Failure Is Not The End

“Haha, an extra $350 is not bad at all,” I was talking to myself. ”All I have to do is change the purchase date.”

I owned a Telco Agency franchise that represented some of the biggest Telco companies in our state in Perth, Australia. Our franchise group was so dominant that customers often received better deals to purchase the latest mobile phones from us than if they dealt directly with the Telco companies. We pretty much ruled the market.

We started with one franchise and moved on to add another two. Life was good. It was even better when I figured out how to get monthly bonuses simply by .. changing the purchase dates.

”Fred, how did you do that?” Anton, another franchise owner, was wondering. “You have been getting the bonus for 3 months in a row now.”

”Well, our sales staffs are very hard working,” I said to him.

”I need to steal a few of them from you,” he said jokingly.

”Yeah, you can try, they are loyal to one person only, me!”

”Haha, we’ll see about that,” he smiled.

Anton was not going to steal anyone from me. His sales staffs were twice as good as mine. He was one of the best franchise owners I knew. He knew the industry well and he was such a good leader. Sometimes I wished I worked for him.

Being a not-so-honest franchise owner, I tried to find other ways to maximise profits. So I learnt the system and every now and then I found loopholes. The latest one being a simple change of dates that would magically improve my monthly sales to ‘earn’ bonuses.

***

’Sorry, your account has been deactivated’ – a message suddenly appeared as I tried to login into the franchise network.

I didn’t immediately make the connection. I thought it was a system error. It was not. My account was disabled. They figured it out. My ‘creativity’ had been found out.

The weeks that followed were full of drama. I was fined and given a warning. They let me off easy because I had a good record as a franchise operator. I learnt my lessons though, no more changing dates for the bonus.

”Well, we got our agency back,” my wife said to me. “Please try not to cheat the system again.”

”Yes dear,” I said, feeling down.

I worked so hard after that incident. I needed to prove my ability to build the franchise without resorting to dirty tactics. I had to redeem myself, reclaim my self-respect and push away any self-doubt.

It was amazing how an embarrassing incident could turn things around so spectacularly. Maybe it was not so bad after all. I found my strength at the bottom of the valley.

***

”Did you hear?” my wife was panicking. “The Telco master franchise has lost all of the major Telco accounts.”

“What do you mean ‘lost’?” I started to panic myself.

”Lost as in the big Telco companies are not selling through us anymore,” she tried her best not to faint. ”We are left with small players.”

”It is barely enough to cover rent,” I said.

”I know!”

”So what are we going to do?”

”I don’t know!”

It did not take long before we started to feel the pressure. Small Telco companies typically tried to dominate certain corners of the market. All of their products were tailored to a very specific slice of the population. A great example is an unbreakable (but ugly) mobile phone designed specifically for the construction workers. It was hard to sell their products to the general public that visited our shop.

Making things worse, those big Telco companies started to open up their own shops competing directly with us. So tell me again how we were supposed to survive? It was impossible. Our sales dropped by more than 70% within a short period of 6 months.

I lost my ability to think clearly. I just wanted to stay in bed all day, staring at the ceiling. I was a zombie.

We were part of a small community group called ‘connect’. There were four to five families in each group. The idea was so that we could support each other. Honestly, I never thought much of it. In fact, I always hated going to this group. “Such a waste of time,” I always thought to myself.

“How are you coping, my friend?” Simon our group leader asked me.

”Not good Simon,” I said quietly.

”Come, let’s have a chat, I’ll make you tea,” he said. “We have a few minutes before the others arrive.”

I have to say, it was such a joy to be able to pour out my heart to someone else without being judged. Simon was such a great listener. He was so genuine. He didn’t say much, he just nodded, smiled, asked questions, and most importantly he was there for me.

That night after talking to Simon I went to bed with a lot in my mind. I knew I had to do something, I couldn’t just wait to be slaughtered by big telcos. I needed to find the strength to move on. You know how some people say it takes courage to start? Sometimes it takes a lot more courage to stop and let go.

