59. David from Everything Business Consulting's Journey Part 1
David from Everything Business Consulting’s Journey Part 1 [Everything Business Consulting EP 59]
ConsultX founder, David Thexton shares his entire story in this 2-part series.
Starting from his childhood in England, we're taken on a journey through his entrepreneurial exploits and follow him to the point where he became a business consultant.
Everything Business Consulting is brought to you by ConsultX, your complete Business Consulting Solution.
Visit www.consultx.com to find out more.
Transcript:
David Welcome to Everything Business Consulting, a podcast dedicated to business consulting success. It's for people who are already a business consultant and want to improve their skills, maybe they're an accountant and want to offer consulting services to their clients, they could be an ex-corporate who wants to get out of the rat race and become a self-employed business consultant. Or you've owned a business before and you now want to use the skills that you've learned to help others in the business. My name is David Thexton.
Julius And I'm Julius Bloem.
David Everything Business Consulting is brought to you by ConsultX, a global business consulting community that gives you everything you require to take control of your lifestyle and income by becoming a successful business consultant. ConsultX guides you through the entire process of building and running your own consulting business with a complete online academy, a system to acquire clients, a framework and software to provide them with real results, and international community of like-minded individuals. Also, we have a suite of resources and much, much more. To find out more about this opportunity, visit consultx.com.
Julius Today, David, I'm going to flip the tables on the interview that we had last week, and I'm going to interview you, the founder of ConsultX. Now, you have had a long and illustrious career in business and you've dedicated your life to business consulting since 2005. David, are you fired up?
David Absolutely.
Julius Well, you started back in 2005, but can you take us way, way back and tell us a little bit about your past and what happened in the lead up to becoming a business consultant?
David Well, that's quite funny, because I've had a long involvement in business, really, and some of these things will sound quite funny. But when I was six years old and lived in England a long time ago in the 60s, my dad said to me, David, if you go to the sports ground, which was next door to where we lived, he said, and collect up all the bottles and take them back to the shops, the three shops there that sell them, they will give you a grote for each of the bottles.
Julius A what?
David A grote. Which is, as I remember, it's like a quarter penny. So you got a penny, halfpenny, you've got a farthing, and I think a grote is the next one down. It's about the size of a, bit bigger than a grain of rice, a tiny little coin anyway. So I did, but it was too big a job. So I got my friends to come in and I said, you go and do sector a, and you do b, and you do c, and they brought them in and I paid them 50 percent of what I was able to cash them in for. So what that was really as a six-year-old was a kind of a franchise.
Julius Well how many people did you have working for you?
David Oh I think at the most about six, something like that. But it was, it made whatever I did, it made my little business six times bigger and I earned half obviously. And but I managed all of them. But I know it sounds crazy, but I did that. And then I moved on to other things. By then we moved to New Zealand and I saw an ad in a comic for a company called Star Seeds, and they were in America, and I sent away for that. And I had to send them three dollars, American dollars. So my father organized that for me and they sent me boxes of seeds and I go door to door and sell them and I'd make 50 percent on. So that was another form of business. We lived in Palmerston North.
Julius How did you see that opportunity way back?
David A comic, saw it in the back of a comic, Mickey Mouse comic or Batman comic or something? And I did that. And then I saw an ad in the local paper and it was working for a company I think could United Waste. And they collected rags from people, old clothing, and I'll be on the back of a van, I'd do the left-hand side of the road, another boy would do the right-hand side and we go and pick up all of these bags of clothing we get paid for that. But that was more of a job. And then I did, by then we moved from Palmerston North to Auckland and I had three paper runs, the night paper called The Auckland Star, in the morning called the Herald, and Tuesdays and Thursdays I did the local courier free newspaper.
David So one thing led to another, and then by the time I got my car license and everything, I started this other little business up. Oh, there was one before that which was downtown where we lived. There was a shoe factory and they had a big giant, one of those big, they call them jumbo bins in New Zealand. And they used to throw out the shoe patterns which had copper strengthening on the pattern. And I used to go there with a pair of pliers and I used to cut off the copper and put them into a sack, and go and sell them to the scrap metal merchant and things like that.
