Banks trying to kill SME's

pedronomix

I have nothing to add to what I have already written. So lets ponder some of the other issues. Of the three siblings, can any do better in the open job market. 3rd level education? Career experience outside the shop? Have you shared with your brothers what you have posted here? if not, why not? If so, how did they respond. Has your father already decided that he is not going to choose between you and hand the business to one or has he decided to hand on to all three?

Calibos

Its not like were all arguing with different visions of how to move forwards and no common ground. Its not a father who won't let go, its not too many chiefs and not enough indians. We're trying to find answers in the first place, we're not fighting over which of us has the answers. Every option is still on the table. No one is complaining about working longer hours for minimum wage now to help save the business, everyone understands that even if we turn things around big time we can never expect AIW each from it if we want to be sustainable going forwards. That said some posters seem to be looking at it from a purely entrepreneurial/investment viewpoint where it wouldn't be a business they'd get into if they weren't able to pull at least 50 or 60 grand out of it in salary for themselves alone whereas none of us have those expectations and would be happy enough just to be able to pay the bills. Father has already decided if the business survives its time to retire. Brothers aren't as bothered as me to save the business and seem to want to just go with the flow. They're fine with me becoming the new 'great decider'.

I don't know where this focus on a succession battle is coming from or the assumption that we all expected an equal stake in the business and 4x €50,000 salaries.

You are right in one thing. I was hoping for a magic wand that might turn around our current cash-flow/credit issues quickly and perhaps hold of the revenue and bank wolves at the door long enough for the rent reduction and minimum wage savings to start showing up in the balance sheet. Then with the existence of the business a little more secure having the scope to implement all the other changes and ideas to start increasing turnover and profits again and a vow to never forget the lessons and be ever vigilant for new opportunities, not fall into old habits.

So it seems like theres nothing more we can do in the short term but lots we can do in the medium to long term if the business survives.

pedronomix

Time to make some actual decisions so, if this really is the position.

pedroeibar1

The discussion for the last several pages really has nothing to do with the thread topic and perhaps should be renamed?

I push people. The better ones think, question and fight back with strong on-topic counter suggestions. That has not happened with the OP, despite fodder being given to him on a plate by me and several others.

Trojan wrote: »

Tough crowd. Yes there are some rose tinted glasses being applied but I don't recall the OP comparing the shop to Simpsons of Piccadilly, and I think it's a bit disingenuous to suggest that's what he was doing.

Not going down the “argument with a Mod” road, but what does the following model suggest? Ever been to Simpsons or even Cavistons? Troj?

Calibos wrote: »

Keeping the traditional looking frontage, Banner in the window "Serving the ******** Quarter since 1936". Traditional looking Varnished and painted wood internal shelving, counters and displays etc.

Actually, the idea is not a bad one, but not appropriate IMO to a shop (anywhere) in Bray. However, there was no response on the Paris/NYC shops I named, which are the “best of concept” for that type of idea and on receipt of comments like that in OP’s position I would have jumped on Google and queried it.

To turnaround a business you need to cut costs or drive turnover, preferably both. Instead of asking about that, the OP has been dissing the “Brands”, moaning about banks, about Musgraves (the No. 2 grocery retailer in the country – and a family company to boot that has overcome succession problems!), dismissing “symbol” group franchise costs and even complaining about the residual balance he has to pay after they subsidize a refit.

I admit I cannot make out the OP –articulate but with some very disconnected thinking, no acceptance of his weaknesses, a large sense of ego and entitlement, and no idea of financial realism with regard to borrowing/repayment ability. But the scary thing from a management perspective , that which is really lacking, is ambition.

