How I turned around a cashflow crisis in seven days
Thursday, June 28, 2012/
Michael Doyle started the Website Marketing Group in order to be closer to his family. He’s managed to create a successful company in the process, with large clients including Deloitte and Mercedes Benz and revenue of $3 million.
But it wasn’t smooth sailing in the beginning. Doyle says at one point, he was a week away from being unable to pay staff – so how did he recover?
So how’s everything at Website Marketing?
Yeah, very good, we’re extremely busy. We have some work on this month, and we’re doing a major site revamp for a client. We’re working with Brumbys, with Michel’s Patisseries, so we’re doing a lot of work.
But at the end of the day, what you’re seeing here is many businesses made websites in the late 90s, did a revamp back in 2004 or 2005, and now they have to do a third generation revamp. It’s a bit like that at the moment.
Last year you were turning over about $3 million. Any update there?
Probably about the same, if anything, just a little less. The hardest thing at the moment is just trying to find good salespeople.
So talk about this issue you had with cashflow – you had to pay staff and you didn’t have the cash, right?
Cashflow is absolutely the biggest issue. When you’re putting up your house as collateral, or using a credit card with an overdraft that you never wanted, it gets incredibly personal. Banking is so much tighter than it used to be 20 years ago, and now people just see that you’re a small business with less than three years’ experience. Of course, having seen that, they don’t want to give you anything.
The situation was really, you have to pay out $20,000 on a Friday, and you have $12,000 in the account on the Monday. And even though you may have several people working for you, you’re still waiting for projects to finish and chase up some money, and then you need to explore, what do you need to do?
That’s a hard situation. What’s your first port of call?
There were actually a couple of things. At the time I believe I was either discussing things with my wife, as she had and still has a job, and then the credit card is the other thing. But it’s not an ideal situation. You also have family and friends, but in this particular situation I believe it was the credit card that had to get used.