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Safety first, cash second.

A PCL product story

Edited by the Engineeringtalk editorial team Nov 21, 2006

Health and safety compliance in the workplace has never been more important with the need for enterprises to comply with the increasing raft of legislation.

Health and safety compliance in the workplace has never been more important with the need for enterprises to comply with the increasing raft of legislation.

Any company with more than 5 employees is legally obliged to possess a comprehensive health and safety policy.

This actually benefits both the employees and the company, especially seeing as during 2004/2005 28 million working days were lost due to work-related ill health and 7 million due to workplace injury, representing massive costs to the companies involved.

MJL was established in 1990 and is now one of the UK's leading Health and Safety and Human Resources consultancies providing highly specialised support and advice to employers, regardless of size or industry sector.

They believe that safety is an inherent part of any business and should be a constant factor in management policy, not just to be applied when cashflow is good and there is enough time.

Due to a business need, MJL has grown significantly over the last two to three years and is projecting 100-150 per cent growth over the next year.

However, no growth plan will succeed without cash, as Partner Philip Shelley explains: "Our clients are typically with us for three to five years, spending an average of GBP12,000 a year".

"However, it is during the first year that there is the most financial outlay in terms of HR systems or risk assessments for example, which we would have to self-fund as the costs were much more than GBP12,000".

"In reality, we were not actually making any money from a client until years two or three which is a long time to wait and contributed towards negative cashflow".

The solution for MJL was FeePlan from Premium Credit, a direct debit management service which offers solutions for monthly payments of annual fees, business loans, memberships, season tickets and subscriptions by spreading the payments.

Through using FeePlan, MJL would receive the year's payment in full whilst their clients benefited by paying their fee by monthly direct debit.

This provided a perfect solution to increase cash flow and removed the need for self-funding".

"We started utilising FeePlan about six months ago for a three month trial with a handful of our clients and were very impressed," enthuses Philip.

"We currently have around 2500 clients of which we offer 75 per cent the FeePlan facility and usually only for the first year when there is the most expenditure".

"We decide whether it is needed in later years but overall FeePlan has allowed us to make money a lot earlier".

This money has been put to good use growing the business.

For example, MJL has been able to offer very competitive salary packages which have enabled them to attract some new key staff members from competitors.

This in turn has also helped to increase sales as the new employees are some of the very best at what they do in the industry.

The task of managing cash flow and collecting outstanding debts has another detrimental effect on businesses as it can damage the client/business relationship, which is another reason why MJL decided to use Premium Credit: "We have very close client relationships which are important to us and nurturing these was a deciding factor when choosing to work with Premium Credit." Philip also looked at the products of Premium Credit's closest competitors but decided to go with FeePlan for a number of reasons: "FeePlan was the simplest and best offering".

"It was also extremely quick to organise with only two months from inception to implementation".

"Premium Credit was also recommended to us by companies in the insurance industry and we have had no problems with them whatsoever".

"They seem to delegate quite a lot to their area managers which works well as our accountant has built up a very good relationship with our area manager Andrew Allen who is very reactive and quick to come up with solutions".

Introducing FeePlan six months ago has made a significant difference to MJL's cash flow through receiving payments for the first year in full up front.

The growth of the company has been phenomenal and development is set to continue through using the increased cash flow in the most positive ways to make a real difference to the business.