David That was a bit of a little mini business going. But I suppose the next biggest one was I knew a guy that worked at a company in New Zealand, that screen printed 20 liter polyethylene buckets. And when they set the job up, each job, about ten or so were poor quality. They couldn't give them to their client. So they would sell to me for ten cents and I'd take them home. And I clean off the ink with a solvent. And then I go out and I'd sell them, all around the area to flower growers, cucumber growers, vegetable growers, all sorts of things. So I'd make a dollar, and buying for ten cents.
Julius That's a pretty good margin.
David It was when I got my license, I got a towbar put on it and I used to go and hire the trailer from the local gas station, which had sides on it, and I could get about 200 buckets in it, all stacked inside each other.
Julius So what I'm hearing, David, is that you were basically looking for all of these opportunities and your eyes were wide open to them from a very young age.
David Yes, yes. And so I learned the atomic level from the ground up on mini micro-businesses and things like that.
Julius What do you think made you like that?
David Don't know, I don't know, I just always
Julius You just had it.
David Yes, I just had it. And then as a job, as an occupation, I went into commercial printing, printing magazines, and I got paid so many dollars an hour and I also did an adult apprenticeship there, which meant two nights a week. I go into town and I got a trade certificate and everything. But I was kind of, they wouldn't promote me. I made myself so valuable on the shop floor running a big printing machine that they wouldn't promote me. And so I got headhunted by the sales manager of a radio station.
David He said you need to come and work for us. And I said, well, what's your hourly rate? What are you going to pay me? He says I will pay you 20 percent of what you sell. And I said 20 percent, 20 percent. But how much is that? And he said, twenty percent of what you sell. And I said, but what does that in dollars? What is an hourly rate? He said it's not. It's called commission. You'll get 20 percent or one-fifth of what you sell. And I thought about it and I said, so the more you sell, the more you get. He said, absolutely, that's it. And I said, goodness me. I said, how long has that been going on for? And he leaned forward and he said, David, about 3000 years. And I was just blown away because, although the early days of doing the bottles and the buckets and everything and never once working it never it never occurred to me that you get paid by that method.
Julius The penny hadn't dropped.
David No, no, not at all. So anyway, so I went into radio and sold advertising. And because I didn't know what good or bad was, I just went out and started talking to people. And at the end of the first day, I had to ring up the sales manager. And because I needed to know what, they had a sports show at night time, I didn't know what the cost was of the ad and it wasn't on the rate card. And I said to the sales manager, I said, how much is it for the sports show? And he said, hold on, and he went away and come back. And he said I think it was twenty dollars or something for the 30-second commercial. And I said, okay, and he said how are you going? And I said, oh, I've done just around about 6000 dollars today, first day. And he said, David, David, six thousand dollars in contracts?
David I said, yes. And he said we have a rule in radio. I said, what's that? He says we don't lie to the sales manager. And I said, no, I have, I have. He said, you better come and see me tomorrow morning and we're going to talk about this. Well, I did, and I came in and had a briefcase full of contracts and everything, three to five hundred dollar contracts for radio advertising. And he couldn't believe it. And I found out then, that I'd sold more in one day than anybody at the station had ever done.
Julius And what do you put that down to?
David I didn't know what was good or bad, and I started early in the morning at what, early four radio at nine o'clock and I didn't stop till at about eight or nine o'clock at night and I didn't even stop for lunch. I remember eating a sandwich, I didn't stop eating the sandwich as I was walking from one place to another. So I was in a pool of about 300 shops and there was no mall there. And I just went from one to the next to the next, the next. And I kept going round and round the circle till, I didn't get all, I got about 70 percent though. But five days I'd done thirty grand and earned twenty percent of that, which is a fortune in those days, I'm talking back in the very late seventies, about 77, 78.
Julius Mm. Well but I don't know what inflations been like, but I imagine that's a pretty significant amount back then.