I had been a franchise owner for more than ten years. It was a part of me, it was my identity, and I was about to let it all go. My mind could not get into gear. I could not comprehend the situation because I had never been in that situation before. How, what, why?

”We have to make a move,” I said to my wife in the morning.

”Yeah, I have been thinking about it too,” she replied.

”I’m not sure I’m ready for this,” I said.

”I’m not either,” she whispered. “But I feel like there is no other way.”

”I cannot do it,” I said to her.

”We’ll do it together.”

I felt like a failure, I felt defeated. The business that I was so proud of. The success that I built with sweat and tears for more than a decade. It was not fair. I did not have a fighting chance.

***

“Well, we’ve done it,” I said to my wife. I had a million things happening in my mind.

”Yup, no more Telco Agency” my wife replied. “Are you ok?”

”I’m .. I guess, yeah, I’m ok.”

”Are you excited?”

”In a way, I actually am.”

”It’s been a long 7 months,” she whispered.

”Yes, a very long 7 months,” I said quietly. “I thought we would never sell it.”

”But we did,” my wife smiled again.

”Yeah, we finally did.”

”Don’t think about it too much,” she said. “Let’s just leave it all behind.”

”I know, I just feel like an era is over.”

”Yeah, that is true.”

”Well, we can, however, start something new,” I suddenly felt much better.

“Yes we can,” she smiled again. “You can now do what you have been wanting to do in the last 3 years – life coaching.”

”I know …” I started to feel my smile creeping back.

”Come on, we have talked about it.”

”Yes we have, and now I really can, I really really can!”

“You can,” she said. “Remember what you told me 7 months ago?”

”What?”

”Failure is not the end,” she looked at me with her most beautiful eyes.

***

”Failure is not the real end, it can be the beginning of your success story.”

What I Learn From The Rain

Do you know how to put away four pallets with a dozen different items into two little shelves? Neither did we, but sadly that was what we were doing in that cold morning. The shelves were almost full too. We ran out of idea until one of us decided to ‘MacGyver’ it. Somehow we connected four smaller shelves, turning them into ‘unofficial-somewhat-risky-shelves-extension’.

Chemicals were the worst because we had to be extra careful. In particular those with ‘DG’ written on them (DG is Dangerous Goods). These must be visible and easy to contain should any of them decided to leak. It means we had to have spill container and granules (aka kitty litter) nearby.

Another hassle was those items with expiry dates such as disposable gloves or alcohol gels. Hah, who would’ve thought, disposable gloves have expiry dates! What would happen when they expire, have you ever thought about that? Maybe they go all wonky or change colour? Nooo, they got sticky and brittle!

After hours of struggle and perseverance, we finally did everything. All items were put away and labelled accurately. We made the impossible, possible, thanks to plenty of coffees and Krispy Kreme doughnuts.

‘Busy’ was the word on the street back then. Our days were full of work, work, work (and back pain, back pain, back pain). The floor flooded with pallet wraps, cut cardboard, and metal straps. No kidding, if we let a mouse loose, it would get lost in no time among the jungle, and then died of starvation.

Well, we did have downtime, sometimes. We used these rare moments to enjoy extra cups of coffees while having in-depth discussions (among other things) about our customers. They kept us busy alright. Some of them pretty much demanded immediate attention when they rang. We should charge more for this ‘concierge’ services, unfortunately not.

Our super busyness though had left us with many little things unattended around the warehouse. For example, our toilet was not flushing correctly, sometimes not at all. Then what about that jungle of cardboards and straps, they were accidents waiting to happen. And then there was this small leak from the ceiling fan. Nothing major yet, just a little bit of concerns.


”What are you doing, Jim?”, I asked our loyal warehouse staff.

”It’s leaking again, boss, I am just rearranging things,” Jim said.

”You mean the ceiling fan?”

”Yup, a bit wet today.”

”Is it getting worse?”

”Probably a little bit.”

”I probably should call the agent to fix it.”

”Yes, you should.”

I helped Jim to move the stocks away from underneath the ceiling fan. Some of them were severely damaged already. Luckily we didn’t have too many perishable products down there – at least that was what I thought.