Calibos wrote: »

……at its height our wage bill for the minimum 3 staff excluding my father was 60,000

Who, with any reasonable skillsets, would be prepared to work longterm for the €20k income he has and is prepared to accept into the future?
Succession is easy. Have the guts to take over from the Da on a lease deal with an OTP, get the brothers to smell the coffee, move them or let them move themselves. Or have the balls to leave the protected, cossetted comfort of the family nest and move out into the big bad world of commercial reality.

pedronomix

Calibos wrote: »

Its not like were all arguing with different visions of how to move forwards and no common ground. Its not a father who won't let go, its not too many chiefs and not enough indians. We're trying to find answers in the first place, we're not fighting over which of us has the answers. Every option is still on the table. No one is complaining about working longer hours for minimum wage now to help save the business, everyone understands that even if we turn things around big time we can never expect AIW each from it if we want to be sustainable going forwards. That said some posters seem to be looking at it from a purely entrepreneurial/investment viewpoint where it wouldn't be a business they'd get into if they weren't able to pull at least 50 or 60 grand out of it in salary for themselves alone whereas none of us have those expectations and would be happy enough just to be able to pay the bills. Father has already decided if the business survives its time to retire. Brothers aren't as bothered as me to save the business and seem to want to just go with the flow. They're fine with me becoming the new 'great decider'.

I don't know where this focus on a succession battle is coming from or the assumption that we all expected an equal stake in the business and 4x €50,000 salaries.

You are right in one thing. I was hoping for a magic wand that might turn around our current cash-flow/credit issues quickly and perhaps hold of the revenue and bank wolves at the door long enough for the rent reduction and minimum wage savings to start showing up in the balance sheet. Then with the existence of the business a little more secure having the scope to implement all the other changes and ideas to start increasing turnover and profits again and a vow to never forget the lessons and be ever vigilant for new opportunities, not fall into old habits.

So it seems like theres nothing more we can do in the short term but lots we can do in the medium to long term if the business survives.

Except of course you have assiduouly ignored the questions I posed (post #62) which I can only assume means they did not suit!!

antoinolachtnai

Calibos wrote: »

Do you reckon the quadrupling of Turnover and Profits between 1997-2007 was an aberration then with no possibility of ever returning to those levels of profits again no matter what we do? Its making a lot less money now. You don't believe we can ever make it again? Why don't you think we have a future?

Here is the problem. You were not making any significant level of profits. You were and are subsidising the business with cheap labour. Even when you were doing well you weren't really making much (or any) money when the true value of the labour was taken into account.

I would never say you do not have a future. You and your family sound like capable and hardworking people. You will always find something to do, somewhere, somehow.

The reason people are saying you need to change your staffing is not because we want to see you or your brothers put on the road or that it will save money. The reason is because it might be the best thing for the individuals involved as well as the business. A job outside the family might pay better money, with less work and give more career opportunities and a better quality of life.

The shop alone can't let you all fulfil your full potentials. This is the biggest issue of all for your family, maybe bigger than the issues within the business.

There are lots of advantages to having a flow of outside people working in your business. It brings different perspectives and great flexibility. That said, it is a whole different thing from depending on family.

The other issue (and this points at the nub of your question above) is that the retail business is getting tougher and tougher and more and more sophisticated. There is more and more pressure. Look at what happened to Tesco, the biggest gorilla in the jungle. Life is not easy for the Irish chains either. Further afield in retail, there are people shutting down all over the place. You can make money in it sure, but you need to make a lot of investment and you really need to be very canny. That is why I am concerned about the business's future.

It may be the case that there is a reasonable medium and long-term for the business, but the problem is how to get there. To get there you need to get a coherent plan and get investment for it. Just struggling through and staying in business isn't enough.

It is great if you can resolve the family issues. You are lucky in the sense that you have a proposal on the table from your supplier. I would look carefully at the reasons why you you would reject this deal, and fully cost out the alternatives. I would also consider very quickly how you are going to fund investment for whatever plan you decide upon. Your father may be willing to fund this, or he may prefer to hand it over and not be involved.

Calibos

I'm getting even more confused now. On the one hand I was told that we should be staffed with minimum wagers and it was madness to be paying the brothers more. One of the Pedros runs with it and immediately jumps to the conclusion that we were/are/want to pay ourselves 200 grand between us. I clarify that our wages were a heck of a lot more modest even at their height and they are now down to minimum wage levels to help try and secure the business. On the other hand I'm told we were subsidising the business with cheap labour. Is that not what the others are telling us we should have been doing all along? If my father had hired 3 minimum wage staff all along he'd have been clearing nearly 100 grand for himself. Never making much if any money?

