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]]>The team at the business unit was dysfunctional and required a great deal of man management, as staff had been working through the pandemic at home with little or no direct management nor supervision.
Any interactions with customers were not recorded on any CRM and market information/intelligence was rarely shared between the team members.
The majority of the team had worked together for some time and there was a great deal of loyalty to the, now ex-senior manager and this was evidenced as staff turnover increased significantly following his exit from the business. This was further amplified through the hostile attitude to anyone who shared plans for improvement.
It was combative, messy and it was going to be a very long road to recovery.
One of the key objectives was to start to get greater transparency over the customer activities within the business (i.e. who was doing what) and as all of the interactions appeared to be carried out on the individuals’ personal mobile devices, using their personal WhatsApp, there was a huge risk of the business both being in breach of UK data protection/Privacy laws, but also that the customer contact information was highly likely to be shared with another employer, in the future.
An initial project was carried out to identify a software platform that could offer total visibility of all WhatsApp messaging and which would be capable of facilitating a multi-user, single-number service, where all of the data was secured on the business’s platform and which could be accessed either via Mobile app or PC web, and regardless of whether this data was collected by staff members from the teams, both inside and outside the UK.
A user training plan was introduced and rolled out across the business with multiple department teams being included in the group, thereby supporting the simple transfer of any client documentation received and the assignation of conversations to the right person, all secured and compliant with the data protection and privacy laws.
The WhatsApp for Business service enabled customers to make contact with staff members via WhatsApp at any time of the day as the service was a worldwide 24/7 service and this would enable queries to be dealt with by the working staff members, regardless of their physical location.
As we developed the user experience across the business and with our customers, some automations were introduced to enable key activities to be requested/reported by using keyword shortcuts.
The successful launch of the platform enabled all departments to communicate with our customers seamlessly and with total transparency, and all documentation was saved within the platform history, with a full audit trail, available when required.
It is difficult to quantify the savings to the business but it is clear that this platform helped professionalise the business and was hugely successful in ensuring that everyone within the business could now have full access to the conversations.
Whether your business is facing financial, operational, marketing, sales/business development, or tech challenges, we are here to provide support to you. We work with you to identify the areas of your business which require immediate support and prepare solutions to those that may impact future growth. Our objective is to address all challenges and assist you, resolve the problem areas so that you can return to delivering growth.
We serve as trusted, independent advisors, partnering with you to establish the future direction of your business, explore new opportunities and provide a listening ear to understand the pressures you are experiencing.
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]]>The pair got together formed the business as 50/50 partners and fairly soon after it was clear that their skillsets were very different with one of the partners feeling that he was more industrious than the other, but despite the mismatch in terms of skills, they continued on. One of them was looking after the sales of the business whilst the other looked after the back office.
This scenario continued and the business grew with increased headcount and despite many occasions when both partners held discussions about how the division of labour was split, they always seemed to sort things out.
Both of the partners felt that at some stage they would want an exit but they had very different views of the value of the business. One had a view that the value of the business must be £1 or even £2 million pound, without any evidence, whilst the other was more pragmatic. There was an expectation that at some stage they would exit with some cash in the bank for their efforts.
Over the years, the business went through periods of growth, followed by flat-lined periods and very challenging times too. Despite this they continued on, but privately they started to consider what they would do next.
After being in business for almost 20 years, they started a process of an investigation to exit and, by chance, a larger competitor approached the business owners to discuss the possibility of sale. To determine the current value, Colin & David sought the advice of a business broker who provided a positive valuation, albeit surprisingly high and despite the business being in a slow decline.
The valuation was very tempting, however, in order to engage their services, the broker required an upfront fee of around £10,000 for an exclusive listing and market preparation, along with a transaction fee on any subsequent sale (this was around 3% of the ultimate sales price).
They decided, armed with this inflated valuation, that the more likely sale, would be to a competitor with a guaranteed outcome, rather than having to pay a broker fee, without any guarantees.
The sale process was not easy, lots of due diligence and preparation, which resulted in a further reduction in business, as so much time was being spent collating the necessary documentation in preparation for the sale.
Eventually, many months later, the sale went ahead, although this was a long, painful and expensive experience, all parties suffered deal fatigue and eventually, just wanted to get things completed and move on.
The deal went ahead with an agreed severance pay-off for David, which was significantly below his lofty expectations, with Colin staying on as a Director on a salary with shares in the company.
Both Colin & David, were each personally responsible for their own legal fees a sum of £20,000. Not something that they had expected as they were selling their business.
That’s right, both partners had to pay their legal advisers for the privilege of selling their business from their own savings, whilst the acquirer, once the deal was finalised, was able to pass their legal and financial due diligence expenditure through the newly purchased business (a sum of c£50000 was placed into the P&L as a business expense).
Despite the unexpected legal costs, the new business relationship started well with a fresh perspective and all was going well until Colin’s partner suffered a serious accident, which meant that he could not commit full time to work and as he struggled on, he had a mental health breakdown.
The result of this breakdown was that he was off work for around 4 months, without pay. After spending some time recuperating both he and his wife recovered but he felt that he should reduce his working days as he needed some personal space in his recovery phase.
The new employer accepted this and paid him a pro-rata salary.
His return to productivity was slow, despite a heavier workload and limited support. The new owners were unsatisfied with his progress and felt he wasn’t meeting their expectations, so they increased the pressure and suggested he take on a new role with little direct experience of the sector. He was open to the challenge, but suspected the owners had ulterior motives to remove him from the business. This led to increased pressure and a further decline in his mental health.
Fortunately he was able to reach out to his support network and he managed to speak with his GP and other friends who provided a bit of perspective.
He had been in the same industry for 20 years, he had a huge network of clients in the sector that he had always worked in and many of his clients were personal friends. His company had been acquired because of this strength and, despite stabilising numbers, he was being encouraged to start in a brand new sector.
Despite this pressure he carried out some analysis on where his performance was and what was required to get him to increase business levels. Once he had this information, he started to figure out, what he needed to do to ensure that he continue to focus on his specialty area and prepared a business case for his new employers, requesting administration support, which would ultimately enable his focus on more productive tasks, and generate income for both him and the business.
The results have started to come through and he is now in a much greater mental space, with clarity about where he needs to focus.
He has even accepted that the acquirer may not have the same long term outlook as he does and he is now looking to exit on his terms, rather than on theirs.
The business had a legacy and overall was a successful business but in the end their exit value was significantly less than they had expected.
A great purchase for the new owners, who have had to do very little to integrate a cash generating business, which introduces them to a new sector and at the same time folds neatly into their portfolio, increasing their ultimate value multiple.
What suggestions do you have that could have helped the business owners get a better outcome to their situation?
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