”So what is the damage?” I asked Jim.

”Well, some of the almost expired disposable gloves are now definitely expired,” he replied.

”What do you mean some?”

”What?”

”How much is ‘some’?”

”Two cartons boss.”

”All wet?”

”Yeah, all wet.”

”Is that all?”

”Yup that’s it. The Nitrile gloves are also wet, but they are water resistant.”

”I hate this rain.”

”You mean, the leaky roof? The rain is not at fault here.”

”Yeah, I mean the leaking roof.”

The rain did not stop that day. Our humble little ceiling fan was leaking rainwater like a beer tap. We put plastic buckets all over the place to contain the rain. I remember back when I was a little kid we used to do something similar at home. Leaking roof and plastic buckets, we couldn’t get away from them.

Unfortunately, things got a bit hectic afterwards, no agent was called that day, and no leaking roof got fixed. It was Friday too, and we wanted to go home.


It’s funny how things go a lot slower from Monday to Friday, and suddenly speed up on the weekend. And before you know it, it’s Monday! Back to work, folks!

Non-stop raining continued over the weekend. I was hoping our leaking roof wouldn’t spill too much water into the warehouse. We cleared the area underneath already and put together a circle of spill granules to contain the possible flood.

Jim was already there when I arrived.

”Jim, how are things?” I asked Jim.

”Not good boss,” he replied.

”Oh, no..”

”Yes ..”

”How bad is it?”

”Interestingly, the leaking was not too bad.”

”But ..”

”But some of them found their way into our chemicals drums.”

”How did that happen?”

”We forgot to close the lids boss.”

”Yeah, but the drums were not underneath the leaking fan.”

”Well, apparently it was leaking at other places too.”

”And they happened to be on top of the drums.”

”Yes, boss.”

Fortunately, none of the DG chemicals was affected. We made sure they were all closed properly. The concentrated dishwashing liquid and glass cleaner though, they were all ruined.

I knew it was my fault for not calling the agent sooner. But again, the primary damage was not from the ceiling fan. Even if I called the agent and got the fan fixed, we would still suffer significant loss from that leak on top of the drums.

Soon the season changed, and we forgot about the incident altogether. We finally fixed all the leaks. But we couldn’t sell our concentrated chemicals though, because well, they were not concentrated anymore.

At least I learnt a few lessons from this.

Number one. Always do what you can do today, not tomorrow. If I did, I would have got the leaks fixed, and the drum lids closed. But I didn’t, and I paid a hefty price for that.

Number two. Water is so powerful even its drips can ruin the whole drum. It reminds me of an old proverb: “One drop of poison infects the whole tun of wine“. I should never underestimate the damage that small drops of water can do.

Number three. There is no point in blaming the past because it already happened and there is nothing I can do to change that. This one I needed to learn the hard way. I have now accepted that instead of crying over what has happened, it is better to learn from my mistakes and try not to repeat that.

Wait, there is one more lesson to learn from this saga.

Interestingly, this lesson is the culmination of all three.

It is the classic concept of ‘grit’.

Grit is about doing what you can and not procrastinating (lesson no.1).

It is also about persevering in doing little things at a time, and never underestimate how they could affect the more significant things (lesson no.2).

Finally, grit does not worry about the past and focus instead on the future (lesson no.3).

***

“It’s hard to beat a person who never gives up” —Babe Ruth

The Gates Are Closed

“So if we purchase 40 cartons, you can give us 15% discount?” I asked John, the sales rep.
“Yes, that’s right,” John said.
“Can you write the quote on paper, John?”
“Sure,” he said, writing it on his business card. Which seemed a bit informal to me, but John looked confident, so maybe it was common practice.

It was a good day when our supplier decided to give us a massive discount. We had been talking to a customer about a bulk purchase of rubber gloves. They were happy with our services, so it was just a matter of prices.

We were confident we could win the contract. And off we went to negotiate, armed with great discounts from our beloved supplier.

