You can follow more recent instalments of Mike Smart's post-redundancy journey at his blog
Smart Moves.
From Redundancy to Business Owner
I've just come off an hour's international conference call (via
Skype - cost me less than $2!) with the group of new franchisees I
trained with in Carlsbad, California last month. Sharing tips from
our network's first experiences with our new businesses was most
useful and I have new ideas I'm keen to try out....
But let me start at the beginning, in September 2008.
That spring day, I was working late when the liquidators came.
At a briefing the next morning, we heard the company would keep
trading with the goal of selling off the various branches. We still
had our jobs, but the writing was on the wall.
I was, to put it mildly, extremely annoyed. I was in a senior
position and this was the third time in fourteen years I'd faced
redundancy.
The Job Search
In early November, with no buyers, the inevitable happened: my
branch closed. What a time for it to happen! End-of-year syndrome
was kicking in and the international financial crisis was well upon
us. I secured a few leads but it became evident that nothing would
happen before Christmas. To compound the issue, my wife was also on
the job market! To our great relief, she managed to secure a job
just before Christmas, so we entered the holidays with some level
of comfort.
It was a great summer in Auckland and I did my best to enjoy it.
After all, getting stressed wasn't going to help. By the end of
January, my wife was at work, my daughter at school, and most
businesses were up and running. The financial crisis was really
biting though. I began the long round of phoning my pre-holiday
contacts, as well as searching for any new jobs that had been
advertised. There were pitifully few.
Plan B
In early February I was talking to a friend, Simon Lord, the
editor of Franchise New Zealand magazine and website.
Frustrated by my job hunt, I said, "Tell me about franchising." He
explained the franchise industry often benefits from economic
downturns when people in my situation turn to it as a way of
securing an income. Were there any good opportunities available? He
assured me there were, but what suited one person wouldn't
necessarily suit another. Soon after, he brought me articles from
his magazine that reviewed different franchises, how to investigate
them and carry out due diligence.
I read it all, spent time on the Franchise New Zealand website
and then began my investigations. Simon and I discussed my findings
over a beer and this helped me select a shortlist of two.
I met with both franchisors and decided on the one that
interested me most. Then began my due diligence, talking to my
lawyer, my accountant, franchisees already in the business and,
most importantly, discussing it with my family. This was not a
decision to be taken lightly: it required a substantial investment.
Finally, my wife and I agreed this was the best option open to us.
I signed the agreement in early March.
My new future: Expense Reduction Analysts (ERA) is a business
dedicated to helping businesses cut non-core expenses. Its unique
business model operates on a contingency basis: no savings, no
fees. This seemed to me an ideal value proposition for the current
market.
The next ERA training course was only ten days away and I saw no
reason to delay. I frantically set about registering a company,
organising phones, and setting up a home office. On top of this, a
courier arrived from the USA with pre-training preparation work.
Boy, what a hectic ten days!
The First Sales Calls
In early April, I landed back in Auckland, my two weeks of
training complete. My pre-Carlsbad preparation had required me to
identify prospect companies, and my first task was to phone them. I
revised my training notes, mentally steeled myself and picked up
the phone.
The first person I chose to call was an old acquaintance,
reasoning this would be the easiest way to launch in. He hadn't
arrived in the office yet. Bugger! Eventually, I started calling
people I didn't know. To my surprise, I found it wasn't that
difficult: the training worked! Most people were polite and some
even quite chatty. On my last call of the day, I got an
appointment. What a buzz that was!
On subsequent days I did get refusals, which was to be expected.
After two weeks of training and two weeks of calling, though, I
fixed three appointments. After Easter, I would be sitting in front
of potential clients and, hopefully, convincing them I was worth
engaging.
A friend described the first year of your own business as like
being on a rollercoaster. I'm going to remember that!
Working from home
On the Easter Monday public holiday, I prepared for these first
meetings. As an employee, I wouldn't have been at my desk on a
public holiday. It made me reflect on some of the realities of a
business based from home, and the different style of working it
entails.
I don't have to get up early, but of course I could very easily
waste a lot of time lying in bed daydreaming. I'd soon realised
this wasn't going to win me any customers, so I began getting up at
7 am, just before the family left for work and school. And guess
what? I can throw on a T-shirt and jeans and no one's any the
wiser! My goal is to be at my desk by 8 am but it wouldn't be
difficult to make it earlier. After all, I used to be in the car by
7.30am when I was an employee. Boy, it's been wonderful not having
to fight the morning traffic! By the time I head to meetings, the
traffic has largely abated.
It's not that simple, though. Since being made redundant and
with my wife now working full-time, I've taken on running the
house. This carries a whole lot of other responsibilities. For
example, my first morning task is to feed the cats, following which
our ginger tom likes to settle on my lap, purring furiously. Then
there's the grocery shopping, laundry and other chores. I could say
"no" and leave them for the weekend but I've found it easier to fit
the chores in as a break from work. Without the social aspect of a
'normal' business, taking a break can be a nice offset to the
monotony of my very quiet workplace.
The reality is that working from home gives me enormous
flexibility. I can structure my day any damn way I want and I don't
have to ask a soul! An article by Simon Young on the excellent
HomeBizBuzz website describes the sensation.
What has become abundantly clear is that time management is
critical when you're a lone operator. You can't ignore anything.
Balancing phone calls, meetings, research, accounts (and the cats,
laundry, shopping...) takes some planning. I have to be careful to
build a flow of potential business yet still keep on top of the
day-to-day mundane matters. Get this wrong, and I can see my
business will be like a high swinging pendulum.
One cold, hard fact remains - my success, or failure, will be
directly related to how many companies I call and how quickly I
call them. I constantly remind myself of this fact. I know I
haven't found the balance yet, but it'll come, and I'm excited
because I am now the master of my destiny!
The value of networks
In the week after Easter I went along to my three appointments.
My first reality-check: two postponements and one no-show! They
were all genuine mistakes, but still frustrating. On the positive
side, the rescheduled meetings went well and the potential clients
were interested in my business model. I'll hear soon if they want
to engage my services.
The nice thing about ERA is the camaraderie between the
associates and the support from the national office. Even though
we're operating alone, we're not alone. My March group of trainees
(we've called ourselves the March Maniacs) are all racing
to see who'll be the first to sign up a client. This kind of
friendly rivalry makes the business fun.
A common thread that emerged from our international conference
call was that networking is probably one of the most powerful tools
for success in this business. For the rest of that day I got back
on the phone calling more potential customers and firing up my
network. By business close, I had secured another four
appointments, all from my network. Guess where a lot of my efforts
will be focused?
Oh yes! The rollercoaster is climbing and I think I'm upside
down, but I'm not really sure! And you know what? It doesn't feel
that bad! Maybe fear is being replaced by exhilaration?!
Acknowledgement
Mike Smart has over 25 years' experience in industry and wide
ranging technical, operational and business management skills. He
has project managed the development of million dollar,
groundbreaking technology in underwater mining equipment and taken
products from the drawing board to production in the fields of
electronics, gas detection and gas measurement. He gained
experience in supply and logistics in the international lift
industry and general management skills in the local building
industry. Mike holds a degree in Mechanical Engineering and a
Masters in Engineering Management.
T 64 9 444 8827
M 027 260 9900
msmart@expensereduction.com
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