The following article originally appeared in the March 2009 edition of The Myers Report newsletter published by the firm.


The “Business” of Being in Business: Success Tips You Can Count On

By Jane M. Myers, Esq.


As Main Street struggles to keep its doors open, business owners have a clear choice: focus laser-like attention on the “business” of being in business – or perish.  The economic forecast may be gloomy but the bottom line is crystal clear – no one has the security of conducting business as usual anymore.

Here is a list of Action Points that, if implemented, will give your business the tools to survive these challenging times:

  • Develop a specific plan to strengthen your firm at its foundation.

Examine your operations to find and trim business “fat”.

Eliminate every unnecessary business expense by being honest about what you might “want” versus what your business truly “needs”.

Focus on cash flow projections and predict sales.

Review your accounts receivable for any collection problems and address them immediately.  This is not the time to be shy about collections.  You may have to go to the client’s office to pick up payment; you may even have to agree to discount your invoice, but better they pay you now  before they pay someone who’s being more assertive than you are.

Make it easy for clients to pay you.

Arrange to accept credit card payments to get paid on the spot.  Paying a small fee to the credit card company for their services sure beats waiting 120 days or more to receive a client’s check.

Use your company credit cards to your advantage.

Make only necessary purchases using the company’s credit cards and time those purchases so that they’re made at the beginning of a credit card billing cycle.  The invoice won’t arrive for another 30 days and you’ll  have 14 days or more after that to make payment without incurring interest.  That can help with cash flow.  Also, use credit cards that offer money back.

Re-evaluate productivity of your employees.

Job losses seem to be in the news every day, but there may be alternatives to explore before terminating any employees.  Cost-saving measures you can implement can include across the board salary reductions, cutting hours, job-sharing, furloughs, increased employee contributions toward medical insurance, and reducing or eliminating business perks.  Consult with an employment attorney to make sure your choices comply with applicable law.

Negotiate with your landlord and vendors.

If you don’t ask – you don’t get.  I know of a landlord who had one of its retail tenants unilaterally announce in a letter that they wouldn’t be able to continue in business at their 700 locations unless their rent was reduced by 25%. Take it or leave it.  The landlord would not agree but did end up negotiating a slight reduction in the rent.  Undoubtedly other landlords accepted the tenant’s proposal.  You can make a similar request to your landlord and your vendors.  In today’s market, many would rather have some business than none at all.

  • Make Your Banker Your Business Ally.

If ever you needed your banker as your business ally, it’s now.  Every business owner must be aware of what lenders require so that when the business owner needs to borrow, the lender will be ready to lend.  Here are The Business Owner’s Five Commandments for Commercial Lending:

1. Always be scrupulously honest in reporting business income. If you don’t, it will appear that your company has low revenue and the lender will not be inclined to grant a loan.  Another downside, the IRS really hates tax cheats — you can go to jail.

2. Frequent communication is a must. Everything concerning the company’s financial health, or illness, must be communicated to the lender, at least quarterly.  That means good news, bad news or no news – stay in touch with your lender on a regular basis – not just when you need something from them.

3. Know the decision-makers at the bank. Make sure you have a relationship with them and that your interests are aligned.

4. Be realistic. Don’t call your banker pleading for a loan four days before payroll is due.  Work with your lender to create a plan to speed up collections and slow down payables.  Coordinate your day-to-day business operations with your lender.  From a financial perspective, they have a vested interest in having your business succeed.

5. Be prepared. Lenders may require more collateral than they might otherwise have a year ago, but if the bank is made to feel “secure”, it will lend.  Loans may be granted to the business owner if the collateral pledged to the lender is increased and viable personal guaranties are given.

  • Market, Promote and Prospect — Your Business Survival Depends On It.

When the economy settles down and the dust clears, those who made sure they were visible during this economic storm will most likely survive; those who put their heads in the sand will be gone.  While it may be tempting to cut your marketing and promotional budget as you trim your business “fat”, don’t do it.

Keep your name in front of your clients and prospects with emails, phone calls and newsletters.  Eventually they will need the type of services you provide and when they do, you’ll want them to call you.

Now is the time to take some creative risk and take a lot of action.


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Please note that this article is intended only as a general discussion and that it should not be taken as creating an attorney-client relationship or as legal advice with respect to any particular person, business or situation.  Circumstances and the applicable legal principles vary and you should consult with an attorney and/or other professionals regarding the facts of your particular situation.