Getting a million pounds Investment and loosing everything!

Its 6.30am in the morning, the month is January, and the year is 1994. The birds are tweeting; the sun is rising. I am 24 years of age and have been working night and day for nearly three years building my promotional clothing business. I am on the way to my office, situated above my mum’s shop in Epping Essex. Today is the day that is going to change my life forever. I am going to sign a contract today that will secure me over £2 million pounds worth of imported clothing from Indonesia. The problem is that I do not have one single penny to put down as collateral.

Last night I was working on a fast food stall and Wembley Arena earning extra money selling hotdogs to support my business. On the way home at 2am D:ream were playing on the radio “Things can only get better”.

I had worked on the stock market as a blue button when I was 16. The stock market crashed a year later and I lost my job. I bought my first market stall business when I was 18 years of age costing me £15,000. I also bought my first house when I was 18 and interest rates increased sharply to 15%, resulting in losing my £34,000 life savings that I had invested. I went bankrupt when I was 21 and thought my world was at an end. I clawed back from bankruptcy and started my promotional business when I was 21. I had already experienced major adversity and I was still only a baby.

 

I arrive at my office in Epping at 7am to prepare for my biggest ever business deal, one that would set me on the road to entrepreneurial stardom. A Korean gentleman called Mr Kim was arriving at 11am to see my business in action. He had been sent by his company, The Kolon Corporation, a multi-billion dollar organisation to open export channels in Europe and I was his one of his UK supply options.

The other two companies who wanted this contract were already turning over millions of pounds, had an established client base and had sound financial backing. Not only that, they had showrooms and warehousing in the clothing wholesale capital of London, Commercial Road E1.

My company was turning over just £250,000 a year. I had little stock and few customers. My first floor office was 300 sq ft with a few racks of stock. I had no office furniture and only two spare chairs, one of which had a broken leg and paint all over it.

I knew that I had to impress Mr Kim and I also knew that if I secured the deal it would mean that I could take my company to a multi million pound turnover business, pretty much over night. In business belief is everything and if you are prepared to do what your competitors do not have the imagination or balls to do then you will win.

I called in four friends dressed in smart suits and sat them at desks and placed phones on the desks that were not connected to any phone lines. I told them that when Mr Kim arrives that they should be on the phones closing deals and mentioning high profile companies. I also asked my family to call and place orders at a precise time and not to stop until we called to say that Mr Kim had left.

It’s 10.45am and Mr Kim had arrived early. My palms were sweaty, my heart was beating and my legs started to shake. I had to calm myself down and prepare for the pitch of the century. The boys were ready, the order pads were out, phones were in their ears ready to take orders and my family were ready to call in 5 minutes to place orders…… Ok action stations here we go!

I greeted Mr Kim downstairs, shook his hand and walked him up the stairs to my office. The only two incoming phones lines I had were ringing off the hook. The sales guys were on the phones that were not plugged into anything pitching customers and taking orders. My family were playing their part in helping me secure the deal.

Mr Kim questioned me for almost two hours nonstop. The sales guys kept taking order and my family as requested kept ringing in. After about an hour someone took an order from my family, later I found out it was dad. The order was for 6000 jackets and I can remember saying to myself “calm down family”, that is an order for £120,000 and if they keep placing silly order like that, it’s going to blow my deal out of the water.

Mr Kim had questioned me about sales, marketing, manufacturing, ranges and design styles, colours and size ordering breakdowns. We had discussed import and export duty, ports of origin and ports of destination. In fact we had covered everything from fabric and the mills that would be making it to container sizes, shipping and warehousing costs.

I understood it all and had been studying about manufacturing for a long time and besides, both of my parents had inducted me into the world of fashion from about 10 years of age – Thank you mum and dad!

Mr Kim knew that I was buying jackets from a Company in London called The Cobles Company ran by a Jewish man called Lawrence Cohen. Mr Kim also knew that Mr Cohen was spending a good few million dollars in Indonesia producing the jackets. What I did not know is that Mr Kim knew his exact import numbers and had the use of the factory two streets away producing the same goods and he had his eyes set of Western Stardom and needed me to make his dream a reality.