I'm not arguing per se but trying to clarify info from my side and clarify if I'm understanding the points being made.

I am amazingly appreciative of the perspective and advice I'm getting here whether I agree with all of it or not, whether it's harsh reality pull no punches or not. The mere word count is evidence of the time and attention you've all given my posts. For that my utmost thanks! If I'd taken the hump at not getting an echo chamber here, I'd have been gone when I was told I'd run the business into the ground and it was a dog.

However I feel like I've been playing a game of whack-A-mole some of the time trying to clarify stuff that some posters have run with. No, we don't expect 200 grand salaries, No, there are no succession battles or too many chiefs and not enough Indians, No, a throw away comment about some nice wooden displays and shelves does not mean I have delusions of grandeur and want to turn our small shop into Brays answer to Cavistons. Pedros keeps accusing me of ignoring and not discussing further some of his points. Well No, not when most of them seem to be erroneous assumptions or jumps he's made like 200 grand salaries and 'Cavistons De Bray'.

Still somewhat perplexed at being told it was a dog, was always a dog and we ran it into the ground and that the economy from 2008-> didn't have anything to do with it, that banks slashing overdraft limits forcing 200 shops to close every year since 2010, doesn't have anything to do with it. I'm not saying they had everything to do with it but they did have something to do with it. I don't mention these things as a blame game for all our issues or feel a sense of entitlement but only mention them in defence of the accusation that the business was a total dog that we ran into the ground. We may have reacted poorly or like I said a few days ago were re-active instead of pro-active and for that we take total blame. This conversation has been great for highlighting some mistakes to ensure we don't make them again and strategies to help us grow if the business survives.

With regard to the brothers employment. With their work to live as opposed to live to work attitude who are we to say what's right for them. If they chose to stay given the future wage prospects, fine, if they decide to leave and I hire other minimum wagers, then great, more for me. We've all got degrees or technical qualifications though but in myself and one of the brothers cases we need to re qualify as the industry moves on so fast (Network Administration). We could certainly move into better paying unskilled work almost immediately even if we didn't go back to third level to reskill.

Tiddlypeeps

pedronomix wrote: »

Not at all sure why I am still posting on this item. OP keeps changing the goalposts without ever addressing the real issues and is facilltated by more off the point advice. So, take the wages as long as you can get them and when it finally dies, you can say well we did our best!!

Calibos wrote: »

Or are you getting frustrated with me because I didn't agree with everything you said, the moment you said it and act on it straight after you said it? Crikey, I only bumped the thread 2 days ago. Give me time to process the advise and set up the fecking meetings

I think you've hit the nail on the head!

pedronomix wrote: »

Except of course you have assiduouly ignored the questions I posed (post #62) which I can only assume means they did not suit!!

I don't blame him ignoring you, you have done nothing but spread toxicity since you joined the thread. Why are you still posting here? You clearly have no desire to help the OP and are just taking every opportunity to put them down. pedroeibar1 isn't too far behind you on that front either. OP's motivations and goals are clearly different to what you think they should be, he wants to keep his family business alive. If you have constructive criticism to offer on that front then do so and keep the unnecessary hostility to yourself, it's certainly not helping the OP and I can't imagine anyone else enjoys reading it, so why bother.

antoinolachtnai

Calibos wrote: »

I'm getting even more confused now. On the one hand I was told that we should be staffed with minimum wagers and it was madness to be paying the brothers more. One of the Pedros runs with it and immediately jumps to the conclusion that we were/are/want to pay ourselves 200 grand between us. I clarify that our wages were a heck of a lot more modest even at their height and they are now down to minimum wage levels to help try and secure the business. On the other hand I'm told we were subsidising the business with cheap labour. Is that not what the others are telling us we should have been doing all along? If my father had hired 3 minimum wage staff all along he'd have been clearing nearly 100 grand for himself. Never making much if any money?

It's all about the detail. You would need to model this up in a spreadsheet, but I don't think that would work. You wouldn't be able to cover the workload of keeping a shop with a reasonable standard of service open 13 or 14 hours a day with 3 minimum wage staff.