We got the deal. That’s the good news.

The bad news was, John, didn’t honour the agreement. A quote written on the business card was not good enough for him to acknowledge. John said it was out of his hand. He said something about top management didn’t want the smaller distributor to wreck the market.

We couldn’t get the products at the prices promised to us.

It was a massive blow.

A good day turned into bad weeks, and then months.

In the meantime, our customer got the products from someone else. At least they seemed happy. We still had a good relationship, so hope was not lost yet.

There was only one other supplier in our state that distributed this particular product. They did not bother to return our call though, such rudeness and arrogance. We figured out in the end that they were the one who secretly supplied those rubber gloves through another distributor.

No worries, maybe not our luck. Our lucky break would come eventually.

***

“Fred, this is John,” a voice from the other end said.
“Hi John, how have you been?” I said, wondering what he wanted this time.
“Look, I know we haven’t been good to you,” he said.
“Ok.”
“But I’ve been talking to top management.”
“Yes, I’m listening.”
“And we all agreed to support you.”
“Regarding?”
“You know, the rubber gloves, the one we quoted last time.”
“Oh you mean the unofficial, dishonoured, quote? Is that the one?”
“Yes, that’s the one.”
“Why the change of heart?”
“There’s been a change in strategy, and they want to work with smaller distributors now.”
“I see.”
“So, are you in?”
“I’ll think about it.”

My mind was full of all past rage and disappointment. The time when John dishonoured the quote was still fresh. And the time when our $2,000 profit went down the drain. It left a unique mark because I was looking to use the money as a deposit for a new family car. We didn’t end up purchasing the car of course.

I spoke to my wife about it. We had our usual kitchen bench board meeting.

She said we should be more careful this time. I agreed to it, considering how bad they burnt us last time. We decided to accept the offer, provided they put it on formal company letterhead. In addition to that, but we also demanded better pricing for initial stocks.

John honoured the quote this time.

We talked to our customer and got a new deal with them to supply the rubber gloves. They put in their bulk order, and then another one, and another one. It was like a dream come true. We never thought things would work out well eventually.

Interestingly, we didn’t end up purchasing a new family car. We just felt the time was not right yet. Maybe past trauma was still too fresh.

We did feel that our luck had turned though.

***

“Andrew, can you talk to Tyres West?” I asked our sales rep.
“Sure, what do you want me to talk to them about?” Andrew replied.
“Well, they owed us $12,000, and it’s overdue for more than 60 days now.”
“Ok, that doesn’t sound too good, have you called them?”
“Yes, of course, and the answer was always the same: we are going to pay soon.”
“That sounds a bit worrying.”
“Can you go tomorrow?”
“Yes.”

Tyres West was the customer who purchased those rubber gloves from us. They were usually very good with payment. The past few months, however, were a bit worrying. I had hope that things would be ok though.

The following day, Andrew went to visit Tyres West to talk about the debt.

“Fred, you would not believe it,” he said.
“What?” I replied.
“The gates are closed.”
“What do you mean?”
“I mean, the gates are closed, in Tyres West.”
“What?”
“There is no one here.”
“What, are you sure?”
“Yes, very sure, I even jumped the fence.”
“You what?”
“The warehouse is empty, no equipment, nothing.”
“What …”

Tyres West closed down. No one knew what happened. The day before I was just on a call with their accounts lady. She even expected Andrew to come and discuss the debt.

We figured out later on that Tyres West closed down overnight. And even more surprising was that we read on paper about how the company had ties with the bikie gangs. It seemed like they were not as clean as they looked.

We lost a lot of money.

What an unlucky day.

***

At home, we had another emergency kitchen bench meeting. We wrote down our expenses and tried to figure out how severe the damage was. It was bad. We were glad that we didn’t purchase that family car. Let’s say, someone up there restrained us from putting that deposit.

Our kitchen meeting concluded with us slashing certain expenses. So no more eating outs and end of year holiday was downgraded from Bali to free activities in the city. We were confident we could ride this storm.

