Misdiagnosing the symptoms
I worked with a local tool hire and repair company with a turnover of c.£20k per month. This relatively successful business contacted me thinking they had a sales & marketing problem i.e. the only way they could grow was to acquire more customers.
On inspection, it transpired they had £10,000 worth of tools waiting to be repaired.
Additionally, with most of their customer base being based in the trades e.g. construction, plumbers, electricians, they had accrued over £40,000 worth of trade debt.
That’s a total of £50,000, or 2.5 times their normal monthly revenues – basically, cash sat on the table, waiting to be collected.
I asked the business owners to close up shop for four weeks – and you can imagine the reaction! But they did it, and they refactored the invoices via an invoice financing company and cleared down the backlog of repairs.
Within 6 weeks, they had recouped nearly £48,000 - there was no sales & marketing problem, their business was broken and needed repairing.