Still somewhat perplexed at being told it was a dog, was always a dog and we ran it into the ground and that the economy from 2008-> didn't have anything to do with it, that banks slashing overdraft limits forcing 200 shops to close every year since 2010, doesn't have anything to do with it.

I have heard of cases of aggressive bank behaviour bringing businesses down, but this just isn't one of those. The bank pulled back credit because too much credit is advanced. Credit is not a means for covering slack economic periods. It is for financing growth. Your business has not been growing. In fact, it has been contracting. What's more, it is a cash business. Why would it require finance?

If you do think the bank has refused credit unjustly you can take the case to to the Credit Review Office.

I'm not saying they had everything to do with it but they did have something to do with it. I don't mention these things as a blame game for all our issues or feel a sense of entitlement but only mention them in defence of the accusation that the business was a total dog that we ran into the ground.

The main person I hear saying you ran it into the ground is actually you. You didn't. By the sounds of it, you worked really hard. You didn't take very much out of the business at all.

With regard to the brothers employment. With their work to live as opposed to live to work attitude who are we to say what's right for them.

If you are the new boss, then it will be your responsibility to decide what is right for them and right for the business.

I have no doubt that your brothers are intensely loyal to the family and they are to be commended for that. But I just can't believe that it is your brothers' wishes to work as a clerk in a small shop for the rest of their days. Maybe it is, and that is fair enough. But you really need to be sure that that is the case and they need to understand that they will never get much of a pension out of the business, they will have difficulty ever owning their own home and that any stake they have in the business will not be worth much.

When I say it will not be worth much, I just mean financially. I don't mean to offend you or belittle it. There are certainly other kinds of value besides financial value. However, we all need money to live and to support ourselves in later life and we have to provide for this.

If they chose to stay given the future wage prospects, fine, if they decide to leave and I hire other minimum wagers, then great, more for me.

I don't really think this is necessarily the case. If you replace family people on minimum wage with other people on minimum wage, it will almost certainly end up costing more. The reason for having non-family staff isn't to save short-term cash.

We've all got degrees or technical qualifications though but in myself and one of the brothers cases we need to re qualify as the industry moves on so fast (Network Administration). We could certainly move into better paying unskilled work almost immediately even if we didn't go back to third level to reskill.

That is good.

pedroeibar1

Tiddlypeeps wrote: »

I think you've hit the nail on the head!
I don't blame him ignoring you, you have done nothing but spread toxicity since you joined the thread. Why are you still posting here? You clearly have no desire to help the OP and are just taking every opportunity to put them down. pedroeibar1 isn't too far behind you on that front either. OP's motivations and goals are clearly different to what you think they should be, he wants to keep his family business alive. If you have constructive criticism to offer on that front then do so and keep the unnecessary hostility to yourself, it's certainly not helping the OP and I can't imagine anyone else enjoys reading it, so why bother.

Bulls#1t post. If you knew anything about business you would have seen the merit in what Pedronomix has contributed and you not have written that drivel. Instead you attack the man, not the ball. You have added nothing....:rolleyes:

pedroeibar1

Calibos wrote: »

I'm getting even more confused now.
I'm not arguing per se but trying to clarify info from my side and clarify if I'm understanding the points being made.

It’s obvious that you are confused, Calibos, the truth of the matter is that you are getting the same info from everyone but it is dressed up “nicer” by some and that seems to be the cause:)

You need to break down the problem into bite-sized chunks:-

1.You are involved in a small shop that has a declining turnover, low profitability and a bleak future.
2.It is located in Bray, which is neither the centre of the retailing universe nor a vibrant town (although I believe it is substantially below its potential currently ).
3.The shop is a family business that employs several siblings and a parent, the latter operating as a sole trader and the premises incorporates a family home and probably is regarded as a pension income vehicle. Incomes from the business are dire.
4. The business will fail unless it changes.