My mind went back to the day when John dishonoured his quote. I was so furious that I sent a formal complaint to his boss. That complaint seemed to go to a deaf ear though.

It seemed such an unlucky day. But now that I thought about it again, maybe it wasn’t so unlucky at all.

Perhaps it was our real lucky day.

We didn’t realise it yet.

 

“It’s amazing how you can look back at your life and feel like you’re the luckiest and the unluckiest person in the world at the same time.”

The Cavalry From Above

“So remember son, stick with your business for as long as possible. Because in business, boom and bust come in waves. This is not something you can control. If you stick around long enough, eventually, you will get your golden era. You just need to be ready when it hits you.”

That was what my dad said to me around 12 years ago. He had been in business for more than 30 years, so I thought it was great advice. Until of course I came to my senses and realised being an entrepreneur is all about being able to control my own destiny. I mean who has time to wait for this ‘golden era’? He was in business for decades, and we still lived in a modest 3 bedrooms house. Surely he would have come across his ‘golden era’ already?

***

Back in 2009, we were importing rags from a Canadian company. It was high-quality rags where the raw materials were collected from local charities around the country. They were not the cheapest, but we had been dealing with them for years, and they were always professional and reliable. Other suppliers tried to get our business, albeit we were never interested. We were one of the most prominent rags dealers in our state back then. We were small, but we were fierce.

There was a guy, Paul, who came few times to purchase our rags. He was an importer too, but he never said much about it to us. Mind due, his primary business was not in import. He told us about his plan though, going to Pakistan and India to search for new suppliers.

The Canadian company that we dealt with only worked in US dollars. Which meant being an Australian company we had to be careful with the currency exchange. Few percents off could mean few thousand dollars loss. I even established a foreign exchange account with a local financial institution to improve my overall exchange rate.

The strategy was to purchase US dollar when AUD dollar was stronger and put it into the forex account. At one time we accumulated more US dollar in the forex account than our own business account.

You can see how risky this currency exchange stuff was.

We managed the business pretty well. It started from one container every three months, then every two months, and in 2009 it was one container per month. We had a few of them on order at any one time. All because it took approximately two months from the time we put the order in until we received them in Perth.

I said to my wife that we were selling rags like peanuts. They just flew off the door. Looking at the way we were growing, we would reach our first ever $1 million sales that year, all from rags alone.

But of course, fantastic results did not come without its own risk.

You see, I never thought it would come to that. I prepared everything, trying to control every little area of my business. I had enough US dollar in our forex account to purchase two containers. Never did I know that AUD dollar would decide to plunge itself against US dollar and stayed at the bottom, for a long time.

But it happened. AUD dollar fell from a high 97c to a US dollar to a mere 61c in only a few short weeks.

We used up all of our US dollars to purchase two containers. And then things got worse because AUD dollar dropped even further to 50c. We did not have any choice but to pay the next order based on the weak AUD dollar. We tried to increase our price, but at that rate, unless we raised the price by 80-100%, we were still at a loss. An increase that much would only give our competitors an incredible window of opportunity to steal our customers.

The market would react, and the price would correct itself but not until another few months at least. We didn’t have the luxury of time. Our modest price increase was nothing compared to the profit we lost to the weak AUD dollar. We were running out of cash, very very quickly.

We lost at least twenty thousand dollars per container at that time. And we had a few of them on order. At the end of the day, we decided to cancel everything unless they were already on the sea. As a result, unless we started to purchase from our competitor, within one month, we would have nothing to sell. Our $1 million sales target were reduced to $0 within five months of AUD collapse.

***

I was sitting in my office trying to get my head around this dire situation. I could not believe only five months ago we were doing so well. Now we just had a little bit of stock left, maybe enough for few weeks.

I tried to think my way out of this, but my brain just couldn’t get into gear. I called everyone I knew to get advice from. Unfortunately, AUD dollar did not collapse against US dollar very often. In fact, it was one of the rare moments that it happened, and even more unusual because it stayed at the bottom for an extended period of time. It almost like AUD dollar found its happy place at the bottom.

