Closing a business down

Closing a business down

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Discussion

technodup

7,576 posts

129 months

Saturday 5th May 2018
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EddieSteadyGo said:
Next is to rehearse your arguments to explain to prospective customers why your fees are superb value for money. What matters to the client is the sale price minus fees. If you can explain how you can sell their property more quickly and for a higher price, why would they be bothered about your fees being a bit higher?
I'd absolutely spell this out in terms a simpleton could understand (assuming the numbers stack up).

On average our sellers achieve £xxxx more than those who use an online agent. Complete with figures, big and bold:-

Online Agent
Sale Price £98k
Fees £500
YOU RECEIVE £97.5k

Your Local Agent
Sale Price £100k
Fees £1.5k
YOU RECEIVE £98.5k (What would you do with £1000 extra?)

You might think it's not necessary but people are generally thick AF, so the focus has to be on their pocket. The other thing I'd do is focus massively on the local/personal angle. Get your photo on EVERYTHING, lived in the area 40 years, sold hundreds of properties, knows the market better than anyone type schtick. There are plenty of things online can't do well, focus on doing them better and justify your fees rather than try to compete on a single metric (which you can't anyway).

Totally agree with the guy above, the estate agent's sale is getting the property on the books, not moving it on to a buyer. To that end I'd have the key messages above taking up at least half the window space and anything else you can put it on.

fridaypassion

8,503 posts

227 months

Sunday 6th May 2018
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If you have recognised a downward trend I would bail and do it as soon as possible.

Fighting against the tide of a market that's changing so completely is a losing battle especially if all the competition are doing the same. Some of that competition will probably have the resources to become the last agent in town so that's worth considering.

There's no shame in it I think in this country the general public can scoff at "failure" but those of us that actually run businesses would just commend you for doing it in the first place and for making these hard decisions.

Take some time out and do something else.

allchange

Original Poster:

6 posts

70 months

Monday 4th June 2018
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just to thank everybody for their input and to give a brief update.

Current thinking is that we'll keep the shop till the lease expires, the odds of subletting it are slim at the moment as there are 8 other units available close by.

But we plan on blanking the windows out (still with space to showcase houses etc) but to make it an office not a shop, so if we are out we are out and we don't have this need to keep the "shop" open in case someone comes in, footfall is minimal but we basically employ someone to be in - just in case someone pops in - basically we can trial being a local/hybrid agent for 10 months..

If it means we are not tied to the office it frees us up to go out delivering leaflets, door knocking, viewings etc.. we can get rid of the staff member and if people want to see us, they can make an appointment like the rest of the world manages!

Hopefully i'll be able to keep people updated as things either progress or fail wink

sideways sid

1,371 posts

214 months

Tuesday 5th June 2018
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I've occasionally thought that for a BTL investor with a reasonably large portfolio, there must be a point at which it becomes preferable to own a lettings agency outright than pay an agency.

Any clients who might like to buy the lettings-side of the business, OP?

anonymous-user

53 months

Friday 8th June 2018
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OP I feel for your predicament. I have been there. Pride takes a hit, but don't let pride force you onwards. BUT:

1 - Move on and do something you enjoy and pays regularly

2 - Don't take out a new lease, they cost £huge to get out of later ... if you can at all.

3 - Don't pass the business on to your kids and saddle them with it, let them get their own career.

I don't think there is any shame in having tried for 5 years and admitting you're swimming against the tide in your line of business. I have been where you are almost precisely and so glad I moved on.

Good luck.

allchange

Original Poster:

6 posts

70 months

Wednesday 20th June 2018
quotequote all
Thanks Mike, appreciate the input.

Well we have done the most painful bit and just made our staff member redundant, pretty painful and its been a hard couple of weeks building up to this but there was just no way other than head on. Seemed a bit callous to do it almost as soon as she walked through the door but there we go its done and we are free of the pressure of paying someone.

All we have to do now is see how the nice few months pan out as we wind our lease up (May19) i may well market it though to see about sub-letting it for a couple of months..


jeremyc

23,335 posts

283 months

Wednesday 20th June 2018
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Strikes me that one of the key differentiators you have over the online guys is the shop.