Another 30 minutes went buy and I held my nerve and made Mr Kim believe that I did not need his imports. I finally shook hands and Mr Kim left the building.

What I had achieved in the last two and a half hours was this:- I secured over £2 million pounds of imported goods ordered and ready to be delivered in ninety days to my 20,000 sq ft warehouse. The beauty of the deal was this. I did not have to lay out a single penny security. I had just placed an order for £2 million pounds without a single penny deposit. To this day I have not heard of a deal being done like that by a guy of 24 years of age.

I had no warehouse, no customers, no distribution and no way of even financing the deal I had just signed. I had just ninety days to prepare to take a business from turning over £250k a year to a £3 million a year business.

I did just that and by 1996 I was supplying Walt Disney, Coca Cola, Wembley Stadium, Capital Radio, The Spice Girls and had supplied products to just every brand that you could imagine from food to drinks, pop and rock groups, formula one racing teams and SkyBSB. I built a blue chip client network that was the envy of the promotional clothing world. I was turning over £3.3 million pounds a year, had been approached by Dunn and Bradstreet for outstanding growth as well as Sir Richard Branson’s Fast track 100.

It all seemed to be going so well until the Far East Crashed in 1998 costing me over half a million pounds and everything that I had built over a 5 year period.

When you lose everything it hurts, but the extraordinary people get back up, learning from their experiences to go on and achieve greater things and that’s why – Everyday People Achieve Extraordinary Things.

 

Best Wishes

Bradley Chapman

Ten Tips to Survive the Recession

Here are ten tips to help you be one of the survivors.

1. Cut costs as soon as you can

As sales revenue falls you will have to cut your cost cloth accordingly, so act decisively and make the big decisions straight away. Numerous small adjustments can feel like death by a thousand cuts and could take too long to have the desired effect. Use your business plan to assess where cuts should be made and how deep.

Take advantage of any government backed schemes like the redundancy payment loan scheme. When you come out the other side of the recession leaner and meaner you will need key skilled staff to take you forward, so consider if it is wise to lose them all now. Try cutting salary and benefits or the working week to reduce costs but retain the skills, and whilst this may be short term it may buy you enough time until the economic picture improves.

2. Maintain up to date management information

Keep up to date records of every business transaction in order to review performance. It is highly recommended that you produce monthly management accounts INCLUDING A CASHFLOW. Make sure they are produced in a timely manner and that you review them immediately, and even more importantly, ensure you understand what they are telling you. Compare them to your annual budget and investigate any major differences.

3. Remain in control

When a company becomes insolvent the directors need to act in the interests of creditors rather than shareholders but ordinarily that does not give creditors the right to dictate terms, and that includes your bank. Choose your own business advisors so you can be confident that they will act in your interests. Often the spectator sees more of the game and the warning signs are often more obvious to a casual observer than they will be to you.

When you are in the thick of it, punch drunk from fending off creditors and juggling your budget, you can miss the bigger picture. It is not normal to constantly get chasing phone calls to make payments, cheques bouncing at the bank, being on stop with suppliers, or for the bank to insist on an independent review. If this happens, take matters into your own hands and make some changes.

4. Focus on cashflow

Look at all areas of the business. Consider strengthening credit control procedures and debt chasing, reduce stock levels, and try to negotiate extended credit terms. It is also worth looking at taking advantage of “Time To Pay” agreements with HMRC. Some of these will not be easy as everyone is in the same position and is looking to maximize their own cash position.

Don’t forget the old cash clichés as they are even more relevant in a recession, “turnover for vanity, profit for sanity” and “cash is king”. When times get tough it is very easy to chase turnover but remember, you only want profitable turnover. You may have under utilised assets within the business that could be sold to raise cash but ensure that this would not damage the business in the future.

