PetesWeekly

The past few articles about the fallout from closure have led to one key question being asked: When should I close?

Before we look at the road signs that you should notice, like the one that says, “Road Flooded”, lets look at the issue of quitting. Quitting is a bad, bad thing. Quitting implies that you are a yellow-bellied, chicken-livered coward who does not have the balls for the job. (How are we supposed to insult women, I wonder, when so many great insults refer to some aspect of a mans anatomy?)

Contrast quitting, just sommer giving up, with making an informed decision to shelve this project in the light of new information, robust experience, and strong economic indicators showing imminent collapse. That’s not quitting, that’s plain common sense, if only we knew how to voice it.

That’s what explorers do when they do not find gold in them thar hills. They stop drilling there, because they have proved that no gold is to be found there using their current tools, and so they move on to a new location to try again.

Not us SMEs. Having told the world that this is what we plan to do, we think that our friends regard our words equal to the carvings that Moses brought down the hill. (Your friends don’t care because they’re too busy trying to eke out their own daily crust.)

Stopping is to quitting what braking is to crashing. Stopping is intelligent.

Mentioning road signs reminds me that I once found myself driving through an awful storm outside Humansdorp. It was so bad, and I was feeling so guilty driving a nice car, that after fuelling up I collected a couple of indigent families at the roadside, intending to drive them home. (Just a few miles up this road, they said…)

This road was the one which said ‘Road Flooded’. To which they said “Nee Oom, there is no floods on this road, hey.” Anyway, a few miles turned out to be about 20, and I covered the last 10 very, very fast. Eventually, one of the families told me we had reached their stop, so we stopped. I assumed, wrongly, that this was for both. Not so. Just a few more miles, the second team told me. As I turned forward to start, I saw rushing water across the road, 30 metres ahead.  I still have nightmares about it. Hint 1: Read the signs.

I took the second family back to Wimpy, where I discovered that my blood sugar was way too low to be driving in the first place. Hint 2: Always carry chocolate.

The issue of when to close is simple and clear when you read the signs. It’s never easy to do, because in closing we have to bury that set of dreams. I no longer think of my business as a ‘business’, but rather as a project. it reminds me that there will always be another one.

The key determinant, in my humble opinion, is when you have to lend more money to the business to keep it afloat. We’re not talking about emergency bridging finance, but rather about a downturn that needs you to keep funding the business until it upticks again.

It is usually that funding that ‘forces’ you to borrow against your home, and forces you to sign the unlimited surety that is part of every business overdraft. I have lost count of the number of folk I have counselled who borrowed heavily during their last few months, using the funds to pay staff, and themselves, without realising that the ONLY reason for the firm continuing was the funding they were feeding in.

I am a great believer in Kahlil Gibran’s words. I paraphrase: “If you love your staff, set them free…” No matter what happens, no matter how Herculean your efforts, they will hate you when you have to fire them. They don’t care that you will have lost your home paying them for the next year. I mention this because it is one of the key reasons we borrow so much in the last few months. So do them a favour and help them on their way early.

This is also, for what it is worth, why I am so devoted to running a very, very lean business. Running online costs so little that my Norwegian accountant is convinced that whatever I am doing must be illegal. No business of substance has costs this low, he feels. It is also why the Internet is a fine answer for anyone who has just closed a business.  It is as close to a free startup as is possible. But more about that later.

Firstly, here is a link to Tuesday evenings webinar on surviving failure. This page will list the videos as we make them.

It was fun, the feedback was great, but the e-mails it provoked beforehand were just plain fascinating. The bottom line is that failure is embarrassing. Not just any failure, we are talking specifically about money.

We forget all of the other roles that we are called on to play.

For those of us who work from home, for instance, we forget that we are always in our children’s lives. You can’t measure that with money.

We forget the amount of time we’ve been able to live independently, not relying on somebody else for our income.

We forget the value we have added to our suppliers, our staff and their families, and the amount of money we’ve given back to the government in tax (VAT, personal tax, company tax, and the taxes that our staff pay).

We forget all of the learning, the personal growth, that we’ve achieved and that our efforts have allowed others to achieve.

We forget that, until this month, we have managed to pay for 10 years of schooling for the kids, 15,000 meals, more clothes than were needed by Caesars Roman soldiers, doctors bills, and at least three Mauritian breaks for our dentist.

We forget how much value we added to our clients.

We forget everything in the cold harsh light of this mornings bank balance when compared to next weeks bills. And in that one moment, we see just one thing: failure.

As an aside, in September, the SA government is hosting an international conference on small business ownership. It’s not for small business owners, just as a conference on farming is not for cows, pigs, chickens, or alfalfa. A conference on farming, just like a government conference on small business ownership, is about how to make more money out of the herd.

I say this because I looked at the Call for Abstracts, the kind of thing we speakers fill in to get invited to address the group. The search is on for papers about making small business ownership more sustainable for government. In concept, it’s a little like a call for papers to discuss how to get more milk out of your herd, rather than how to increase the well-being of your cows.

