Home Back Issues April 2008 Five tips for tough times

Five tips for tough times

| Print |  Email
Archives - April 2008
Tuesday, April 01, 2008

 

money.jpg

Even though the economy is sputtering, the last thing small-business owners should do is panic. “You can actually take the opportunity of a downturn, when you’re not as busy, and re-strategize your business looking for new opportunities.” says Harry DeWolf, Portland district director of the U.S. Small Business Administration. Here are his top five tips small businesses should follow when economic times get tough.

1. Don’t lose track of cash flow. Cash is king — especially in a down economy. Income statements and balance sheets are fine, but they are telling you what happened in the past, not the future. Use a cash-flow report to project your cash flows at least three months in advance.

2. Eliminate nonessential expenses as much as possible. Ask yourself: Is that activity necessary? Will this activity create profit? If not, don’t do it. Also consider cutting personal spending. Simple reductions can make a difference.

3. Don’t build up inventory. Don’t get bogged down with excess merchandise and inventories tying up your cash. Convert your overstocked inventory into cash by using sales and promotions and consider selling items through other channels, such as the Internet.

4. Don’t take on new debt. Think long and hard about taking on more debt, and don’t be in a big hurry to pay off debt early. Instead, focus on building cash reserves.

5. Don’t let accounts receivable get too big or too old. Get aggressive with collections. When business is good, companies tend to become lazy about collecting on receivables. Being tough with customers may be unpleasant, but it’s an important safeguard against the effects of a prolonged economic slowdown.                       

EVAN CAEL


Have an opinion? E-mail This e-mail address is being protected from spambots. You need JavaScript enabled to view it

 

More Articles

The short list: 5 hot coffee shops for entrepreneurs

Contributed Blogs
Friday, November 14, 2014

CupojoeBY JESSICA RIDGWAY

Oregon entrepreneurs reveal their favorite caffeine hangouts.


Read more...

The 100 Best Companies survey is open

News
Friday, October 24, 2014

100-best-logo-2015 500pxw-1How does your workplace stack up against competitors? How can you improve workplace practices to help recruit and retain employees? Find out by taking our 100 Best Companies to Work for in Oregon survey!


Read more...

OB Poll: Wineries and groceries

News
Friday, October 24, 2014

24-winethumbA majority of respondents agreed: Local vineyards should remain Oregon-owned and quality is the most important factor when determining where to eat or buy groceries.


Read more...

True Blood

October 2014
Thursday, September 25, 2014
BY JOE ROJAS-BURKE

Antibiotics really aren’t magic bullets.


Read more...

Political Clout

November/December 2014
Wednesday, October 22, 2014
BY KIM MOORE

Businesses spend billions of dollars each year trying to influence political decision makers by piling money into campaigns.


Read more...

Constant Contact

October 2014
Thursday, September 25, 2014
BY AMY MILSHTEIN

To prevent burnout, companies are banning email and after-hours communications. But is the 24-hour workday here to stay?


Read more...

Podcast: Turn Things Around with David Marquet

Contributed Blogs
Friday, October 17, 2014
davidmarquet thumbBY TOM COX | OB BLOGGER

How can you move from a command-and-control leadership model to one of true empowerment and accountability? David Marquet did, and he took notes along the way.


Read more...
Oregon Business magazinetitle-sponsored-links-02
SPONSORED LINKS