5. Prepare or update your business plan

This is essential as all business owners and managers need to understand where they make or lose money and need to look ahead at different scenarios, like what changes would be needed if sales were to drop, say, 25%. Most importantly, more businesses will need this information to optimise cashflow and maintain reasonable headroom within agreed facilities.

If a company is looking to secure bank or Business Angel funding, a sound business plan is a prerequisite to even get in the door. A business plan obviously looks forward but if you have a monthly reporting system in place, it can be used to compare against actual performance allowing the business to identify and react to differences much more quickly.

6. Update your trading terms

Many businesses have relatively little experience of their customers becoming insolvent. In a sharp recession this risk will become a more frequent part of doing business and needs to be built into pricing and terms of trade, including provision to charge interest on late payments, termination of contracts, taking early recovery action and claiming a lien or retention of title to goods. Obtain up to date credit reports on major customers.

Ensure you have an efficient, computerised credit control process and use it to chase customers before the payment terms are stretched. You may need to take further action if contacting the debtor doesn’t result in payment. Consider using a local solicitor to send official looking reminders to debtors, it doesn’t cost much and may speed up payment. The normal standard payment period is 30 days, after which you might consider charging late payment interest.

7. Look out for opportunities

For every business that fails there will be customers, key personnel and other assets available to those that survive. Register on IP-Bid.com, the UK’s online insolvency market place, to receive email updates and opportunities. In the current climate there will be many companies coming up for sale so update your marketing plan to include market growth by acquisition. This will make you a bigger player in your market and may present an opportunity to buy a competitor cheaply.

8. Inject additional working capital

In the current climate the banks are no longer prepared to take all of the risk in a business so you may have to consider putting some money into the business yourself to pay creditors, especially if your bank has declined additional facilities. You may be able to tap up friends and family, sell some personal assets or release equity in a property but there are a number of potential pitfalls you will need to navigate, so seek specialist advice first.

9. Have a structured survival plan

Battening down the hatches and hoping to survive the recession may not be the best option so you will need to put together a plan to get you through the difficulties. This will prevent knee jerk panic decisions particularly when looking at cost reductions and will also look at how you will maintain and grow your sales at the same time. You can only cut costs so much but if the sales are not there you will still suffer severe cashflow problems.

10. Don’t panic

You can be sure that in the current climate you are not alone with your problems and challenges as just about every other company is going through the same. Despite the negative coverage in the media over the last year, the world will not end next week and if you are proactive and actively take steps to get through it you will survive and be better for it.

Don’t feel a failure if you seek professional help from a competent business advisor. If you need specialist insolvency advice they will tell you. Recent case law has clarified that as long as directors act in accordance with professional advice they should avoid personal liability.

REMEMBER!!

There are usually a number of constructive options available, especially if you take early advice. This may be the first time you have faced being unable to pay creditors but we see this type of situation every day. Even if the company cannot be saved, often the business can. Be positive and you will survive, bury your head and you will become a business failure statistic.

 

www.remedyforbusiness.com

 

What does it to be an entrepreneur

What does it take to be an entrepreneur?

With the UK economy in full re-build, it will be the entrepreneurs, who create jobs, through innovation and by putting their ideas into action. Being an entrepreneur or business owner is not an easy thing to do and with so many new business startups perhaps more than ever before, you have to ask yourself one question:-

Am I ready?

Being an entrepreneur requires a passion, determination and courage that few people actually realise. You will experience the highest of highs coupled with the lowest of lows. At times, your mind and resolve will be tested to the limits and only when you face real adversity will you know whether you truly are entrepreneurial.

Entrepreneurial Leaders

Entrepreneurs are natural leaders that inspire and innovate through ideas and creation. An entrepreneur must accept and realise that he is not skilled in every aspect of business and day-to-day operations. The skill is knowing when and where to seek help and how to use it and in what quantities.  Always stand up and be counted even when things go wrong. When your ideas work, ride them, when they do not, evaluate and reapply.

