Paul from Fred Aldous passes down his advice: treat your suppliers well

Crafting a future for the upcoming generations

After more than 138 years in business, treasured UK arts & craft store Fred Aldous has been through its fair share of ups and downs, including two world wars and a global lockdown during the pandemic. For Paul Walker, a fifth-generation co-owner and operator of the store, there’s one lesson that continues to ring true: treat your suppliers well.

Having helped countless customers and generations of families bring their imagination and creativity to life, Fred Aldous has been understandably thoughtful on expansion; they only launched their third store in Sheffield in 2020. Throughout this they have always embraced technology to improve the quality and efficiency of their business.

The business ventured into e-commerce early, building an online storefront with Shopify, which helped them not only survive, but thrive during the Covid-19 lockdowns as people searched for new ways to spend their time indoors.

Streamlining paying their bills

And more recently, they switched their accounting platform to Xero, enabling them to streamline the way they handle their finances, especially bill payments.

Historically, managing supplier payments was incredibly manual as they were using older accounting software. Switching to the cloud was life changing, but they were still using an external payment platform to manage payments. Fred Aldous’ accounts payable team manages two payment runs per week to more than 200 suppliers across the UK and Europe.

Because of the number and scale of the payments, there was no cash in reserve in case of errors. They would break each payment down into smaller amounts to avoid running into security checks that could slow payments down and disrupt cash flow. Getting those payments wrong could mean missing shipments of key items or damaging relationships they have held for more than 60 years.

With Xero’s new bill payments feature, making payments has become a lot easier. Fred Aldous has moved to making batch payments for suppliers directly from Xero, saving significant time and effort in setting up, managing and reconciling payments. That time saved from using open banking, Paul says, has allowed the business to improve its cash flow by paying consistently and negotiating better payment terms with many of its suppliers. And it has allowed them to spend more time building strong relationships directly with suppliers.

“Having the right technology in place means we’ve been able to build a system that makes sure we’re feeding back to suppliers and having good communication about what’s going on, no matter how small. It gives the supplier confidence in us and also clarity on when we pay. In Xero we can see everything now, not just what’s coming in and going out, and that's hugely important for navigating the business. I can see what our position is at any point in the day, and if there’s anything that needs attention.”

Investing in software for the next 100 years

For an age-old business, Fred Aldous is looking at its software tenure the same way it does with everything: with longevity in mind.

“We’ve just been through our first financial year with Xero and it’s amazing... it’s built for everyone and there’s no surprises. I want software partners like Xero that I’m going to be with for 100 years, not two.”

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