How the mighty fall. A few years ago no one could touch Tesco. Most other retailers were in a David and Goliath situation with them. They had the right strategy, the human touch (remember “Every Little Helps”?) and the ability to be everything to everyone. Oh, how we all desire to be that business.
But something as simple as “accounting errors” looks likely to be the stone in the forehead of this mega-giant. 92% fall in half year profits…eesh!
I know it isn’t this straight forward. Tesco was being squeezed on both sides by competition. They rolled out a massive store make-over in order to compete with high end Waitrose and Whole Foods whilst also being squeezed out the market on price by bargain food chains Lidl and Aldi. Tesco no longer fit nicely into one space or another. But, at the end of the day it was “accelerated recognition of commercial income and the delayed accrual of costs” (an attempt to feed the beast), which did it in.
So what’s my point? Well, if a big business like Tesco can get it wrong, think how easy it is for a small business to get it wrong. I’m not suggesting that Tesco’s error could have been prevented by using better software, but perhaps it’s time for you to think about how you can run your business more efficiently.
I don’t know any business which hasn’t had a “hairy” moment or two – perhaps in its embryonic period. It’s scary, but possibly preventable. Consider this: do you have accounting software which integrates your sales so that your forecasting accurately reflects your trends? Or do you still have someone hand cranking a forecast each month? Do you set your business goals based on real time information? Or do you have to wait until the current accounts cycle has run its course? Are you “Doing a Tesco”? Or are you being the most effective and efficient (and truthful) version of yourself you can be?
To talk to one of our software gurus about how your business can be more effective talk to us
Written By Emma Stewart