Have you ever felt that maybe, just maybe, you are a small part of a much bigger system that needs you to be focused on money, rather than the myriad other joyous things you could be focused on.

Maybe I’m being a little grumpy, but you can check it out for yourselfhere. And look at what they want the speakers to talk about  here. (They have already decided what is best, and want confirmation. Nobody has yet asked us cattle.)

Being alive is a miracle. In my case, it really is, because if Fred Banting had not isolated insulin 35 years before I was born, I wouldn’t be around. Each day is a bonus. But it is just so for all of us, because we forget that just 100 years ago the average lifespan was half of ours.

We are living in the best time in the history of mankind. Even the poorest person reading this newsletter lives better than a king of 200 years ago. And has more access to help, entertainment, and food than almost anybody 100 years ago. And yet we define our lives in terms of a single failing: Not enough money, right now.

I am embarrassed because for 20 years that’s the field I have been teaching in. In technical terms, a “failure” in life implies a systemic failure, another word for which is “death”. But death is a natural part of life. Nobody likes it, but we don’t think of the recently deceased as failures. Rather, we celebrate their lives. It occurs to me that this is a great balance. As our businesses close, maybe we should celebrate their lives as well?

How much money we each have really seems an appalling way to measure our lives. It seems about as relevant as basing our self worth on the number of freckles there are on the neighbours dog. And neither of my neighbours even has a dog, so what does that say about me?

I don’t know about you, but I feel that I must be getting old.  I am still trying to recover from my birthday in February, which turns out to be rather a long way back, but seems like yesterday.

The speed with which this year year hurdled past is matched only by the speed with which the economy worldwide has collapsed.  Except in China, of course.

But as we get closer to Christmas, and hopefully snow, it occurs to me that the single biggest regret I have in life is not that I haven’t yet reached my goal of retiring rich.  Or that I’ve given up on that, and just surviving to retirement age is the new target.

Nope, my biggest regret is that I have spent the past 35 years focused in the wrong direction.  No matter what business books tell you, a client-centric focus is not the right approach for the small business owner.  As one of my clients delicately put it a while back “Don’t ever confuse us clients with your friends.”  Before you get frothy, please bear with me for a moment.

Many of my clients are great friends.  But that’s not the point.  The responsibility, nay the duty, of a small business owner is to be kiddie-centric.  Clients come and go, but your kids are going to be messing up your house for the rest of your life.  (Or messing up your life for the rest of your house, whichever comes first.)

They are a lot more forgiving.  They are unlikely to abandon you when you mess up, or at least for as long as you have money to share.

In my case, until just a few years ago, every waking moment was spent on business.  I rather liked the challenge.  I still do. And frankly, it’s so much easier a challenge than preparing children for life.

But my biggest regret is that I didn’t get to put my kids to sleep every night they would have let me because I was too busy travelling, or too busy coding, or too busy in meetings, or too busy doing a bunch of thngs that seemed more urgent, but were nowhere near as important.  My children assure me that “it’s okay dad”.  But it isn’t really.  Maybe they didn’t miss it.  But I did.

Nowadays, when Mrs Carruthers and I go to any school gatherings with young Ms Carruthers, it is tacitly assumed that Danielle is accompanied by her mother and her grandfather.  When I was about 30 I met a man older than 50 who told me exactly what I’m telling you.  I ignored the best advice I ever got because I was too busy to believe him. In hindsight I think that 30 year old version of me was a prat. (I have no shortage of clients happy to confirm this.)

As I write this I’m listening to some vintage Rolling Stones.  Each song brings back a memory of a person, a relationship.  I have no idea what my bank balance was at the time that I heard each song for the first time.  And I don’t know what business was like.  But the people, them I remember.

So, for this last e-mail of 2011, may I humbly beg you to follow the only real piece of good advice I can give you this year? Take the time to put your kids to sleep over Christmas, and – what the heck – throughout next year.  That investment is safer, more guaranteed, and will generate better returns forever than anything else you could possibly do.

Except, maybe, taking the time to put your partner to bed every now and then as well. That’s also whole heap of fun, it turns out, and you won’t be kicked in the nuts as often.

You don’t actually have to prepare them life. Just loving them is enough preparation – for both parties. And it sure is a lot more fun.

At the risk of cheapening the point, when your family takes strain, when your relationships are in turmoil, you might as well forget about business until you find balance.  Relationships are more important than anything else.

And finally, don’t ever think that your kids are interested in the money. They aren’t. They don’t care, at least while they still want you close by when they sleep. They quite like you, though, so matter how tough things might seem to you, they just want to play. Try it. It’s kinda fun! There will be enough time for clients next year.

God Jul (Merry Christmas) and best wishes for 2012. We’ll talk again in January. Thanks for a fun 2011.