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10 Ways Businesses Can Survive In Today's Economy
With a little discipline, good
organization and planning, small and mid-sized
businesses can
safely survive an economic downturn. Here are a few
suggestions on how to stay healthy financially:
- Manage Your Cash Flow. Focus on the
areas
where your cash is being held up, such as inventory,
equipment purchases, and accounts receivable. By
doing so, you will be in a position to improve your
current cash flow and predict a future shortfall in
cash.
- Consolidate or Restructure Your Debt.
Bring
together debt from loans, credit cards, or other lines of
credit. Negotiate with creditors for a longer repayment
period.
- Look For Ways To Cut Costs. Look at
direct costs, gross margins and overhead expenses
carefully. You could,
for
example, cut down on old and obsolete inventory, and
save on direct labor by better tracking and creating
efficiencies.
- Focus On Your Financials and Make Needed
Adjustments. Review and use your financial
statements on a regular basis to make prudent
business decisions. Act on these decisions sooner
than later. Forecast quarterly to know where you
stand.
- Tighten Your Credit Policy. Set stricter
terms and
conditions for extending credit. You could require a
down payment at purchase, shorten the payment
period, and only extend credit to select customers.
- Use Assertive Debt Collection Techniques.
Know
when to make phone calls, send written requests for
payment with statements, and know when it is time to
temporarily stop providing services to a customer.
- Carefully Plan for Expansion. It is better to
stick to
what you are already good at and just try to make it
better. If you do expand, create a brief business plan
and forecast based on research before expending
your time and money on new products and
services.
- Negotiate With Your Suppliers. Negotiate
what you
are paying your suppliers. If you have a long term
relationship with any of your suppliers then you may
be able to get better credit terms.
- Focus On Customer Satisfaction. Work on
retaining the customer base that you have built up with
follow-through, stellar customer service, and
quality control. Then, upsell to increase business with
these customers.
- Know Your Financing Options. Know
where to get
money before you need it. Some financing options are
based on future sales and have flexible repayments,
such as invoice factoring or merchant/business cash
advances. Focus on building relationships with
current lenders, and establish a business line of
credit for short-term cash needs.
Seek help to complement your expertise, especially
where a lack of your time or a pressing need exists. It
can be the difference between success and failure.
Contact Mark Hartsell at (949) 759-8676 for a free
consultation.
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Greetings!
Our mission is to provide
CEO's and business owners of small to mid-size
companies the
needed focus and expertise, coupled with hands-on
advice to grow
your business. To take your business to the next
level, call Mark Hartsell, MBA, President at (949)
759-8676 or email MHartsell@CEOAdvisor.com. Visit
us at
www.CEOAdvisor.com for more information.
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| My 7 Most Important Business Lessons |
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America is a thriving country
for small and mid-sized business owners.
Thousands of
people start businesses in the United States every
day.
Many fail at running a business every day. What
causes one business owner to succeed where
another fails? There are seven key areas to focus your
efforts for a successful business. It starts with
knowing oneself and ends with not being afraid to ask
for help.
1. Know Yourself
To be a successful business
owner, there are many personal sacrifices you will
make. You must also realize your strengths and
weaknesses and get professional help where
needed.
Your basic roles in a mid-sized or small business are
in marketing,
sales, planning and forecasting, product/service
development, funding, finance/accounting and
administration. To get the needed results, it is
rare for one person to play all these roles equally well.
You must know what aspects of your business you
can handle yourself and what aspects you are going
to need help with.
2. Action Planning
I like to call it "action planning" rather than "planning".
Action is the only element which turns a plan into
reality. Many people are great at planning but they
suffer when it comes to follow-through. Successful
CEOs and small business owners are action
oriented. But that
action starts with a plan. According to leading
authorities, the main reason 80% of all businesses
fail within the first five years is not money, but the lack
of planning resulting in wasted time and money,
missing critical opportunities and many failed
products that could have been successful.
3. "Get Inside" Your Customer's Head
Are you listening to your customers? They are the
reason you are in
business, and your future depends on them. Don't
forget, it is the customer
that determines whether or not you succeed. Price
your products and services properly, manage your
direct costs and overhead efficiently and you will be on
a path to success.
4. Know Your Industry
You can gain the greatest competitive edge if you
intimately understand your industry. You should know
every competitor's strengths and weaknesses. It's in
your
competitor's weaknesses where you will most
frequently find your own success.
5. Understand Your Financial Reports
The "game of business" is played with
products and customers, but the score is kept in
dollars and cents. Good financial records and
accounting procedures are critical to a successful and
secure
business. Learn how to read and analyze your
financial statements. Also, run and
analyze financial ratios. Use these tremendously
important reports to better manage your business and
make decisions. This is the difference in a successful
CEO and one that is flying blind and at risk.
6. Manage Your Cash It doesn't matter how
unique your business is, your business cannot
survive without good cash flow. Cash is the lifeblood
of your business.
A monthly Cash Flow Statement is a critical business
tool. It identifies the various sources of incoming
cash and the reasons for outgoing cash. Budget
wisely and remember through it all, the old
adage "cash is king" is true.
7. Ask For Help When You Need It
When you're young and unseasoned, you tend to think
you can do anything. Or when your business grows to
a certain level, you feel you can continue with the
same methods of operating. This is a formula for
disaster for a business owner. Remember, getting
results is what counts! Don't be too proud to ask for
help.
Like any game, the game of business has rules and
tools. Those who excel at the game, play it better than
their competitors. Keep focused upon these seven
critical areas and you will succeed.
CEO Advisor, Inc. provides extensive
expertise
and services to strategize, plan and forecast for the
coming year.
Visit
www.CEOAdvisor.com for more information, or
call Mark
Hartsell at (949) 759-8676 for a free consultation.
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| Client Testimonial |
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"I have been a client of Mark and CEO Advisor,
Inc. for 2 years, and Mark has introduced
many
new ideas for us to improve our business. Once
implemented we have seen very tangible increases in
our sales that have added greatly to the value of the
company. In addition, because of Mark's experience,
he has advised us on many organizational changes,
such as revamping our sales strategy and team that
will have a big impact in the future as we raise
additional funding and we ultimately sell the
business. Mark has also helped us with our
financials and coached us on using this information to
make better management decisions. Mark has
shown us how to increase the price of our products
and services without impacting our customer
acquisition, which has been a large boost to our
revenues. I strongly recommend Mark and his
company."
President/Founder
Advanced E-Media,
Inc.
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| Words of Wisdom |
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"Effective leadership is putting first things first.
Effective management is discipline and execution."
- Stephen Covey
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| CEO Advisor, Inc. - Member of Accredited Organizations |
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- Tech Coast Venture Network
- Technology Council of So. Cal.
- Orange County Venture Group
- Irvine Chamber of Commerce
- Newport Beach Chamber of Commerce
- Institute for Independent Business
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