One of the guys that I called said he never saw this happened before and this guy was a furniture importer for ten years before he became a pastor. I felt somewhat unlucky after that conversation.

My closest friend reckoned I should update my resume because the end was near. We didn’t talk much to one another after that.

And then I realised. This was beyond me.

This was out of my control.

OMG, my dad was right. Boom and bust came in waves. I was never in control. All these time I was just lucky.

The time finally came for me to face the worst in my journey as a businessman.

***

“Fred,” Paul suddenly appeared through my office door.
“Hi Paul,” I waved to him.
“How’re things mate?”
“Good,” I said, trying to hide my apparent stress.
“Remember I told you about sourcing rags from Pakistan?”
“Yes.”
“I did. I went there and had dinner with rags suppliers.”
“Wow, that was great.”
“Yes, one of them decided to make me their sole distributor for Perth.”
“Sounds like a great deal.”
“Which is why I am here now,” Paul sounded a bit nervous. “Well, are you interested in getting rags from me?”
“What sort of price are we talking about Paul?”
“Look, I know I am new with all these, but the quality is very high you wouldn’t believe it,” Paul replied.
“Yes, but at what price?” I was getting impatient.

And I swear to you if I could record the next five minutes conversation I would play it every day until such time that it was time for me to meet my creator.

“Fred, the price is excellent,” Paul smiled.

And it was. The price that Paul said was 20% less than the cost of rags we paid to the Canadian company when AUD dollar was strong. I couldn’t believe my luck. Paul appeared just at the right time with the right product, and the right price (better even).

There must be something or someone up there helping me out.

I was screaming in my head: “Look, if there is an intelligent higher being up there, thank you, thank you, thank you. Although next time, please don’t wait until the very last moment before sending the cavalry. A slightly faster help would be great.”

Our business was saved from disaster. Paul had been an excellent supplier. He was always ready to help. His company grew multiple times afterwards. I guess AUD dollar collapse meant he could sweep struggling rags dealers like me within a short few months. Now that I think about it again, it was a brilliant move by him. Well, I couldn’t complain. He did save my company.

And for us, we are back on track.

I am done trying to control everything. I know I have to be ready for incoming boom and bust. But deep inside my heart, I know someone is looking after me.

Somehow, I thought about you, dad.

 

 

I Was Blind, But Now I See

You know that feeling when you could not do the simplest thing in the world like putting the correct address? Well, guess what, we had three returns this week, all due to the same mistake: wrong address. The worst thing was, of course, it was all my fault.

I didn’t normally do this. It was not in my nature to make mistakes.

They used to call me ‘the machine’ back in Dog Swamp Distribution. I was so good even my supervisor started to doubt himself.

There was something wrong somewhere. I knew I needed to fix it. We could not afford customers missing their goods all the time because of my stupid mistakes.

“Hello?” I answered the phone.
“Hi, is this Fred’s Industrial Supplies?” the voice from the other end said.
“Yes, hi John,” I replied, recognising the voice straight away.
“Fred, how have you been?” he said.

John didn’t normally say “how have you been”, so something was wrong (again), must be my lucky day.

“Look, we have just decided,” John said.
“Decided .. yes?” I said nervously.
“O look, I feel bad, honestly, but we have decided to use another supplier,” John finally said. “I felt like I had to tell you directly.”

My senses were frozen. I wanted to say something but all I could gather in my head was silence. It was cold, dark, and just silent. I felt nauseous. I felt sick.

John was my biggest customer. His company contributed about 30% of our revenue. His departure was a major shock to me. Well, to be honest, it was not like he didn’t give us any warning. He had been telling us how we should review our pricing. I didn’t think it was that serious. I guess I was wrong. But I couldn’t be wrong, I knew what our competitors were selling at and we matched them, we matched everything.

“John, are you serious?” I said. “Can we talk about it?”
“We have talked about it, Fred,” John said. “You just didn’t listen.”

