A growing number of forecourt retailers are finding that retailing isn’t actually now expected to be their main role at all. In days gone by they were told by the oil companies that their main function was ’front of house’ but today they are often finding themselves expected to do another job altogether - namely the paperwork and administration for five or six sites, and some DIY accounting in their ’lunch break’.
The change seems to have been prompted by a blind faith in IT solutions coupled with the network owners’ desire to cut costs. The rationale seems to be that you’ve got a group of sites with an IT system at each one, so now you can do everything yourself, from ordering stock through to knocking out a set of financial accounts and tax computations, all without ever leaving the office. Can you spot the flaw? Well, looking through the Shop Doctor column in previous issues might just give you a hint - ’missing this’ and ’dirty that’ are seen more frequently than most brand managers should feel comfortable with. Put simply, if a retailer is expected to stay in the back office and do admin, then who is supposed to do the retailing?
As mentioned above, one of the reasons that this trend has caught hold is that managers have an almost child-like belief in the ability of PCs to solve every problem and allow everyone to do everything.
Now there are some very good accounting programs out there from the likes of Sage, Quickbooks and others. We know because, in addition to our own in-house systems, we’ve used them for years and quite happily accept files that some of our clients generate from them for further accounting and tax work. Over the years those software packages have been developed to the point where most high-street accountants couldn’t survive without them. The software allows relatively inexperienced staff to produce what are generally known as ’draft accounts’ - but with the more experienced staff in the practice there to supervise, spot the queries and do the technical accounting and tax work that only begins when you have a draft set of accounts off the PC. And there’s the rub: accountants and bookkeepers use accounting software all of the time because that’s what accountants do. They don’t sell petrol, arrange the grocery order for next week, fix car washes and deal with the site alarms going off at two in the morning. Accounting software is primarily for accountants as legal software is primarily for lawyers.
Now decades of experience here at EKW have taught us that most forecourt retailers can happily go from running one site to two sites without much hassle. Some have even gone on to add a third site without having to expand their ’administration’ too much. But by the time that they try to add a fourth, things tend to go somewhat askew. By then they either have to start locking themselves into the back office all day and employ a manager to actually do the retailing bit - or they have to start thinking seriously about employing bookkeepers and accounting staff to do the paperwork and administration. Unfortunately we also find that when the grand plans for these ’mini groups’ are being drawn up, everyone seems to forget to factor in the administration and accounting time required.
In some instances, particularly where the business is getting really big, it may make sense to take on permanent full-time or part-time clerical and accounting staff. But beware - they don’t come cheap, usually won’t just work in the storeroom or a lock-up shed, and once they’re in that spanking new office you’ve built for them, they’ll forever be asking you to update their PCs and software. But the business does have to be big enough to justify such a move - after all, even if you find yourself using a solicitor quite frequently, you’re hardly likely to go out and actually recruit one to be on your staff, are you?
An alternative route to consider is to outsource the admin and accounting to an outside organisation, which is then contracted to do the work for you at an agreed price. At some point everyone running a business has to seek expert help and assistance. PC software packages are okay but you should no more expect them to answer your employment queries than you would expect them to perform DIY brain surgery just because there’s an interesting site for brain surgeons on the internet. DIY is not for amateurs.