How to come back from failure transcript

Greg Wilkes (00:01):

The construction industry can be a tough business to crack, from cash flow problems, struggling to find skilled labour and not making enough money for your efforts, leaves many business owners feeling frustrated and burnt out. But when you get the business strategy right, it’s an industry that can be highly satisfying and financially rewarding. I’m here to give you the resources to be able to create a construction business that gives you more time, more freedom, and more money. This is the Develop Your Construction Business podcast, and I’m your host, Greg Wilkes.

Greg Wilkes (00:43):

Today we are talking about a subject, and I’m going to be a little bit vulnerable in our podcast today, it’s a subject that’s quite painful. It was a painful lesson for me many years back, but probably one of the best lessons I’ve ever had in business. We’re talking about the subject of failure. Failure – just saying that word is quite painful <laugh>, because no one likes to fail and some of us are wired where the fear of failure is even more painful. It could be our upbringing or just the way we are wired, that we’re always trying to prove something to people, and fear of failure can be worse for certain individuals. For me, personally, I don’t like the thought of failing. But at the same time as I’ve grown and read a lot of books and understood more about myself, I’ve realised that actually there’s nothing to fear with failure. Failure can actually bring huge strength to you in life, to your character and to your business. Failure can be embraced, if you learn the lessons from it. So in today’s podcast, I’m going to tell you a little bit about my story. I’m going to talk about some of the clients that work with me and the struggles that they’re facing, and maybe you are facing these struggles at the moment, and what to do if you’re in a situation where you’ve either failed or you’re trying to come back from a failure or you feel like you’re about to fail. Where do you turn to next? We’re going to briefly talk about some of these things and hopefully my story might resonate and you might be able to take something from it.

(02:23):

Lets go back to me (if you’ve read my book, you’ll know some of this, but just to go into a bit more detail about it) Originally when I was running my construction business, it was hugely successful. We were growing so fast. I remember when I finally split from my business partner and went on my own, the second year of running, I’d increased turnover by about 70%. I’d gone from £700,000 up to about £1.2 million in one year after the split. It was highly successful. People were looking at me, my friends could see how well I was doing. I felt successful, was earning great money and the business was thriving. I just wanted to keep going, just wanted to keep expanding. I was hiring people left, right, and center. I didn’t know what I know now. At the time, I carried on the same path. We had some huge contracts with a local council and they were sending us loads of work at the time. I thought, “Yes, I just want to go for it. I’m going to get this business up to 5/10 million pounds and get into property development etc.” I had huge ambitions for the company. We just kept expanding. I kept spending out increasing the overheads, got a shiny new office, bought myself a nice company car. My project managers had nice cars. I ended up hiring a sales director, who came on board and was fantastic. He was responsible for bringing in some huge contracts for us. And then I brought on another salesperson, and things were going from strength to strength. It was quite incredible really how quickly we grew. Although things seemed to be going really well on the outside, there were some cracks appearing in the business, that at the time I didn’t really dive into. There were cracks appearing with the company culture. I had people in the business that thought they deserved a little bit more out of it and stopped giving their all. I had a bit of a problem with some company culture there. I’d started hiring some of the wrong people. If <laugh> you read the introduction of my book, I’ll talk about it briefly. I had one guy who came on, who stole a contract from me! He was a project manager that came on. We had a nice half a million pound contract with someone. He basically coached the client on how to get out of this contract, which was unbelievable. He sent one stray email from his company email address that we managed to find and intercept, and it brought the curtains down for his career with us, but it also meant an end to the contract as well with the client. We ended up losing money on that. We lost a massive project and had a six month gap to fill. This was the start of things going wrong. Hired the wrong person. That project manager should have never have come on board. I didn’t listen to my gut instinct, and we took him on and it was a big mistake. That was some of the first things (where things started to go wrong), bringing the wrong people into the business. I remember at one point we had about 14 people in the office and output really had started to decrease. We got a little bit too big for where we were. We’d missed the sweet spot. If I’d just stuck at 5 million turnover with a smaller team and had bigger projects, I could have easily have managed that. But at the time, we were still doing really small projects for people (although we were doing some large ones, we had a million pound project on) we were still undertaking some small works. I remember the council work we were taking on, we were doing small bathrooms for £5,000 pounds. So we had a range of £5,000 pound jobs, all the way up to a million pounds. It was not a model that was sustainable, or that worked. At the time I didn’t realise that, but I clearly see it now.