Your idea

If you are starting a business then you must test-drive your idea. Do not keep it to yourself, as you are not re-inventing the wheel. Put your idea out there, as that is the only way to know if it is going to work. Use your friends and family to test drive your idea but also use people who do not know you, as they will answer honestly without emotion. Above all, listen to them, as they could be your future customers.

Finance

Do you have adequate finance to get your business where you need it to be? If you do not then you have two choices: – either wait until you have secured enough money to fund the business or start it knowing that you will require investment at a later stage. Some investors prefer to see something tangible, live and working. Be careful and choose wisely.

Employing people

During my career, I have employed thousands of staff. I have learned only recently at a great cost that you must employ the best person that you can and if that means you have some kind of profit share then do it. Getting employment wrong, can cost you time, money, grow and can have a negative impact on your business. When I met and interviewed David recently he reinforced that to me.

Business planning

Your business will change as soon as you create it. A business pan rarely goes according to plan. Keeping an eye on costs is key and reviewing your monthly costs is essential if you are to survive.

Always look at your three month cost base and if you are not making money then ensure that you either decrease costs, increase sales or your GP to stay above water. Always remember that if your business makes 10% net profit after all expenses then for every £10,000 in turnover you achieve you earn £1000. Every £1000 that you spend requires you to turnover another £10,000 just to make it back.

Time and resources

Entrepreneurs work long hours and often take home less money than they were paid by the jobs they enjoyed prior to starting in business. I would advise that you have a second income while you build your business. The less you draw from the business, the stronger it will be in the long term.

Your resources are everything and the contacts that you make will help you grow your business. Business networking is an essential tool for any business owner and there are many business-networking opportunities for you to explore.

Business Networking

Business networking is a vital tool for your business. Get out and join as many business networks as you can. Entrepreneur networking will help you make new contacts that you can later use to your advantage.  Raw Business online offers free online business networking. Every registered member also receives a copy of Raw Business Magazine each month. Join as many networks as you can and make as many new contacts as you can.

Bradley Chapman

www.rawbusiness.com

Less Survival Of the Fittest, More Like Survival Of The Quickest To Adapt! – By Charlie Mullins on Homeform in Administration

Charlie Mullins spoke today on the bad news from the high street with Moben, Kitchens Direct and Dolphin Bathrooms all closing and it’s not looking like they will reopen, with the loss of more than 550 jobs.

“They are not exactly direct competitors but it’s close enough to home to make me sit up and take notice of what’s going on, and consider what exactly the difference is in these times between staying in business and going to the wall. As best as I can see survival in business, as in any walk of life, at any time in history has a lot to do with adaptation to your circumstances. Maybe less survival of the fittest, than survival of the quickest [to adapt], as waiting around doing nothing new and hoping things go your way doesn’t seem to be any kind of sensible tactic.

That’s my best theory and I’m sticking to it. Once upon a time to have a Dolphin bathroom was a bit special, but in recent years they just didn’t come up to the mark, and as such were no longer seen by many people as value for money. It may sound harsh but if you go skint, and it’s not because people don’t know what you have to offer or where to find you, then surely it has to be a case of ‘seen it, and didn’t want it any more’.

Hopefully all the sleep I keep losing wondering what else we can do to add something to what we already have, that will give customers better value for money, are worth sacrificing. Speaking to the accountant yesterday it looks like it was with sales for our last financial looking like going through the £16 million mark. In the last 12 months we have started doing locksmith work, upgraded our call centre technology and communications with engineers, concentrated even more on staff training (for old and new employees), and at the moment we’re running a summer 15% discount offer on labour. The reason I believe we are still expanding is that we are able to continue to come up with all these little tweaks quickly, rather than is the case with less flexible companies where there are meetings to be had before even so much as a memo gets drafted. Or worse companies that know there is so much internal red tape involved in doing something new or different that they don’t even know where to start as far as coming up with something that people actually want. Seems to me Dolphin et al have followed the Woolworths/ HMV example”.