David Houses are 20 times more than what they were back in those days. So yeah. So that was me in radio. Then I went to another radio station who offered me a better deal and then I went to Hong Kong and worked for an ad agency over there on a percentage. And I came back to New Zealand and walked into the owner of Radio Hauraki, which was New Zealand's first pirate radio station. And that means they're on a boat because the government wouldn't give them a license.
Julius So a ship? Pirate ship.
David Yeah that's right, pirate ship, looked like a pirate ship. There's a book here somewhere. Where is it? Somewhere around here. Anyway, can't find it. And, yeah, that was just fantastic. I was there for two years and I got promoted to the sales manager over those two years. And then they changed ownership and they tried to lower my commission by about 60 percent or 70 percent.
Julius Oof.
David I know. We couldn't come to agreement on it, so I left basically. So that was me out of the radio industry.
Julius And then what was next for this budding young sales manager?
David Well well, my one of my reps, at Radio Hauraki and I were down South Auckland prospecting for advertising clients, and I remembered walking into a little tiny fruit juice company and in a place called Manukau City, for those of you in Auckland or nearby. And I went back and saw him and he'd been going for less than a year, probably. And I said I got a deal for you. And I put this proposal to him, and it was identical proposal that I work for Radio Hauraki for, which is a percentage of revenue and we negotiated a percentage. And he agreed and away I went. So I set up all his New Zealand distribution because he's only in Auckland and I got him into Hamilton, got him in to Whangarei, and so on, so on, down the country. Within a year, I had him right down the country, products being distributed to shops and everything.
Julius So you were selling his products into other stores?
David No, I wasn't, I was setting up distributors around the country.
Julius Okay and they were doing the selling?
David Yes.
Julius So, you had become the sales manager.
David I had.
Julius For this business, and you were basically sitting up reps.
David They were distributors which are self-employed salesmen. Yes. The kind of reps. But they got their own truck and they did their own deliveries and everything. And I got a percentage. So I built it bigger and bigger and bigger. And after about 18 months, he gave me a call at home and about nine o'clock and he said, you better come in in the morning and clear out your office because we've gone broke. And I said, what? I was pretty naive. I said, well, why? You said, well, we've lost so much money. And I said, but our sales have been going up at about 45 degrees. And he says, well, it appears that we weren't charging enough for the product.
David So, yeah, that's what happened there. So I saw an opportunity and went and saw him and I said, you can't close this down. We've done so much work here. I said, what if I buy half of it, and you do the packing and I do the sales and the distribution through the system we've already got and we go on like that. So he said yes, so we signed that other agreement. So I paid him some money and away we went. And after a year, he came back to me and he said, I hate just being a packer, running a juice factory.
Julius What did he want to do?
David He actually wanted to become produce corporate videos, and that's what he told me.
Julius That's a bit of a difference from producing fruit juice.
David It is, it is, he didn't want to do fruit juice. So I bought him out and I had the whole lot. I had all the production, I had the sales, the distribution, I had the license for the brand and away we went. And that was by now we're up to about 1982, 83. And we were so tiny, we were under a million-dollar business, but growing about 30 degrees on a graph so that was okay. And then in 85, we changed the name. We owned a license to an Australian brand called Orchy, O R C H Y. And we changed the name to Rio Beverages R I O, because all the juice that I bought came from Rio de Janeiro in Brazil. That's where all the orange groves are. They make the most orange juice in the world. So we change it to Rio. And by importing our own orange juice, we were able to drop the cost of goods by at least half, maybe a little bit more.
Julius Well, that's very significant.
David That was very handy because we were struggling to make money. We weren't losing it, but we weren't making much. And so we grew and grew. And then we moved from juices into fruit drinks and then we moved into energy drinks. Then we moved into bottled water, sports drinks, and a few other categories as well, and the company got bigger and bigger. By ten years into it by owning it for ten years, up to about 92, 93, we were about a four million dollar company. And then I learned, I was approached by a young lady who worked for a company called SMI Success Motivation International in Texas, Waco, Texas. And she talked me into, I have to say, into buying one of their goal-setting programs, which I'd never heard of. So I learned through that program the art of how to set goals, complex goals, big goals, how to break them down into their component parts, and how to put them into a system whereby I could, it's like, how do we eat an elephant? How do you eat an elephant? We eat at one mouthful at a time. It was that kind of thing. So from 92 to 2002, which is ten years, turnover went from four million to 100 million.
