From £1 Million To Bust: How To Turn Your Business Round Again
January 30, 2008
Hi, Thanks for visiting. You might want to click here to sign up to my RSS feed, so you don't miss anything important.
What would you do if your business was about to go bust? Do you think it would be possible to turn things round again?
Ian Denny did it. In their 8th year of trading, Ian’s IT company was turning over almost £1 million ($2 million). To an outside observer, the business appeared to be booming. But, things were far from good. In this interview, Ian explains how he resurrected the business after it failed.
Ian - your business had many years of success before you faced bankruptcy. What was your most fatal mistake?
That’s a tough opener. I’ve got so many to choose from! But, If I had to choose one, it is focus.
Rapid business growth isn’t the same as a fast car ride. You can’t feel the speed or the acceleration. It’s just very busy. And as you grow, new problems arise. When a team is bigger you have a new set of challenges like management! And I’ve got to admit, I was both inexperienced and not exactly a natural!
I have picked up how to juggle many things now. But equally, I’ve discovered that you shouldn’t try to spin too many plates, or some will smash. Instead, outsource or increase focus on systems and quality rather than throwing more people at the problem.
Did you lose clients when the business failed? What did you do to try to minimise any losses?
Yes we did lose clients but not in the way you’d expect. The vast majority moved across. In fact more than we could cope with.
We were penniless and needed to start again. We actually helped some clients move to other providers. Not because we didn’t want them, but because we didn’t want to let them down as our small initial team of 4 couldn’t cope.
Were you approached by dubious companies offering paid help when you were facing bankruptcy?
Actually no. We are incredibly lucky to have an amazing accountant. He referred us to an insolvency practitioner he had known and trusted for many years. And it was an excellent recommendation.
If you could give just one piece of advice to someone starting out in business, what would it be?
Plan - pure and simple.
If you don’t decide upon the destination then the journey will meander and you’ll never really arrive anywhere. But, by being clear, setting targets and goals, and aligning your plan to financial realities, you have a better chance than the majority of businesses who fail.
Were you ever tempted to pack it all in and get a job?
For about 6 months before we went bust, I yearned for a job and an end to all the worries about paying salaries, taxes, rent etc.
Now, having doubled in size within 8 months, turned a profit, and reached a point where we are turning work down, I can’t see myself working for someone else again.
There used to be a huge stigma attached to bankruptcy in the UK. Do you think this has improved?
I actually think it has, which was a pleasant surprise. I’ve openly told many new clients we went bust, and it’s amazing how many of them reveal they had a failure.
After we’ve shown off our scars and war stories, it actually builds trust and a better start to the relationship.
What are the most dramatic changes you’ve made to the resurrected business?
I would have to say the opposite of my answer to the first question - focus.
We are so focused on the quality of what we do. We have put systems and processes in place we never had before. And we aim to get 95% of all customer IT problems solved within 4 hours.
That’s a tall order. Some take more than an hour to fix because of the nature of the call. And some take more than a day, especially when you have to wait for a part to be delivered. So every time an incident drags, we have to work harder than ever to stay within target.
If someone else is experiencing difficulties in business and they think they’re about to go bankrupt, what is the first thing you would advise them to do?
Don’t put off asking for help. The longer you delay, the worse it will get. Get professional help, but surround yourself with mentors too; friends in business who know what they’re talking about.
Don’t go with “Pub Talk”, instead trust the people who’ve been there. And try to talk to someone who has failed as they will help immensely. But don’t choose someone who failed and went down the pan also. Choose people who turned it around; positive people. People who don’t bemoan the cruel world and the fact that the world owes them a living.
You will get support from the most unexpected sources. For example our suppliers were amazingly helpful.
Where do you see Multisolutions in five years time?
I see it as a multi-branch operation, at least covering the North West of England, but possibly UK-wide. But, I refuse to be precise with 5 year plans, because I think that’s almost impossible. Either way, it will be based on a sounds financial footing.
Ian, thank you for sharing your story with us.
Have you had similar business problems? If so, please share in the comments section. And if you have any questions to ask Ian, please ask.
To read more about Ian’s amazing business turnaround, check out his blog: Phoenix From The Ashes. And if your business needs IT support (Liverpool and Manchester area), check out his company website: Multisolutions.
Comments
14 Responses to “From £1 Million To Bust: How To Turn Your Business Round Again”
Got something to say?
-
Sponsors
-
-
-
I found your site on google blog search and read a few of your other posts. Keep up the good work. Just added your RSS feed to my feed reader. Look forward to reading more from you.
- Jason.
Thanks for that Cath. If I rewind to this time last year, the world’s turned into a much brighter and happier place!
Happy to answer any questions. Tough ones too!
Ian Denny’s last blog post..Hate Selling? I Do Too. Instead Of Desperation, Here’s How To Have Fun And Get Sales
Ian - I was going to be evil and say that you were also available for public speaking engagements - push you out of your comfort zone a bit!
