Flowtech Fluidpower 2015 Annual Report
The Operational Board regularly monitors a range of financial and non-financial performance indicators to allow it to measure performance against expected targets. The following represents a selection of these indicators.
The accurate daily reporting of gross profit achieved by each operating division across the Group with comparison to prior year is a fundamental performance measure. This is further supported by additional calculations giving indicative full month estimates on a daily basis. As part of any acquisition programme, new businesses that join the Group will be required to comply with this daily reporting requirement as soon as it is practicable. The primary benefit is to allow the Operational Board to reinforce close scrutiny of trading performance, provide local management focus and an early indication of any negative growth, if evident. The majority of staff reward schemes by way of monthly bonus payments are linked to any growth in gross profit achieved.
Performance across all segments remains strong
We have a clear focus on the management of profitability at customer and product levels. Within the Group's IT systems, appropriate Business Intelligence modules are maintained to allow ease of analysis on a timely basis to both underpin sales development initiatives at a strategic and tactical level, and to quickly identify underperformance.
Granular KPI review has led to overall growth targets been achieved
The Group maintains accurate stock provision measures down to item level on a minimum twice monthly basis. This can then be analysed by individual product group or supplier to ensure that action to alleviate any potential costs associated with slow-moving or redundant items can be made at the earliest point in a product life-cycle.
Regular review of KPIs and remedial action has reduced provision requirements
The Group reports on a standard calendar monthly basis using a consistent format across all trading businesses and, as well as sales and the gross margin measures, will include comparison of cost types detailing actual against 12 month average, year-to-date and prior year-to-date.
* Before separately disclosed items which are shown in the financial statements
The aim of the Flowtechnology division is to provide a wide and deep product range, competitive pricing, consistently high service levels and a unique dependable next day delivery. These attributes are all linked to optimised inventory levels to provide an unparalleled customer support service. This is measured by the percentage of orders despatched same day.
Supply chain and logistics continue to deliver consistent performance
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