Linda LundstrÃ¶m’s story has a happy ending. But that outcome was hard to foresee in 2001, when shrinking sales and growing costs put her Toronto-based women’s clothing manufacturer, Linda LundstrÃ¶m Inc., on the brink of bankruptcy.
Founded in 1974, the firm had enjoyed a meteoric rise, thanks largely to the popularity of LundstrÃ¶m’s signature item, LaParka, a winter coat that quickly became a wardrobe staple for women around the world. By 1997 the company had grown to 150 employees and revenue of $12.2 million. Business and personal accolades piled up, and the company made plans for a new 60,000-square-feet office.
Then things began to unravel. An eroding global economy, combined with falling revenue and escalating costs squeezed the company’s cash flow. Believing the dip to be temporary, LundstrÃ¶m refused to lay off staff and went ahead with the firm’s move. “I was operating as if the company was in a growth mode. I didn’t take action soon enough,” she admits. Indeed, three years later, facing a financial nightmare, LundstrÃ¶m knew she had to take control.
Despite every effort to retain the firm’s employees, LundstrÃ¶m was forced to lay off 137 people in six months. “I felt such a sense of failure,” says LundstrÃ¶m. With 12 employees remaining, she faced a touch choice between bankruptcy and rebuilding that “involved a lot of soul searching.” With her family firmly behind her, she opted to rebuild.
There’s nothing like crisis to provide focus, says LundstrÃ¶m. Stripping the company bare, she scrounged for revenue to pay the bank and suppliers by turning unused fabric into product and converting inventory into cash. Refinancing came with the help of a private lender. It was an uphill climb. “A miracle would happen,” she says, “then we’d have some setbacks. Then another miracle would happen.”
One right move was informing customers, suppliers and the bank of the firm’s poor cash position early on so that unfilled orders wouldn’t leave others in the lurch, she says. The honesty generated goodwill with the bank and, she marvels, “a tremendous outpouring of support” from retailers, some of which took delivery of stock a whole season early and paid COD. “We’re still doing business with some of those people because we really tried to conduct ourselves in a responsible way,” she says. “Relationships and being honest with people is everything.”
In the midst of the turmoil came an unexpected discovery. In 2002, at age 50, LundstrÃ¶m was diagnosed with Irlen Syndrome, a light sensitivity and depth perception disorder affecting how she perceives the printed page. “I’ve always had a great deal of difficulty reading in my life,” she says. “The words jump around and I lose my place.” To cope, LundstrÃ¶m developed mechanisms to deflect or avoid reading. Her executive assistant reads letters into her voice mailbox. “I’ve been doing that for years,” says LundstrÃ¶m. “I became more of a verbal/auditory/visual [with pictures and colours] person.”
The diagnosis was liberating. “Even though I’d achieved a certain level of success,” she says, “doing poorly in school really haunted me. I always felt a bit like a fraud.” Now, tools such as coloured overlays and tinted glasses help her bring printed words into focus and ease her sensitivity to light.
Still, the disability and setbacks never dampened LundstrÃ¶m’s spirit. Today, Linda LundstrÃ¶m Inc. is well back from the brink. It employs 100 people, operates three flagship stores and distributes its collections to more than 450 independent boutiques throughout North America. Moreover, 2004 revenue reached $10.5 million.
Here are powerful life lessons that helped her battle back:
Maintain a positive outlook
“I think everything is a gift,” she says. “If I’d been good at reading, I might not have developed such strong visual skills. I started having a whole new appreciation of what a valuable handicap it turned out to be for me.” Faith, she adds, is an incredibly powerful tool when you’re faced with the unknown and difficult decisions.
Build and trust your support network
The near demise of her company produced and solidified some strong relationships with family and friends, says LundstrÃ¶m. “I got really clear on where my support lay.”
You can’t be everything to everyone
LundstrÃ¶m was devastated by her company’s layoffs, but slowly found solace when she realized that entrepreneurs cannot be responsible for guaranteeing jobs. Now she guards against seeing herself as a matriarch in a family. “I don’t think business is a family. This is a community of people that come together every day,” she says. “There’s a difference. I don’t think I had that clear perspective before.” Now, “everyone here realizes that we’re in this together, but there’s no guarantee.”
For three years, LundstrÃ¶m ignored the warning signs and pushed her company forward anyway. Setbacks and disappointments are opportunities in disguise–if you look for them.
Nurture yourself first
Find time for exercise, reflection and solitude to gain the strength to give to your business and family.
© 2005 Susanne Ruder