On 1 and 2, your suggestion is tart the place up, play on the family store image, ye olde wooden shelves image, etc. The opposite view, Deleahuntv’s idea (and that of many others) is to go the symbol brand group. Go to Glasthule, pop into Cavistons, look at what they have and how they operate. Look at their catchment area (Dun L, Sandycove, Dalkey,Killiney, Glenageary, etc.) and also look at the neighbouring specialty shops – boutiques, restaurants, wine shops, antique shop, etc. All of those attract the same type of customer from a large affluent area. Huge footfall. That model cannot work for you because Bray has none of those attributes. Delahuntv, all the others (including the two Pedros) agree - go with the symbol group/brand,.

For raising cash, both (1+2 above) of these mean that access to cash, not just for a property loan but even for working capital/stock, etc., will be most difficult to borrow from any bank/investor. The business also is not capable of paying the staff a living wage.


On 3, you cannot continue to work for almost nothing. Fifty K is the minimum you should expect to pull out of a business like that once it is on its feet. How could you ever have a partner/children/car/ LIFE on the peanuts you talk about? There are 4 grown people working there, that is where I got the 200k. The business is drifting, family want an easy life and you seem to be the only one that has woken up and realizes/cares that the ship is sinking. As the other Pedro and others have said, repeatedly and in total frustration, action is needed.

On 4, somebody needs to take charge. Maybe the Da is waiting for one of you to do that, to seize the initiative and do something (although it doubt it). You seem to want to take it on, so you need to plan, to line up the ducks in a row and then take action.

You (not them) need to have the business independently valued. Then, with that valuation and the planned business model do a business plan with expected sales figures and CASHFLOW. You need to get a handle on the figures and know them inside out. Then you need to sit down and talk to the Da on your own. Tell him that it is disappointing that the place is sliding downhill, that you don’t want that to happen and you need to work something out as a family. You must give him a potential solution. Only you know what will work with him.

A possible solution is to carve off the residential part, and for you to lease the retail side from the Da (i.e. he gets a pension out of it). You need to ensure that suppliers will support you as the new sole trader. Tell the brothers that you are taking over. The fact that they are prepared to work for almost nothing when you say they are highly qualified is both scary and a warning on their lack of ambition.

If the Da does not agree to your plan, just walk. Quit. Depart, get a job, go. Do it nicely. That way you can retain family links but cannot be held responsible for the collapse. Quitting will allow you to get a life again and retain your mental health.
PS Do not think people are "getting at you" for the sake of it, they are just pi$$ed at your apparent inability to see the wood, not just trees like nasty banks.

Stheno

pedroeibar1 wrote: »

I push people. The better ones think, question and fight back with strong on-topic counter suggestions. That has not happened with the OP, despite fodder being given to him on a plate by me and several others.

This sums up the thread for me, I'm currently contracting in IT, and working primarily for a startup, but both my bosses consider the above an essential skill in my role.

OP has just come back justifying how things are with no real plan for the future.

pedronomix

contrast this thread with this http://www.boards.ie/vbulletin/showthread.php?t=2057343590. Also recently updated.
When threads like this one now get divisive and polarised, along come the non-regular do-gooders, mostly clueless in business matters, with posts typified by that of tiddlypeeps.
The written word can be very 2D and I find it very enlightening to have a gander through a wide selection of posts in other forums by posters/OPs. Quite often a very different picture emerges to the one being painted on here and muddy waters start to clear. Try it!

Tiddlypeeps

Tiddlypeeps wrote: »

I don't blame him ignoring you, you have done nothing but spread toxicity since you joined the thread. Why are you still posting here? You clearly have no desire to help the OP and are just taking every opportunity to put them down. pedroeibar1 isn't too far behind you on that front either. OP's motivations and goals are clearly different to what you think they should be, he wants to keep his family business alive. If you have constructive criticism to offer on that front then do so and keep the unnecessary hostility to yourself, it's certainly not helping the OP and I can't imagine anyone else enjoys reading it, so why bother.

I would of thought that in the OP's situation the type of fast balls he's had thrown at him are exactly the type of advice he needs to shake the shackles off and make some decisions. Being pushed out of your comfort zone is often the time when you perform at your best, slightly annoyed and yet more motivated and focused to make whatever it is your doing work.

pedronomix

The OP was 15 months ago, nothing much has changed in the interim it apears. This probably puts a scale on the dynamic ability/interest in actually doing something/anything, other than restate the position ad nauseam.