Julius That is a very steep graph.
David That is amazing when you see it on a graph, nothing does that except the space shuttle more or less.
Julius Can I just stop you there, when you started in 1994 and you set these goals, were they to be that big, to be 100 million?
David Yes, no, not so much the dollars, but to be number one in orange juice, number one in fruit drink, number one energy, number one in sports, number one in concentrated juices and two or three other, number one in those areas. And we were, that 100 million represented being number one in the market on top of everybody else. Like we were the second-largest beverage company here, Coke was number one. And we didn't make soft drinks like Coke did Coke and Fanta and Sprite. And we did all these other products. And there are other brands in there like V and Red Bull and other things were there but we dominated. We had seven production lines running around the clock in the summertime when the sales are high and they work just a normal eight-hour shift during the winter. But it became very, very large.
David We had 400 staff and yeah, it was very gratifying. So after 20 years, almost to the day, we got from two or three hundred thousand dollars a year through to 100 million. And I put that down to being able to use goal setting and being taught how to use it properly. And this is something in our ConsultX consulting program that we use a lot in there. We help not only business consultants, but we help the business owners with the same kind of strategy of how to take a really big task and break it down into something that sort of bite-sized chunks like eating the elephant.
Julius Something you can actually do and you can see the end result rather than something that's too big to manage. Before we go any further, can I ask you, were there any really important or valuable lessons you think you learned from the days of Rio?
David Only that I suppose in hindsight you can do anything like I was thrown out of school at 14 and my reading was terrible. My writing was terrible, and I didn't even know how to use a calculator. So you would ordinarily think that some young guy that started off his working life like that would have absolutely no hope and certainly not to be able to build a 100 million dollar business in 20 years. You'd have thought that he'd been unemployable and be down collecting the unemployment benefit and things like that. But it was the passion and the motivation that drove me along, even right back to the collecting the bottles in England and the seeds and doing three paper rounds and things like that. Like I was just determined, that I was going to be a success in whatever I did and still am. Absolutely nothing's changed there. But so I'd say really point number one is you could do anything, anybody can do anything. It's got to be within reason, you know, you're not going to be able to ride a bicycle to the moon something stupid like that, but anybody can do anything that is within reason.
David The second thing is that if you don't have the skills like I didn't, then anybody can go out and get those skills. You can learn and you can be trained to do anything that you want to do. Like we train a lot of people to be business consultants, and people teach themselves to do all sorts of things through books and courses and stuff like that. So if you can't do something but you really want to do it, you can learn to do it. And I know, you're interviewing me, but in your background, you entered the motor industry as an apprentice and you did exceptionally well in that, in fact, you can't do any better. Would you like to tell the audience about that?
Julius Yeah, well, my story which is I covered a little bit in the last podcast, but if you haven't listened to that, go back and listen to it. But I actually started out as an apprentice mechanic and very quickly I set the goal of becoming The Apprentice of the Year or the top mechanical apprentice in my trade, basically. And I guess in a similar vein to David, I was a little bit naive and I didn't know really what that meant before I started and I didn't know if I was any good or what it took to be good. I was just focused on becoming very good at what I was doing. And I didn't think I was anything or anyone until I got called up to be in the final four. And then I thought, hello, maybe I'm alright, and then when I won, I wasn't surprised because I was working towards it, but it was what I was working towards, so wasn't unexpected. But,.
David You know, surprised.
Julius I guess I was surprised. Yeah. Yeah, it was an expected surprise. I don't know if that's a thing.
David Expectancy.
Julius Yeah.
David Power of expectancy. You expected to win it?
Julius Yes, yeah. And I'm the same as well. That's kind of built into me where whatever I do, I'm focused and I want to succeed basically.
