You have a choice: kill it before it kills you.

These were the words I said to my friend Ceecee.
Ceecee used to work for me when she was in high school.
She bought a restaurant franchise in 2015.
Success blinds us. With no external pressures on her time, Cee dedicated herself to the business.
She was young and could afford it.
Surfing through Covid-19, Cee opened a second location.
On the ocean of life, she fell in love, got married, and had her first “real” baby.

The second location opened at the worst time in the past 50 years.
Sales grew but not fast enough.
Her manager quit. She couldn’t afford a manager anyways. She had hoped things would get better.
Employee retention was tougher than she was used to.
The baby needed her mommy, but Cee was taking care of her real baby at home.

From a distance, I could see an implosion. I called Cee to see if she was ok.
Entrepreneurs are a brave group. She told me that she was handing it. The family sold the house. They are moving into a newer, bigger home.

I “diagnosed” Cee with postpartum depression on top of all the other stuff she’s dealing with.
I tell her I think her business is failing and she’s too busy to do anything about it because the important thing in her life needs her 24 hours a day.

Cee finally tells me the company is bleeding cash. She forwarded reserve cash from the other business to keep current in its obligations.

Cee has HOPE tomorrow will be better.

Hope drives us toward growth.
Hope pushes us for a better tomorrow.
Hope gets crushed when despair uses a megaphone.

Viktor Frankl wrote in “Man’s Search for Meaning” that meaning comes from suffering. He observed in the Nazi concentration camp that when prisoners lost HOPE, they died.

She spoke to her franchisor friends. They promised to help turn the business around.
They believe Cee is a great operator and marketing is the solution.

Cee needs $3000 in new sales every week.
She needs a 25% increase in traffic immediately to stop bleeding cash.

The franchisor believes an aggressive advertising campaign will give her the clients she needs.

Holy Crap! The franchisor is dealing with reality distortion.

The only advertising that can give Cee her customers immediately is through deep discounts.
The market responds well to a cheap offer.

Unfortunately for Cee, that market will fade as quickly as it responds.
This type of advertising appeals to a transactional customer.
They are loyal as long as the deal is the best.
They will spread the word.
And they go elsewhere as soon as the deal is gone or Cee’s competition beats the price point.

The customer Ceecee really needs is a Relational customer.
It takes time to build trust.
Cee doesn’t have time.
I advised her to kill it before it kills her.

There are a few ways she can proceed.

  1. Sell the business at a deep discount to a young hands-on entrepreneur. The problem with this option is the restaurant industry isn’t attractive post-pandemic. And it takes time to vet and close the deal. Time is not on Cee’s side.
  2. Kill it and deal with the financial consequences.
  3. Get someone to take care of the real baby while she commits everything to save the business. And it still might fail, taking her marriage and her child along with her other business. If this is not an option, revert to option number 2.
  4. Renegotiate all the debts, leases, and franchise obligations. If they won’t renegotiate, revert to option number 2.

The one way this business cannot be saved is through advertising deep discount specials.

Cee understands this, but her HOPE won’t let go of the possibility that it might work.

Call me a grumpy old ad man.
I’ve seen this picture before, and I don’t like the ending.

Short-term advertising creates short-term results.
You can try to bail out the Titanic with a five-gallon bucket but eventually the hull will split in half, taking you and the bucket to the bottom.

I HOPE Cee sees this before it’s too late.

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