All start-up businesses, as well as well-established businesses, deal with limited cash flow at one time or another, and a lot of times there’s no way of being able to prepare ahead of time for it unless you have some set boundaries when you’re trying to figure out how to get through the rough spots without failing altogether.
- One of the biggest fails business owners feel is that they need to spend money in order to make money, but unfortunately a lot of times that’s not always the case. Often there’s no guarantee that this idea will work and then you’re often in a deeper hole than when you first started.
As an example, I was personally exploring an ad-based review service that used pay-per-click advertisement rates, and while the sales rep was demonstrating the site to me, they told me that as soon as I put in my credit card information to make a commitment, they would give me a discount code. When I refused and explained I first needed to determine how much of a financial commitment I could make for advertisement, as well as exploring what other companies were doing and if my market audience was who I would target, they persisted until I finally hung up. I don’t fault them for their drive, but it needs to be beneficial to my needs and not just how much they can collect.
- When was the last time you had an idea as to what your business loan(s) status was and if the possibility of renegotiation was available? I’ve personally worked with numerous clients who felt that they needed to take what was offered to them and should just leave well enough alone. Or another reason is that they didn’t want to seem needy or desperate, so they would just find other, more risky alternatives.
A former client took out a loan once and when I calculated the loan’s interest, it was a whopping 48% they ended up paying. Why did they get something to what seemed so ridiculous? They thought that they needed it to get through a rough time they saw in the future, but that situation never happened and were locked into paying a lot of unnecessary monies when it could have gone to something more profitable.
- Where does loyalty lie when it comes to making sure your business survives? If you owe vendors, work with them and not just go silent hoping they’ll ignore you. Work with your bank loan officer and keep them posted as to if you need some potential breathing room to help make ends meet. And above all else, remember that relationships are your bread and butter so if you need to look at firing “the pretty one” because they’re costing you more than what they’re bringing in, then you need to do it. You worked too long and too hard in order to not put your business’ needs first.
As business owners, we rarely have a day off to just breathe, because if you just expected to work 9-5, then it’s a matter of working for someone else then. Because we work to have the flexibility and freedom to accomplish greater things, that takes sacrifice. There’s always going to be lean days, which is what makes us appreciate the better ones.