ABCNEWS.com : Small Business Builder: Surviving Tough Times

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Staying Alive, Part 3
	Part 3: Dealing With Managers, Money and the Marketing If your business is flailing, focus on what you can do now, not what you should have done. (ABCNEWS.com)

By Mary Campbell
Special to ABCNEWS.com
“There are benefits to being self-employed,” says Kansas City real-estate agent Doug Pillsbury. “Our hours are flexible; every day we can work any 18 we want.”
     Maybe you’re nodding grimly and wondering why, after years of sacrifice and strife, your business is still struggling, maybe even lurching toward catastrophe. Your friends, all with 20/20 hindsight, have sage advice on what you should have done. The issue, though, is what should you do now?
    In two previous columns we looked as some survival strategies. Here are some ways to deal with your managers, money and market.

Mind Your Managers
In a small shop, even a little fluff is suffocating. A horizontal organization working as a team is more productive and harmonious than a puffed-up pecking order.
    If there’s dead weight in your enterprise, revive the esprit de corps with profit-sharing or other performance-based pay incentives. Then see what happens next time there’s a choice between sipping coffee and schmoozing with customers
     When it comes to customers, less can be more. Those who buy low-margin products, require a lot of hand-holding and are slow to pay are probably costing you money.
    Focus your sales and marketing activities more narrowly on your target market. At the same time, trim your product lines and drop less profitable items. Schedule your business hours according to customer traffic flow. Being open fewer hours could save you money on wages and utilities with little or no revenue reduction.
    If you’re stuck in a single market, consider a strategic alliance or joint venture with another company.

Extraneous Employees?
Investigate free and low-cost alternatives to permanent employees. These might include workers in training programs or students assigned to do internships or practicums. Or look for virtual assistants, who are easy to find on the World Wide Web.
    Another possibility is to lease your current staff from a professional employee organization. Or ask employees whether they’d accept a temporary pay cut, or accept their wages in other forms, to keep the company from going under.
    Finally, eliminate unnecessary positions and unproductive employees, even if one of those is your brother-in-law. Nobody is suggesting that people are like furniture and you should throw them out when they start to sag. The fact is, the best employee benefit is a solid, solvent company.

A Penny Saved
Shop around, then renegotiate with your suppliers, asking for better pricing and terms. The Internet also offers a time- and money-saving way to comparison shop. Don’t just pay cash; barter for goods and services.
    Remember all those folks who have offered to help? Take them up on it. Friends can help with maintenance, inventory (counting and storing) and distributing fliers. Pay them in “stock,” merchandise or food and drink.
    If you need office fixtures, accessories, shelving, even some equipment and software, it’s better to buy good used than new, low-quality merchandise. Make the most of technology by using e-mail instead of making long-distance phone calls and sending faxes.
    Cut your space costs by working at client locations or at home. If you’ve got a more room than you need, try subleasing some of your space to others.Also, examine production processes and eliminate unnecessary steps.
    Finally, boost your cash flow by aggressively pursuing overdue accounts and requiring a retainer or deposit when accepting a job.

10 Quick Marketing Tips

Market to repeat customers. Include them in market research: What do they like about your company? What would they change? How do they feel about your prices, your service staff and your logo?

Network wherever you go. Join organizations. Wear a jacket with your company name and product line.

Don’t leave selling to the salespeople. Call on customers to tell them about a new feature.

Send news releases. Cover everything from just-hired employees to just-signed contracts with alliance partners.

Promote. Attend trade shows and fairs.

Offer workshops. Also consider giving for-fee training programs.

Create an event. A founder’s day celebration with a “soak the prez” dunk tank, an open house or a volunteer activity (not just to get attention but to do the right thing).

Offer peripheral services. Choose ones that don’t require time and money—make your fax machine available, accept consignment items with a healthy cut for you.

Go consignment. Offer your own merchandise through consignment dealers.

Word of mouth. Use recommendations and testimonials in your advertising.

An editor since the age of six, when she returned a love letter with corrections marked in red, Mary Campbell writes and edits for The University of Arizona College of Business and Public Administration and for dozens of entrepreneurs, publishers, and authors. She is editor of the midsize-business journal The FINOVA Quarterly.

Small Business Builder is published on Wednesdays.