29 Aug Cambodia, All-Terrain Investment
Cambodia, All-Terrain Investment
29 August 2018
With an average growth of 7% per year, Cambodia is indisputably a land of opportunity for investors. Entrepreneurs must, however, bear local constraints in mind before commencing an activity in the kingdom.
A training deficit, increasingly stringent tax legislation, difficulties encountered in the field setting up financial control and a reliable system of reporting…
Grégoire Prat, CEO of Cover Link, details for us the main problems encountered by his clients: “Investing in Cambodia means, first of all, anticipating the risks related to the training deficit, and the lack of standards can, for example, render the endeavor dangerous if the accounting and operational structure is not optimized well ahead of the start of the activity.”
“Companies that go beyond the first three years of their business plan all have in common a reliable system providing a constant view of their cash flow, especially with regards to B2B as the terms of payment are often capricious in Cambodia”, he continues.
“Moreover, a good breakdown of processes and the reporting system makes it possible to identify fraud in time and, above all, to identify gaps that require additional training”.
But economic solutions now exist for implementing real-time monitoring of commercial, operational and accounting activities.
A young company, however, must always make sure to optimize its processes, the training of its staff and the financial control points, in order to anticipate slippage.
Full Throttle in Cambodia
The young company Motoland Cambodia is a good example of successful implementation on Khmer soil.
Official importer of the Mash motorcycle brand and Kenny Racing equipment, number one in Europe in endurance, Mx, rally raid and touring equipment, Motoland also organizes endurance raids in the most beautiful regions of the Khmer kingdom.
From the start, Motoland opted for a cloud-based logistics and accounting monitoring system that allows a real-time view of sales and inventory to be obtained at a cost 20 times lower than traditional ERP systems. Cash flow monitoring and tax declarations are carried out by professional sta specially trained in using the system put in place.
“Starting your business with a well-designed system is crucial in Cambodia. There are many examples of companies that find themselves, after 3 or 4 years of operation, in inextricable situations, with very concrete inventory and accounting errors. Correcting accounts in such situations represents a significant waste of time and money for the company, and changing bad behavior internally requires a lot of investment and patience when procedures have for too long been allowed to drift”, comments Grégoire, who assisted the company in its development.
Grégoire Prat served as CFO for seven years in Cambodia in various sectors such as forest plantations, industry and education. He has since founded the company Cover Link, which advises young companies about accounting and financial procedures, and about their insurance coverage requirements, via a dedicated IT platform.
#87 street 63, Phnom Penh, Cambodia www.coverlink.asia