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Practical Advice for Managing Your Business in These Economic Times

Cash Is KING 

  • Know where your cash is 24 hours a day
  • Know what "safe" accounts mean
  • Monitor your bank’s financial health
  • Where to invest excess cash
    • Safety trumps return
     

Getting Your Cash – Accounts Receivable  

  • Be relentless to increasing cash collections
  • Monitor credit
  • Billing strategies/Payment terms
    • Consider adding an interest charge
     
  • Deposit availability
  • Asset based financing

Inventory – How Low Can You Go? 

  • What are the "right" levels of inventory?
  • What’s hot? What’s not?
  • Monitor critical vendors/suppliers – Plan "B" ?
  • Pricing – Changes in Overhead
  • Lifo – keep it or lose it?
  • Imports – price protection

Keeping Your Cash at Home! – Accounts Payable 

  • Take full advantage of payment terms-pay in 30 not 15
  • Use EFT to make payments the last day they are due 
  • If you have an issue - communicate
  • Work with your key vendors
    • keeping the relationship
     

Keeping Your Bank Relationships 

  • Understand and monitor your bank debt
  • Review all provision for compliance
  • Renewal Dates
  • Best Deal in bad times
  • Explore alternative sources
  • Lines of Credit
  • Communicate

Keeping Control of Your Cash – Cash Flow Forecast 

  • 2009 Budgeted P&L
  • 2009 Budgeted Cash Flow Statement
    • Reflects your current reality
     
  • Stress test now !!
    • What you will do if…
     

Your Cost Controls 

  • Payroll
    • Make decisions early
     
  • Selling, General & Administrative
    • What’s really necessary?
      • Marketing in a downturn
       
     
  • Capital Expenditures
    • Time to minimize purchases?
    • Sell unused equipment (inventory too)
    • Deals to be had?
     

Other Considerations 

  • Insurance Coverage
    • Review
    • Strength of carriers
     
  • Real Estate
    • A chance to buy?
    • Renegotiate leases
    • Property tax appeal
    • Leasing?
     

Growth Through Acquisitions 

  • Troubled competition
  • Lower values
  • Motivated "sellers"- bank and other investors

Managing Your People 

  • Upgrade?
  • Retention
  • Benefits
    • Cash
     
  • Fraud
    • Pressure of the times
     
  • Morale
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