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PostPosted: Tue Aug 22, 2017 6:13 am 

Joined: Mon Jul 24, 2017 1:06 am
Posts: 15
Ok, slightly controversial topic given the nature of the forum, but I'm genuinely interested...

Are there any people out there who gave up their regular 9-5 to set up their own business and ended up regretting it?

I feel like there is so much glamourising of working for yourself, but the reality must surely be more of a spectrum.

Thanks in advance to anyone willing to share their story!

PostPosted: Wed Aug 23, 2017 3:48 pm 
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Joined: Thu Mar 15, 2007 10:29 am
Posts: 4804
Location: Melbourne AU
Hunterfilm78 wrote:
Ok, slightly controversial topic given the nature of the forum, but I'm genuinely interested...

Are there any people out there who gave up their regular 9-5 to set up their own business and ended up regretting it?

I feel like there is so much glamourising of working for yourself, but the reality must surely be more of a spectrum.

Thanks in advance to anyone willing to share their story!

Sure… in my mid-20s, back in the early 1970s. My day job was manager of a division of a successful publishing and printing/packaging group. In my first 8 months I took the fledgling operation from start-up to 85% market share in our entire region, and forcing our #1 competitor into a merger to block out a huge national media group from basically taking over all newspapers in the region.

My strategy worked: the partners in the merger were able to strike a rare deal with the national media group in which they retained 51% control while maximising the sale price of the 49% shareholding — a price they could only dream of ever selling for if they'd retired.

But my own position became untenable because the directors of the company we'd forced into the merger (before the takeover deal) teamed up with the national media outfit to get revenge on me for my part in implementing my strategies — despite that former competitor being saved from a potential loss on TWO counts: a massive loss of market share because of my marketing strategies, then massive loss on the proposed takeover deal originally offered by the national media group, which I pre-empted and prevented for them through my knowledge and contacts in the industry.

I was sidelined in the management tree and had to watch my highly-effective marketing strategies being systematically dismantled by small-minded, petty incompetents to whom gratitude and loyalty had no meaning.

After a couple of months in this position I came to the conclusion that I'd be better-off cutting my losses and going out on my own, using my unique combination of experience, expertise, skill sets and contacts to actively repair much of the damage done by my marketing strategies and taking 85% market share from them in less than a year — which had severely damaged the entire industry in our region.

I only realised how much damage I'd done when I attended a regional industry convention, a few weeks after these events, and found myself ostracised. So I made personal connections with all of the major players at the convention to ask them what specific problems I'd created for them — which I was uniquely qualified to fix for them — and, over the next couple of weeks I visited each of them to offer them the opportunity to regain their former market shares, quickly.

My strategy was simple: My personal and professional skill sets, experience, etc — at the ripe old age of 26 — were the key competitive edge in taking that market share away from them in the first place. By setting up my own strategic, creative and high-end, cutting-edge technical services consultancy and production house, with them as clients, would give them the competitive edge no longer available to my employer locally, or without hiring many people to provide them.

They were sceptical at first, so I offered them a special deal that they quickly recognised as being too good to refuse — especially since I was offering it to everyone, including their own competitors. They couldn't afford to not get on board!

So I opened my doors and became profitable in the first month. For the next four years this strategic alliance saw market share return to the members, several mergers and acquisitions and enormous trust and goodwill toward me, professionally and personally.

The business was so successful that, in December and January each summer (Australia, okay?) when the industry traditionally wound down for school vacations and the holiday festive season, we converted to a different work schedule. We were located on the coast, close to world-class surf beaches, safety beaches, fishing and boating, tourist destinations (#2 in Australia after the Great Barrier Reef). The first summer I noticed a dramatic drop-off in productivity and profitability, which puzzled me. Make-overs and errors meant long hours to keep faith with clients. My staff seemed distracted and careless.

One day I stayed at work during lunch hour — I normally went home, because my home was just 3 minutes away and I had two young children — but I noticed something I was completely unaware of: during lunch hour (12:30pm-1:30pm) a steady stream of wives arrived to collect the family cars/vans to take their kids to the nearby beaches, etc for the afternoon. After that, my guys' hearts and minds were simply no longer on the job.

So I called my accountant (brilliant strategist) and crunched the numbers on what I had in mind to change things.

