Lately, the headlines have been scary. Unemployment is increasing. There are concerns from the presidential candidates. Real estate values are sagging and foreclosures are skyrocketing. And, premier companies – like Citigroup (NYSE: C) and Merrill Lynch (NYSE: MER) – have raised billions of dollars to deal with heavy losses.
So, if the economy is slowing down, how can your business deal with things?
Let's take a look:
Deal with hidden costs: When looking at expense items, some might seem small. But it's often the case that these items – in aggregate – can turn into a big deal.
According to Tom Sharples, president of Qorvus Systems: "Typical small- or medium-sized businesses that have been around for a few years can find duplicative costs: unused cell-phone contracts that continue to rack up charges, subscriptions to services associated with long-departed employees and often all sorts of legacy junk that no one even remembers ordering, but that you're still paying for every month."
He recommends looking at expenses for:
• Telecom charges
• Web hosting costs
• Yahoo (NASDAQ: YHOO) and Google (NASDAQ: GOOG) search marketing expenses
• Facilities costs (utilities, janitorial services, and so on)
Establish a Credit Policy: Basically, you need to take preventative measures with customers. So before extending credit, make sure they are in good standing and up-to-date on all invoices.
"If you have signed credit applications and are authorized to pull credit reports and check with banks and vendors on someone's payment history, now is the time to revaluate each customer's credit and credit limits," said Michelle Dunn, who is the author of Become the Squeaky Wheel: A Credit & Collections Guide for Everyone (Collecting Money Series)
Work with your vendors: As a small business, it won't be easy to get better terms from vendors. Yet, it's worth asking for.
Or, it may mean dealing with smaller vendors, who may be more amenable for negotiation.
Tom Taulli is the author of various books, including The Complete M&A Handbook
Nuclear power is on the comeback trail
Apple backs AT&T in continuing spat with Verizon
Closing Bell: The recession is still over, still... do you feel it?
