Life on the good ship SME. 3. A slow climb out of hell

I wish I could say that this is where everything turns out right. A quick trip to Family Court, a just outcome and normal transmission resumed.

Alas I can’t tell you that, but nor am I going to drag you through 10 years of Family Court, $100,000.00 of legal bills, the onset of PTSD and an ongoing battle with depression and anxiety. What I do want to emphasise is that no matter how low things get, there is always the opportunity for something new. Call it recovery, call it redemption, call it sheer bloody-mindedness – where there’s a will there’s a way.

So. on with the story. We’ve talked about the emotional and physical effects of trauma. There were financial ones too.

Mortgagee Sale and personal bankruptcy were a couple of the other outcomes which pretty much prepared the groundwork for a place we could easily summarise as Ground Zero.

I had no business, no home and no love. It wasn’t that love wasn’t offered. My family were always there but I think I thought I didn’t deserve them and the shame of having fallen so far was something I couldn’t imagine confronting with them.

Naturally I needed a new challenge, as though I didn’t have enough to deal with, but there are times when you can lay back and wallow or get up and try something that drags you out of yourself. Guess what?

Not recommended for anyone, but when life pushes you to your absolute outer limits, sometimes there are only two options – check out or start again.

Me trying to grow up…

I thought to myself, I’ve never really had a “proper” job. You know, reporting to someone else other than myself. Yeah, I’d done some kid finishing school jobs, but not a proper job. So, driven by some vulture on my shoulder telling me I wasn’t good enough and who would employ me? I embarked on a search.

I wanted something that looked like a proper job but would still enable me to be myself. As it happened Levene & Co were looking for a few unusual people to try an experiment with. Here was the deal. There were six of us selected and we were to get out in the world and find new opportunities to sell the extensive array of Levene products.

With a desperate need to prove something (not sure if it was more to myself or everyone else) I decided to go big or go home. So, out of sheer determination and a bit of common sense, I recognised an opportunity. Levene & Co sold paint, wallpaper, furniture, housewares, window treatments and everything needed to furnish a new home. What was the biggest market in town at the time? Apartments, springing up everywhere.

I thought, ha! Most of these apartment buildings were being built by developers to largely overseas buyers and as far as I could tell, there was nothing that made it easy for them to furnish their apartments from thousands of kilometres away.

Discovering I can make things happen…

So, I put together a series of apartment fitout packages and convinced some developers to make these available to their buyers. This ended in my travelling to Singapore to attend apartment fairs at which I managed to sell many packages, generally at around $250,000.00 apiece.

Back in New Zealand my efforts had obviously hit the right note so I was migrated from having to get about in my ancient and disreputable Hillman Hunter into a shiny Levene ute and from a commission on to a salary. All of a sudden I was a genuine employee. Seemed pretty good. The whole idea of getting paid for public holidays seemed the height of luxury.

Start with nothing but some self-belief and wonderful things can happen and they might seem nothing to anyone else, but inside you… Time went on. This was a time when Levene was transitioning from the ownership of David Levene (my Mum’s beau as previously mentioned) to a bunch of corporate raiders. The words The Smartest Men In The Room spring to mind but only in the most bitterly ironic way.

If you know the David Levene story, you’ve probably heard that right till the end, he was able to walk into any store in the country, greet each member of the team by name and more often than not ask after their spouses and children by name too. A rare skill.

The Smartest Men In The Room had a different approach. It started with hacking and slashing at the network of trusted people in the business to make it more “productive and efficient”. David was supposed to stay on as a member of the Board but was so dismayed by what was happening to his business that he walked out.

Given that this is a tale of how life and business intertwine, here’s something that brings them together tightly. People who have lived their careers in corporate privilege can be very prone to something we scientifically call “believing their own bullshit”. It is certainly a thing in the SME world, but it sees itself on full display in corporate life.

Never be fooled by smart dressed men in Porsches. Neither their clothes, nor their cars, nor how they afford either says anything about how smart they are.

Sniffing bullshit…

Anyway, The Smartest Men In The Room paid more than they should for what was an elegantly vertically integrated business. At the pinnacle stood the absolute golden goose – the paint factory.

Managed by an old and trusted associate of David’s, it was where about half the total profit for the group lived. Next down the pecking order was the wallpaper factory. A solid earner, it probably held about 30% of the group profit. Beyond that was the rats and mice manufacturing and importing and the retail and Levene Extreme store network.

Vertically integrated businesses can be a beautiful thing when they are maintained as vertically integrated and you know very clearly where the money lives. Unfortunately TSGITR were heavily leveraged to the global avatars of kindness and generosity Goldman Sachs and very quickly it became obvious that the rent checks weren’t going to be paid. Oh oh.

So, sell the paint factory came the cry from the brains trust. Next payment due and whoops, there goes the wallpaper factory. Give them credit. It took 18 months from taking the keys from David Levene to handing them over to the receivers.

A very bitter pill to swallow…

Till my dying day I will not forget the distress and fear from staff and suppliers alike as they saw their livelihoods vaporise. Here again I need to make a mea culpa and it’s one that I have carried with me from that moment forward. It’s something that is as relevant to the SME world as it is in corporate life.

My way of doing business has always been deeply personal. It might sound like a cliché, but to me business is between people, not entities. At Levene & Co I developed strong and trusting relationships with many suppliers. This is much clearer with hindsight than it was during the chaos at the time, but in my heart, I knew I should have warned suppliers to reduce their exposure to us as I saw things unravelling internally.

Of the regrets in my life (and there are a number), right up there is allowing people’s trust in me to keep them supplying us on account when there was a better than even chance they would never see their goods or money again.

Now here’s a question for SME owners. When is enough enough? If you’re a supplier, when do you read the room and cut off a client that appears to be in trouble? If you’re a client, when do you do the right thing and tell your suppliers that you’re in trouble and their risk is escalating?

I can only answer this in the theoretical. I wish I could say be open and honest at all times and I truly believe that is right answer. Then life comes knocking. Very little is binary. Anything can happen at any time. You can think all is hopeless but something comes along and everything changes. You could have thrown your hands up and missed a miraculous turnaround.

Similarly, you may (like the Black Knight in Monty Python) think that having all your limbs severed is “just a flesh wound” and not recognise that you are in fact, buggered.

All I can suggest is that you examine your own soul. Discover what your default is. For me it is generally Eeyore. I anticipate things will go badly of they can. You might be Tigger and have boundless confidence that all will work out. Whichever you are, find the balance and always consider the harm you may do yourself or more importantly, others.

Your gut isn’t the answer to every question, but ignore it at your absolute peril.