The Business Transition Blog

Falling Sales Leads Business Owner to Panic

A client called me recently.

“I think I want to sell my business. Can you help?”

This was the same client who eight months earlier had given me a tour through his relatively new facility, said he was pleasantly surprised at how well he was weathering the recession and couldn’t see himself ever retiring.

Then his company hit a wall. Sales stopped abruptly. They were still making sales calls, still getting interest, still quoting, but no one was buying. The tap was turned off completely. And he panicked.

“If I could have pulled the plug and got out, I would have,” he said. Emotionally, mentally and physically he became a wreck. “I’ve never been through anything like this before. Rationally I knew it wasn’t as horrible as it seemed, but I experienced feelings I’ve never had before.”

We had coffee and talked. He seemed to feel better after that and he decided not to react by putting his business up for sale. After all, he only had a bad quarter. His banker told him he was ok. His accountant told him he was ok and his partner was concerned but not unusually stressed out. And I knew enough about his business to be able to confidently say that things weren’t as bad as they seemed.

So he decided to take a deep breath and try to relax.

The solution to his immediate problem wasn’t to sell the company, it was to get better information and data so he could really understand his situation and make good business decisions. He needed to evaluate their current status – separate from the recent P&L and decide what they wanted to do going forward.

To make a major decision like selling your business, you need to be sure you are acting upon accurate and complete information, not an emotional reaction to a couple months of bad sales. I recommended he read and utilize CEO Tools by Kraig Kramers. (Find it at: http://www.theachievementcentre.com/section/view/?fnode=98 ) It’s a great, straightforward look at what tools you need to be an effective CEO and what to track.

That said, you need to respond quickly to your sales figures and forecasts by managing your payroll and expenses so that you don’t lose your shirt.

Focus on the things you can control and look forward and plan for bigger changes if required.