Small Business editor of the NZ Herald

Small business: Mentoring - Aaron Calman and Yvonne Treen

Aaron Calman is the owner of Dos Amigos, an Auckland-based Mexican restaurant. He was mentored by Yvonne Treen between 2011 and 2013 through the Business Mentors NZ organisation.

Aaron Calman (known by his nickname, Lizard), owner of Dos Amigos.
Aaron Calman (known by his nickname, Lizard), owner of Dos Amigos.

The mentee: Aaron Calman, Dos Amigos

How did you come to take on a business mentor?

After two years of working seven days a week, from morning to late at night, I got the restaurant busy, but I was working harder than I ever had and was barely seeing a dollar.

What were the needs you identified in your business that you wanted mentoring to help address?

Being the owner of a business is totally different to being the manager. I needed a fresh set of experienced eyes and a voice of reason. There were things I had to deal with that I had never had to before - everything from lease agreements and negotiations, to council and government requirements.

Yvonne taught me to look at things as percentages and how to stretch the dollar, how to look at ways of saving money and delegating responsibility so my time - and that of my senior staff members - was used efficiently.

What impact did the mentoring have?

Any new business will have teething problems. What I learnt is it's a matter of identifying those problems and putting a system in place to prevent them happening again.

Personally I have gained the confidence to deal with all sorts different people in business - landlords, banks, creditors, the council and so on. It also gave me the confidence and systems to have trust in my managers to give them responsibilities so I can work on my business instead of working in it.

What would be your top tip for other small business to get the most out of mentoring?

Never think you know everything and never stop learning. There is always someone out there that has done what you're doing and they can help find a solution that quicker - and cheaper - than by you learning from your mistakes. Because mistakes cost money.

Business mentor Yvonne Treen.
Business mentor Yvonne Treen.

The mentor: Yvonne Treen

How did you get involved in mentoring?

I have been a business mentor for more than eight years. It started when the company I worked for became a sponsor of Business Mentors NZ and asked if any managers wanted to become mentors. After I transitioned out of general management roles in corporates into my own small business I just kept going.

In my own business I work as an executive coach, facilitator and change consultant. The Business Mentors NZ voluntary work is more focused on business change but the coaching skills certainly come in handy. I love it when the mentees are successful - that's why I keep going.

What did your mentoring of Lizard involve?

We had about five meetings, as well as contact over the phone and by email. Meetings were usually at the restaurant because there you see what is going on and how the mentee is interacting with staff and customers. When we met we were going over the work assigned from the last meeting and reviewing material - a revamped menu or a draft budget, for example. We also mapped out some scenarios for the business based on whether he needed to change its location, which in the end was not required.

What needs did he have with his business, and how were you able address those?

Lizard had multiple issues to deal with, but the first priority was sorting out his business partnership issues and he got some legal advice around this. Once this was out of the way we started in on the financial side of things and in particular where his business was on the key financial ratios. This went down as far as looking at recipe costings and portion control and up to the level of making an overall financial plan for the next three years.

Lizard revamped the menu based on our conversations around the principles of menu engineering and identifying appropriate margins based on the food and labour costings. Doing the work on the financial ratios identified that the rent was too high for his turnover but the landlord was talking about a rent increase. The last piece of work we did was looking at the rental arrangements, forecasting out the impact of the rent on likely growth in turnover and how best to negotiate with the landlord. Lizard did a great job representing his needs and got a fair deal in return.

What impact did you see the mentoring have on his business?

I honestly think it turned his business around because the combination of the partnership issues, long hours and low pay were wearing him down. Dos Amigos had the bones of a good business and turnover was good, it was just that some hard decisions had to be made about how to take the business forward. It was very possible when we started that the business would simply cease to trade if the issues weren't sorted. So to be where he is today - successfully trading - is fantastic. In some ways Lizard just needed someone to believe in him and tell him to go for it. He did all the hard work and the success is a reflection of his commitment and passion.

At the start of the mentoring relationship he was not paying himself much in the way of a salary and that is no longer the case. We talked about the fact that a business owes you two things: salary or wages for working in the business and a return on the equity you have put in. Lizard's confidence as a business owner is very high and now matches the passion he has for working in the trade..

What advice would you give to small business owners wanting to get the most out of a mentoring relationship?

You get out what you are prepared to put in. You need to look at mentoring like a project that will require dedicated time and effort. This is a hard ask when many mentees are already working very long hours just to keep the business going.

Also, the downward slope has a momentum that is hard to arrest. Don't wait until you are down to your last cent and last customer. Too many prospective mentees wait too long before deciding their business model is not working because they do not set up any signposts to warn them.

Finally, if you don't have any financial literacy and no interest in developing any, get out now. I have had mentoring clients who have refused to learn how to do a budget or properly work out a profit margin. You need to get real. Business is run on the numbers, not just your passion for your product or service.

Coming up in Small Business: Yahoo's Marissa Mayer may have been down on it, but remote working - or teleworking - is becoming a more viable option as technology improves. So how does it work in a small business? If you've got a story to share, please get in touch via the 'Read more by Caitlin Sykes' function below.

- NZ Herald

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