I was disappointed and angry. That was the moment when I decided that I couldn’t rely on my existing customers. I had to do something. These ungrateful people just kept disappointing me. I gave them the best services ever, the best prices, and the best of everything. And still, they went behind my back and left for useless competitors.

I kept myself composed and said my final words to John.

“Alright John, I get it. Well, let me know if you change your mind then.”

I made a commitment to myself that I would work harder than ever to get better customers. I would not let this incident destroy me. It was time for me to shine. At least that was what I had in mind.

I spent the following months trying everything I could think of to promote our products. I did land new customers. Some of them were pretty good customers too. I knew I could do it. There was nothing stopping me now.

But still, none of them was as good as John. These customers were ‘smallish’. They were like insects, while John was like a whale.

I tried harder. I went around door knocking. I called up potential customers for meetings. I mailed hundreds of sales materials. I faxed promos to everyone I knew would be interested. I did everything I could think of. I landed few more customers, but they were all ‘smallish’. All of them combined were still nothing compared to John’s purchases.

And in the meantime since John’s departure, we sank deeper into financial trouble. Losing 30% of revenue was not an easy matter. I cut cost everywhere I could think of. We even started to turn off the air conditioning during the day to save electricity. We let go everyone except Sam our loyal delivery driver. He agreed to take a pay cut to help us a little bit.

We were desperate. We were on the brink of bankruptcy.

There were times when I didn’t want to go to sleep because I knew I would wake up in the morning to face my nightmare all over again.

I would drive to work contemplating whether I should keep driving or going back home.

“Fred, this is Sam,” Sam my driver called me.
“Yes, Sam?” I said.
“I’m so sorry, I know you don’t want to hear this,” he said.
“What is it?” I said. My heart started to beat faster.
“I have been in an accident,” Sam replied. “I am ok but the van was damaged, badly.”

I felt the cold again, this time I could feel it creeping into my bones. I felt like a dark cloud was hovering around me. I could not say anything. I was just staring at the traffic.

“Fred, I am so sorry,” Sam said. “I will help to pay for the damages. I know things haven’t been easy for you.”

I didn’t say anything. Sam hung up the phone. It wasn’t his fault but he felt guilty nevertheless. He did end up paying for the insurance excess though. He resigned immediately afterwards.

We were out of whack for few weeks while the van was fixed. I ended up using our family car for delivery. We were lucky because we had a big family car. So we managed to fit quite a good volume of items into it.

My wife joined forces to mind the phone while I went around doing deliveries. She was very good with the phone. It was in her nature to build conversations. I had to say, I never knew she was that good.

Due to my activities with delivery, I got to meet with a lot of our existing customers. I didn’t use to talk to them because I was too busy trying to get new customers. This gave me refreshed perspectives.

My customers never said it but I could see they appreciated my efforts to stay afloat. Some of them even offered me cold drinks on hot days. I began to build great relationships with them. I never knew they were such a good bunch of people. I always thought of them as ‘smallish’ customers that I couldn’t care less. Boy, I was wrong. I was so wrong.

I guess there were a lot of things I didn’t know about them.

I began to really care for them, walking the extra miles when they needed help. There were times when I would do express delivery within the hour if I knew they needed the goods urgently. Some other time I would drop my prices heavily because I knew they also had difficulties with their own businesses. I thought it was important if we could weather the storm together.

My customers started to support me more. They gave me more business and they referred me to their friends. I could not thank them enough for their generosity.

John never came back to us, but we survived.

I looked at myself differently now. I thought I was so good that I could never make mistakes. Well, I did, a lot of them. I just didn’t realise it. I thought I was above my customers. In reality, I was beneath them. They were the ones who supported me during tough times.

They were the ones who gave me a second chance.

When that phone rang a few months ago, I was devastated. I couldn’t believe how unlucky I was. I was wrong. It turned out to be the luckiest day of my life. It was the day my life was about to change. What I thought was the lowest point in my life turned out to be the highest point.

I went through hell to see heaven.

But it was worth it.

I was blind, but now I see.

 

 

 

What Marketing Budget?

