Potholes and pitfalls

BY ROD McDONALD

If you spend 10, 20, perhaps 50 years in this trade of ours, when you look in the rear view mirror, you can see pitfalls and potholes in the road. There are so many that the question begs to be asked: How did any of us do so well? And yet we have. This column is about navigating those road hazards.

None of us has been smart or fortunate enough to have avoided each and every pitfall. If only. Most, of a certain age, are battle-scarred. We have had the best of plans blow up in front of us, even though we went to great lengths to avoid that oddball euphemism, collateral damage. In the world of music, it is often called paying your dues. Regardless of the name for those awful situations, we always agree it would be best to not repeat the behaviour.

One of the first early career pitfalls to avoid is borrowing money from family and friends. It is often easy to do — too easy — and often those around us are more than willing to either loan the money or to accept it. I fully understand the situation. I have seen this situation turn ugly, quite quickly, and I have seen it often. 

In 1977, I had a very old rototiller that would not always start. My mother watched as I struggled to get it running to till her garden. I swore at the machine. My mother asked how much a new machine would cost, and I told her $500. She offered to give me the money to purchase a new machine, right then and there. I was flat broke. It was tempting. I said, “No, I will save my money until I can purchase it myself.” It was a good move on my part, perhaps even a defining moment.

WHO CALLS THE SHOTS?
A friend of mine went a different direction and the money was more costly than she could have imagined. She owned a successful bistro. She wanted to carry out a few improvements to take her business to the next level. She didn’t want to go to the bank. She asked her 12 best customers to a meeting, requesting them to loan her $1,000 each, with interest, repayable within the year. All 12 supported her and each wrote a cheque. What could go wrong?

Within a week or two, one of her supporters starts showing up behind the counter, directing staff, telling people that he is now a part owner. When he sits down to order his meal, it is always off menu, something he sees as a privilege, now that he is involved financially with the restaurant, albeit for only a G note. 

My friend had a hell of a time with this fellow. She paid him off immediately and had to be quite forceful regarding what he could and could not do in the bistro. His side was, of course, that she was not showing her gratitude. 
 
ONE LAST STORY: A close friend of mine was a wonderful man, a good husband and father. He loaned his son money to start a business. I noticed that he was arguing with his son more often. I asked my friend,
“Why do you always tell your son what to do? Is he not a competent adult?” My friend turns, snaps at me, and responds: “When I loan him money, I get to tell him what to do.”
Easy money was traded for the loss of independence, a trade not worth making for either party.

CHARACTER MATTERS
The next pitfall to avoid is getting involved with the wrong people. All of us have done that. I listened to at least a half-dozen business people I should never have when I was starting. I willingly took bad advice from those  ‘burners’ and they set me behind by a few years. I was the proverbial sheep led to slaughter.
 
A friend owned a nursery for many years; he has since passed away. He told me the story of being burnt in his first year. A sales rep from a major nursery called; the rep told him he needed lilacs. My friend asked, “Well, how many do you think I need?” This story almost sounds like Red Riding Hood and the Big Bad Wolf, doesn’t it? The rep said, “I’ll start you out with 700.” Seeing as my friend was brand new to the trade and had few customers, it took him seven years to sell those 700. As he told the story 20 years later, “You can’t roast a lilac for Christmas dinner.”

Coyotes are a group of customers, at both the retail and wholesale level, who cannot wait to prey upon the new kid. One of my first adages was, “Life sucks when you don’t get paid.” It really does. Coyotes will insist, “Give me a good deal and I will bring you lots of business,” or place large orders with you, and either never pay or never pick up. Either way, you are left on the short end of that mythical stick.

FIND THE PRO SALES REPS
When starting out, I was approached by many sales reps from media outlets, seeking my advertising dollars, promising instant results. I believed them and bought. When no results were forthcoming, they had many excuses. “You have to spend more as your budget wasn’t big enough; the marketplace was slow that week,” and so on. After a few years, I grew tired of promises made and not kept. I told sales reps that, when I completed a landscape job, my customers insisted upon at least a one-year warranty for labour and materials. I asked the media people if they were willing to provide any guarantee if their ad campaign did not meet targets? They were suddenly quiet.

I am not opposed to spending money on advertising. I had a budget of four per cent set aside for advertising but, and it is definitely a caveat, I had to choose my advertising carefully. I needed research, not glib promises from sales reps. I found a few advertising reps who really knew the business, understood mine and were true advisors on how best to spend my money. A truly good sales rep will make you nothing but money in the long run. 

THE VALUE OF YOUR NAME
As your business grows and your reputation develops, you will have more people approach you with requests. Success attracts others. Some will want you to buy their products and services, others will want you to partner with them, charities will make requests, and others will seek your endorsement or blessing. Some will have merit and others will not. Every bit as important as merit is to ask how will this proposal, request, and product or service fit into my long-term business plan?

If you are offered the chance to make some extra money, quickly, hesitate. Does this opportunity work into anything long-term, or is this a one-off, an in-and-out deal? If it is a one-off and you go for it, your foolishness is showing. 

Several years ago, I had an older couple from Oregon visit me in August. They were retiring and selling off their inventory of Christmas trees for half the usual price. The product looked good and the prices were compelling. I asked, “What happens next year?” They told me that once this year was finished, so were they. “There is no next year.” 

I passed. I had a regular supply chain set up and I had made money off my Christmas tree program for many years. How could I return to my suppliers, after a year’s absence, and expect preferential treatment? Now, I realize some readers think I missed the boat, that I should have leapt at the half price offer. A neighbour also had a Christmas tree program; he also had the habit of jumping at one-time offers. If it was half price, count him in. He went bankrupt owing much money. So where was all this money he made by bandwagon jumping? It was a lesson I took seriously, and one I stand by until this day. Bargains and deals are not always what we think they are. Tread carefully!

Tied into proposals are those who request your endorsement, blessing or partnership. I do believe in supporting each other within the trade, no argument from me there. However, before you loan your name or offer your endorsement, all of the years and energy you have put into building up your personal brand goes along with whatever it is that you provide. What they do, for better or for worse, takes your name along for the ride. For that simple reason, I was most reluctant to allow outsiders inside my operation, or to join them. It was a lot riding on a low return.

These are only a handful of pitfalls that each of us must face, but face them we must to stay on the road to success. 

Rod McDonald owned and operated Lakeview Gardens, a successful garden centre/landscape firm in Regina, Sask., for 28 years. He now works full-time in the world of fine arts, writing, acting and producing in film, television and stage.