Business spotlight: Brompton Bikes powers ahead
29 May 2020: From bikes for the NHS to finance function digitisation, Brompton Bikes has continued to push forward despite the many challenges of coronavirus. George Hawkes-Dawson, the company’s head of finance, tells ICAEW Insights how.
The COVID-19 pandemic and subsequent lockdown have seen the nation rally round the NHS and its workers as a collective act of unity and defiance against the spread of the virus.
Brompton – producer of the iconic folding bicycle - has rolled out its Wheels for Heroes initiative, which aims to manufacture and make available up to 1,000 hire bikes for key NHS staff to help them get to work in a safe and healthy manner without risking infection on overcrowded public transport.
Having initially committed production capacity equating to an investment of up to £100,000 to fund the bikes, the company has now seen that pool swell to over £320,000 of its £400,000 target, thanks to its crowdfunding drive.
An array of rewards to those supporting the scheme includes free bike hire, securing your name on the Greenford factory wall of fame and various corporate packages.
George Hawkes-Dawson, Brompton’s head of finance, says the scheme has been a huge success despite having to reduce production capacity to enable social distancing on the assembly lines.
Each assembly line station was previously 1.7 metres apart, which had to be extended to two metres, but Hawkes-Dawson is proud that not a single day of production has been lost due to pandemic-related issues. And the 450-strong firm still manages to ensure around 1,000 bikes leave its factory every week, destined for velo-heads across the 49 global territories it sells into.
Part of that success can be attributed to the company’s forward planning over Brexit and the increased stockholding from their Far Eastern and European suppliers.
That Brexit stock was a godsend for us as it meant we could use some of it when we saw factories closing down in the Far East to help us buffer through this COVID-19 period.
The pandemic also presented a key challenge in ensuring all those employees that could work from home could do so while some procedures we had in place were quite old fashioned and paper based. Necessity being the mother of invention, an electronic sign-off workaround of purchase orders and purchase invoices was soon adopted.
One key learning from the pandemic is that the business has recognised that we should move towards a more agile and flexible approach where employees can work from home for several days each week, depending on the role that individual is playing.
Digitise that
Having joined Brompton two years ago, the former Dixons Wilson employee, who cycles to work along the towpath astride his trusty steed from his Little Venice home to the office each day, lost no time in conducting his own sweeping reforms of the finance function, primarily in the migration to full digitisation.
That meant moving away from the inherited 20-year-old accounts system that is struggling to keep up with the pace of change in the business, says Hawkes-Dawson, who oversees a team of 11, one of whom is based in China.
We are exploring a pan-European e-commerce channel but are constrained by the capabilities of the current account system that is unable to handle the multiple VAT jurisdictions required to comply with distance selling rules.
The £2m solution is a new very modern cloud-based ERP system, which will be the foundation stone on which to build yet more transformative change.
A smaller but no less significant finance transformation project will see their local retail POS systems in each store morph to a cloud-based fully integrated POS.
Such a move will transform the finance team’s ability to track our global sales across all our retail stores in one database and integrate our sales into our accounts system in almost real time.
On the eighth day
When I joined it took eight days to work out how many bikes we sold across all 12 entities and countries and what we received was the number of bikes per country and revenue by country, and that was it. The sales team came up with one figure, and finance and production another, so it was always a case of which number do we use for bikes sold and revenue by country.
Hawkes-Dawson duly hired the correct resource and used the right systems to be able to intelligently integrate with all the various account systems peppered across the span of entities to extract the sales invoice data.
That glacial eight-day timeframe to update Brompton’s global sales numbers has now shrunk to around 30 minutes, essentially a gain of an entire working day.
Not only does it reveal how many bikes have been sold and the all-important revenue data, but also what colourways, number of gears, handlebar shape and every possible variant that you could possibly want from sales data analytics.
Such a scenario is a huge win for Hawkes-Dawson and he now revels in the ability to drill into absolutely every single invoice, check on the consolidation workings and eliminations across intercompany transactions against the very long-winded days populated by a multitude of Excel reports and lots of V-look ups to the giddy uplands of instantaneous consolidated sales data shared in the business intelligence tool, Power Bi.
That one solution has opened the eyes to the business of what that tool can achieve to such an extent that we are now looking at hiring and creating a fully-fledged business intelligence team that can utilise all data across marketing and production.
It also, says Hawkes-Dawson, highlights that there are better ways of doing things and handling our data to enable better decisions across the wider business.