David Well, that's why I invited you to become a partner in ConsultX because those traits are really important. If you're going to do something and build a successful business. And you've got that. So, yeah, so here we are earning 50/50 of ConsultX, which is great business.
Julius Back to you, David. So tell us about the end of Rio, what happened there?
David Well, the end of Rio was that, it's a bit complex, but I'll abbreviate it all, was the phone rang one day and it was a guy called I can't remember his name, but from Coca-Cola Oceania, they call it, which is all of Asia, all of Australia and all of New Zealand. And he said, hi David it's such and such, I can't remember his name, from Coca-Cola Oceania. He said it's your birthday today. And I looked I thought I said, no, it's not. No, no, no, it's February the fourth. And he said hahaha, no, that's what we say to people when Coca-Cola wants to buy their business.
Julius Is that actually what he said?
David It's what he said, yeah, yeah. So so anyway, we had two or three phone discussions and then he was operating out of, I think it might have been Singapore or Hong Kong, I'm not sure. But he came down to New Zealand and we had lunch together and cup of coffee and lunch and stuff like that, and we talked about it. And I was very concerned that this was serious because I was always very wary and untrusting of them because I thought that they might pull some trick like this to basically destroy our company and, yeah, and pick up market share for nothing kind of thing. So anyway, it wasn't and then within a month or so they had 13 people down here from Atlanta down to New Zealand. And then I thought, heck, I better get somebody in to help me.
David So I got a merchant banking guy who was very used to doing big deals like this, and his name was Carl. And Carl and me, and these 13, 14 people from Coca-Cola. And they went through our company like they put us through a sieve, you know, no stone was unturned. And it took them, I think, roughly something like about ten months for them to go through due diligence.
Julius That's a long time.
David It's just too long. And if I ever did anything like this again, I would not let that happen. But anyway, so ten months went through and the deal was done. And in November 2002, everything was signed and they paid us the money. And Coca-Cola owned Rio Beverages and all the brands.
Julius So what next for a beverage tycoon that has nothing to do?
David Well, they hired my CEO and my sales manager, and they wanted them to stay on for six months and they'd pay them really good money.
Julius But not you?
David Not me, I had to go. And so the two, the sales manager and the CEO stayed on and they were housed in a little office, separate offices in the Coca-Cola headquarters in Auckland. And they just sat there for six months.
Julius What for?
David To be there to answer questions. But there was no questions. And Nigel, who was a CEO, I think he told me he read 30 books while he was there, and Will, who was a sales manager. He went out and he started about four little companies and he bought some hairdressers and he bought a block of flats and did a few things like that. So he was in and out, but he made sure he was there every day for a couple of hours. But they just mainly sat there. Nobody asked them anything, which is incredible. Then after six months, they both left.
Julius Well, so they were there, kind of, as just a contingency in case, Coke needed them.
David Yes, yes. Anyway, they didn't. So that was how it all ended. And they bought eighteen brands off me, but they already had fifteen brands or fourteen brands or something. And at eighteen, they couldn't absorb that so they went through a process over about 18 months of eliminating the smaller brands or the brands that competed with products that they had, so they end up keeping five
Julius and they deleted all the rest,
David all the rest were deleted and sold out, yes.
Julius So all of your market share either dissolved or they kind of absorbed into their products.
David Well, the top five brands probably made up 80 percent of our turnover. But because we went from our fridges into their fridges and they had double or triple what fridges we had, then their 100 million remained and stayed there and carried on and got larger and larger because they were way better distribution than we did because they've been around for 100 years.
Julius Yep.
David Hmm.
Julius Okay. And then after Coke, what did you do?
David I moved to Australia with my family and I became a professional racing driver in the V8 Supercar series. And that's all around Australia. There's 13 rounds about every three weeks roughly. And I bought a complete racing car, all of the spares, a big transporter truck, and it would take nine mechanics came with it. And I did professional motor racing for approximately between two and three years.
Julius How did you get into that?
David I've always wanted to do it. I used to be a rally driver in New Zealand and I'd always watch supercar racing in Australia. And I thought, well, I'm going to do that one day. And I did because I'd got a lot of money from Coca-Cola and I was able to buy a team and go racing.
