Integrating the different areas of an agribusiness company to produce timely and relevant financial information.

Agroalimentos is a Colombian healthy snacks company with national reach, administrative headquarters in Medellín and an agro-industrial operation plant in the municipality of Rionegro. Founded in 2017 by the Restrepo brothers, the company experienced accelerated growth in its first years taking advantage of the fitness lifestyle boom and the introduction of the so-called “superfoods” to the national market. However, as is quite common for young entrepreneurs, the growth brought with it a series of administrative problems and financial challenges.

The challenge

The entrepreneurial team and its board of directors were happy with the exponential growth observed in recent years; however, it was becoming increasingly difficult for the entrepreneurs to keep up with the management of the business, not only because of the high workload involved, but also because they lacked a structured methodology for organizing their business finances. The absence of financial reporting made it impossible to have the level of detail needed to navigate an increasingly challenging business environment and also made it difficult to communicate key business metrics.

Agri-Food's management team was frustrated by the accelerating pace of operations and the inability to understand their own business in a holistic manner.

Our solution

We get close to our customers, learn about the business and go deep into the operation to fully understand the playing field. In the case of Agroalimentos, we created an internal financial area to coordinate the different teams: the crop operation, the production plant, the commercial area and the external accounting team. Our multidisciplinary intervention included:

• We implemented a cloud-based accounting system to maintain traceability of business transactions.

• We standardize different procedures within the company in order to optimize the use of key resources such as time, raw materials and labor.

• We accompany and guide the documentation of processes in the field, implementing different tools for a better definition of business activities. We formalize and socialize the new practices with the employees involved.

• We apply procedures to mitigate legal and tax risk by establishing precise scopes with the suppliers involved. We implement improvements to key subsystems in business management such as inventory management, payroll settlements, accruals, period closings, financial planning, among others.

• We simplified data collection files by adding the necessary tables to have everything in the same place and connect the different areas in a strategic way.

• We defined the procedures for the cash count and bank reconciliations in order to have full traceability of each transaction and ensure the quality of accounting information.

• We design and implement the company's cash flow statement with a clear separation of the business activities to follow up the operation and investment plans.

• We trained and oriented the entrepreneurial team on financial management issues through short talks and applied workshops.

• We aligned the commercial goals with a detailed production plan that considered the participation of the different business lines in the portfolio, their profitability and their impact on the installed capacity.

The result...

After an intervention of approximately 6 months, the Agroalimentos team obtained an arsenal of tools to continue with the growth and consolidation of its business.

Established process map: simple and intuitive formats to establish operation times, added value, waste analysis, responsible areas and improvement opportunities.

Real-time business insight: timely access to key business metrics with weekly management reports summarizing different areas of the business.

Greater coordination between areas: establishment of information and communication systems that favored the interaction of processes between different areas: accounting, production, purchasing, collections and commercial.

Cost optimization and greater labor satisfaction: greater agility in the relationship processes and management of the relationship with employees. Less waste of ingredients, achieving a better use of raw materials.

Reduced legal, tax and operational risk: up to date documentation and accounting paperwork for both sales and purchase invoices, providing greater control over the business. Optimization of payroll processes and identification of the break-even point.

Greater control over the business operation: for cash flow projection and budget control, designing instruments for working capital management and ensuring traceability.

Significant improvement in data quality and reliability: establishment of a reliable information architecture for the generation, updating and custody of the company's financial information.

Increased efficiency and productivity: through process reengineering, it was possible to increase weekly production by up to 50% in a sustainable manner.

"Simple ideas come from complex thinking; in this case observation, a couple of physical formulas and everyday materials were enough to optimize liquid management in an industrial processing plant."