Tiddlypeeps

Deleted User wrote: »

I would of thought that in the OP's situation the type of fast balls he's had thrown at him are exactly the type of advice he needs to shake the shackles off and make some decisions. Being pushed out of your comfort zone is often the time when you perform at your best, slightly annoyed and yet more motivated and focused to make whatever it is your doing work.

Nothing wrong with that and the OP has responded positively to pretty much everybody other than the two insanely aggressive people in the thread. The OP has stated repeatedly that they aren't interested in a large wage, they just want to know if it's possible to save the family business and are looking for advice on how to do that. Advice on how to do that seems to be fine, even if that advice is that it's not possible.

What's not fine is aggressively insisting that the OP's motivations are wrong, that they should want a large wage and anything else isn't good enough, especially repeating it ad nauseam page after page and getting narky at the OP for not accepting it. Normal people move on if their advice isn't taken, they don't start insulting the person looking for advice and literally try to ram said advice down their throats until they take it. That's just a very weird thing to do.

Tiddlypeeps

Tiddlypeeps wrote: »

Nothing wrong with that and the OP has responded positively to pretty much everybody other than the two insanely aggressive people in the thread. The OP has stated repeatedly that they aren't interested in a large wage, they just want to know if it's possible to save the family business and are looking for advice on how to do that. Advice on how to do that seems to be fine, even if that advice is that it's not possible.

What's not fine is aggressively insisting that the OP's motivations are wrong, that they should want a large wage and anything else isn't good enough, especially repeating it ad nauseam page after page and getting narky at the OP for not accepting it. Normal people move on if their advice isn't taken, they don't start insulting the person looking for advice and literally try to ram said advice down their throats until they take it. That's just a very weird thing to do.

To be honest with you I think they are correct in most of what they are saying. I would run a mile from this business just looking at it objectively as an entrepreneur, and think in this case the sentiment attached to the tradition for want of a better word is a bit naive. Its not like a trade thats been passed through the family for generations, a wonderful skill or something, its only a convenience shop, which while carries plenty of nostalgia Im sure does not need to define a family and the future of all the sons. I dont mean to belittle anything here, but just from a purely objective standpoint forgetting about tradition its not lucrative, and seems fairly stressful. Soldiering on at crap wages to maintain this tradition seems a bit foolish to me.

'Aggressively insisting' isn't everyones cup of tea, but the reality sometimes is its the only way to get through. Some people need that to get their ass into gear. I did at various points in the past!

Tiddlypeeps

Deleted User wrote: »

To be honest with you I think they are correct in most of what they are saying. I would run a mile from this business just looking at it objectively as an entrepreneur, and think in this case the sentiment attached to the tradition for want of a better word is a bit naive. Its not like a trade thats been passed through the family for generations, a wonderful skill or something, its only a convenience shop, which while carries plenty of nostalgia Im sure does not need to define a family and the future of all the sons. I dont mean to belittle anything here, but just from a purely objective standpoint forgetting about tradition its not lucrative, and seems fairly stressful. Soldiering on at crap wages to maintain this tradition seems a bit foolish to me.

'Aggressively insisting' isn't everyones cup of tea, but the reality sometimes is its the only way to get through. Some people need that to get their ass into gear. I did at various points in the past!

I agree with you, that would be a business I'd run a mile from too. But for me it's would be purely for reasons that the OP has stated don't bother him. His motivations are different to mine, so I have no right to insist that he do what I would do in his situation. Suggesting he consider it is fine, but repeatedly and aggressively insisting on it is just outright weird.

Trojan

For me there's a thin line between "pushing people" and being obnoxious. I wouldn't accept that tone in a business meeting, even if I agreed with the substance of the message (which I do).

pedronomix

This is an Entrepreneurial and Business Management forum not one for nostalgia and cuddly toys. People are entitled to expect straight, clear and even blunt commercial responses to tough business issue. What they take away is up to them... "its all the banks fault" simply don't wash here.

