How to change a company that isn’t generating a profit ?

I got a call from one of my dad’s mate who’s name is Steve. He is the managing director in his business. He told me in the last 3 years, the company hasn’t generated any profit. He is reaching retirement and wants to sell out. He is telling me that his accountant told him that the business is worthless and should shut it down and just go fishing. He wanted a second opinion on the matter, so they brought me in.

This was what his profit and loss statement read:

Total Revene : $1,500,000

Cost of Goods Sold: $600,000

Gross Profit : $900,000

Expenses :

Advertisement :$200,000

Account fees: $100,000

Wages :

Management: $400,000

Staff: $300,000

Total Expenses :$900,000

Net Profit : $0

So I asked him, have you heard of Kotters 8 Steps of Change Mangement framework? He said no, John what is that ? I said it is an 8 step process to create organisation change to his business to generate a profit for him. He asked me : Why doesn’t my CEO or Accountant know about this ? I said : “ The CEO and Accountant don’t respect you. They are taking all the profit for…