Marketing Communications Blog

Defend or be Aggresive?

Let's continue with where I left off the other day - with me deciding to stop consulting with a company that continues to make the wrong decisions and drive themselves into a deeper and deeper hole.

This company, as I mentioned, decided to give up control of their company to a creditor; and interestingly, the creditor wanted me to stay on board and continue to consult.

They wrote a letter begging me to stay and do their dirty work (continue to pass control of the company to them).

In my response, I said "No, thank you"; and then went on to list out the companies current legal issues and how I would approach them - either by listing them as "Attack - file suit", "Defend - put in place legal defenses", or "Neutral - ignore for now". 

When the company hired me as their General Manager, I was given complete control of their financials, their staff, and their legal defense.

Obviously, when the company decided to give their creditor control of the company, that broke our contract as well as me having moral and ethical issues with it.

But, while I was managing the company, my priority was to remove the legal liens, lawsuits, as well as pay off creditors - but, sadly, one of those creditors controlled the companies manufacturing and threatened to stop production unless they were allowed control of the company.

So, what am I saying? Well, as I tell all anyone and everyone that interacts with me in life - make a list of priorities.  This will allow you to focus on what is important. Granted, if you don't follow the list, then, you will get hurt in the long run.

Posted by blaine at 07:46 AM | Permalink | Comments (0) | TrackBacks (0)

When & if you should quit or continue...

Working with a company that is hurting, as a business, for the past six month (see my previous posts). They have about $1.3M in revenue and have about $3M in debt.

The two owners (who own 60% of the company), discussed the reality of going bankrupt - but, they both spent seven years building the company to where it is today and did not want to take the "easy way out".

We discussed doing an asset sale, which, on paper, is valued at about $5.2M - with assets being two items, IP and inventory.  This is seriously being considered and currently some investors are being pursued to purchase their assets.

But, sadly, even if the assets are sold for $3M, the $3M debt is still sitting on the companies shoulders. Through lawsuits and bad contracts signed by the partners, they are either personally liable or the company (the shell remaining) will have to take the burden. Back to bankruptcy - which, sadly, the partners think that they can "resurrect" the company and get rid of the debt and continue to grow the company.

So, back to the title of this post.  I have decided to leave them.  Six months ago, lawyers and consultants (with much more experience then I) came in and advised the company on what to do to get out of their current situation and put the company back on track.

All the advice was ignored or, more importantly, listened to, but, a decision on that advice delayed until the company was not in a position to act on the information and advice.

In a past posting, I talked about how, if you delay on making a decision, the opportunity that was presented may be lost - and that in most cases, if you wait until 100% of the information is known, the opportunities presented will most likely not be there anymore. 

Because this company delayed, they enabled themselves to be put in an even worse place then they were previously (a creditor is now in a prime position to take over the company), the partners keep making decisions that causes them to lose more and more control of the company (even though you own 50%+ of a company doesn't mean that you control the company if you continue to turn over that control through contracts and poor decisions).

So, I can't work with them anymore as they continue to lose control, continue to make decisions that allow a creditor to take over all of their financials (thus control), direct contact with not only their sales force but their customers, and complete inventory control. Meaning, the owners have done an asset sale without receiving ANYTHING in return. 

Watching the poor decision making and a company being gutted because of sheer desperation (or stupidity), has forced me to run away and keep my reputation, as well as my efforts, intact and respected by a future company that will hire me.

Posted by blaine at 12:37 PM | Permalink | Comments (0) | TrackBacks (0)