What we have achieved in the first 6 months by turning around a business that would have gone under if we had not intervened. This was the first wobble, but nothing too serious and not our fault either.
This week our main client paid late due to one of their customers paying late and basically highlighted a need for change on our part. The way we are set up currently is like a house of cards and all it would take is a client not paying to set off a chain reaction. The phone has not stopped ringing since yesterday morning and today the last two accounts were paid. I was prepared to pay all the accounts myself, but I was not going to divulge that unless I had to.
I have spent the last day talking with our service providers and land lord who were a little stressed. The transport company who we rely on so heavily had a few bad accounts earlier this year and it turns out we are now their biggest client. If we did not pay they would possibly go under and I would never let that happen. Losing two clients with debt means they are most likely working this year for free anyway which must be heart breaking.
In my previous business I never chased accounts because most of them were too risky and if they contacted you then normally it is a sign they are desperate and their financials are not good. I know exactly what everyone was experiencing earlier this week and thankfully this has now been resolved with everyone being paid.
What needs to change is the having all the eggs in one basket and the other online business needs to be launched as soon as possible. Our business partner and factory owner in this online business has been away and is expected back tomorrow after working the last 2 weeks laying sports flooring in Zimbabwe.
The delay has been the photographing of the product range as I have rejected the first batch. As we know buying an online product you normally have 4 or 5 photographs showing every possible angle including a close up. I do think this needs to be done professionally and doing this will guarantee that we can have this business live within a few weeks. I think we will all feel more relaxed once this happens as it is no longer relying on just one income stream.
The punchbags have to be stuffed and delivered before the 27th of this month and we are yet to receive those skins. This order in itself will have me laying out a small fortune, but there is a very good profit margin and is extra income even though this is linked to the same business that delayed our payments.
I have enough funds to cover our entire business for a few months if it came to this point which I do not think for 1 minute it will. Paying the service providers and staff is what these funds were kept aside for as you can never renege on your obligations ad may as well close the doors if you do. I have seen companies who use their service providers like a bank using the debt they owe to fund their business activities and for me that is the lowest of the low moves that I would never be part of. Sadly many companies operate this way and why when they fail they take many companies with them.