With Business Coach and Strategist Isaac Bardos
Prepared for print by Ilana Keilson
Recap: Michael had thought bringing in a new partner, investor, and manager would save his business, Foodies, but it led him into $1.4 million of debt. Isaac advises Michael to meet with those people to create accountability from the top down.
I ask a question I’m pretty sure I know the answer to, because as it is, Michael is struggling to generate enough revenue to cover his expenses, pay back his debt, and become profitable again.
“Michael, what’s your take-home pay?”
Michael doesn’t respond — he doesn’t have to. I’ve seen this before. Michael is paying himself last; he’s making himself Foodies’s sacrificial lamb. But by making himself the korban, he’ll ultimately sacrifice the whole enterprise, which is why it’s important to get the ball rolling.
“Set up those meetings,” I advise him. “Once you’ve met with Josh, Samantha, and Josh’s father, we can take it from there.”
“I’m still nervous,” Michael says. “Half my business is at stake here!”
I know that Michael’s misgivings stem from his lack of confidence — he doesn’t know how to run the meetings.
I stand, and I tell Michael to stand, too.
“You know that sales adage, ‘When you’re in your head, you’re dead?’” I remind him. “You can’t effectively influence and lead others when you’re in a place of fear. To roll out these new changes, your employees and partner have to feel confidence from you — and for that to happen, you have to feel it first.”
“Confidence doesn’t come from your head — it comes from your heart,” I say. “Fear comes from your head. You need to get out of your head, and moving your body shifts your attention out of your head.”
I lead Michael in a series of physical exercises for five minutes, designed to increase his heart rate.
“Wow! I actually feel more confident,” he says in mild shock.
I walk Michael through a few more techniques, quick and simple routines that help release fear and generate inner confidence so he can lead the meetings with assurance and authority.
“Do these before your meetings,” I instruct him, explaining that they’ll help him muster the courage to confront his partner and employee about their faltering responsibility.
First Michael meets with his partner, Josh. He explains that if Josh has 50 percent ownership in Foodies, he has to commit to doing 50 percent of the work, one hundred percent of the time — and Michael can’t be checking on him constantly.
“Josh, I’ll be honest with you,” Michael says. “I need you to step up. You’re supposed to oversee the technological backend of this business and making sure all the pieces integrate — but remember that marketing campaign that had a tech glitch?”
Michael proceeds to remind Josh that Foodies didn’t even catch it until they saw all the unprocessed orders, but meanwhile, they had paid for the new customer leads.
“I caught that,” Michael says, “but really it’s supposed to be your responsibility.”
He isn’t finished.
“What about when our Dutch oven — one of our most popular items — wasn’t staying in people’s carts because of a technical error? You should have caught that, too. Customers emailed that they couldn’t add it to their carts, but nobody took care of it. You should have noticed it wasn’t selling.”
There’s more. Josh is supposed to be on top of marketing, to see if ads are bringing in customers, and he isn’t coming through there, either.
“You have to check on each of your tasks every day, not assume they’re happening,” Michael concludes.
He takes a deep breath before outlining his plan moving forward: If something in Josh’s purview falls through the cracks, any monies lost will come out of Josh’s cut of the profits, and cleaning it up will be Josh’s responsibility.
“That’s a lot to ask,” he says slowly.
“True,” Michael agrees. “But the only way we can make financial gains is by doing things right. Those gains will also land on your shoulders… assuming you stay on top of things.”
You can see it’s a tough pill to swallow, but Josh is a smart guy; he knows Michael makes sense.
“Okay,” says Josh, taking a deep breath. “I know I’m lucky to be here, and what you’re saying sounds reasonable. I’m on board.”
Michael and Josh high-five — and then Michael gives Josh a hug. They’re both relieved to be on the same page; they’ve renewed their trust in each other, as well as their friendship.
