Q:
We need more cash, but the bank won’t lend us any more money – How
can we get it?
A: You cannot finance your way to profits. It is important to remember
that a lender's priority is being repaid, on schedule and with appropriate
interest. Therefore, you will have to show a history of success, or
at least a strong indication of your operation's potential to turn
a profit in the not-too-distant future.
The only way you can solve
your problems is to “manage” your way out of them through close attention
to the day-to-day operations of the business. If you evaluate changing
your entire infrastructure and focus on the management of the business,
you will start seeing profits and will turn your company around, reducing
the need for money or making you more appealing to lenders.
Q: How can I pursue procurement opportunities
with the Government?
A: Government procurement presents a real opportunity for small business.
The Federal Government has allocated more than $35 billion for small
business contracts alone. The best way for you to pursue Government
procurement opportunities is to contact the contracting agency directly.
Click here for a list of Government
Agencies and their web sites which feature tips for pursuing contracts
and contracting officer information.
Q:
What about family issues? – My brother is not carrying his weight…My
dad is retired, but still comes into the office every day, etc…
A: Family businesses face a unique set of issues and problems. The
most important thing to remember is to keep all family issues out
of the office. Never discuss family issues in front of employees,
deal with any personal issues at home. Also, hold family members to
the same standards as other employees – ask for their 100% commitment
and do not be afraid to replace anyone who does not adequately perform
his job and therefore, cannot contribute to the success of the business.
Q:
My employees feel they are entitled to raises – What should I do about
it?
A: Do not be afraid to reward quality employees whose contributions
make a difference to the business. One of the best ways to do this
is to create a pay for performance plan and make their paychecks a
direct result of their productivity. Do not guarantee any employees
a raise, instead make them earn their raises by contributing to the
success of the business. This creates a winning situation for all
involved.
Q:
My profits were higher this year than last, but I’m making less money
– Why?
A: Profit on paper does not necessarily lead to real profits and money
in the pocket. You need to practice cash based accounting and list
all billings, cash receipts, and expenses. Too many business owners
practice accrual accounting, which does not take into account the
cash that was collected vs. the billings sent out.
A true measure of profitability
is seeing an improvement in your company’s cash position and or/additions
to your personal wealth.
Q:
My wife wants to send my son to private school, but we can’t afford
it, with business being how it is – What are my options?
A: Do not sell yourself short through sweat equity. Pay yourself what
you are worth. It will help you to maintain your own self-worth and
self-esteem and allow you to meet your own personal financial needs
in addition to those of the business.
