It all happened so fast.
The price of oil dropped, the currency fell 30%, and inflation shot up to 14%.
The forecasts for the future were even worse, with some analysts suggesting we
would have hyperinflation – over 3% per month.
I remember my father
telling about the 1980s when people were paid weekly and even daily. You bought
things when you had money because it would cost more the next day. He told me
you could not get lines of credit and that no more imported goods were coming
in. He worked for Unilever and a lot of their raw material came from abroad and
he had to pay cash when collecting them.
I had no idea what to do. I
decided that I had to talk with all my customers and work out immediate payment
schedules. I withdrew our price list and told people we would give them quotes over
the phone. I tried to get as much cash out of the country and into dollars and Euros.
I ruthlessly reviewed all my costs and people and cut back to bare essentials.
At the end of the year, we
had lost money but our customer base was in tact. We had gained a lot of market
share and refused to sell anything at a loss. We paid more attention to stock,
stock turn, and logistics and I reviewed the cash position everyday myself.
One day our major
competitor called and said he wanted to sell his business to me. He was out of
cash. He could either declare bankruptcy or sell the business. I offered to buy
his accounts but said I did not want ay assets or people. To my surprise, he
agreed subject to him joining my company. Today, we work together and dominate
the market. We leaned hard lessons but we are beginning to see a brighter