Julius And so is it another area of your life where you kind of had this goal that you wanted to do it?
David It was a goal and it was probably the most difficult goals. I've done other things prior to that were big, but this was pretty big because I'd never raced on a racetrack before. I've driven on backcountry gravel roads and I had to learn a whole new sport. And that took a while. But I had some very good engineers on the team and the team manager, Bruce was very good. And he taught me everything that he knew. So, yeah. Went and did that. And that lasts about three years, up to 2005.
Julius And were you doing anything else at the same time?
David My wife was, we started on the side, an online health business, and then we bought out two. This is in Australia, bought out number one, number two in the market and we bolted it into Thexton Health. So we were the market leader for quite a number of years, selling vitamins, and minerals, and diet stuff, and bodybuilding stuff, and sports stuff like that. About 9000 products.
Julius Wow.
David It was a lot, lot, we had a huge, thousand square meter warehouse and we're sending it all over the world, but mainly in Australia.
Julius So that must have been before e-commerce and online stores were a really big thing.
David Very early days. Yes, yes, very early days.
Julius Okay. And so I think we're getting to the part of your journey now where you start to look at consulting. How did that come about? And what was the inspiration behind you wanting to become a consultant?
David When we set up the health company Thexton Health, we realized my wife and I, realized that it was a waste having two of us running it and she was better at running it than I was and that I would go and do something else. And I said to her, I said, I'm going to be a business consultant. And she said, well, what is that? And I told her it was, you go and help businesses to improve profit, growth, and value. And, but I started searching around to try and find something that was online, something I could buy off the shelf. And I couldn't find much. I couldn't find anything that I really liked. I went down a couple of tracks with a couple of coaching programs and things like that. And then I came across one that was in London and it sounded like what I wanted to do. So I contacted them. I rang them up the day after I found the ad, it was on the weekend and I spoke to them there and they said, oh, damn, we've just been a Melbourne. We just run a course in Melbourne three weeks ago.
Julius Which was not very far from
David No. It's an hour's plane ride. So, from where we were on the Gold Coast in Queensland. So I had to go over to Spain, he said the next one in the three weeks or a month in Spain. So I paid for it, booked it, did everything, and to fly to I think it was Frankfurt change planes there, go down to Barcelona and Singapore to Frankfurt. Auckland, Singapore, sorry, Gold Coast, Singapore, Frankfurt, Barcelona.
Julius A marathon.
David A marathon. It took I don't know, thirty hours, thirty-six hours or something. And it was fantastic. I'd have to say it was absolutely fantastic. It opened my eyes and all of the things that I've learned over 20 years of building up Rio because I learned right from the atomic level every single thing I learned over those 20 years, and it confirmed a lot of theories that I had, a lot of ideas that I had. And yeah, and they're a great bunch of guys, it was me and 31 other guys. So 32 of us, two women, sorry. And did that course, it was 11 days and boy, they thrashed us, they thrashed us like with a stick. They'd be waking us up at 3:00 in the morning. Was like a boot camp.
Julius A boot camp for consultants.
David Yes, yeah. All sorts of things. And anyway, we formed up into consulting teams of three and then we had to compete against each other, which was really good. Really good. I learned a lot.
Julius How do you compete as a consultant?
David Oh, we had, there those a number of case histories. So the first case history was Robin Hood as a business, and the sheriff of Nottingham and Sherwood Forest, and how he would rob the rich and give 50 percent of the money to the poor and how the merry men came to him. And they said, Robin, 50 percent is not enough, we want more. How about we rob the rich and we keep 80 percent and give 20 percent to the poor? And Robin said, no, no, no, that's not our strategy. We don't do that. We give 50 percent to the poor. So anyway, so half as merry men left and went to the other side of the forest. They started robbing coaches of the rich people and taking all their money off them, and they started giving 20 percent to the poor and keeping 80, you see. So time goes on, time goes on, and these the merry men who on the other side of the forest cut down the number of coaches that were coming through. So the market size for Robin diminished. So his earnings went down. So he had to follow them and he started keeping 80 and giving 20 away because there wasn't as much coming through
Julius because he was given the same volume.