(06:19):

There were also problems with my leadership. As a business owner, because I’d had huge success, I was trying to step right back from the business. Loving going to play golf and going on some great holidays etc. I was loving it as the business owner, but I’d handed off control too fast to some of my employees, and they didn’t know how to deal with some challenging clients and some key contracts that we had. I’d left them to deal with it themselves. We had a client who literally on the last day of the project, he decided he was going to withhold funds. We literally had a couple of hours left to finish something and there was a huge payment outstanding. Again, at the time, we made mistakes. I wasn’t chasing the debt down quick enough and we’d let him build up a debt, trusting him. Then literally on the last day said, “Right, I want you to leave site. I don’t want you to do anymore.” We had a few hundred pounds worth of work left and there was a huge, huge amount that he owed. I think it was (I can’t remember what it was now?) It was something like a hundred thousand pounds. He decided not to pay. It ended up in a protracted legal battle with this guy, that again, cost me thousands and thousands, and put huge pressure on the business, massive pressure on the cash flow, and things started to get stressful. We had that. He wasn’t just the only one. There were some others that were unhappy with some of the work that we were producing because we’d let the quality go. We didn’t have the right project management team to check the quality. Although we were churning out a lot of work, we’d started to let quality go too. There were problems. As we said, there were cracks appearing and I wasn’t fast enough to get on top of it. So a real lesson, if I did it again, I’d do it completely differently (I did do it again, which I’ll tell you about in a second, and did it a completely different way). But at the time, some of the things, was I bearing my head in the sand a little bit? Not wanting to know? Possibly. Possibly I was allowing my senior management team to deal with this stuff, when really I should have seen the problems and jumped in head first and said “Right, let’s deal with this and let’s deal with that.” I think if I’d have dealt with the actual clients that we were having problems with, I could probably have talked them round and got them on side. Whereas, because I was being so standoffish, I had other people doing it for me and the clients weren’t having it. They were treating us just like a business rather than having a business relationship. To be clear here, I’m not blaming the clients at all. It was my failing. There were probably four big lessons that I take away from my first business, that were going wrong.

(09:07):

I think the first major problem was, that we hadn’t actually niched as a company. We were taking on all work from, as I said before, £5,000 to a million pound projects. That was number one. We were running round like headless chickens, trying to service every contract we could. That was a big mistake on my part, not being niched enough.

(09:30):

The second problem was we’d expanded way too quickly. We got to between 4/5 million really fast and we hadn’t had any periods of consolidation. Looking back, we should have had maybe a year of slowing things down a little bit and making sure I had all the right systems and processes in place before we pushed forward. That was a mistake, not consolidating, we scaled too fast.

(09:56):

Leading on to that (because we’d scaled too fast) I was bringing the wrong people on board, I didn’t have a really good recruitment strategy. That was a mistake. I had people that were coming in that weren’t really aligned with our vision and our goals and they weren’t a cultural fit. That caused us problems, we were bringing people on just to fill up a seat on the bus. That was a mistake. That was problem number three.

(10:24):

