Case Study: Business Mentoring & Business Exit Planning
Owners of an Albury-based electrical contracting business, were facing mounting pressure from increased competition and low margins. By engaging in a business mentoring program, the duo increased their bottom line by 88%, which led them to a lucrative business sale opportunity.
Melissa and Tom Muntz were the long-standing couple behind a successful, 30-year-old electrical contracting business. Melissa handled the bookkeeping and payroll. Tom worked as the customer-facing electrical contractor. Throughout the years they capitalised on key knowledge of a specific sector to create a prosperous company that allowed them to live comfortably.
However, despite their accomplishments, the two faced tough times during the GFC (Global Financial Crisis) when they were forced to let go two-thirds of their staff. Following this, they were then hit by increased opposition from out of town contractors, having to compete for painfully low margins. The pressure on their business was mounting. Tom Muntz explains;
“At that time, I seriously wanted to get out of my business, so we went to see the accountants at Cumulus. I told them I was done and asked how we could finish things and move on”
When Cumulus Client Manager Sally Knight saw Melissa and Tom’s drastic need for help, she quickly introduced them to Ben Gay, Director at Cumulus.
“When we met with Ben and Sally, they reassured us that we had a good business. With their assistance they knew we could work our way out of the situation and achieve a better outcome.
At the end of that week, when we got home there was a bottle of red on the doorstep with a note from the Cumulus Team saying ‘keep your chins up – we are here to help.”
The duo enlisted in business mentoring to improve their business strategy and operation, to better position themselves for a profitable exit to their trade business.
With dedicated guidance and operational and strategic advice from the Cumulus team, Melissa and Tom were able to focus their energies on developing a clear action plan to better position themselves to achieve their goals.
The couple followed a structured and detailed program as part of their business mentoring program with monthly meetings focused on:
- Project accountability
- Management targets and actions
- Profitability improvements
- Customer analysis
- Service Mix
- Exit strategies – potential targets, how do we best position the business
“We’d had business coaches before, but found ourselves scurrying to prepare before each meeting. This was much better than any others we’d had.”
After just 12 months of coaching, and a renewed operational strategy for their business, the two saw an 88% increase in the bottom line of the business. They also managed to structure their electrical contracting business in such a way that they attracted the interest of potential buyers.
“By the time a deal came along, our business was in great shape. Without Cumulus, it probably wouldn’t have happened at all. Coaching a trade business can be hard – either you’re busy or not – and sometimes the dice rolls in your favour. Cumulus were helpful in getting us back on track.”
Eventually, Melissa and Tom signed the dotted line of a sale contract, marking the profitable exit of their much-loved business. The couple’s success story is testament to their hard-work, dedication and the invaluable assistance a structured business mentoring program can provide to business owners.