Losing 6-Figures In One Call & How To Avoid It

On the 20th of September, we expected to receive the second half payment of a $480,000+ contract we secured over three months ago at Rugby Bricks.

The money, though, never turned up.

We jumped on a call and were informed we weren’t being paid (a story for another day).

We’d invested in a couple of other projects with this legally contracted income, and as a result, without the money, we now find ourselves in a 6-figure pickle.

We’ve pivoted and made the most of a bad situation, but one of the lessons we keep relearning in business is that the plan rarely goes to plan.

A plan is only useful if it can survive reality.

And a future filled with unknowns is everyone’s reality.

The more elements of a plan we need to hold true for success, the more fragile the plan is.

Many endeavours in business fail not because they were wrong but because they were mostly right in a situation that required things to be perfect.

The only thing we know for sure is that the future is rarely as we predicted.

A good plan doesn’t pretend this wasn’t true; it embraces this and allows for alternative scenarios. This gem from Martin Rogers is a good way to look at implementing scenario planning - something we wish we had read three months ago.

Use scenario planning to avoid making poor plans like we did.

Notes: We’re not preaching conservatism here - having legally secured capital is a pretty strong guarantee that you’ll get the money. The difference between having a signed agreement and legally enforcing one is a grey area we should have allowed for in our planning.

When taking risks, understand that you will need to allow for various outcomes where you can still be successful in as many of those outcomes as possible.

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Author: Kale Panoho

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