subject: Most of you are doing the same ole thing. Stop it! Haven't you learned your lesson yet? [print this page] Small business owners are swimming in unaffordable debt. Because the economy has melted down, and revenues have declined significantly for so many businesses, the debt is choking the life force out of many of them.
Thus we offer debt reduction and forgiveness strategies and successfully eliminate or significantly decrease debt so our clients can survive and succeed.
Debt workout we all understand, but it is only one side of the coin. The other side which seems to be ineffectively implemented is downsizing and sharpening the business model.
This is where the small business owner begins to make serious mistakes. The overall trend is to enjoy the benefits of the debt workout strategy and continue to do exactly what you were doing before debt reduction occurred.
This may work for a short while but in a word this simply sets up another form of disaster.
Here is the other side of the coin:
1. The business owner must reduce payroll dramatically. Not minimally but significantly. I cannot say what the right amount of employee reduction is, as it depends upon what the specific business needs. The point is, more often than not the business owner does not go deep enough. Thus cash is wasted and future issues are bound to surface.
2. For the past ten to fifteen years business has been brisk, revenues high, growth has been the norm, profits fat and easy to come by. Now competition is fierce, customers are very demanding, and profits are thin. The small business owner must not only downsize but he must begin to implement strong controls and tight operating procedures. The small business owner must now do a much better job at running his business there is no room for sloppiness or excessive costs. Productivity must go up. Overtime must be eliminated, profits must be monitored and many other basic business systems must be implemented to assure that the business squeezes out every profit nickel it can.
So the message is yes we must do the debt reduction, without it there is no hope or opportunity. However this is not enough, you must improve your business operation as dramatically. Additionally in many instances the business owner is challenged to adjust, or even radically change his business model, which could mean any possible major and minor change in sales, operations and finance. Re-invent yourself is the mandate.
Do what works and makes money not because you did it before. Change your sales methods, your production methods, your pricing,
Change everything.
Debt reduction and workout, downsizing, sharpening the business operation and re-invent your business. That's the success equation, all four aspects.
Most of you are doing the same ole thing. Stop it! Haven't you learned your lesson yet?
