Background
A dedicated father and business owner, John*, found himself facing significant business challenges when he and his wife, Sarah*, were going through a family law property settlement after the breakdown of their marriage. Unfortunately, the process took a toll on his health and the business when Sarah, in an attempt to gain leverage in the property settlement, began taking actions that severely impacted the business.
What Happened? What were the business challenges?
Unauthorized Withdrawals: Sarah withdrew significant amounts of money from the business accounts.
Interfering with operations: Sarah deleted incoming e-mails and destroyed incoming mail items including customer payments, orders, and enquires.
Business Reputation Damage: Destroyed and deleted correspondence led to strained relationships with customers, lost work and poor reviews on social media.
Profitability and Cash Flow: The business’s financial health was severely strained, affecting its ability to operate smoothly due to insufficient money to pay employees and suppliers.
Stress and Wellbeing: John’s health suffered due to the stress and additional work caused by Sarah’s actions. He was not sleeping well, was eating poorly and was not getting any exercise.
Our Role and Services
John was referred to us by his Accountant, who had previously witnessed our ability to navigate through turbulent and complex matters. Using our Exhilarating Business™ framework, we used the ACTION phase to complete business diagnostics. From those, we developed a One Page Plan focusing on:
Proactive Risk Mitigation
Changing Passwords: We assisted John with immediately changing all business-related passwords to prevent the risk of further unauthorised access, including on all e-mail accounts, website access, digital marketing platforms, social media networks and operational software.
Supplier Communication: We contacted all suppliers to revoke any purchase authorizations Sarah had previously held and advised them of updated postal address and a direct mobile to contact John.
Customer Communication: Working with John’s administration team, we implemented a revised system to follow up all customers for non-payment, and updated all points of contact to ensure any issues or problems were addressed immediately.
Bank Notifications: We guided John in notifying banks to change the authority on all business accounts, ensuring Sarah could no longer access funds, including on their personal accounts, investment accounts and self-managed superannuation fund accounts.
Quantifying Losses
Detailed Accounting: Working with John’s bookkeeper, we developed a system to ensure all unauthorised withdrawals and financial losses incurred due to Sarah’s actions were recorded and quantified.
Impact Analysis: We quantified the impact on profitability, cash flow and business valuation providing a clear picture of the impact on the business financial state.
Legal Support
Documentation for Negotiations: The detailed records and impact analysis were provided to John’s lawyer, strengthening his position in the property settlement negotiations.
Court Case Preparation: All financial discrepancies and losses were documented and prepared in the appropriate form for use in court.
Business Focus and Support
Client Prioritization: We helped John with his time management using a ‘time blocking’ technique and developed with him a priority ‘traffic light’ system to help him focus his work activity, ensuring he could maintain service quality and customer satisfaction.
Stress Management: We took over the lead role, liaising with his accountant, bookkeeper and lawyer in relation to all the financial and legal complexities, allowing John to focus on running his business and reducing his stress levels.
Personal Support: Dean arranged to meet John for a surf a few mornings each week to ensure he was reducing his stress doing some exercise and something he liked. John was also able to talk through any concerns or issues he was facing in a more relaxed environment, usually over a post surf breakfast with Dean.
Outcome
The legal process was expedited, thanks to the comprehensive documentation and proactive measures taken. Using the court process, Sarah’s lawyer recognised that her share of the property settlement had already been taken from the business. As a result:
- John retained the family home and the business.
- Business Recovery: With reduced stress and a clear focus, John quickly returned the business to profitability.
- Ongoing Support: John saw the value of our assistance and decided to have quarterly meetings to stay on track and develop strategies to achieve his goals.
This case highlights the importance of proactive risk management, detailed financial documentation, and continuous support in navigating complex personal and business challenges.
*Names have been changed to protect the privacy of our client. This is a real situation and unsurprisingly one we encounter often. If you, or anyone you know, needs assistance in a similar situation, please contact us.