When the going gets tough the tough get going

So sang Lionel Richie. Our younger readers are going Lionel who?

This week we are going to look at what it has been like in CF over the last 7 months. We will look at the life of a small business in that time. The struggles, the hard decisions, the losses, the wins, and some of the lessons learned. We will look at the early months this week and follow up next week on the last few months.

Last week we spoke about the importance of your compliance and how vital that is in the current time. In case you missed it Read here

“May you live in interesting times” is a Chinese curse that has never been so relevant. Times have been interesting, historic, unprecedented for all, and very difficult for many. We at CF had a very interesting journey over the last 7 months. There have been a few highs, some lows, much change, and great resilience, like many other businesses.


I was telling a guy at the gym that I was heading to Malaga later that day. That was the morning of Friday the 6th of March. I remember him asking me if I would worry about catching the coronavirus over there. My reply was that I could catch it just as easily here. 5 days later I had back pain, a cough, and a runny nose and my doctor told me to assume that I had it given where I had come from. I had met my kids on Tuesday afternoon and was at work in our office on Wednesday. I was in a panic that I had passed this on. I had the call with the doctor on Thursday. That was the start of self-isolation for 14 days. On Friday the 13th of March we closed the office and didn’t open it again until Monday the 7th of September.

This was at the start of the lockdown period when those who could work from home were to do so. Leo announced that schools were to close on Thursday the 12th of March until the 29th of March. As we know they didn’t reopen again until late August. There are 9 of us in the office and 7 of the 9 now had to deal with working from home and home schooling. Throw in restrictive lockdown measures and it all becomes quite difficult. In the early weeks, staff were adjusting as best they could. We were lucky to be on a cloud server so could work from anywhere with a good broadband connection. Ger and Dee were busy sourcing extra IT equipment and furniture so staff could set-up a home office. The plan was to mirror the workspace in the office at home. The first few weeks were at the kitchen table and work was on the agenda once the kids were alright. Husbands and wives were juggling, doing different shifts to keep the show on the road.

Difficult Decisions

I remember taking a video of the prom in Tramore at 10 o clock on a Saturday morning. Two people were walking and I was filming them. The place was empty. Businesses were closed and the usual hive of activity sadly missing. The main positive was the weather. It was warm and sunny so we could get our 2kms in without getting soaked. Walking up Main street and by the arcades it was very sad to see all the businesses closed. Some of these were our clients so we were lucky to be still working. There was huge uncertainty and so much doom and gloom. We were questioning if we would have a business at all? Worry, doubt and fear had crept in and was taking hold. We had to make some decisions, some of which would be difficult. Our income was going to suffer due to a fall in sales and clients being unable to pay us in the short term. We had to look at our costs too and we decided that

  • we would cut our monthly marketing spend from one supplier to zero
  • we would cut our business mentor that we worked with for the previous 5 years
  • we wouldn’t renew the contract for one employee
  • as owners, we would reduce our income
  • we wouldn’t reduce staff incomes
  • we would avail of the Temporary Wage subsidy scheme [TWSS]


Why those decisions?

As business owners, we had to understand the reason why we made those decisions at the time. The marketing and the business mentor would save us about €x per month which is not huge in one month. In 9 or 10 months it is significant.

For marketing, it was a case of we would continue to do some to keep our name out there, but we would cut the larger spend. Our focus was on survival, not on growth, so we didn’t want more sales as we had enough work on.

Our business mentor had given us an excellent service since 2015 and had helped us so much to grow the business. Not only that, but he was excellent when it came to a large sale or if you needed some advice on a particular topic. He is UK based and we went over to meet him every 3 months. A huge benefit for us was to mix with other UK accountants and find out what is working well for them. We knew travelling would be difficult, so we wouldn’t be in a position to attend the UK meetings. Our heads were on survival, not on a growth strategy, so we made the difficult call to inform our mentor

We decided to reduce our income, keep staff incomes the same and leave a staff member go. I was of the view that we would all need to take a hit on income. If I was taking a hit well why shouldn’t everyone else? I was wrong. It was correct for us as business owners to take less when there was less available. When times were better, we would earn more, and this is part of the entrepreneurial journey. We made a call to leave one of the team go. That was difficult as she had started with us as a trainee 4 years earlier. We are a small team and all friends, so it was a very hard decision to make. After a few calls with Ger the decision to keep staff salaries at the same level made sense too. Why was that? The team here were the ones at the coalface who would help us through the bad times. They had plenty of worries about working from home and home schooling. If we reduced their income, then we would be adding a financial worry. This wouldn’t show loyalty and wouldn’t arm them with enthusiasm to go the extra mile for us when we needed them.

Availing of the TWSS was the easiest decision to make. Once we met the conditions of turnover being down more than 25% in Q2 we would qualify. In the latter part of March I didn’t think we would need this, and I didn’t think we would qualify. I must have been suffering the after-effects of the virus! This was a huge plus for us and so many businesses across the country. Our turnover took a massive hit in April and wasn’t much better in May, so we were star pupils to qualify. It was a massive help to pay staff in those months. Staff weren’t able to work as normal, so our output was down quite a bit. There were other reasons for that too.

Helping clients

Many of our clients were in trouble. They had to close their doors and leave some or all of their staff go. They had the same problems as us and more. We made the call, in March, not to focus on completing jobs and getting them billed but to help clients where we could. We had to understand the intricacies of the TWSS, do cashflows, and breakeven numbers. We had to call clients to see what their problems were, and we were taking a lot more calls too. The need was there to help. The right thing to do was help as our own business would depend on the survival of our client’s businesses. We know them, know that they have good businesses and we had to fill that gap to help. Money wasn’t talked about, but the hope was that our loyalty would lead to customer loyalty down the line. The key understanding for many of our clients in April and May was knowing their numbers. They also needed help with the TWSS. Good information was vital and an ability to pick up the phone to a listening ear so important.

To say that Ger got stuck into the intricacies of the TWSS is an understatement. I was getting phone calls, what’s app messages, emails, and texts at ridiculous hours. He did live webinars with Waterford Chamber and was a mine of information on this topic and others. We set-up a dedicated page on our site to get as much useful information as we could out there to help. See here We did blogs and got e-mails out with the latest information. There was a real sense of we are all in this together.

There were more difficult bumps in the road to come. There were a few wins and many changes afoot. Interesting times continued to be interesting