Success Story: NTB Survey Ltd
This fast-growing business was increasing turnover but not profit. As in many small businesses, the management team needed additional accounting support to understand different types of costs and to determine strategies to ensure a level of profitability that would secure the future of the business.
NTB Survey is a specialist land surveyor business offering fast and affordable surveying solutions throughout the UK. The services it offers include topographical surveys, measured building surveys, setting-out engineering, machine control models, cut/fill analysis and settlement monitoring.
The business was founded by Nick Bamber in April 2020 at the start of the first COVID-19 lockdown. Construction work for essential national infrastructure continued throughout this period, so there was a continuing demand for essential surveying services, despite the circumstances of the pandemic.
NTB Survey met these needs whilst also delivering desk-based services, such as consultation work and quantifying improvement works. Nick aimed to realise his vision to provide the best quality surveys that maximised the benefit of new technology, rather than simply replicating traditional hand-drawn surveys. Surveys are colourful, easy to read and important information stands out. Strong demand saw the business grow its turnover by £100k per annum.
By Christmas 2022, however, Nick realised that there was something very wrong with the business accounts. Despite steady growth and a significant amount of money coming into the business, his cashflow was highly stretched.
Nick knew of Prevail Accounting via the Grafters networking group, a specialist construction and property group on LinkedIn. He turned to Prevail for help.
Nick recalls, “Although I am an experienced surveyor with a strong background in sales, I had no previous accounting experience. Like many small business owners, it wasn’t a part of the job I was particularly literate in or enthusiastic about. However, by Christmas 2022, I was experiencing the real-world effects of not staying on top of the business accounts – and that meant a lot of sleepless nights.”
NTB Survey engaged Prevail Accounting in February 2023 and Prevail began reviewing past accounting records in order to prepare for year end 2022/23. With the business facing insolvency, Prevail discovered that the existing accounts had not been prepared in enough detail to reveal from where the problems stemmed.
“I didn’t know what questions to ask,” admits Nick. “I was blind to the root of the problems.”
Prevail Accounting conducted a thorough review of the business accounts. This included detailed budget setting as well as adjusting the chart of accounts to bring information fully up to date.
It revealed that the previous lack of clarity had arisen from the attribution of direct costs, including wages, as overheads. This hampered a true understanding of gross profit margins. Further, an outstanding loan had a very high rate of interest, making it unaffordable. After accounting for all the missing costs, Nick was not in a position to pay himself a dividend.
It was clear that the business finances needed work if the business was to succeed. A new loan was agreed with the support of a friend, which significantly reduced the interest burden and relieved the financial pressure.
Prevail worked with Nick to develop a detailed budget and targets for gross profit margin, net profit and overheads. The budget is checked against actual figures on a monthly basis. Prevail also created detailed costing and efficiency reports which enables Nick to track how profitable each job is. These insights have led to a change in direction for the business.
Nick says, “I now have a much better understanding of staffing costs, including National Insurance and pension contributions, holiday allowance, etc. As a result, I am in a much better position to set prices and make informed decisions.”
In addition, Prevail discovered that NTB Survey was eligible for research and development tax relief. This has been a big help, equating to a big injection of cash into the business.
“The tax savings have been absolutely fabulous,” says Nick. “But the new costing spreadsheet is more valuable because that’s long term. I now know what my most profitable services are – so I can refocus on my core abilities. With Prevail’s support, I have expanded my skillset in finance and business management and I am able to make money.”
Twelve months later, in March 2024, NTB Survey undertook an annual review to assess progress against the financial targets developed with Prevail Accounting.
Nick says, “I have hit the expected target almost to the penny! We’ve gone from loss-making in year three to absolutely profitable in year four. I have been able to pay myself a good salary and secure the future of the business, including the employment of my team. I wouldn’t have been able to do that without the support from Prevail Accounting.”
He adds, “I have already recommended Prevail Accounting to other small business owners. Prevail are absolutely proactive and not afraid to flag issues when things are wrong. We needed that support as a business. Prevail want the best for the businesses they work with and they have demonstrated that in their passion for helping NTB Survey succeed. We now have a strong accounting foundation in place and I am really excited about what NTB Survey can achieve in year five.”
Do you need help understanding the detailed financial performance of your business? Would you like support setting realistic, achievable financial performance targets for the year ahead?
Call Prevail today on: 01706 550 825.