Kicking off this new series I was delighted to chat with Gregg Wallace last week about his experiences with finance and running a business. As I think I may have mentioned last week, I’ve long been a fan of Greggs, but particularly wanted to talk to him about what lessons he learned when he lost his fruit and veg business that might be able to help other business owners.
So I was very chuffed to be sitting next to him at a dinner held by Champions last Thursday night. He’s every bit as fun and cheeky as the puddings he’s so fond of, although I have to report that he didn’t in fact finish his pudding at dinner!
In his autobiography “Life on a Plate” he was very open about the time his business went down, posing the question, how did it all go so wrong and so quickly. The business had grown quickly through incredibly hard work to a turnover of £7.5m. Not too shabby by anyone’s standards. But sadly typical in a fast growing business the financial controls just weren’t there.
Gregg says the biggest mistake he made was not having really brilliant up to date management accounts. He says that you should always know exactly how much money you have at all times, that cashflow and profit are very different things and cashflow projections are very important. You should always have a budget to work to and know what margins you’re making.
I know, it sounds like exactly what I’d say!
Describing the dark days after the business closed, Gregg says in his book how many hours of hard work and dedication it takes to build a company and yet how quickly it can disintegrate. I’ve seen the devastating effect this can have on business owners who see their dreams destroyed and I know there’s just so much more that can be done to get more businesses to survive.
Speaking about how he used those lessons in his current business, Gregg had some very interesting and surprising insights:
- You can’t run your business without the numbers people, but you can’t let them run the business.
- There is, and should be a constant tension between the creatives and the accountants – this keeps the business in check, and keeping that fine line between taking risks and driving the business forward, and keeping the business safe.
- Knowledge is the most expensive commodity and without it you’ll lose your business.
- The more you study your numbers the better they get. As the more you focus on them, the more you’ll have them in your mind, and the more you study them, and you find ways to constantly improve them.
Firstly it’s fantastic to get such brilliant advice from someone who has been there, and also what great insights. Too many business owners abdicate their financial responsibilities to their accountant. It’s all about balance, and you the business owner has to be firmly in control.
A huge great thank you to Gregg Wallace for sharing those thoughts and I hope they’ll give you food for thought!
Gregg is now available for after dinner speaking (link is external) work through Champions Speakers.