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Trading and Investment

Trading and Investment

The Council’s role

The Council has agreed that it will focus on maximising growth, which will then allow redirection of resource to support Council priority services.  As part of this strategy the Council is looking, where appropriate, to generate income through trading services and maximising investments.

Possible destination

  • Council trading will be underpinned by robust business plans, will be supported by adequate resource and sector specific marketing and sales expertise, such that delivery models are sustainable, adaptable and have the capacity for growth. Further economies of scale will be realised through interdependencies between activities.
  • The effectiveness and extent of all traded undertakings will be continuously monitored by robust, fit for purpose financial and performance management systems to optimise return on investment. A corporate product/service development strategy will be essential to sustaining trading activity levels and as the basis for future market development and investment proposals.
  • There may well be fewer areas of significant trading activity but these will be more successful in terms of return.
  • All areas of Council activity will be more commercially aware.
  • The Council will review its investment strategy. The current financial investment strategy is based upon a low risk, low yield, high liquidity model. Robust medium term financial planning and balance sheet analysis will provide a greater more informed knowledge of the Council’s monetary liquidity requirements which will enable extension of the term and yield of investments without significant additional risk exposure and this may open up other areas of investment to the Council.
  • The investment strategy would also be balanced between short, medium and long term investments maximising external or partner funding and exploiting the prevailing low interest rates.
  • The Council’s working balances and reserves are likely to be heavily impacted over the next 3 years and this will affect investment decisions. Significant investments such as the Airport and Energy will be maintained or expanded
  • A major risk to the Council is that the budget will become more and more dependent over time on traded income.  Delivery of the budget will be impacted by commercial risk and this will need to be assessed and covered.

Key actions to get to the destination

  • Develop Income Generation strategy and review investment strategy
  • Develop commercially-focused culture, trading friendly environment and customer focus
  • Consider different delivery models for Trading and Commercialisation
  • Explore Trading and Commercialisation opportunities for development
  • Develop a Commercialisation / trading pricing framework
  • Develop commercial skills in the workforce
  • Review financial reporting and charging arrangements for traded services
  • Review appetite for market expansion
  • Current trading activity will continue but be subject to review to ensure clarity of objectives and optimum approach.

Budget proposals

Ref.Draft proposals
56 Repairs and Maintenance Contract with a further contribution 2018/2020 
57  Increased income from trading activity including Energy Services, Housebuilding, Funeral Services, Property investments, sponsorship and schools catering. 

Year 2 and year 3 will see the following further work:

  • Improving the financial performance of School Catering through increased meal update and expansion of customer base.
  • Review of services provided to schools
Further developments in traded services.