Michael proudly tells me about his conversation with Josh, and I tell him how confident I am that Foodies has taken its first step to recovery. With things ironed out between the two of them, they can move onto the next step — meeting with their manager, Samantha.
Michael tells me he’s still concerned about how Samantha will react.
“It’s entirely possible she’ll be upset,” I agree. “But she’s not doing her job, and you’re getting more upset by the day since you’re picking up the pieces. You need to have it out with her — openly, honestly — so she knows how she’s not meeting your needs and expectations. Your manager needs you — her boss — to guide her to be the best manager she can be for your company.”
Michael and Josh sit down with Samantha, and Michael speaks first.
“Employee efficiency is at an all-time low, refunds are through the roof, and the warehouse has boxes everywhere. Ads we’re paying for aren’t being displayed, some have links that don’t work — and no one is managing any of it,” he says bluntly. “You need to be the one on top of these things, so we don’t need to babysit.”
Samantha isn’t surprised.
“I’ll be honest. I knew this was coming,” she responds. “I thought you were firing me.”
“I won’t say the thought never crossed my mind,” Michael says honestly.
Michael asks Samantha what she’s accomplished over the past few months, and what follows is a litany of excuses: things came up, there was a family simchah, a relative out of town wasn’t well… the list goes on. Since she works remotely, it’s been easy for her to get away with it.
Michael doesn’t even have to ask Samantha how she dealt with missing inventory or customer service issues, because she quickly admits that she hasn’t been doing much at all. He firmly tells her things can’t continue this way, and he slides a piece of paper across the table: a clear list he and Josh drew up delineating their expectations.
Once Michael reports back to me, I tell him to schedule a follow-up meeting to review Samantha’s roles and responsibilities and to establish the amount of time she has to devote to Foodies.
“I’m paying you to make sure I don’t have to make sure things are taken care of,” Michael tells Samantha in their second meeting.
He impresses upon her that she needs to show more initiative and to be on top of marketing, order fulfillment, software, and search engine optimization. Additionally, Samantha needs to make sure that everyone under her is doing their job correctly and consistently.
During the meeting, Michael texts me in a panic.
Samantha is asking, “If I get all the work done, can I work fewer hours??”
Tell her that when she’s getting all the work done, you can discuss hour flexibility, I text back.
As manager, I later explain to Michael, Samantha is responsible for ensuring orders, employees, processes, the website, and that all of the behind-the-scenes aspects of the business are running smoothly, even after 5 p.m.
“First show us you can stay on top of your responsibilities, and then we can explore hours and flexibility and working remotely,” Michael clarifies, nodding.
“Exactly,” I confirm.
Finally, Michael meets with his investor, Josh’s father. Michael starts by thanking him for the investment — after all, that allowed Foodies to stay afloat by covering the most pressing expenses, paying off vendors, and getting new products in — but now Michael would like to pay him back.
“We’ll need a deferment of several months in order to do that,” Michael tells him. “This way we can invest the money to clean up Foodies and make it profitable again.”
Josh’s father begrudgingly agrees to a six-month deferment, but Michael isn’t finished.
“We also need to renegotiate the interest rate.”
Josh’s father isn’t too happy — and he makes that clear.
“We had an agreement,” he says. “I don’t want to lose out, I want to get the return on my investment we discussed initially.”
“I understand,” Michael says, nodding, “but we simply can’t afford it. If we keep the rate at 15 percent, Foodies may go under. And if that happens, you won’t get your investment back at all. Plus, Josh will be out of a job…”
Michael isn’t making a threat — he’s laying it out the way he sees it, and he has a good point. In the end, he and Josh’s father compromise on a lower rate of interest — five percent — and a six-month deferment.
I’m proud of Michael’s progress: He’s really stepped up to the plate, gaining a new level of confidence and leadership, and he’s no longer cowed by uncomfortable conversations. He’s also managed to bring all the important players on board. But there’s still more to do for things to get to where they need to be.
To be continued…
(Originally featured in Mishpacha, Issue 893)
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