Trojan

Trojan wrote: »

For me there's a thin line between "pushing people" and being obnoxious. I wouldn't accept that tone in a business meeting, even if I agreed with the substance of the message (which I do).

Compared to some of the meetings I've had, its just tea and biscuits here shooting the breeze!
I guess its what your used to. Im used to a more stark reality, and a lot of very direct conversations. Maybe that doesn't fly in a more corporate environment where a ghost isn't allowed to say boo without an internal investigation, but when I read the posts they don't come off to me as obnoxious, just very straight talking.

Anyway we've been here before. About 10 times in the last few years lol, its not going to change!

Calibos

pedronomix wrote: »

The OP was 15 months ago, nothing much has changed in the interim it apears. This probably puts a scale on the dynamic ability/interest in actually doing something/anything, other than restate the position ad nauseam.

Last year I was simply the concerned 'employee' who took a backseat because of a degree of frustration over the years that my input wasn't heeded. I'd also second guess myself given that this was the father that quadrupled the turnover and profits. Maybe he was right and I was naive and wrong. Remember I said that I wanted to cut our wages a couple of years earlier for example and be pro-active rather than re-active. That could have meant we cleared those OD converted to Term loans quicker and maybe even been able to build back up a useful working capital amount and thus not be as reliant on the Bank Overdraft. However my fathers pride wouldn't let him do that until he absolutely had too.

Again, as I said a few days ago, this year as things got even harder and there was a more clear and present danger of closure my attitude changed from 'Fcuk it. He doesn't want my advice anyway, let the chips fall where they may', to 'Damn it, I don't actually want the business to fail, I want to take over and make a go of it'.

I thought I understood exactly what you meant by the need to restructure (Take over myself basically) but then got confused again and ended up fighting a rearguard action so to speak when you started talking about 200K salary expectations. You were obviously worried I'd interpreted restructure as the 3 of us sons taking over all with an equal say and all with proprietor Salary expectations.

I simply re-iterating what I also said and thought was understood from a few days ago ie. the difference in my attitude this year compared to last year, not that there is any substantive difference in the health of the business between this year or last year.

pedronomix

Much more measured reponse with a lot more clarity, it is still going to be a very tough battle to get this business to a sustainable level. Despite what some appear to think, I only wish to see you to succeed. To do this you will need a proper structure and a real worked plan and stick to it. The 200k number was the other pedro's not mine!! But you do want to be looking at a minimum income in the order of 50K for yourself going forward, if you cant make this level, it is simply not worth doing.
Do the hardest part first, the Da and the brothers......

Calibos

By being slow and re-active instead of pro-active we've ended up in a position where in the short term our options to turn things around are more limited and it might be too late. Thats the gist I'm getting from most of the posts. That we never should have been so reliant on bank credit facilities as they were symptomatic of the Celtic Tiger Credit boom and that the reduction in credit facilities since the crash is actually them returning to sensible norms. (I think the father became more reliant on them as he put money away into a pension fund which went into negative territory in the crash. ie. the bank is giving me plenty of credit anyway, I may as well keep this cash in a pension fund and also take advantage of the tax advantages of doing that etc)

So in the short term seeing as we have already reduced our costs as low as they can go, I need to start thinking of cost free ways to increase footfall and turnover. What products or services do we not already sell that have a low cost of entry. Maybe theres products or services that dad got rid of in the good times because they were too small a margin for too much work (For him) but that we should bring back if only for footfall. He got rid of Payzone because of certain issues and kept PostPoint because of the stamps. No need for 2 Phone credit machines. However now that middleman phone credit sales have almost died off anyway and people in the intervening years have gotten more comfortable with bill pay, TollPay and Leap etc maybe its worth having both machines again or that stamps aren't enough of a margin earner or footfall driver and we should switch from Postpoint back to Payzone. (Outside the box-Free Parcel motel type service where customers direct internet purchase deliveries to us and collect between our hours of 8AM-10PM was an idea I mooted a while ago that got a lukewarm reception???)

Then start thinking about things to increase footfall and/or turnover that have a higher setup cost/barrier to entry but where we might be able to get funding for from the sources mentioned earlier in the thread.