July 7, 2011 | Charlie Mullins

http://www.pimlicoplumbers.com

Press Link

Charlie Mullins talks about Homeform in Administration

Raw Business Interviews with Charlie Mullins - http://www.rawbusiness.com/interviews/index.php?page=8

Trademarking

A trade mark is important because it is the signal to the customer that the goods or services they are buying from you will be of a particular quality and that subsequent purchases will be of equal quality.

Trade marks are assets which become more valuable to the business as your brand recognition grows. It is the symbol that embodies the goodwill of your business.

How do trade mark rights come into existence?
This will vary from country to country.

Unregistered rights
In some countries there are laws providing rights to unregistered trade marks. These can be useful in many circumstances but are invariably more difficult and expensive to enforce than registered rights.

Such laws normally run in parallel with rights provided by registration and examples are the common law rights in “passing-off” in the UK and “unfair competition” laws which operate in some European jurisdictions.

Rights in passing off protect the goodwill in a business. In order to succeed it is necessary to show that the requisite goodwill exists. Proof of goodwill requires collection and submission of substantial amounts of evidence. The nature of this evidence will depend on the facts of each case but the materials must support the claim that there is recognition of the alleged goodwill. Details of the past use including annual turnover figures, advertising expenditure, volumes of sales, and consumer surveys can be positive contributions. However, without a trade mark registration there is a great deal of uncertainty surrounding your rights in a brand.

Registered rights
Most countries around the world enforce Trade Mark laws and operate a trade mark registration system. A Trade Mark Registration is the most effective way of protecting the rights in your brands.

In many countries the only way to protect your Trade Mark is by registration and the first to register owns the right. It is therefore important to file trade mark applications as early as possible.

Different types of registration are available:
National Registration: This provides protection in relation to a particular mark in a particular country and is obtained through the National Trade Mark Office of that country.

Community Trade Mark (CTM) Registration: This is a single registration obtained at the Office for Harmonisation of the Internal Market (OHIM) and provides protection in all member states of the European Union (currently there are 27).

International Registration: This is a system operated under an international convention (the Madrid Agreement and Protocol) which enables a bundle of National Registrations to be sought in one or more countries which are party to the convention, by filing an application centrally at the World Intellectual Property Organisation (WIPO).

There are advantages and disadvantages to each of these types of registration and your HallMark IP attorney will be able to advise you on the best choice for your case.

The registration procedure
The detail of trade mark registration procedure varies from country to country but the general principles are similar. These are summarised as follows:

• An application is filed at the local government Trade Mark office
• The application is examined by the government office (unless the country runs a deposit system – this operates in very few countries and the application is registered  automatically with no examination)
• The examination looks at whether the mark is inherently registrable – descriptive  “marks” such as COUTURE for clothing do not qualify – and/or for conflicts with earlier marks on the register
• If objections are raised you are given the opportunity to try to overcome them
• The application then proceeds to publication for opposition purposes
• If oppositions are filed you are given the opportunity to defend the mark
• If the application successfully negotiates these stages the mark proceeds to registration

What rights are given by registration?
Registration of a trade mark gives you a monopoly right to the mark in a particular territory in relation to relevant goods or services. It enables you to prevent unauthorised use of the same or a similar mark by others in respect of the same or similar goods and services.

In certain circumstances you can also prevent the use of the same or a similar mark in relation to different goods or services.

It is essential that you have adequate trade mark protection for two main reasons:

●    To ensure that you can enforce your rights against infringers should that be necessary; and
●    To reduce the risk of others being in a position to limit your business activities by obtaining conflicting rights ahead of you.

How can we help you ?
We can advise you on all aspects of Trade Mark law from brand development and clearance to registration and enforcement. Once you have made a decision on the best strategy for you we can implement appropriate trade mark filings in all trade mark jurisdictions around the world and take care of all registration and maintenance requirements.