What it takes to run a business

Podcast

This week, Paul Downs tells Jaci Russo and Sarah Segal about laying off a third of his workforce. “Here's the problem in a nutshell,” he says. “Last year, January to March, we sold $1.356 million. This year, January to March: $680,000. March is on track to be the worst month I've had since I started taking records.” Paul also tells the owners that he used to have a rainy-day fund for such occasions, but he used it to renovate his house. He does think the layoffs and other cash savings have put him in a strong enough position to hang in there until business picks up. “We’re getting calls,” he says, “we’re just not getting orders.” He’s also trying out a digital marketing service that can identify and contact anyone who spends even just a few seconds on his website. Plus: Paul tells us that sometimes, when forced to lay off people, you learn things about your operation that you might not otherwise have known—like that you’ve been overpaying your sales tax by at least $30,000 a year for quite some time.

In this week’s bonus episode, special guest Dylan Jones shares his entrepreneurial journey, which includes serving in the Air Force, a Master’s degree in business analytics, a failed software business, and a brand new consumer packaged goods startup that draws on his knowledge of military working dogs—most importantly that it can be a challenge to keep military dogs (and pets) hydrated. Jones came up with a solution and started selling it at farmers markets where he would simply announce, “Hey, I have Gatorade for dogs.” That drove interest and sales, but not enough to make money. And when his wife delivered their second child, Jones started thinking about maybe selling out his inventory and looking for a job. But then, at one of the last farmers markets he planned to attend, he ran into an investor. That led to a conversation, an investment, a reformulation, a rebrand as Lyx, and a product that is now rolling out with big aspirations, especially for a solopreneur. As Jones puts it, “We want to be the Kleenex or the Google or the Apple of dog hydration.”

This week, five years after Covid arrived and as we find ourselves in another period of dramatic uncertainty, Jennifer Kerhin, Lena McGuire, and Sarah Segal talk about the advances their businesses might never have made had it not been for the pandemic, from the technology they use, to the people they employ, to the systems they’ve created. “It was very scary early on,” says Jennifer, “but it was transformational.” Plus: Do you hire full-time employees in anticipation of more business or when the new business is in hand? And Sarah asks what she should do when a new client signs a contract and her agency goes through all of the preliminary onboarding work only to have the client walk away. Lena’s suggestion? Review your cancellation policy, but she also tells us: “My business is 100 percent up-front. I get paid, and then I do the work.”

This week, Mel Gravely tells Shawn Busse and Jay Goltz that he believes we will eventually find out that the U.S. economy has already slipped into a recession. The funny thing about recessions is that they can start and even end before the GDP numbers make it official, which leads us into a conversation about what businesses can do to prepare for a possible recession. Mel, for example, says his team is checking in on everyone and everything: suppliers, customers, and employees. We also discuss why a lot of pricing models no longer work, why some businesses have never fully recovered from the pandemic, and how Mel turned around a facilities-management business that was losing $1 million a year. Plus: the owners discuss the relative merits of planning to fund your retirement by investing in a 401(k) vs. by selling your business.

This week, Jaci Russo tells William Vanderbloemen that she’s a little surprised, given all of the uncertainty in the air, how well her marketing business is holding up. Marketing, as we all know, is often the first thing businesses pull back on. Jaci says her strong results may have something to do with the changes she’s made in the way her agency closes sales. We also get Jaci’s and William’s takes on the conversation we’ve been having about whether owners should consider their employees’ personal circumstances when making HR decisions. But our main topic today is weightier than usual: William’s wife and co-founder Adrienne recently received a cancer diagnosis and has begun treatment. Long-time listeners may recall that William has spoken in past episodes about his efforts to make sure the business can run without him. “And oh my goodness,” he tells us, “how thankful I am that we started that process so long ago.”