Our 2017 Annual Report

As per our tradition, below is our 2017 annual report. It was a record breaking year for the team. Our PhilGEPS sales machine kicked off and we doubled our sales revenue!
Mostaco Blog - Our 2017 Annual Report

Our Annual Report – Record Breaking Revenue

As per our tradition, below is our 2017 annual report. It was a record breaking year for the team. Our PhilGEPS sales machine kicked off and it helped us increase our sales revenue by almost 70%.

We had to diversify our products for 2017 since thermal paper sales is on the decline. True to what we forecasted, our thermal paper sales went down for the second straight year. To mitigate the downtrend, we had to diversify. Enter PhilGEPS. We did not fully go to PhilGEPS until April but we created enormous businesses with our PhilGEPS clients. For 2017, we had almost 12M in PhilGEPS sales.

Our team continued to improve. We increased our productivity and efficiency by relying more on our systems that help us automate some of our manual processes. We are proudly subscribed to Zoho for their Books, Inventory, People, Reports and Assist software apps. We heard that they have rolled out Zoho One for a ridiculous price of $35 per user per month and it includes ALL their enterprise level apps. As of March 2018, we are subscribed to Zoho One to take advantage of all their enterprise level apps. We will be rolling out some of their apps in the coming months.

Since we went full board on PhilGEPS, we had to recognize high value customers. We implemented a Customer Lifetime Value (CLV) that was missing last 2016. While we still cater to small retail customers, we are cutting back on some of their benefits such as delivery and payment terms. We love our customers however it makes much more business sense to target customers with high CLV and retain their businesses.

We have plans on buying another delivery vehicle because of the onslaught of deliveries from PhilGEPS. We have delivered as much as ₱400,000.00 worth of office supplies and consumables to some of our PhilGEPS customers. We are expecting a lot more of the same for 2018. We are targeting PhilGEPS clients in the CALABARZON and MIMAROPA areas.

New Hires

Attrition was a big problem for us for 2017. People come and go and it was a revolving door to find the right person. We subscribed to Jobstreet to help us with our recruitment needs. We advertised for 5 full time positions. While many came for the interview and some 5 FTEs were hired, none of them stayed for more than 3 months. This is a major issue for us. We cannot grow if we do not find the right people. We resubscribed to Jobstreet again in hopes of finally finding the right people.

Summary

2017 was a big success. Every metric was up across the board. This is significant since we had the same number of FTE for 2016 and 2017 and yet we almost doubled our sales revenue.

  • Sales Revenue increased 68.5% in 2017 compared to 2016
  • Gross Profit increased 75.6% and Net Profit increased 95.3%
  • Cash increased 201.3% in 2017 compared to 2016

Sales by Items and Financial Ratios

Below is our financial ratios for the past 3 years. As you can see, all financial ratios are solid and convey irrefutable data that we are a sound company.

While our Average Collection Period improved for 2017, I do not see that happening for 2018. We are expecting a lot more PhilGEPS customers and all of them are on government terms. To understand the definitions of financial ratios, you can check out Investopedia.





Takeaways

  • Record breaking year for the team. All significant financial metrics increased in 2017.
  • Significant increase in cash in 2017 compared to 2016. We need to reinvest and diversify our offerings to take advantage of our Cash on Hand.
  • Current and Quick Ratios are well above 2.0. This means that we can meet all our payables with ease.
  • As per the chart, our main products for 2017 were POS Papers, Inks and Toners and Office Supplies. POS Papers are still our best selling product but it’s share decreased by almost 50%.
  • We will reinvest some of our Cash on Hand in buying a spanking brand new delivery vehicle. We will also tap Jobstreet to get new hires to help our growing team.