David Yeah. And then Sheriff Nottingham, who was getting really annoyed with these stagecoaches, being robbed. So he put about six protection people on there with bows, they had bows and arrows in those days, no guns, bows and arrows, and everything. And it became more difficult to rob the coaches. And then on the other side, where the merry men were, half of those men said, look, the takings are so low that I think we give nothing to the poor. We keep the whole 100 percent. So little John, who was in charge of that group said no, but that's not our strategy. So half of them left and went to the other.
Julius So now there's three groups?
David Well, they all started, because the competition, had to start following each other. So this group kept 100 percent then little John and his group kept 100 percent because the number of coaches coming through had slowed down and some of them were so heavily armed and then Robin had to follow. So that was the business problem that we had. And we had to, as a consulting group, we had to consult to Robin and give him a plan of what to do, using the software that they gave us.
Julius Do you remember what you did?
David Not really know. No, I don't.
Julius I'd like to know that though.
David I think from memory, an idea that we had an Irish guy, just like one of those jokes, there was a New Zealand guy, an English guy, an Irish guy. And the Irish guy said he reckoned that we got all three of them together and we pulled them back into a kind of a merger or a JV.
Julius Big corporate, yeah.
David Yeah, then went back to 75-25 or 80-20 or something. And they did nothing for sort of six months until everything calmed and then they come back and started again. That was one idea that I remember him coming up with. But we had lots of case histories. One was a London-based printing company and another one was a company that manufactured bicycles in Portugal, and because we're in the UK. Sorry, we're in Spain when we did this, yeah.
Julius Okay. And so you learned a whole lot over this 11 days. What did you do when you came back and started consulting?
David Well, I came back to Australia, obviously, and I started consulting, and I will go out, and I would talk to people, and I'd ask them a series of questions, really. It was just that was the way I used to sell radio. I didn't go in and sell it straight away, I'd ask them about their business. So I started doing that, I joined a couple of business associations, a couple of networking associations and I just spoke to people face to face, and I had a calling card and I had a little brochure that I'd made up and everything and letterhead, and I would go and talk to them and I'd get myself invited round for a cup of coffee and or I'd take them out for a cup of coffee. And I would just ask them a series of questions that I made up. And through the answer to those questions, I knew what they wanted or what they needed for their business. So then I'd go away, and this is very early days, we're talking about 2005/6 here.
David And I thought that I had to build them all a business plan. And that's what I was there for because that was what I learned in London. What they were teaching us.
Julius Spain.
David Spain from the London company, yeah. Was basically hunt and kill consulting where you go out, get a client, do the job, solve the problem and put it into a deliverable, give it to them, get them to sign it and give them an invoice and they pay you, and you never see them again. So I did nine of those, and I billed huge amount of money. And in late November, the end of 2005, I was in Brisbane and I had a canceled agreement, meeting, because of sickness. And I thought, oh, I'll call up the first guy who was ironically a beverage company, and I would find out how he's going with the implementation. So I rang him up, he said, yeah, come over for a cup of coffee or a cold drink. So I'll go over there, I only say four words to him, how's the implementation going?
David And he looked a bit embarrassed, leaned over onto his bookcase behind him and he took off the folder, which was lying horizontally, and he blew the dust off it. And I felt sick. He paid me a huge amount of money, it was forty-six thousand dollars from memory, Aussie dollars. To New Zealand dollars, closer to fifty thousand New Zealand dollars, which I'd done for him. And he said we haven't started yet. What? He said, no, no. He said, Jim, the sales manager, broke his leg skiing and Bobby's wife had a baby and this and that, excuse, excuse, excuse. And I thought this is just ridiculous. Like he was in dire straits. He was losing a lot of money.
Julius So he needed to do what was in your plan, but he just hadn't done any of it.