There were leadership problems from my end. I’d tried to completely step back from the business and allow everyone else to do everything. I didn’t want to know. I just wanted to go and play golf and <laugh> do some other stuff. I didn’t want to know any of the problems that were going on. I just didn’t want to know. I wanted to let everyone else deal with that. There were some leadership failings, my end for sure, big time. They were big, big lessons for me. Because of all of that happening, and because we’d got so big so quickly and our overheads had increased massively, we ended up entering a period where work started drying up a little bit through a mini recession. Work was definitely quiteing down for everybody across the board. Our overheads were so high. My sales guys had taken their foot off the gas, again, because we had some problems there. I couldn’t get them motivated to sell. They’d gone from bringing in £400,000 pounds worth of work a month to zero or £50k <laugh>. There was definitely something wrong there. They’d done that multiple months. We were trying to deal with that internally. We had all of a sudden, all these overheads going out, no new work coming in. Our biggest contract which was our local council, also had stopped issuing work because they’d had massive budget cuts for them internally. That caused us big problems because they were one of our biggest providers of work too. All of that combined with then customers not paying us on a few projects, It was really tough. It was really, really stressful. We’d gone from a business that was hugely profitable, and it seemed as if it was overnight that we were now in massive debt as a company. We had huge outgoings. We owed everybody from HMRC to our local suppliers, to our subbies we’d worked with for years and years and we just couldn’t pay. I was throwing my own savings into it to keep things afloat. But you can only do that for so long. It was horrible. It was a really horrible time. I remember I was so stressed. I remember I used to have to go for walks after work, we had a nice forest walk and a lake near us. I’d walk around after work and do deep breathing exercises to calm myself down. I remember, sitting on a bench trying to do a bit of mindfulness and listen to the birds to try and calm my brain down because it was just on overdrive. I even had a sauna at home and that was really good actually <laugh>. I used to have a lovely sauna and then I’d sit in the sauna with some classical music on. I was doing all of this as a bit of a coping mechanism. I didn’t realise at the time how stressed I was. It was having a real impact on my mental health. Although it looked to everyone on the outside that I was coping, I can deal with a lot of pressure, it wasn’t good for me. At all. It is only now when I look back, because I’ve got a pretty stress-free life now (or as stress free as it can be at the moment) but back then it was awful. Absolutely awful. I had young kids and a family that was relying on me, and I had a certain expectation and a living standard that I’d set for us all. We were going on great holidays. Once you set your lifestyle to a certain standard, it’s very difficult to then scale it back, when you’re not earning any money and you’re using your savings to try and keep your business afloat. So big, big problems. Big, big stress. Ultimately, it led to the business failing. The business ended up going bankrupt. I had to pull the plug on it one day, just got all too much. The creditors were really pressuring us. We owed money left, right and center it to different ones and it was horrible. Absolutely horrible. I remember, first of all, just the feeling of failure from that was awful. Internally, I thought, “Have I even got it in me to run a highly successful business?” Although I’d been really successful for many years, you then start questioning your own personality and your own abilities. Have you really got it in you? That was challenging internally. But also, you had all the other outside pressure, of letting people down and certain subcontractors that we just couldn’t pay at that time. Although, we tried to pay a lot of them off later on when we got going again. But at the time, they had to wait for their money, suppliers, not being able to pay HMRC and all the different ones. It was all just a massive, massive letdown and a failure and it was really, really painful. I can’t stress how stressful it was. It was awful. Even just talking about it now, just bringing back those memories…It was a terrible time in the business.

(15:30):

But that was a failure and it wasn’t the end! Although I went through a bit of period, a few weeks of my head down and feeling a little bit depressed and sorry for myself. I remember I actually went out to a concert one night with a good friend of mine, and we were talking and I was thinking, “What do I do? Do I start up in business again or do something else?” I pretty much decided at that point that I needed to start again. I needed to prove to myself that I could do it. I didn’t want to end my career in construction on a loss like that. I remember talking to him at a concert once saying, “What if I haven’t got it in me to do it again? What if I’ve just been lucky up to this point with my business success so far?” And he said, “Listen Greg, you need to snap out of this because this will become a self-fulfilling prophecy. If you talk like this and you don’t think you’ve got it in you, and you think that you’ve just been lucky and this failure can happen again, then it will, it’ll become a self-fulfilling prophecy.” And I thought “He’s right.” He was a hundred percent right. I knew this myself, but sometimes you need people just to smack you around the face and tell you it! So I thought about things and I thought, “Well, if I’m going to do it again, I have to do it differently. I have to learn from these mistakes and I have to use this failure as a massive catalyst to make huge changes in the next business that I create and the lifestyle that I want.”

