Business Mistakes and Good Decisions

Video from our FREE Online Business Course
http://www.myownbusiness.org
Session 12 Opening and Marketing

Question:
"From your own personal experience as an entrepreneur, could you share the singe best and worst decision you have made?"

William H. Crookston, Ph.D.
Professor of Clinical Entrepreneurship
University of Southern California

Topics covered in this video:
Business decisions, mistakes, expanding

Transcript:
The single best decision was about ten years into the life of my company. I saw that if the company was going to grow, we had to have bigger facilities. And I immediately took the time and the necessary steps to find a facility reasonably close to where our customers were located. In order to save money, I did most of the work myself in designing the layout of the factory floor. I then took it to an industrial engineer for him to complete the process. After eleven more years it proved to be a fine and efficient layout and I think made us better off and more efficient at manufacturing.

However during that same period of time I took a very large order from a promoter. I also mentioned to him, because he was not creditworthy at that particular time, that I would require a down payment and progress payments as I delivered my product to him. The number of products that I had to produce put an extreme strain on our factory and we went to a second shift and worked on weekends. We met our part of the bargain but it slipped through my fingers that I didn't catch all the progress payments at the time I was making deliveries. At the end I stopped producing and he turned to one of my competitors whom he also almost bankrupted. We sued him and unfortunately ended up with about 50 cents on the dollar. It was lose lose all around for me, for my employees, for the reputation of the buyer and it was a bad credit decision. The worst of it came when my board, understanding what I had done, resigned as a group and I found myself for the first time without directors. So you reap what you sow. Be careful.

Category:

Education

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