At just 28, Larissa Robertson used her own 'rescue plan' to take over a company with 250 staff. Christopher Niesche reports.
When Larissa Robertson joined a Western Sydney labour hire firm in 2005 as the financial controller, she could see the company was in trouble.
- Read our last entrepreneur profile: Casting aside labels for fashion studio with soul
She told the senior management and the board, and presented them with a plan to save the business, but they weren't interested.
“The first board meeting I attended in 2005 I said 'you haven't made any money this year, you've actually lost a few hundred thousand dollars this year, I recommend restructuring or going into administration',” she says. “We had that same conversation every year.”
Four years later, the firm was in administration and Robertson bought it. She decided she could use the rescue plan the board had rejected.
Aged just 28, she raised $70,000 in investment from a couple of friends and took ownership of a business with 250 employees and an annual turnover of $20 million.
“I was terrified,” she says of the purchase of what is now SCO Recruitment. “Even though it was terrifying and I wasn't quite sure what I was doing, every time I looked at the numbers I knew they worked.”
Four years later the business is back on an even keel. It had turnover of more than $16 million in the financial year just passed and has about 400 employees at any one time. SCO Recruitment has two arms. One is a labour hire arm that supplies 60 per cent of the contract labour to councils in New South Wales and has recently expanded into Victoria, South Australia and Tasmania.
The other is a property services arm which provides cleaning and handyman services to the Department of Housing. Robertson runs this as an “employment incubator” to help the long-term unemployed back into the workforce.
When she bought the business Robertson, now 31, had wanted to find $300,000 to invest, but had to make do with a lower sum raised from investors.
“[The business] had been losing money for a long time and so I knew how to run the cash flow really, really well regardless of whether or not I had money to keep the business going,” she says. “I knew I could do it with $70,000. I just knew there would be a lot more negotiation with suppliers and people as I started to get it up and running.”
When the business went into administration, all of its existing contracts were terminated, so Robertson had to quickly make rounds of its clients to outline her business plan and see if they were willing to give her their business.
Most agreed. “That motivated me. If they said yes and they think it's all right, maybe it's the right thing to do,” she says.
What Robertson had bought were the old business' plant and equipment – including 35 vehicles and ride-on mowers. She spent a frantic week finding new premises and setting up the office. “We were there at four o'clock in the morning putting desks together and trying to get it all ready so people could come into the office the next day.”
Robertson quickly shored up the business by shutting down loss making divisions and was able to save the jobs of 180 of the 250 staff from the old business.
Within three weeks of taking over the recruitment company she lost a $4 million contract and Robertson found out she was pregnant. Even now Robertson is unsure if she would have bought the business if she knew she was soon to have a baby. “I'm very glad I didn't have to find out until afterwards,” she says.
Juggling pregnancy and a baby with running a business has forced her to delegate.
“I used to work up to 80 hours a week and my intention had been that I would just do that for the next six to 12 months while the companies got organised and we got everything under control,” she says.
As someone who says she was a control freak, Robertson is still learning to delegate and communicate clearly to her staff. “Sometimes I'll tell them what I need done and it's all very clear and it's done much better than I would have done it,” she says. “Other times it comes out completely the opposite to what you were looking for. Was it me? Was it them? It's just a learning thing.”
Having a baby – her son Alex is now two-and-a-half – also prompted Robertson to introduce a crèche at the office. It's free for staff – as long as they have lunch and play with their children – and helps retain good staff.
Another rude shock
Three months after buying the business, she got another rude shock. A glitch in the company's accounting system showed it had made a $25,000 profit, but Robertson checked the figures and found a $300,000 loss.
Her business partners lost confidence and decided they wanted out. “By December I was eight months pregnant and negotiating to pay them out and take the business back on myself,” she says.
She restructured again and further cut costs, including her wage.
The experience taught Robertson, a former accountant, that nothing is a simple as the numbers make them seem.
“Being an accountant, the numbers all make sense and the plans all there, but real life does not follow a business plan,” she says.
Initially she says she found running her own business a lonely experience, because her family and friends didn't understand what she was talking about, but now gets support from entrepreneur organisations.
Larissa Robertson's entrepreneur tips
1. Don't let fear stop you.
2. There is always a way!
3. Don't let your passion become your obsession. Let go and enjoy every moment you get with your friends and family – even if they are cranky, over-tired toddlers having meltdowns at the supermarket!
4. There is no smooth sailing in business. You can't control the weather, let alone the global economy. Don't dwell. Accept, learn, adapt.
5. And the most important rule: Get the right people on your team. You can't do everything yourself, you need to find the people that not only share your vision but whose passion and support turns that vision into reality.