We didn't rely on passing trade. In fact we had only two small clients within a 30-minute drive, and the nature of our work required planning and often several weeks of lead time. So I proposed the following for the entire summer each year:

We'd start work each day at 5:30am. At 7:30am we'd talk to the dining room of the large motel/hotel/entertainment venue next door for breakfast until 8:00am. The business paid.

At 10:30am we'd have a break for 30 minutes with light refreshments delivered by a bakery across the street. The business paid.

At 12:30pm we'd close for the day.

The results? Nothing short of astonishing…

Productivity soared by more than 300%. Profitability doubled. Re-dos and make-goods were practically non-existent.

Whenever we needed to hire someone new or replace an existing worker (which we usually needed to do from the State capital because of the leading-edge tech we used — I bought equipment from overseas that didn't exist in any but a few high-end, city-based production houses) — I would have a waiting list of applicants instead of weeks of searching for suitable applicants. Our life-style was incomparable in the industry.

The BIG bonus was when my accountant called me to suggest that, with the compensation package I was paying — including profit-sharing and bonuses — I should consider changing it because of the high taxes we'd all soon be paying! We're were close to market saturation, we were all earning outstanding incomes, but once we hit the next income tax brackets, we'd be losing substantial amounts in income tax.

After discussions with him and my staff, we made the decision that, rather than lose money to the government, we'd all prefer more discretionary time with our families and personal interests. So we changed our hours permanently to our summer schedule, so that we all had every afternoon off, and we only worked 3 days a week.

Productivity and profitability rose even higher because we were all MOTIVATED. My team kept each other performing at the highest levels and took responsibility for each other. It soon dawned on me that NONE of them wanted to risk their jobs because they had such incredible work-life balance — and this was the 1970s, remember — so they performed for the 3 days a week they worked.

We were the talk of the industry when an industry/trade magazine interviewed me and several of my team. I was inundated with enquiries from all over Australia. The waiting list grew exponentially.

An unexpected bonus was enquiries from large companies wanting to know how we managed security of Intellectual Property. As a result of the practices I'd implemented when we started out in 1974, we found ourselves handling a growing clientele in this market as well. (I had no trouble finding qualified and motivated staff whenever required.) Interestingly, in all those years, I never needed to fire anyone. :D

In 1978 disaster struck on several levels, all of them personal and only one of them business-related.

After a traumatic 8-9 months, including the terminal illness of my father, I finally sold the business to a consortium of clients and relocated my family to the State capital, Melbourne (Australia)… the World's Most Liveable City. https://youtu.be/E6RtMMOSXmo

My regret?

Not having a proper contingency plan for upheavals in my personal life. I was so debilitated and stressed that I basically lost interest in my business. But a few short years later the Macintosh arrived on the scene and changed everything, so it was great while it lasted. :)

PS: How did we handle contact with clients and prospective clients, etc with those opening hours?
Simple — we sent all clients and suppliers a letter before summer each year advising them that we'd be unavailable every afternoon and in the mornings on Tuesdays and Thursdays. There were no mobile phones or tablets back then, but pagers were issued to all staff members, with a central messaging service that could contact anyone needed urgently. It worked. I made a practice of having my calls forwarded to my PA, who worked from home, where she had two small children. We met in my office on the three days we were open, typically for about an hour. There were no PCs much in those days.

PPS: Management authority Peter Drucker said that "because of its nature, business consists of two things, and only two: marketing and innovation. Marketing and innovation make money. Everything else is a cost."

Often, the innovation needs to be in marketing. Or HR. Or customer relations. Not just in products or services. :)

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PostPosted: Thu Aug 24, 2017 6:49 am 

Joined: Mon Jul 24, 2017 1:06 am
Posts: 15
Hi John,

Wow, thanks for your candour! If there's really one thing that stands out to me in your story its the importance of having a steady balance in your life and an appreication of everything you have outside of work.

Your employees over-performed because they were so keen to enjoy their time outside of work, and the respect their job had for this made them value their position even more.

I'm terribly sorry to hear about your father, but these terrible times are a reminder that our personal relationships mean more to us than any day job. Even though sometimes the latter can soak up more of our available time.

I think when you start your own business, you are inclined to treat it as something more than a job. But its important not to lose sight of all of the other things in your life too.

Thanks for your time - what a journey!

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