Creating a new accounting system for Card Connection
My parents are currently franchises of a successful greetings card company, name Card Connection, and in order for my parents to sell the business which they intend on doing in the near future, they have to have the accounts and other information about their franchise on a computer system which will also help them with stock ordering because when it comes to actually selling the business, the potential buyers needs to be able to check the accounts of the business to ensure they are correct and it is actually making a profit and that it would be worth their while to actually purchase the business.
With having the accounts on a computer system, it also means that they can be viewed more easily and can easily be changed and updated every month etc. What is Card Connection? Card Connection is a company, which produces greetings cards, for example, Christmas cards and birthday cards. The company then sells these cards to its franchisees who have bought the rights to sell its cards in a particular region of the country.
For example, my parents have the rights to sell cards which Card Connection produce in area 127, which in this case is the Bournemouth
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They are regarded as one of the best run franchises in the UK today, and around 50% of all franchises joining our network are former customers. They operate throughout the UK and Ireland, and also have franchises in Holland and Malta. In total there is around 110 franchises and service in excess of 16,000 retail outlets. Because the networks in the UK and Ireland are complete, the only opportunities available are to acquire a developed territory from an existing franchisee. These vary in price according to their level of development. There are normally some opportunities in most parts of the country.
How the Franchise works Franchises place our greeting card ranges in retail outlets on a ‘consignment’ basis. This means that they put the stock display equipment in on free loan to the retailer. This is one step beyond ‘sale or return’ – the customers never have to but the stock in the first place. They only pay for what they have sold. This system is well proven, and Card Connection is the clear UK market leader in this type of distribution. Franchisees have their own exclusive territory and operate out of their homes. They call upon their customers typically on a monthly basis.
Customers include convenience stores, sub post offices, petrol station forecourts, and staff restaurants in large offices. Card Connection have numerous national accounts, which include Shell, Total, Jet, Sodexho, Londis, Spar, and many more. Examples of Card Connections produce Below are some examples of the kind of greetings cards Card Connection have to offer: What is the current problem with my parents accounts? Currently, the problem with the accounts are that they are not all organised, badly written and poorly presented, and as well as this, they are not always up to date.
As it stands, all of the accounts for the business are being worked out by hand on sheets of paper, with the basic layout and design being printed from a computer but the actual information and sums being worked out by hand. This is therefore time consuming and prone to mistakes because working things out by hand all of the time, is bound to produce a mistake or two, or more. This would then mean that the accounts would be inaccurate and could have a dramatic impact on the finances on the business when it come to budgeting etc. It is also time consuming compared to using a computer system.
As the current method is time consuming, it means that it is less likely to be completed because my parents never actual get around to do it because they just keep putting it off because it will take too long. If it was on a computer system then this may not be such a problem. See separate sheet number 1 for an example of the current accounts sheet used. Data Flow Diagram of current method In order to understand fully, just how this current process is performed. As it stands, my father travels down to the Bournemouth area 4 days a week, and each of those days re-stocking cards in the outlets.
Each outlet currently has a folder with core information about it, as well as the accounts for that particular outlet. At the end of each day, he is supposed to complete the accounts for that outlet, and each outlet gets visited every 4 weeks. However, the only problem with this is that, the accounts don’t always get done when they are supposed to because they are boring and time consuming. Perhaps a computer system could change all of this. This data flow diagram has been produced from my own knowledge with regards to what my parents do as I have witnessed them doing this on a regular basis.
However, despite this, when it comes to actually interviewing my parents I will ask them about the process in which they visit each outlet with regards to the accounts of that outlet, and I will display the process later on in the project. How could the current method be improved? After reviewing the way in which the current method is carried out, I feel that it can be improved with regards to updating the overall accounts for the business at the end of each week, with a computer system because this will make it much easier to write up the accounts and information, as well as saving time, and probably being more accurate at the same time.
As this is the case, it would make it much easier for my parents because it is quicker than the previous method so they may have more motivation to complete and update the accounts on a regular basis. At this current position in time, all of the accounts they have need to be transferred into a computer system because the results will be presented more clearly which will be ideal as my parents are currently trying to sell the business. This would probably be best done in a spreadsheet as these are ideal for calculating results from figures that have been entered into the spreadsheet. What is the current problem with the stock ordering system?
The problems with the current stock ordering system are that the first phase is done by hand and by memory, which is not always a good thing because mistakes can be made which means that there may either be too little stock, or too much stock, both of which can create problems. For example, problems with having too much stock can include storage space etc. The more stock there is, more space is required in order to store it. As well as this, the stock may become ‘out of date’ and may not sell very well because nobody wants that particular product anymore by the time it has actually got into the outlets.
Problems with ordering too little stock and quite obvious, for example, too little stock will mean that there will not be enough stock to fill all of the outlets which therefore means that the business may not be maximising its profits because it may not be selling as much as it could be. Currently, picking boxes are produced the day before each outlet is visited, each picking box contains various amounts of cards, which are recorded, the amount of each etc. On the day of visiting the outlet, the picking box is used to re-stock to outlet with the cards it is missing, or new products my parents wish to try.
At the end of each day, the picking box comes back and is unpacked, with each card being put back into its correct place, and, as with the packing of the picking box, the contents of the picking are recorded to maintain stock levels. The recorded information would then be analysed carefully before an order is put through, which, unfortunately can take time, and is once again, a very boring thing to do. Data flow diagram of current method Once again, in order to understand fully the extent of which the current stock ordering method works.
For example, from picking the boxes the day before, to unpacking them the next day after the outlet has been visited. Once again, this data flow chart has been produced from my own knowledge about how the business works after having first hand experience with regards to how it works. However, I will check that this method is correct when it comes to interviewing my parents about the business and what they actually need. How could the current method be improved? I think that this current method could, like the problem with the accounts could be improved with a computer system.
Currently stock levels are only recorded by pen and paper, but a computer system would enable them to have a clear view of their current stock levels which will help when it come to ordering more stock online via the Card Connection website. If the system was on a laptop then the system could be used when the picking boxes are actually being picked, when the outlets are re-stocked, and also when the picking boxes are unpacked at the end of each day. This would then save writing everything down and then transferring it on a computer system, which would once again, take longer than putting it straight into the system.
1st interview with my parents In order to check that the data flow diagrams I have already done from my knowledge of how the business works, I will ask my parents some questions to hopefully confirm what I already know and have analysed. I will also check what they actually want doing for the business in order to help them sell it. Below are the question I asked them. Date of interview: 1st October 2003 Time of interview: 17:30 As you already know, for my IT coursework I need to help a business with a new computer system for a real person/business.
Do you currently use IT for any aspects for the running of the business? Yes, but only for the ordering of new stock every Wednesday night, but other than that, no! What do you feel you actually need to sell the with regards to a new computer system? Well, we could really do with a database with the outlets and the accounts for each outlet as well as the sales figures, which could then be used to help with the stock ordering system because at present it is not always accurate enough. The accounts also need to be formal and well present for potential buyers of the business.