Have you considered further differentiating the shop experience from the others in town? Maybe partner with a local coffee shop or cafe and make it a 'destination': if you can fill a few tables with people stopping off for coffee and cake you have a captive audience to look at the properties you have to offer.

garythesign

2,056 posts

87 months

Wednesday 20th June 2018
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allchange said:
Thanks Mike, appreciate the input.

Well we have done the most painful bit and just made our staff member redundant, pretty painful and its been a hard couple of weeks building up to this but there was just no way other than head on. Seemed a bit callous to do it almost as soon as she walked through the door but there we go its done and we are free of the pressure of paying someone.

All we have to do now is see how the nice few months pan out as we wind our lease up (May19) i may well market it though to see about sub-letting it for a couple of months..
I think first thing in the morning is the best time.

They can then use the rest of the day to take action over their future.

Friday afternoon is the worst time for an employee. They have all weekend to worry and have to wait until monday morning to take any action. Maybe a bit less of an issue nowadays with the internet, but still a worrying time.

Good luck with things

The Don of Croy

5,975 posts

158 months

Wednesday 20th June 2018
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Interesting thread.

I'm sat in my office and the phone isn't ringing. We sell specialist tools and distribute into the EU. Currently t/o is about 30% of where we were 10 years ago (when I bought in). A combination of internet trading (big name competitors selling knock-off imports) and zealous H & S enforcement has brought us here.

From Jan 1st 2019 I have an offer to become a wage slave again, working for a growing contractor in middle management and the opportunity to take a full 25 days entitlement each year (something I have not done for >20 years).

With little or no debts, my pension owns the unit, and the business will continue with minimal input (the Lady Don can oversee that) it's time to move on. Despite the lousy commute it will entail.

How will I find time to post on PH? How will I adapt to office politics 2019 and all that entails? How do I allocate the excess cash in my account each month? Decisions, decisions.

I wish the OP all the best and hope things work out for you.

WarnieV6GT

1,135 posts

198 months

Thursday 21st June 2018
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jeremyc said:
Strikes me that one of the key differentiators you have over the online guys is the shop.

Have you considered further differentiating the shop experience from the others in town? Maybe partner with a local coffee shop or cafe and make it a 'destination': if you can fill a few tables with people stopping off for coffee and cake you have a captive audience to look at the properties you have to offer.
Interesting..

So would any estate agent on here or similar consider the above ?


red_slr

17,122 posts

188 months

Saturday 23rd June 2018
quotequote all
The Don of Croy said:
Interesting thread.

I'm sat in my office and the phone isn't ringing. We sell specialist tools and distribute into the EU. Currently t/o is about 30% of where we were 10 years ago (when I bought in). A combination of internet trading (big name competitors selling knock-off imports) and zealous H & S enforcement has brought us here.

From Jan 1st 2019 I have an offer to become a wage slave again, working for a growing contractor in middle management and the opportunity to take a full 25 days entitlement each year (something I have not done for >20 years).

With little or no debts, my pension owns the unit, and the business will continue with minimal input (the Lady Don can oversee that) it's time to move on. Despite the lousy commute it will entail.

How will I find time to post on PH? How will I adapt to office politics 2019 and all that entails? How do I allocate the excess cash in my account each month? Decisions, decisions.

I wish the OP all the best and hope things work out for you.
Tempting isn't it. We are finding things tough but managing to make ends meet with other lines of business. Our core business is down about 50% from pre 2008 levels. We are still trading around the same and PM improved slightly but I am working very very long hours and taking jobs I would never have considered which brings its own risk. I suffered a nasty injury on a job back in January which I only took to pay the employees wages for 2-3 months as it was very quiet. Took me 6 weeks to recover and gave me a bit of a new outlook on things.

Its a seasonal business and we have found the season gets shorter every year and the traditional busy times are not as busy. The off season is even more quiet which is when we have started doing other work to keep going. Mean while my friends are moaning after they come back off their 3 week holiday to the states to find their boss has reduced their bonus from 25% to 22%....

Robertj21a

16,475 posts

104 months

Sunday 24th June 2018
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allchange said:
In response to more info:

Traditional estate agency (shop front) locally we are all losing instructions to online agents with millions to spend/ lose on marketing.

Catch 22, not enough £ to market = not enough £

Our lease is up in 10 months so maybe one last push?