When a business finds itself in financial trouble there is an inherent meaning which most consultants don’t get. The business has ‘financial’ trouble. It needs every dollar to survive. The last thing they need is another marketing budget for that campaign to get more leads which presumably will get them out of trouble.

We need to understand that there is no money left (well maybe a little bit).

We need to fix the cash flow first, cut cost, chase payment, move (not make) some cash into the bank (if there is any), and fix the fundamentals. Then we have a little bit wiggling room. These precious resources are all they have. That’s it, there is nothing else. If it is not enough then that’s it – it’s not enough – start to think about an exit strategy. The more time is wasted the worse it will get.

But don’t lose hope because it might be just enough for us. The challenge is to use these little resources to turnaround the business. And this is when we get a bit ‘creative’. The words ‘free’ and ‘creative’ will be your best friend in the next few months. In order to make all of these to work, we need to be creative in using freely available tools around us. The internet is a great place to find them. But also do some outreach to your friends, families, etc. – not to get free money but free contacts, advice, knowledge, etc.

Fix the fundamentals, hang on to every resource, and be creative to get and use more resources (free is preferable). Then we will have a good shot to turnaround the business.

Now one more thing. While it is great to have a strategy, the real impact will happen during execution. And things will change, the great strategy will be rewritten, and execution will stall.

So persevere, be flexible, focus, and take it one step at a time. We might not have the big budget enjoyed by larger companies. But our mind and mental strength will make up for it.

 

 

Breaking Point

Have you ever heard the story about a frog that gets boiled alive?

Well, there’s this little frog. It somehow ended up inside a big pot of water which was conveniently put on a stove. The stove was on by the way (but only with low fire) which means water got slightly warmer, then slowly got a bit hotter, and a bit hotter. Interestingly the frog didn’t try to jump out of the pot. Instead, it just sat there not moving a single muscle. So the water got even hotter until it finally reached boiling point. The frog didn’t move at all (you wonder why).

It eventually died, boiled alive.

This didn’t happen, of course, no frog was harmed during the writing of this story.

It could happen though. The science behind this is simple. The frog adjusted itself to the increasing heat of the water because it got hotter slowly. The poor frog would have jumped out of the pot if water got hotter quickly. But it didn’t, so it decided to stay and try to overcome (and persevere) in the midst of hot water. It got used to the new heat and when the heat went up it adjusted itself again. Then the time came when it was too late. It got to the boiling point and the frog realized it lost the battle – it was boiled alive.

Let’s use the same principles in overcoming tough times in business. The question we need to ask ourselves is similar to the frog. “Am I being boiled alive and I don’t even realize it?”

We also tend to adjust ourselves to difficult times. We become stronger so we could face adversity. There’s nothing wrong with that because it’s us (the person). What doesn’t kill us makes us stronger. It is very true indeed.

However, when we go through tough times in business it’s not only us that gets pummeled. It is the business itself also. So let’s rephrase the question a little bit now focusing on the business. “Is our business getting boiled alive and I don’t even realize it?”

Business is made up of different substances. Its blood vessel is filled (as you have probably guessed) with “cash”. While its infrastructure is made up of a complex relationship between owners, staffs, customers, suppliers, and other stakeholders the whole thing is run with cash.

Now, with tough times this complex infrastructure is damaged. Unlike the human race, a business does not get stronger after getting damaged. For example, a brand does not get stronger after it got bad publicity. A business does not lose customers and gets stronger as a result.

The people inside the business got stronger though. However, these experiences, skills, and everything else that the people learn during difficult times – they don’t always stay with the business. They move around following the footsteps of their owners.

The business itself would suffer. Its complex infrastructure split, its ability to earn and keep cash broke down. It would do that until such time that it would completely break. That is the breaking point.

So what’s the point of all these you might ask?

It is crucial to know the breaking point of your business.

As much as we want to persevere during tough times our business is separate from us. It does not have our brain, heart, and soul. We are the brain, heart, and soul. Just like the frog, we cannot control the heat around the business. On the other hand, we can control whether we want to make the jump or not.

Do you know your business’ breaking point?