They Saw The Handwriting On The Wall
It was the late 1960s. The country was undergoing massive changes. And a decade of urban unrest had changed the New York City I grew up in. My family business and home were centrally located in Rockaway, Queens, a summer resort town within New York City. My dad Irving and my Uncle Morty, his partner, were slowly losing their hard-earned business to this every widening epidemic.
Rockaway had once been a lovely little summer resort area located on the Atlantic Ocean along the western border of Long Island. As I was growing up, it was the premier destination for the heat-oppressed New Yorker seeking the cooling summer breezes from the ocean.
But, this was all ending with the ever-widening use of air conditioning and the growing desire of New Yorkers to head further east onto the fashionable beaches of Long Island. And my hometown was showing all the effects. The once beautiful movie theaters were crumbling, the fashionable shops had fled across the border to Long Island leaving behind a kind of ghost town and the once full summer cottages and stately beach houses were abandoned.
Then things got worse. Rockaway had become the dumping ground for New York City. Old-age homes, drug clinics, the newly released psychiatric patients and homeless shelters all sprung up. And in numbers that were too much for any one community to absorb. Crime skyrocketed and naturally those who saw the handwriting on the wall sold their homes and fled.
A decision had to be made about how to stay in business. Things were changing for the worse and fast.
A Vehicle For SuccessAs with most young people starting out in business, my dad and uncle were hard workers but short on money. They took all the calls they could, seven days a week, and rotated the night and weekend coverage between them to keep costs down. But, they were also blessed by running their shop in this very concentrated area. Because it was just a few miles in either direction from our office, they were afforded the luxury of saving money by running older vehicles and using their time working rather than driving. Productivity was very high and overhead was very low.
They were planners with big dreams. That's why they decided to save as much money as they could to handle the inevitable "rainy day" occurrences that crop up in any company and still grow the business.
Fortunately, the business did grow by referrals from their happy customers. And because the service area was so concentrated, their trucks were like rolling billboards. You couldn't help but notice all the trucks because they were everywhere you turned in this little town. Very helpful to a growing business but it would also prove too be an area of vulnerability.
Urban renewal's wide-scale condemnation of homes and the massive exodus of people out of our service area threatened the business' very survival. While the bulldozers were busy flattening the majority of our former marketplace, a major decision had to be made and action taken. Dad and Uncle Morty mulled over all their options and decided that they'd have to move outside their normal service area or go out of business.
After considering all their alternatives, the only way to do it fast enough and in a big enough way to survive was to acquire other companies. The hard-earned cash that they had set aside was quickly put to work.
But, this was their first time buying another company. They had only focused on expanding their own company. So they had to learn fast how to evaluate the value of the company they were buying, how to combine staffs to maximize their effort and skills, and how to reduce costly overhead without affecting customer service.
As time went by, they became very good at it. Instead of a desperate attempt to survive, acquisition became the vehicle for success. Acquisitions helped fuel their growth beyond what the business would have ever allowed even before the problem of urban renewal surfaced and forced them to expand.
To their credit, their willingness to recognize a fundamental change was happening and their ability to react quickly created this opportunity. Also, they didn't neglect their loyal customers who still lived in the Rockaways. They continued to provide the same responsive service just as before.
So when problems arise, take a look at the fundamental changes affecting your business. Be honest. If necessary, bring in someone that will take a fresh look and help you identify where you are at risk. Think long and hard about what the problems are, what they will become and what your options are. Select the best option and then act. Be committed to the plan but flexible enough to make the adjustments needed as new circumstances arise. Dad's advice? Put away money for the proverbial "rainy day."
If you do, you'll find new opportunities that will make your company dynamic and vital today and into the future.