Tim’s Story

When I left school in 1989, I never in my wildest dreams thought I would end up in retail, let alone owning a business that sells menswear. In fact, before I bought The Club Shoppe in 1999, I knew absolutely nothing about menswear.

I actually started out as a school teacher and although it’s a noble profession, I discovered real early that it was not for me, and that it would not take me to where I wanted to go.

So with the help of my family, I decided to buy a business. In fact, it was a small music store that just happened to be situated next door to the menswear store that I would eventually buy. I was relatively successful with my music store, but had developed a passion for menswear, so I decided to go for it.

It would also be fair to say that prior to being introduced to ActionCOACH, I knew very little about how to run a business effectively and profitably, although I never realized that at the time.

In the 14-months that I followed ActionCOACH, I have turned The Club Shoppe into a viable and profitable business that is now a lot of fun, an integral part of my life and a business with huge potential.

But I’m jumping ahead here. Let me start at the beginning …

The Club Shoppe was established in 1959 by the then minister for the Environment, the Honourable Mr. Barry Cohen. Soon thereafter, Barry employed Ray Jacomb to manage the business while he pursued his political ambitions.

In the 35 years that followed, Ray turned The Club Shoppe into one of the finest menswear stores in the country, selling only the finest clothing available anywhere in the world.

When I bought the business, The Club Shoppe was operating just as it always had; very smoothly and generating good profit – or so I thought.

The shop is based on the north side of Sydney in an affluent suburb, and stocks the very top-end of men’s fashion.

When I bought the business, I knew nothing about menswear. I didn’t even know how to read a tape measure. However, I had an extremely good mentor in Ray, who, fortunately for me, had decided to stay on for another two years to teach me every aspect of the business.

I dedicated myself to learning the basics during the first 12-months. I was so determined to learn the business that I could not think of anything else. I lived and breathed the business, everything from how to sell a suit to ordering clothing for the new season. I literally drained Ray of information. You see, I was thirsty for information, and he was more than happy to give it to me.

After the first 12-months, however, I began to realize the business had a lot of flaws, and I noted that they were very serious flaws.

These included the following:

• At the beginning of every season, the business experienced very severe cashflow problems, which were impacted by the introduction of the GST (Goods and Services Tax). These problems arose from trying to find the cash for the duty/freight and GST on imported goods. Every season this amounted to over $100,000 – and it always materialized during the quietest times of the year (that is at the beginning of a season). Although we were making good profit, all of it was tied up in excess stock.

• Because The Club Shoppe was established in 1959 it had a very dedicated clientele … the problem was they were getting older. Many of the customers whom the shop was built around were retiring and no longer needed the expensive suit or a new range of casual clothing every season. I could see that for ten or so years the shop’s turnover was stagnant, and did not rise or fall by more than thirty of forty thousand every year. I was worried that in ten years time I would not have a business left.

• For 40 years, the shop had been built around Ray, who would work more than 50-hours a week. Customers would come into the store looking for him and some would only come back when he was there. I was absolutely petrified of what would happen to the business when he decided to retire. Even though I had learnt extremely quickly and knew I could do everything he could, people still wanted Ray to look after them.

• The shop had developed something of a discount culture; we regularly gave discounts to our VIP’s and we had numerous sales, which tended to attract the wrong type of customer – price shoppers – so our profitability was heading in the wrong direction.

• Although I did not know it at the time, I had become reliant on the “old ways” of doing business. For the first 15-months I had a bookkeeper that looked after everything from paying bills to doing the banking. She was also, you might say, my own secretary. This was a big mistake. Although this bookkeeper did her work well, I never had a handle on the company’s finances. I never knew the impact my cashflow problems were having on the business. I didn’t even know how much I owed suppliers or how much I had in the bank at any one time. I realize now how silly I was at that time, but in hindsight, I was spending all my time in the shop concentrating on the physical aspects of selling.

After the first 12-months, the excitement of a new business was well and truly wearing off. The GST had been implemented and the Sydney Olympic Games was looming. Business was down, cashflow was pathetic and I felt absolutely trapped. What’s more my wife Natasha had just delivered our first child and her maternity leave was about to run out. We had two choices: either she would go back to work or I’d have to build a place for her in the business. We chose the latter.

Natasha took charge of computerizing all our accounts in the business. This turned out to be the first of many steps we took to turn the business around. And it was the first time that I could see every dollar being spent, and earned. I started to gain control of the business, and I really started to feel that it was mine. Our current bookkeeper decided to leave, and this gave Natasha and I real scope as far as the accounts were concerned. I could see that we were ordering too much stock. I also realized we had far too many suppliers.

Things began to improve, and by the end of that financial year, we actually made a nice little profit. I put this solely down to the fact that we had better financial management. However, I still felt trapped. I wanted to spend more time with my family, yet I felt tied to the shop. I was constantly under pressure to be there more.