David Correct. He'd done none of that. So I pedaled like hell, and I tried to get in as his implementation manager and he wouldn't let me in. No, no it's alright, we're starting in February. Now, that would have meant that he'd had to thing for over a year, around about a year, and done nothing with it and paid me all that money too.
Julius How was he still able to operate?
David He just did, it was just like a big flywheel was rolling along, basically doing about thirty-six million dollars a year. And there was so much money thrashing around inside the business that he could keep ongoing. But he was losing a million dollars a year still, 100 grand a month roundabout. So yeah. So that was that was him. And on the way back to the Gold Coast, which is about an hour and a half drive, I started ringing up other clients of mine where I've done a business plan for them. And they all haven't started.
Julius How many? Nine?
David Nine. I did nine and build over four hundred thousand bucks. And no, sorry it was about between three and four hundred thousand dollars that first year, and seven of the nine that done absolutely nothing and two had made a start and couldn't do it, couldn't implement the plan.
Julius Why not?
David They just said they couldn't, don't how to do it, can't, I don't know how to do this. And I tried to get in there, wouldn't let me in. Something psychologically had changed. So over that Christmas on the holidays had two or three weeks off and I was thinking, I need to be the implementation guy. I need to be in there helping them to put the plan into place through all the implementation strategies that I've done for them. So I started off for 2006, early in 06, and the very first person that I spoke to, that I went and visited, and I said, and I'll stay with you for as long as it takes to achieve whatever vision we put together. He said what if it's five years? And I said, give us ten years, whatever, whatever it is, I'll be helping you to do that.
David And he said, right, when can we get started? And I said, woah, I haven't even done a proposal for you yet. So they were just biting my hands off to get started. And the next person was pretty similar on the next one. Next one. Next one. It was so easy, so easy. Once they found out that I wasn't only going to solve their problems, do a business plan, but I was going to help them to implement it and help them because the road progress has never been a beautiful straight line.
Julius Of course not.
David Bumpy, and I was going to be there when the bumps were and the hollows and things like that.
Julius Help get them through it.
David Yeah, yeah. So I did that and I got to the point by the end of 06 that I had 18 clients and I couldn't take on anymore because there's around about 18 working days in a month, some months there's 20, isn't there. I don't know exactly, but in my mind, I was kind of dedicating around about eight hours per day per client for 18 clients. And some cases it was a lot less. I was only four hours a month, so I had a lot of free time, but 18 clients was fine.
Julius What did you do in those hours? How are you able to help a large business like a 36 million dollar business in only eight hours a month?
David Because we'd done all, there's a bit more time involved when you're building the business plan, maybe double that. But I got better, first I got better and better at doing business plans, the first one took me about two weeks to do and the next one took one week and then three days. And by then I'd learned quick solutions or quick steps or shortcuts to building business plans so I could do it in a day at the end of it. So what I spent with them, seeing them every week for about eight weeks, 12 weeks if it's a big company. And I was mining all the information out of the owner and his management team and I was collating it all together, basically like a Rubik's Cube, pulling the business to pieces, more like a jigsaw puzzle, and then putting it back together in the right way, is what I did, and when I came with a business plan, they had no business plan.
David Nobody has a business plan, that's what I found, still today. And I put it all together for them. And then what I do is, I go from a meeting every week of a couple of hours to a couple of two-hour meetings every month, one at the start of the month, which is purely implementation, and one at the end of the month, which was purely key performance indicators and financials. That's the measurement meeting.
Julius Yep.
David And that gives us a couple of weeks to get all the numbers together and everything. So that was what we went down to, so I'd see them twice a month. Big, big clients that were paying big, big fees, I might be there three times a month for a couple of hours each meeting and had the occasional phone call and things like that. But with me delegating the tasks to the management team, I was able to point them in the right direction and keep them busy and make sure that they did what they had to do to keep that business moving forward towards a five-year vision because that's made up of goals obviously, hundreds and hundreds of little goals. So, I'd make sure that they were doing all those things. And like I said before, I was the implementation guy.
Julius This seems like there's a lot to the story, David. So we're going to have a break now and we're going to pick this up on a new podcast that's going to be available this time next week.
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