The Holidays Are Coming!

Want to know what's really tough…

Especially right now…

Sales!

Being able to sell is a skill and it’s one which isn’t appreciated nearly enough in business

Selling:-

?????????Get’s you to think about the needs of another person

????????Equips you to engage with the emotional state of another person

?????????Enables you to be an influencer in the situation

?? ♂????????Builds resilience as you will hear ‘No’ more often than ‘Yes’

I started selling early, working in my father’s DIY shop in Oxfordshire, weekends, holidays until we sold the business, it’s tough, but it’s great when it goes well

What I learnt was it about relationships, built over time, people got to know me, they liked me and in time, I built their trust with knowledge, experience and empathy of their situation or problem and how I or the products we sold could solve, remedy or do what they wanted to do

It’s the same today

Most clients have issues or problems they want addressed or corrected, they don’t know how or what to do, so they come to me for help and in time, when it’s right, we can work together to address the symptoms and correct the problems they had and the business is the better for it

I’m a CFO and Advisor, I’m not a Salesman

I won’t sell anything or even try to, but I respect those, especially my clients, who diagnose a customer’s pain and help relieve that concern or issue with a product or service

That’s what selling is…

Helping people...

Three type of businesses I don't work with…

Family businesses, Life-style business and 'basket cases'

The toughest may just be family!

Family-owned businesses, while well-meaning, can be very challenging to partner with for non-family members

But these businesses often outperform their non-family counterparts due to their long-term focus and commitment

Family members have a vested interest in the business's success, leading to sustainable strategies and dedicated efforts

One advantage of family-owned businesses is the ease and speed of decision-making

Family members often possess a deep understanding of the business, allowing for rapid decision-making. Moreover, the transmission of core values across generations can foster a strong company culture, providing a competitive advantage

On the positive side, these businesses tend to have lower employee turnover rates, promoting stability. They are also flexible and adaptable, enabling efficient execution of decisions

Family businesses often excel in building strong customer relationships, as customers appreciate the personal touch and commitment

However...

These same family-owned businesses face challenges

Limited resources compared to larger companies may hinder growth and expansion

Conflicts arising from the intertwining of business and personal affairs can strain relationships and negatively impact the company

Additionally, finding a capable and willing successor within the family can be difficult, causing uncertainty and potential instability

Despite these challenges, family-owned businesses remain a powerful force in the global economy

Their long-term vision, commitment, and understanding of the business contribute to their success. Lower employee turnover rates, flexibility, adaptability, and strong customer relations are key strengths they leverage

To thrive they must navigate the inherent challenges. Striking a balance between leveraging their unique strengths and mitigating limitations is crucial

But I still likely won't work with them, prove me wrong..?

I had a client sometime back, Mom, Dad, Son and Daughter, never again!

Good, bad, the worst..?

Some things you learn, some just are!...

??Cash is everything

??Hire slow, fire fast

??Everything is negotiable

??Learn enough to delegate

??Benchmark whatever you can

???Valuation is negotiated not set

??Build bridges, don't burn them

??Finance is art more than science

??Numbers don't lie, but people do

?? ♂?Your accountant IS NOT your CFO

??Think 'asset-lite', it's where $$$ are

???Revenue is the best source of finance

??Pay attention to where cash is leaking

??Weak leaders say I, strong ones say we

??Debt is a two edged sword, use it wisely

??If you don't have systems, you have chaos

??The tax man never giveth, they only taketh away

??If you aren't chasing your debts, you won't get paid

??Investors are driven by two things, narrative and return

??You are not your business. However much it may feel like it

??Contracts are there for when things fail, So always have one

?A business only runs out of cash, when you run out of steam

??Excel can be bent to anything, but doesn't mean it should be

??If you're the CEO and haven't made a sale, you're not really a CEO

??Your business can't be in good shape, if my mind and body aren't

??No better way to kill your business, than to not understand the numbers

?? Insurance exists for a reason, plan for the worst, even in the good times

??Some people are bad faith actors in business. Recognize them & steer clear

I truly hate Ryanair

But sometimes you have to…

Some call it the Costco of airlines

I don't think it can usurp Southwest Airlines of that brand

Either way the comparison with Southwest is apt but twisted

While Southwest focused on customer service, Ryanair does not!

Southwest flies to 'non-prime' destinations, Ryanair too

Where they both score is price, Southwest has been doing it way longer and better

Yet the European airline seems to be winning out, gross margins are a multiple of Southwest's

One of the reasons, Ryanair fleece you for add on's; baggage fees and seat selection, whereas Southwest do not

A key success factor is long-term thinking and an obsession with keeping costs low, one reason why Ryanair has delivered a +16% revenue CAGR since 1997, and now moves ~170M passengers annually

There's your learning!

I'll never fly Ryanair, but I will always fly Southwest where I can

Enjoy your holidays…

A great CFO...

Will oftentimes be the difference between a business success and

Failure…

One never drives a vehicle by looking in the rear view mirror, that's sure to lead to an accident

But the need to focus on the environment ahead, scanning for risks, helping navigate that path to success is what being a great CFO is all about

My clients would attest, looking backwards is of little use to them, its ALL about the future

The environment in which we operate has changed dramatically over the past 2 years and its evolving more quickly than many businesses can adapt:-

If you are:-?

??Not identifying your ideal/best customer

??Not partnering to enable success

??Not rewarding staff to grow & develop

???Not operating to maximise key differentiators

?Then you aren't:-

??Maximising margins or profitability

??Growing and scaling the business to its capability

??Building a valuation methodology that maximises your exit

??Being the best you or your business could be

What's clear is you need a management team and partner who have seen the past and can plot a path with knowledge and experience to enable success

Whatever success might mean for you!

Find an advisor/counsel to help you incorporate current technologies and enable best in class strategies to support the team to achieve the success you desire

Talk to your CFO...

If you don't have one

Call me

My friends at?Zanda?did a nice blog around the Portfolio/Fractional CFO and a more traditional FT CFO, take a look...

https://lnkd.in/dPZA4cDh

Summer Skiing?

Ever gotten over your skis?

I have..

Sometimes in business you can get ahead of yourself and where your business performance actually is

In the current environment you need to ensure you are operating within the cash and operating capability of the business you're in, not the business you want to create

I was working with a client last year, who were over their skis!

First things first, we needed to cut cash burn, you can do this! it's painful for sure, but if you don't the business may not survive, leave it another 30 days or more and you could be calling a different type of advisor

After exiting staff, which you need to do, everyone less than 90 days and notice where required, in my clients case that's 50% of the staff and all the staff bought into the business in the last 6 months

Careful to ensure NONE of the exits will impact on customer/client deliverables in the next 90 days, understanding of individual circumstances also

Indeed marketing and sales were scaled back significantly, since they are not introducing new business to their products and services, mindful to ensure income in the next quarter is not impacted

My read was that they were in the right business, with industry leading products, a new business plan, a new marketing strategy and financial plan within 120 days will serve them

Directors needed to take the pain too, a 50% cut in directors dividends and salary was necessary and that's now in place for going forward

Three office/facilities occupied, I could reduce that by two by exiting leases without penalty in the next 60 days, saving a cash burn of $1.5k per month and HMRC will have to delay collection of their share

We'll renegotiate where necessary & our primary customer will be given new terms and if they don't like them, we'll advance our plan to exit the contract, whatever it takes….we will do

Out the other side, we'll have a slimmed business model, potentially new clients, new terms, positive gross margin through improved pricing and more, a reduction in risk and business the client can be proud of again

Pain before gain…

But it will be worth it!