Small business growth concerns making you feel a little shaky?
Many small business owners excel in their personal core competency, like designing and installing architectural landscape projects for example. However when other areas of their business that they personally have limited prior experience in, such as cash flow, personnel management or sales begin slipping out of control, it’s difficult sometimes to get the business pointed back in the right direction.
If you can relate to this situation, below are a 4 recommendations that can help guide your business back to a more stable, productive place.
1. Evaluate your Situation Candidly – Identify a list of root causes and begin asking questions until you have a list of specific action items that can turn your business around. You can’t solve problems if you don’t know what they are. Example) Decreased Profit Margins – have costs increased without a subsequent sales price increase? Personnel – do I have the right people in the right seats?
2. Calculate Costs to the Penny – Create an itemized list of your fixed monthly expenses and determine absolute minimum it will cost you each month to remain in business. Review any items you can renegotiate for lower fees and costs. Carefully manage your outgoing cash payments. What’s your monthly break-even and are you generating enough revenue to exceed it?
3. Collections – Update your list of receivables, review your credit terms and begin tracking your payment status. Consider a prompt payment discount and ask for quick payments. Fire customers that consistently do not pay their bills; you’re not in business to finance your customer’s business.
4. Communicate – It’s imperative that you communicate honestly and regularly with all stakeholders (employees, customers, vendors, creditors, attorney, accountant, advisors, etc..). Doing so will gain you credibility and stakeholders will be more willing to work with you if they see you’re proactively trying to turn things around.
5. Pay Taxes – Be certain that your payroll taxes are paid. The US federal government can and will shut down your business without notice. Don’t risk your business and possibly your personally assets; not paying this obligation is nothing more than a VERY BAD idea.
Getting the right amount of small business advice and concentrating on your small business growth can increase your chances of success.