, we spent 1 week every month modifying stock holding, trying to figure out what assemblies were ready and how many components were still in stock. Now, because all of this is done at the touch of a button, we can quickly turn around orders. This has improved our customer service and attracted new sales.”

Paul also comments on the stock business intelligence that is gained from the Access system. “Real-time stock information is always available using Executive Desktop. All stock movements are detailed, providing a quick overview of the direction in which products are moving. Stock problems are easily highlighted and we can take proactive action to ensure that problems do not get out of hand. The reports also highlight stock trends – information which the sales team can act on immediately.”

Improved management information and reduced audit costs
Over the last three years, Homalocks has steadily increased its use of the functionality provided by Access Accounts. A further example of this is integration with Microsoft Office. Having a direct link between the accounts and MS Excel has greatly reduced the time taken to prepare management accounts. It has also introduced a new and more efficient way of making adjustments to static accounts data, using the optional write-back facility.

“Management accounts used to be a nightmare. Just extracting the data took an entire day. Then we had to produce reports in one format for ourselves and a different format for our bankers,” says Paul. “With Excel add-ins, it takes about 2 hours. And this timescale includes chatting with the accountant over coffee… it really is a stress free activity. Our accountant is much happier with what he sees at the end of each month and we have saved a considerable amount on out audit fees."

Paul concludes, “Access Accounts has given us greater ability to look inwards. It shows us the trends we must react to and sets alarm bells ringing if things begin to go wrong. With real-time information, we can keep in touch with company-wide activity, every second of the day. With the current state of the manufacturing sector, the ability to adapt quickly, innovate and use technology to our advantage is essential. Access Business Intelligence makes all this possible.”