Get Working Capital at Competitive Rates - Accounts Receivable Financing at The Receivables Exchange
Accounts Receivable Funding - The Receivables Exchange
From Jay Goltz for Fortune Small Business
All through the summer I thought maybe I was dodging a bullet.
There was talk of recession, but my Chicago picture-framing and home-furnishings businesses - 120 employees, about $15 million in revenue - were doing fine. Then the stock market crashed, and my dashboard software showed sales taking a hit.
Unlike in previous recessions, I didn't scratch my head and wonder what to do. I immediately started cutting expenses and staffing.
If your revenue is off about 10%, that might not sound so bad. But because of fixed costs such as rent, that 10% decline can easily wipe out 100% of your profit. The big surprise comes if you don't make changes. In my case, most of my fixed costs were fixed, but I could have cut payroll. I didn't, and I paid dearly. There's an old saying, "Smooth seas make a poor sailor." Once you've weathered a few economic storms, you learn how to adapt. Here are some suggestions that might help you ... .
You can survive decreased profits if you have cash flow, but the converse is not true - if cash flow takes a dive, you're in trouble.
That will happen if you let your receivables or your inventories get out of control, which is surprisingly easy.
