Client Case: Scaling up a Business

Sam runs an alcohol beverage brokerage business in the American Midwest. In the area that he operates in, there are many craft breweries and distilleries. Sam sources products from these producers and markets the products to restaurants and outlets that eventually sells them to the end consumer. Sam’s business functions as the in-between the producers and end consumer.

Using Sam’s brokerage business makes economic sense for the craft breweries and distilleries as the brokerage replaces the need for a full-time sales representative. At the same time, it is more effective for the restaurants and outlets that sell to the end consumer to have one centralized point of contact in Sam’s business instead of having individual relationships with each producer.

Coaching Issue

The business is profitable and has been running for the past 4 years. Sam wants to expand the business beyond the current state that he is operating in to other states. To do so, he wants to get someone to help him with his business. He has hired one person to work with him previously but the person he hired has decided to take on another opportunity elsewhere. Sam says that he has issues trusting people and is unable to find another person to help him with his business.

Sam would like the coaching session to help him to work on his trust issues and find another person to help him.

Coaching Process

I started the session by exploring the criteria of trust. Trust for most people is an instinctive process. Most people do not know why they will find someone trustworthy — it is just a feeling to them. In a business context, it is important to have a reality check on what are the things that a person is looking for rather than just basing it on feelings.

Sam mentioned that he wants ethical, self-motivated people who has knowledge about product quality and consistency.

Given that he can clearly articulate the qualities necessary for trust, and that these qualities are not extremely difficult to find in the area that he was operating in, I probed whether he was willing to hire this person outside of his industry. The probing is necessary because if he was not willing to hire outside of his industry, then the pool of people he can hire is limited. Sam mentioned that he was willing to hire outside of his industry.

I asked him about the role that he wanted this person to play in his business. Is it a fellow business partner? Or is it an employee? Sam wants the person to be able to take whatever that is working right now in his business and bring the process to outside of his state. In a way, this person is operating as a franchisee and is investing his own money into setting up the business in another state. However, due to franchisee laws in his state, it is too much work for him to set up a franchise right now. I pointed out to him that the way that he is operating now in terms of finding a person based on trust can only happen for 3 to 4 people. Beyond that, he will need to look into more scalable methods of expanding his business. I also clarified that the person that he would be hiring will have a proper business contract instead of basing everything on trust. He assured me that there would be contracts in place.

At this point, it then becomes a question of why he cannot find this person. Was it a function of how he was looking for this person? I probed about the methods that he was using to find the person that he wanted to work with and he mentioned that he was using his existing network and friend’s friends. He has also talked to a few people who were interested in the business but their spouses were not keen on them venturing into this business.

He realized from speaking about the methods that he was using that the four hours a week that he has been devoting to find this person are not yielding results. He wants to devote one full week to exhaust his contacts in his network to find this person.

If he does not manage to find this person in one week, and he said that he would look beyond his network then. He would hire a person to run his business in this state and he would personally go to another state to expand his business himself instead. This person will function as an employee rather than a person that invests money in this business.

Then, we worked out the timelines that he would find this person. Working backwards, he wants this person to be up and running by June. It takes one month for a person to be up to speed. When I coached Sam, it is end February, which means that he has March and April to find this person to work with. I sensed renewed energy from Sam that he is committed to this goal.

The coaching session concluded with him understanding that him being unable to find a person to work with, was both a function of him trusting people and the way that he was approaching the problem. He walked away with an action plan on what to do next.

Why this process was adopted

One thing that Sam stated right at the beginning of the coaching session is that his business is a relationship business. When businesses are based on relationships, trust (and likeability) is important. An excellent product is still necessary, but people will use his brokerage service because they trust him. In the craft alcohol business where there are many small producers and the product is produced in small batches, quality control and consistency is an issue. When the restaurants and outlets sell to the end customer, they need to be sure that each bottle they sell matches up to consistent quality standards that the customer expects. It doesn’t work when the customer buys a bottle of beer today and the bottle of beer that he buys a week later from the same brand has a totally different taste! So trust is important in the alcohol brokerage business.

I have no knowledge of the alcohol brokerage business prior to meeting Sam but I did some research prior to the session and matched it to what he was saying.

I would be more concerned if he had not previously succeeded in hiring someone and succeeded in working with the person for some time. The fact that he managed to work with someone successfully before demonstrated that his concerns were valid and were not paranoia. Also, this being a business that he built from scratch, emotional concerns about letting go would also be strong and he really wants the business he has built to be expanded in the right hands. So it is important to him that he is able to trust this person that he works with.

Given that he is clear about the criteria of trust and why it’s important, it is simply then a function of working with him on the methods and timelines that he has been using to find the person that he wants to work with.

Results from the coaching session

Sam will spend one week exhausting his contacts to find someone that he can work with. If he does not manage to find this person or the person’s spouse does not give the go ahead to proceed, he will hire someone and go outside of state to expand his business himself. Timelines were established for him to have another person to help him with his business

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Michael is a Human Resources Director. He and his wife are originally from Canada, and they have been living in Hong Kong for the past two decades. They have a family of four teenagers, and the teenagers would all be going to university in a few years.

Michael is looking to relocate back to Canada with his family.

Career Advancement

Sheryl is a HR Officer working in a manufacturing firm in Barbados. Barbados is a small Caribbean island with a population of 300,000. It’s primary industries are manufacturing and tourism. Unemployment on the island is around 10% at the time of coaching.

She wants to find a HR manager role either in her current firm or elsewhere.

Team Restructuring

James is a Human Resources Director based in an Asian country and looks after the regional HR department. The company is transitioning into a new Enterprise Resource System (ERP) that will allow employees to perform most of their HR tasks via self-service.