Hidden Evil

Mislaid trust can ruin a business.

“Trust me.”  This short sentence is fraught with meaning. When you choose to build a retail enterprise, one in which you invest your heart and soul, you need to be able to trust those around you, especially those who may control your financial destiny. Sadly, not everyone is worthy of your trust. These wolves in sheep’s clothing can do untold damage if not spotted and rooted out. I’ve found that one of the hardest tasks I face in retail consulting is getting an owner to face the hard truth that their trust has been misplaced.

Here is one such story. Call it “Hidden Evil.” It concerns the dark souls who seem to lie in wait for the unaware to break their hearts and ruin their businesses.

When we are asked to come in and help a dealer, we dive in with both feet. The records are one critical aspect. Gathering and analyzing the data help us to see if the business is profitable. In the process, we find some owners who are better at tracking money matters than others. This particular husband-and-wife operation had an outside CPA who was supposed to do monthly P&Ls along with detailed balance sheets. But the work had not been done with any consistency for years. This person was clearly not an active part of the business, and as a result, the owners did not have enough information on hand to make good decisions.

I repeatedly tried to arrange a time to talk with the CPA. No luck. But because of my inquiries, we suddenly got up-to-date reports the next day. This allowed us to see that the company was current on the SBA note along with payroll and sales tax obligations. They were behind with a few suppliers, but it was an amount we felt was easily solvable with the right discipline and plan in place.

We really liked the ownership team, and we believed they were on board with our suggestions. As we left, the wife gave us a bag of locally made chocolates—a sure way to my heart! They were nice folks. Though not seasoned business people, they had done well enough so that they could now grow the business. For several weeks after our visit, we knew the financial plan we had outlined was in motion. Everything was upbeat and moving forward.

But one Friday, I received a joint call from them. Both were crying. They were so emotional that it took time to get matters calm enough to hear their story. The CPA had met with them and encouraged them to file for bankruptcy. I was shocked, to say the least. The books certainly did not call for such drastic action. After making sure they had shared everything with us the month before, I could not see why their CPA would encourage them to undertake such a course. They asked if I would talk with her.

I immediately agreed to intercede on their behalf. We rushed out an agreement to the couple that gave us full authority to talk unfettered.

Going into the call, I set my mind on not rushing to judgment. The call started with her wanting to know just who we were. Fair question. But it was how she asked that gave me the first sign something was dreadfully wrong. Then she interrupted me several times while I tried to answer. A picture started coming into view. She was quick to tell me how she was the only reason the operation had succeeded thus far. That was another sign of danger, as our earlier investigation had shown this was not true. She belittled them and the business constantly. Then, after nearly 20 minutes of uninterrupted talk she said, “I never liked the gun business, anyway, and closing it down would be good.”

This is a prime example of some of the hidden, and decidedly evil, forces that face members of our industry. I lit into her immediately, restating the actual facts of the case. She did not want to hear anything from me and kept interrupting. Finally, I could no longer tolerate her attitude and strongly shared how I felt. I told her she had committed malpractice and had needlessly harmed a kind and caring couple. I told her the industry she loathed so much is honorable, one rooted in the founding principles of our country.

I also told her that her conscience sure hadn’t bothered her enough to keep her from cashing the checks the owners had been sending her. And with that, she hung up on me.

She had come to the owners via a relative and had most certainly cast a spell on them. She had so bewitched this couple that despite all our efforts they finally gave in and elected to follow her recommendation. As a result, this couple traded their dream for a broken heart.

The Simple Truth is that the hidden forces of evil, jealously, and spite are ever present. These judgmental people are quite cunning; they will smile to your face, but the minute you turn around, they‘ll stab you in the back. Unfortunately, many times this conduct can come from the person you would least suspect.

Shakespeare wrote volumes about such treachery. You must look for them and cast them out, no matter who they are. Your best bulwark against such evil is to build a circle around you of true believers. I’ll tell you how to do this next issue.