(17:02):

And so I did. I remember at the time reading a quote from Michael Jordan, which I think is fantastic. He said that “I’ve missed more than 9,000 shots in my career. I’ve lost almost 300 games. 26 times I’ve been trusted to take the game winning shot and missed. I failed over and over and over again in my life, and that is why I succeed.” I think that is such a powerful quote. Michael Jordan was not scared of failure. He embraced it in fact, and that’s why he was a success, because failure wasn’t the end for him. He viewed failure as a means to get better and improve. I had to do the same in my construction business. I had to use this failure as a catalyst to improve and never let it happen again. I had to use that pain of failure and remind myself of that terrible pain, so that if I ever got in a state again in the future where I wanted to go and follow the same path, I wouldn’t allow it to happen. I had to remind myself of that pain. It worked. It really worked.

(18:17):

One of the first things I did was, I got really into reading a knowledge. I thought there must be a better way. What have I been doing wrong? I consumed book after book after book, working out where I went wrong. I started realising some of the mistakes I’d been making and I started documenting it, all the things I was learning. I was saving snippets of books here, there and everywhere and putting them in a big file, documenting everything. I thought, “I’m going to do it this time, it’s going to be right.” I started again. In the first year of business, we had to start from scratch with completely new contacts (we pretty much burnt bridges with a lot of people, we had to start again with all new contacts). We didn’t have any work. We went from a standing start from zero to turning over 1.5 million in my first year! It was highly profitable. Bear in mind, the first year I was still trying to pay back some of those suppliers and subcontractors that I hadn’t been able to pay when we initially went into liquidation. It was a really successful first year, highly successful. This was because I’d done it differently. I’d actually really thought about what strategy I was going to apply, but most importantly, I’d learned from those mistakes I’ve made before. I knew that we were only going to go for a certain type of job, whereas before we were taken on everything. Now, we were very niched in the type of work we were taking on. It had to be a certain value, if it wasn’t that value, we were turning it away. That was the first thing, I was not going to expand rapidly. Although we got to £1.5K in one year, we were quite comfortable that it was a great position to be in and I wasn’t going to go gangbusters and expand at a stupid rate this time. We were taking our time and making sure we had the right systems and processes in place. I was very, very cautious on who I hired and I actually rehired some of the best people from my previous company and they came on board with me, the ones that fit culturally. That was great. I also made sure I worked on myself as a leader. I knew I had to be a better leader this time, the second time round and be fully involved in the business. If there are ever problems, step up as a leader. There’s always a problem in business, isn’t there, something goes wrong on a project, and I had to be the one not to just allow someone else to deal with it, I had to be the first in and say, “Right, let me try and help you resolve this” and step up. I remember, I think when one of the Virgin trains crashed once, the first person on the scene was Richard Branson. The owner of so many virgin brands yet he was the first one there. He’s a leader, he had to lead from the front. I made sure I did that the the second time round too. That resulted in a hugely successful business that then ended up (not only was it successful as a normal construction business) but my mindset had changed. I wanted to make a success, not just in that business, but I really wanted to do property development. It was the catalyst for me to then get into property development immediately. I ended up creating multiple seven figure businesses using these strategies. I wrote all the strategies down, documented them all. And that’s what started the book all about how to build your future, which then led to that becoming an Amazon Number One Bestseller, which led to me getting into coaching, which started off as some one-to-one coaching. Now it’s a highly leveraged coaching model where I teach lots of people these strategies and now they’re having huge success and now it’s impacting their lives and their family’s lives. It’s fantastic. I’m now in a position where I’ve got property development going on in the background. I’ve got other business interests and ventures. I’m a shareholder in businesses. I earn from that. I’ve got a highly successful coaching company and it’s brilliant, it’s absolutely brilliant.

(22:24):

But it all stemmed from the failure and not from the failure itself, but the lessons that were taken out of that failure. I’m so pleased that it happened. At the time I wasn’t, and at the time it was hugely painful, but I wouldn’t necessarily change it. That’s a hard thing to say because I guess if you look back (because it was painful) you’d want to change it, if you knew differently. But, what I’m really grateful for is the lessons, I’ve taken out from it because I wouldn’t have had those lessons if I didn’t fail.

