How to survive a cash crunch

From Tiffany, MA

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From Paul South Florida

Another area that needs consideration is dead-stock merchandise.When shelves are full of unsold inventory,it weighs heavily on the bottom line of any business.Consider the amount of capital that is tied up in the merchandise and how having that money will increase cash flow.

http://www.sellmyinventory.com

From Paul South Florida

Also, as in any business the major factor that is most always overlooked is the amount of excess,dead-stock inventory that is eating up a large portion of the cash flow.Consider the amount of time and space that merchandise costs the bottom line.Reducing or completely eliminating the merchandise will free up valuable space and cash.

http://www.sellmyinventory.com

From Eric, Baltimore

One thing Ocean should do is to carefully examine accounts receiveable, and reduce the amount of time balances are outstanding. Pay close attention to handling past due accounts.

Small businesses in a growth phase often overlook staying on top of this.

Since growth is occuring, consider it as an opportunity to bring slow-to-pay customers in line, or simply replace poor customers with better ones if necessary (customers willing to pay a better rate, and pay on time).

Part of managing cash flow through a growth phase involves pruning out poorly performing customer accounts. This can be hard to do, as some of these customers got you where you are today, but don't fall into the trap of being their lender.

I was once involved in a computer and electronics firm that nearly grew itself into insolvency. Sales were double the previous year, but cash flow was horrible. Reviewing accounts receiveable uncovered numerous accounts 3-6 months past due. They were, in effect, financing other people's growth by delivering goods and services and allowing long-past-due accounts to go uncollected.

It doesn't matter how much you deliver in goods and services if you are not being paid … Like Ocean's case, this firm was borrowing money to meet its ever-growing demand for incomming materials. However, by not attending to making sure they were being paid promptly, they nearly grew themselves out of business.

From J.Sami Younis, Madison, WI

I think u should go for the loan since your assets are under utilized. But provided that u are certain of the demand for your product or service in that particular market.

From Sridhar, Dallas, TX

Have you considered venture capital? Tradeoff stock options for money. This money will be interest-free to you while the investors can cash on the stock when the company turns profitable and/or goes public

From SRogers, Allen, Texas

One item that seems to be missing in a possible solution to this individual's cash problem is increasing the prices for the services being provided. You may lose some clients initially, but if the increase is reasonable, the majority of your clients will stay especially if they feel you are providing a valuable service and you are not getting greedy.

From Sam , Washington

Hi, One of the things I have seen very successful is giving coupans which are punch kind buy 9 meals get 1 free reademable on weekends. May be you can distribute those to your existing customers.

From Satish Choudhary , Washington , USA

I think in your situation take a close look at your operating expenses, some times the margins we think we are making are not true so get a realistic margin percentage. If your business is booming may be you are loosing sales because of credit crunch in which case borrowing will make sense. Overall I think the problem may be in operating margins.

From Kevin A

Hello FSB
I am the owner of a BBQ restaurant in a downtown area in florida, but my town is a small town and the downtown area is slowly developing. Right now there are about 8000 employees in the downtown area from 8am -5pm EST and about 30 restaurants. After 5pm, its pretty slow, and the weekends are even worst, but the night life is slowly coming. However there are residential houses, a few hotels and a main traffic road nearby.

What are some of the ways I can attract customers after hours and on the weekend?

Thanks