We have minimal debt.
Personally, I'd close it. Put in down to experience and move on. Life's too short.

stuthemong

2,260 posts

216 months

Sunday 24th June 2018
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fridaypassion said:
If you have recognised a downward trend I would bail and do it as soon as possible.

Fighting against the tide of a market that's changing so completely is a losing battle especially if all the competition are doing the same. Some of that competition will probably have the resources to become the last agent in town so that's worth considering.

There's no shame in it I think in this country the general public can scoff at "failure" but those of us that actually run businesses would just commend you for doing it in the first place and for making these hard decisions.

Take some time out and do something else.
This, this, a million times this.

'Failire' is the person telling someone else they're a failure for trying to build something, and having the balls to acknowledge it not working out. They're the failure, for never having the guts to try it alone themselves, sniping from the sides, happy in their PAYE existence, sneering at those who make it as 'lucky'.

Almost never will an entrepreneur / business orientated person perceive someone closing a business as failure, its just part of the game of of this life we choose.

Failure is stubbornly holding onto a depreciating asset / failing business and not valuing your opportunity cost.

In business financial success is never guaranteed. I have Far far more respect for any businessman who tries, gives a good shot, and realises it's not the time/the idea/the market and who gracefully shuts it down, than many would realise.

Chin up. Roll the dice again, or take it easy, but you'll never wake up in 30 years and regret never giving it a go. Many do.

smile

Good luck in coming months. Value your opportunity cost.

Stu


joyless lobotomised parrot

5,637 posts

110 months

Sunday 24th June 2018
quotequote all
allchange said:
I have my own business, its been going for about 5 years now, its never quite taken off and the industry we are in is changing and fees are being driven down.

We have 1 member of staff.

We take hardly anything out of the business and its harder and harder each month.

A job has come up which fits well for me but..

I have a reluctance to close the business down, possibly vanity - don't want to be seen to be a failure and all that and a nagging doubt that it could work out and be an opportunity for my children (should they want to)

Anyone had any experience of closing a business and going back to employment?

(regular user, new name)
Sad one mate.

I've exited a good number of businesses, but not often by ending them and more often by 'punting' them. Far and away the worst bit is telling people they've no longer got a job which is something you never forget.

You've had a load of good responses here but one I don't think has been mentioned is the option to sell out. And if you've got a "letting book" you've got a very saleable asset.

To give you an idea, here in Glasgow your book is worth £500 a unit. That's not a hard and fast figure and there's probably regional variation, but if you happen to be in/around Glasgow I'd be delighted to put you in contact with someone who'd be delighted to pay said sum, providing it's a well organised letting operation and not a chaotic bag of havoc.

Obviously you're unlikely to be in this area but you'd be daft not to ask around yours to see who'd be interested.

Anyway, commiserations, and all the best for the future, including a one-day return to 'do your own thing' which, if you do exit , as others have said, shouldn't one iota put you off trying something again.

seaninog

513 posts

188 months

Friday 29th June 2018
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How does the old saying go again?

"If at first you don't succeed, try, try again...

...but then give up. There's no point being a damn fool about it"

If you've given it a good old go but it's not working out then the smart move is to recognise the shifting sands and move on to the next phase of your life. In my business (commercial finance broker) I see far too many business where the owners would be better off flipping burgers at McDonalds - they'd earn the same/more and they'd have a lot less stress - but yet they keep battling away for some poorly defined and ill-thought-out reasons.

Good luck to you whatever you decide.

allchange

Original Poster:

6 posts

70 months

Thursday 19th July 2018
quotequote all
Thought i'd update the thread.

i've taken a job wth another firm, its more money, some stability and offers the variety that i need. Most of our stuff will transfer across which is nice as well.

Our landlord has been good as well, we found another tenant who wanted to sublet (we have 10 months left) but he would like to sell up anyway so is happy to take this months rent and call it quits...

Thanks for the input from all who posted as its been nice to have nuetral input from people with experience / perspective thats not clouded by emotions.

Allchange...


red_slr

17,122 posts

188 months

Thursday 19th July 2018
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Good luck!

fridaypassion

8,503 posts

227 months

Thursday 19th July 2018
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I can only repeat my post from May. Good luck and good work getting away from the lease. You can say you've done it. Now get plotting the next business while your on the books smile

vindaloo79

959 posts

79 months

Friday 20th July 2018
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Could you sign up for purple bricks and 'if you can't beat em' ....