(22:56):

I hope that helps some of you. If you are currently feeling the pinch, maybe things have got out of control in your business, and you feel like it’s going to fail and there’s no way out and maybe you are on the brink of going to see the liquidator at the moment; just take to heart, the fact that you can try and deal with it in the best way you can, and bear in mind that the failure is temporary and be absolutely determined that you’re never going to repeat it again and really dive into the lessons. Look where it went wrong. Oftentimes, I see people when they fail, they are very easy to blame others. Even in this, I’ve got to catch myself sometimes because even in this I’m saying that I hired the wrong people and that was a cause for failure, but that was fault that I made the hires <laugh>. You’ve got to be careful not to blame and take full ownership for things, because it’s easy for us to do. We want to pass blame onto other people, but take ownership of it. Learn those lessons and grow as a person. Work out what you need to change as a leader in order to never let that happen again. Maybe it’s that you need to be shown the right path on how to do it. If that’s the case, if you need a clear path and a clear direction, we are here to help with that. There’s plenty of free videos and the book that I’ve got that you can go and read and there’s plenty of other books out there that give you some business strategies. Really invest in your education and yourself in order to do that.

(24:29):

On that note, we’ve got a special event coming up (depending on when you’re listening to this podcast) it’s on the 30th of June 2023 at the Hilton Hotel in Heathrow. We’ve got a one day intensive for construction business owners that are trying to scale between one and 5 million pounds. The aim of this event is to make sure that you come away with a clear plan and a clear strategy of how you’re going to scale this business without making the mistake that I did. We’re going to identify some of the frustrations that you’ve got and how to overcome them, how to make sure you earn the right profit because there’s so many businesses that get to a million pounds or more and they don’t make any money. It’s crazy. There’s reasons behind that. We dive into some of the top mistakes that you might make and how to overcome that. One of the big things we are going to teach you on the day of this event, is how to generate hundreds of thousands of additional revenue for your company. I may have global listeners here that are listening to this (sorry if this isn’t applicable) but if you’re in the UK, it’s really worth you having a look at this event. Go onto our website and click on the ‘event tab’ and you’ll see all the details about it. For the time you’re are going to take off work, just one day off of work and the small cost of the ticket, we are going to thousand x that investment. I can promise you that with what you’re going to learn on the day and the market strategies that you’re going to take away and the growth strategies. It is an event designed to solve your marketing, to give you financial mastery in your business and to give you more time back because it’s so crucial as a business owner that you can actually enjoy what you’re doing. Just a little bit about the event there. If you failed and want to go again and give it a go, or even if you haven’t failed and business is going okay, but you’re a little bit stagnant, then you might find you enjoy that event too.

(26:17):

I hope that podcast has helped a bit. If you’re feeling a bit flat because you failed or you’re going again for the first time or you’re on the brink of failure, don’t give up. One other thing, I’ll just add to this that I should have said earlier. We had Charlie Mullins on the podcast a few months back, a really interesting podcast. What was fascinating with Charlie Mullins is he was at the point of failure and he was advised to close his business by some liquidators, but he didn’t take that advice. He wanted to get a second opinion. When he got a second opinion, they actually said, “No, Charlie, if you really do this, if you do this and that, you can actually turn this around” He was determined, absolutely determined to turn it around and he did it. It wasn’t quick. I think it took him a few years to turn that business around and eventually we know the story. If you listen to that podcast, he had a company that I think was turning over about 50 million pounds a year. He ended up selling it very recently for 145 million pounds. Incredible story. But he was on the brink of failure and he turned it around, he learned lessons from it. It doesn’t necessarily mean you’ve gotta go bust to turn it around. You can <laugh>, you can still turn it around while you’ve got the business. It’s great if you can do that and don’t have to go bust by any means, much rather that I was able to do that. Unfortunately, I wasn’t able to, but Charlie Mullins did and you may be able to do that too. Take some heart from that and I’d love to hear your stories. I often get messages of people telling me what they’ve been able to do or what they’ve achieved in business. Feel free to reach out and tell me your personal story. I love reading it I’ll always reply to you. So hope this podcast has helped. It’d be great to see you there.

Greg Wilkes (28:05):

If you’d like to work with me to fast track your construction business growth, then reach out on developcoaching.com.au.