10 Survival Steps to Take Right Now
Last week we talked about assuming a survival attitude. Here are 10 things to do right now to execute on this attitude.
- Profit is the Queen of business, but cash is King. Ask employees to help cut waste and expenses, plus review operational steps and eliminate or tighten up inefficient ones. What’s their motivation? How about job security? Watch the pennies, and the dollars will take care of themselves.
- Stay close to accounts receivables and cash management. Many responsibilities can and should be delegated by a business owner, but right now cash management isn’t one of them.
- Declare war on excess inventory. Don’t miss a sale, but don’t let one piece of inventory use the night in your building unless it’s absolutely basic. Inventory is cash you can’t use until you transform it back by making a sale.
- Review ALL contracts for sets to make sure you nevertheless need them. Your customers are doing the same thing; get ready.
- Make your banker your survival partner in 2009. Keep him or her informed about how things are going, good or bad – especially the bad. Bankers need information, already if it’s bad news. Remember this: An uninformed banker is a scared banker, and no one ever got any help out of a scared banker.
- Wherever possible renegotiate term loans, including real estate mortgages, to take advantage of lower interest rates. Longer amortization and lower rates preserve cash.
- If you rent, talk with your landlord about adjustments in the terms of your lease. Don’t expect the landlord to take a major hit, but he or she knows that prospects may not line up to take your space if you leave. This is a good time to be creative.
- transform non-performing assets to cash – already if you have to sell for less than you want. What things were worth last year has no bearing on what they’re worth today, and they might be worth less tomorrow. If it’s not performing, cut it loose.
- If it’s humanly possible, personally call on EVERY customer at the minimum once in the near future, already if a salesperson is calling on them. This isn’t a sales call; it’s a relationship call. Find out what you can do to help them, and then do it. Your company’s future probably depends upon these visits.
- Payroll expenses must be addressed. Non-performers must go first. Before making other cuts, ask your team to help find creative ways to allocate your bare-bones payroll budget. But don’t forget that now could be a good time to invest in the future by acquiring a highly trained “big business” employee who just got laid off.
Write this on a rock… Don’t wait – take these 2009 survival steps right now.