How to find success in business failure
While failure has become more socially acceptable and entrepreneurs are willing to talk about their struggles, setbacks in business still hurt.
However, small business expert and bookkeeper Don Doolan believes the lessons learned in adversity can spur future success.
We talked to him about how his tough times helped him triumph.
The Pulse: Before we get down to business, could you tell us a bit about yourself?
Don: I joined GIO straight after leaving school and did a computer industry training program with them as well as completing an associate diploma in business in my own time.
After 10 years with GIO, I headed to America to work as a computer programming consultant for five years before returning to Australia to start my own business.
The Pulse: What motivated you to go out on your own?
Don: Honestly, the main reason was because I didn’t want to get sacked!
The IT industry is subject to fluctuations, and I’d ridden the wave of recruitment and redundancy enough times to realise I wanted to take control of my own destiny.
So, I took the plunge and bought two Michel’s Patisseries in 2002 — the first of many businesses I’d go on to run.
The Pulse: How successful have you been?
Don: With Michel’s, I bought in and sold at the right time to maximise capital growth and did very well.
I then bought the Lilac City Motor Inn in 2005 and spent seven years converting it from a neglected motel to a hospitality destination.
A Pack and Send franchise then came up in 2011 and I saw potential.
The business was in poor shape and the company was happy to give it to me for just the franchise fee, so I saw it as a chance to make a bit of money. However, it wasn’t long before I realised I was going struggle with this business.
The Pulse: So, what went wrong?
Don: Well, by anyone else’s measure, Pack and Send did quite well but it just wasn’t hitting the mark by my standards.
I’d managed to turn a business that was losing money into an operation that could pay a full-time staff member and me a small salary – but I just couldn’t grow it to the next level.
I thought that if I trained up staff then I could focus on running another business I was passionate about at the same time (my bookkeeping franchise) while still drawing a small salary.
However, I couldn’t find the right person to manage Pack and Send and hit the financial targets I wanted so I knew I had to get out.
The Pulse: That must have been stressful, how did you manage it?
Don: The terms of the franchise meant I couldn’t walk away, so I had to come up with a plan to get the business in shape for sale.
Success depended on focusing on every client and quote in a systematic way to ensure we were making good margin on every sale.
I hired a very talented and savvy sales person and for two years worked closely with her to boost the bottom line, and I managed to sell in 2016.
The Pulse: What did you learn from the experience?
Don: I’d run winning ventures before, so I was a bit down about why I couldn’t make Pack and Send work in the way I wanted it to.
After a bit of soul searching I realised that I wasn’t doing something fundamentally wrong — I just wasn’t passionate about the freight industry.
The Pulse: Was there ever a moment when you thought you’d fold?
Don: No, and that’s because I felt the franchise had my back.
When I reached out they showed me the marketing and sales techniques that successful franchises were using.
I think that if I’d been a standalone business I might have folded because I didn’t have an office full of staff to call on for help.
The Pulse: What advice would you give a struggling business owner thinking of closing shop?
Don: Don’t be too hard on yourself, because many other successful people have been in the same boat.
To avoid further pain, I’d recommend getting a business advisor on board to help them with exit strategy.
When I’ve helped businesses through this process, 50 per cent of them end up finding new love for their work because they’ve figured out how to run their company.
However, in cases where the business keeps going backwards every month despite improvements then it’s about cutting your losses with the least collateral damage.
Don Doolan is a multi-awarding First Class Accounts bookkeeper who prides himself on treating his client’s businesses like they were his own. He is passionate about providing exceptional strategic advice and administrative support to help his client’s business dreams flourish.