With regard to Symbols again. You'd swear we were the first Independent to have reservations. Unless Musgraves Daybreak Symbol members get more preferential margins than their regular customers then like I said, Our experience of having to buy more of our stock from them in the last few years instead of direct from the distributors is that our margins on those products have actually been cut nearly in half. With the Central invoicing are we not contractually obliged to buy everything from them. So if we can't expect increased margins from joining a symbol then that only leaves the possibility of increased footfall from the brand recognition and I'm not sure if thats enough of an offset given our location and type of passing trade. And we've to find 15 grand for the privilege? This is why I'm still not sure.

However! Whether or not I'm right or wrong about the level of benefit joining a Symbol would bring us in particular, maybe its the only thing the banks would see in a business plan as reason to continue to invest in us. Maybe its the thing that keeps the wolves from the door long enough for us to sort out all the other issues. If it turns out that joining a Symbol really did turn around turnover in a big way, then great, I was wrong and glad to be wrong. If I was right and a small increased turnover was offset by worse margins but the Symbol proposal got us the breathing room with the banks and time to sort out all the other issues and implement the other changes, well it still served a purpose and theres nothing stopping me from pulling back out of the Symbol group as others explained. (Then I can build my nice wooden shelves )

Right, I'm off to buy a Mars Bar in every newsagent, garage and convenience store in a 3 mile radius......

pedronomix

By George I think he's got it!!......

antoinolachtnai

I hate to rain on the parade, but I do not think the bank will want to finance initially, no matter what is written above the door. The bank is currently financing on the basis of the principal's net worth, not on the basis of the business.

This shouldn't put you off, but don't take the bank's support for granted. Even if they really like your business plan they will be reluctant to finance.

The reality is that Musgraves are offering you a financing facility at present. They are investing in your business, and are willing to do so even though the bank isn't. The extra you are paying for goods through them is basically a financing charge. Being a lender of last resort isn't a cheap thing to do, and they need to get paid for it. If you had alternative financing and could pay on-the-nose, i'm sure you'd get better terms.

Building a national brand is also an expensive thing to do. Whether a symbol is right for you is one question; whether a symbol represents good or bad value generally is quite another.

Stheno

Calibos wrote: »

So in the short term seeing as we have already reduced our costs as low as they can go, I need to start thinking of cost free ways to increase footfall and turnover. What products or services do we not already sell that have a low cost of entry. Maybe theres products or services that dad got rid of in the good times because they were too small a margin for too much work (For him) but that we should bring back if only for footfall. He got rid of Payzone because of certain issues and kept PostPoint because of the stamps. No need for 2 Phone credit machines. However now that middleman phone credit sales have almost died off anyway and people in the intervening years have gotten more comfortable with bill pay, TollPay and Leap etc maybe its worth having both machines again or that stamps aren't enough of a margin earner or footfall driver and we should switch from Postpoint back to Payzone. (Outside the box-Free Parcel motel type service where customers direct internet purchase deliveries to us and collect between our hours of 8AM-10PM was an idea I mooted a while ago that got a lukewarm reception???)

Then start thinking about things to increase footfall and/or turnover that have a higher setup cost/barrier to entry but where we might be able to get funding for from the sources mentioned earlier in the thread.

As a consumer, when I go into a convenience store, I tend to have several different things that I expect at a basic level.

Those include being able to top up my leap card, grab a cup of coffee, do the lotto and grab a sandwich (that being less important) along with whatever has sent me there, I won't go back to a shop that doesn't have those "extras" and indeed the one convenience in my store that didn't closed down last year. An Applegreen opened on the same street and is mobbed Todays bizarre need from me was a pair of sunglasses, bit extreme but the third store I went to had a display of sunglasses and I picked them up.


Now the basics I am talking about can be found in convenience stores in the arse end of Cavan, if I was living in Bray and knew your store had none of those services I'd never step foot inside the door.

Just getting more people in the door by adding in those services will make a difference, you'll get incidental purchases by dint of people coming in to top up the leap card, then remembering they need a loaf of bread/pint of milk etc.