Business Succession

It doesn’t always have to be a gamble

Did you know that less than 1 in 2,222 sell their business at the time planned for the amount that they hoped to sell it for?!

There are many reasons for this including staffing and share structures impacting sale process, poor succession planning and key person dependencies or just simply a general lack of retirement planning.

If you knew those odds before you started in business, would you still have invested your life in it?

The good news is that many businesses still defy these odds and some do it in spectacularly impressive ways!

Technology unlocks opportunity

Technology has proved to provide both massive opportunities and risks within businesses of all sizes.

Sticking to the gambling theme (but not encouraging it!), there is inspiration to be taken from Phil Cronin who established Tombola in the North East of England in 1999.

He initially worked within his father Edward Thompson’s printing business until 1995 but recognized a gap in the market presented by the idea of putting bingo cards online instead or printing them.

Tombola reached audiences in homes and countries that could never have been reached by the original business model and became a flag bearer for responsible game play.

Their association with I’m a Celebrity, Get me out of here catapulted them into the consciousness of the nation and this week it was announced that they had been acquired by Flutter in a deal worth £400m+.

Not bad from a company that started of printing bingo cards!

Conversely, there are other examples around us of businesses that have missed the opportunity that technology delivered, and which on reflection were quite simple and obvious at the time – Netflix versus Blockbuster, local taxi companies versus Uber and so many more.

We are often talk about the pareto principle of 80% of a companies profits being attributed to less than 20% of their customer base.  How many business people act upon this and how many people; like Phil Cronin, actually try to flip these percentages by scaling those that make up the most profitable 20% segment?

Family succession with impact

Another example from the gambling sector is Bet365. One that defied odds that you would think were stacked against them from the start.

Peter Coates was born into poverty and had several commercial interests of varying success during his business journey. One of those was Provincial Racing, a handful of ultimately underperforming betting shops that operated across the country.

His children were involved in the family businesses from a young age with daughter Denise working as a cashier in one of the betting shops. The reality at the time was that the betting shops served as a distraction from one of the other family businesses – a catering company that serviced football grounds.

Fast forward a few years and with an economics degree under her belt, Denise was to become the operating manager of Provincial Racing – a business she described as “a handful of rubbish shops that was up for the challenge to improve.”

It is at this point where many people give up. However, by just looking beyond the basic numbers in front of them and adding some context to the figures, they identified the opportunity that the internet might afford them.

In January 2000, Denise purchased the domain name Bet365.com for £10,000 from eBay and went toe to toe with Ladbrokes and William Hill; whilst working from a portacabin.

They expanded their reach far beyond their competition to ultimately provide 24/7 opportunities to bet on something, somewhere at any time of day. 

How did they keep growing so quickly? A big part of their success was a continuous reinvestment of profits and the identification of continuous ways to improve and innovate over the competition (not dissimilar to the theory marginal gains that we have previously written about).

Bet365 remains privately owned with most revenues reaching £2.8 billion across international markets.

Repackaging and reinventing

In your business, you might think you are sat on “rubbish” (as Denise described it) but it might just be something that would benefit from repackaging alongside a new strategy to take it in a direction in which it can succeed.

By bringing in a team with a different vision or specialist expertise, perhaps you too could see future family members taking your business forward?

You could be sat on a rough diamond but do you; or will you ever, truly know.

Add a degree of structure and some digging beneath the surface and you too could defy the odds and join us on our mission to help more business owners to take less of a gamble and ultimately leave behind a legacy for future generations to be proud of.

Family versus Work versus You

While we miss our loved ones, we’re actually seeing more of our immediate family than ever before.

Have you taken the time to reflect?

  • Perhaps you’ve been thinking about the times you missed meals at home because you were working for small margins.
  • Or all those weekends you worked; missing out on time with the family, to get your business to where it needed to be a success.
  • And how; during lockdown, you’re now reaping the benefits of feeling healthier compared with beforehand when you found no time to exercise.

Before the pandemic broke out, was your business on its feet? If you could ask your ‘startup self’ if they’d be happy with where you are now, would you say yes? If so, why have you, up until now, been continuing to work in that way?

It’s time to pivot your business and your life. Why? To make sure you can continue to enjoy everything you appreciate right now and previously took for granted.

Family

For the first time ever, I can eat two meals a day with my two daughters and my wife. I love it.

I’ve watched my daughters, aged four and six, bond so much over the past couple of years. Even though we were close to begin with, we’ve grown even closer and I’ve seen first-hand their development.

That, to me, is priceless. So, I’ve pivoted my attitude and outlook.

I thought I was missing out on these moments because of ‘work commitments’. In reality, it’s taken this pandemic to show me that it was actually because of the decisions I made as a business owner.

Not anymore.

Family

Work

I work long hours. I bet you do too.

Why do we do it? To provide for our family and our team. If we hated it, we wouldn’t do it. My job is a hobby to me, and I’ve got no hesitations in telling anyone that I absolutely love it.

Most of my clients have the same mindset, but because everyone’s working the hardest they can for their own business this presents a unique challenge: everyone is working ‘too ethically’.

What this looked like for us was we let certain clients ask and expect a service they could not afford or were not willing to pay for. We tried too hard to please.

You want to do your best and keep everyone happy, so it’s an easy trap to fall into.

Don’t get me wrong, we will continue to go above and beyond for our clients. However, we pivoted our business to start working how we wanted to work, with the people we wanted to work with.

Did that mean letting some clients go? Yes. Was it scary? A little. But was it best for our own business? Absolutely.

The ultimate goal is to run your business, and not let your business run you. Now we’re in control of the margins we want to make. It’s a work in process, so we’re using the downtime to give us a chance to explore this further to find a fit we’re happy with.

You

Fitness has always been important to me.

I’m approaching 40, so I had been going to the gym three times per week (on top of other weekly sports) for a while now. Mentally and physically, it’s an escape.

If you work out, you’ll have made the switch from the gym to home exercises, and like thousands of other people across the UK you might’ve taken up running.

This testing time has made me appreciate this more than ever.

If you’ve recently started, ask yourself why you haven’t done this before now? What was it that put you off?

Going Forward

There’s a real risk that once the pandemic passes, you’ll fall back into the bad habits we’ve discussed.

Perhaps you’ll have less free time than ever before. The demands of your business may outweigh the demands of your family and health as you try to recoup the time lost.

So how are you planning on stopping this? If you’re enjoying this time with your family and are feeling better for it, what are you going to do to maintain this?

If you’re unsure, it might be time to contact us. We will help you rebuild your business without sacrificing the work/life balance you’re now enjoying.

There’s one thing you can never get back – time. So how do you save more of it to spend on the things you love?

Technology is just one of the ways to achieve this, but there are many other ways dependant on what’s right for you.

Contact us today to put measures in place now that you’ll enjoy in the future and never take for granted what you had previously.

Speak to the team about your goals and vision. We'll tell you how we can help you make them a reality.

Are you looking to work with a strategic accounting partner to help shape your business’s future? We’d love to hear from you