Whether you’re talking with a potential new client or investor, or you’re talking to a long-time employee, having difficult conversations is pretty common in the world of sales.
No one enjoys having these types of conversations, but they’re often necessary in order to build the world-class organization you’re aiming for.
For me, some of the toughest conversations I ever had, happened just over a year ago. In late March of 2017, I had decided that it was time to close the doors of FITzee Foods, my previous company.
I had tried to secure funding from many different sources, from being on Shark Tank, to pitching investors, to applying to be on the show, The Profit as my last option. Unfortunately every opportunity fell through.
In late March of 2017, I had to make the decision to close FITzee Foods, a company that I had worked to grow for almost 10 years. I had spent years nurturing it, and on that day, I had to meet with and lay off 25 employees. People who had worked with me very closely for years.
I also had to get out of two leases, one for our commercial kitchen, and one for our retail store. And, then had to spend time unpacking and repacking my office that had 10 years worth of stuff in it.
It was one of the most devastating days of my life, but it needed to happen. Things with FITzee Foods weren’t going to get better, and in order to go out on top, I closed my doors.
It wasn’t all bad, it is what led me to creating The Pitch Queen, and getting to know all of you, but that day was so difficult.
Exiting a Superstore
A guest on Success Unfiltered, Kirsten Tobey, the creator of Revolution Foods, a company that provides fresh, healthy meals to schools, shared her experience with working with WalMart.
Kirsten and her partner Kristen originally created a retail product line, of healthy lunchbox products. They put in a ton of work and wanted to get these products into the hands of the masses, so they set their sites on Walmart. They hoped that by stepping into a bigger market like Walmart, they would get in front of the majority of the US people more quickly, rather than trying to get into Whole Foods, or smaller stores local stores.
The buyer at Walmart was very compelled by their story, and after many follow-ups, and relationship building, they hoped that they would be put in all of Walmart’s several thousand stores.
Unfortunately it didn’t work out that way. Walmart did bring Kirsten’s company products in stores, but put them only in about 200 stores. Walmart knew since the ingredients in Kirsten’s products were fresh & of quality, the price points would be higher, which isn’t always what consumers in Walmart stores are looking for, so they wanted to test in just a small number of stores.
Kirsten and her partner decided to go ahead with the test, but quickly learned that it wasn’t worth it. The supply chain management is much more difficult when you can’t meet the minimums due to the low volume with only 200 stores, which leads to problems with managing inventories and other challenges down the line.
Revolution Foods was just not able to support the products in Walmart, they got lost in the sea of other products, but because it was too expensive for them to support, they decided to end the business relationship with Walmart.
It was a total mismatch of the size of their company, the quality of their products, and the need for low pricing, that they had to have the difficult conversation… Walmart would not be their big break.
Kirsten and her partner quickly learned to not put all of their eggs in one basket!
Demonstrate Your Long-Term Goals
Revolution Foods most devastating NO came, when they were working to become the food supplier for charter schools in their area. Originally they were just based in one area of California, but quickly realized they would need to refine their model in order to be able to work with larger public school districts.
They began submitting bids for some of the food service contracts, and ended up talking extensively with one of the food service directors at a larger school district in California.
When Kirsten and her partner were asked how many meals they were currently able to make a day, they were about 15,000 meals less than what the school district needed.
This led Kirsten to have a very detailed and difficult conversation with a potential big customer, that they wanted to partner with, asking what the concerns were. Kirsten and Kristen took that plan and created a game plan for the next couple of years.
They built up their operations, expanded their facilities, invested in growth and also invested in understanding how the large school districts work.
Three years later, they were able to go back to that same school and rebid on the same contract and won it!
This difficult conversation led to the start of Revolution Foods biggest successes. They learned so much, were able to start investing in the right areas so that they could grow in size and credibility.
Not only that, but by having the difficult conversations, Revolution Foods was able to make the changes that created growth. Demonstrating that they were committed to long-term goals and growth.
In Conclusion
I think we all have to have those painful, difficult conversations that lead to incredible opportunities with our businesses.
If you have something or someone on your team that just isn’t working, clear the air and have the conversation sooner rather than later, so that you don’t run out of money or energy.
What difficult conversation are you going to have today?