Ian,
Barbara here.
Did the financial difficulties affect your home life? If so, what did you and your wife do, to “get through it”?
Have you noticed a difference in your spending habits, such as thinking twice now, before purchasing?
Did the bankruptcy change your opinion of “what’s really important in life?’ e.g. Do you find yourself maybe working a little less time at work, and appreciating family and friends more?
You mentioned in an earlier post of Catherine’s that you went from 16 employees (old biz), now down to 4. Would you say you are now more efficient, more observant of the surroundings, or something else?
Barbara’s last blog post..Stop The Press - I’m Dying To Share
Thanks so much for sharing this, Ian.
Cath,
I’ve done public speaking, but doubt many people would attend!
Barbara,
Yes, personal finances were a mess. I can’t really say we did something specific to get through it - we just kept on battling, taking each day and challenge as it arose. The advice from our practitioner to ignore the 100 hurdles and just them one at a time was followed!
Obviously, spending is largely a thing of the past. We’re in a kind of surreal world. On the one hand the business is doing fantastic.
But personally, we’re in a debt management plan so personal spending is strictly within a budget.
I actually work a bit less than I did, but what I do is far more enjoyable.
We went from 16 back down to 4, but recently we’ve doubled up again to 8. BUT that’s based upon contractual income to cover those salaries.
We focused too much on variable rate income and clients. And that’s hard. We now turn down one-off jobs because it dilutes us. Instead we focus on the clients who pay us a monthly retainer. We make sure we’re there for them when they need us.
To get where we are now, I would say that is solely down to an increased focus on the detail and systems to support it.
We’re streets ahead of where we were, and I believe we’re back to the best if compared to the competition.
But I can see an awful lot still to improve. And when we get those ticks in the box, I’m sure there’ll always be room to continuously improve.
We have some excellent reporting tools so we can see at a glance, “live” where we are up to.
We have someone new starting on Friday, and I can;t wait.
The service levels will rocket after his one-week’s induction and systems coaching.
Mrs Micah,
I don’t mind sharing anything - good or bad - if there’s anythin in what happened to me that could help someone else avoid it, or even bounce back from a failure, then great.
Ian Denny’s last blog post..Hate Selling? I Do Too. Instead Of Desperation, Here’s How To Have Fun And Get Sales
Ian,
Thank you for sharing. Your experiences can definitely benefit others who have, or may be going through the same situation.
Catherine,
Thank you for providing such a great post. It fits in so well with your other business lessons and ideas.
Barbara’s last blog post..Stop The Press - I’m Dying To Share
Thanks for the interesting story Ian. I was wondering how all this affected your relationships with your suppliers. Were you able to keep the same suppliers, and did they make you pay cash at first, or did you need to find new suppliers and how easy was that?
Great interview and subject…Two of my favorite bloggers at once. A great treat.
RacerX’s last blog post..Personal Finance QuickTake: Fed Cuts Rate 1/2%
This was a really lovely interview and lots to learn from (even tho as far as it regards managing business, all your articles are awesome, and sometimes i just read and learn in silence here).
I liked Ian’s advice about planing your business and how the hurricane can hurt you if you grow too fast and unprepared, you seem to be a really determined man Ian, thanks for sharing.
SEO Optimization’s last blog post..SEO For WordPress
Neil,
The supplier relationships were largely pretty easy to maintain. There were a few uncomfortable moments, but most of them were actually very supportive.
Strange to say, but I think it actually strengthened those relationships.
I did chronicle this at length on the blog, but in summary, you should ignore the feeling that makes you want to run, and instead go talk to them. In person if possible and explain the situation, apologise for any losses and where possible (and despite no statutory requirement to) make good at least partially those losses. And that doesn’t have to be financial.
In one case, we gave a client free IT support and that is a sensible way of repaying that debt.
In terms of credit/paying cash, that wasn’t a problem. In most cases the credit remained open. We actually changed the structure of the business to clients bought direct rather than through us, and with glee we exited the hardware/software supply market!
In any case, we were lucky that we had a company available to begin trading. Although personally, our credit rating is shot because of the personal inability to keep up, the company has a “green” credit rating.
SEO - thanks for the kind words! And yes, Cath’s articles always make you think or in fact change the way you do things in lieu of the great advice.
Ian Denny’s last blog post..Hate Selling? I Do Too. Instead Of Desperation, Here’s How To Have Fun And Get Sales
Catherine and Ian,
Thank you for sharing this.
Ian your candor is a lesson in itself. Realize that when you blow it, it’s your responsibility.Face it, learn and grow from it.
Ian… here’s to your Phoenix Rising,
Stronger than Ever!
Walt Goshert’s last blog post..How ?Extraordinary? is Your Business?
[...] Of Misery? Can you be truly successful, if you don’t enjoy the business you’re in? From £1 Million To Bust: How To Turn Your Business Round Again: An interview with Ian Denny who revived his business after going [...]