Home
Business-Wise
Kate's Collage
"Vinny Da Vendor"
"Benny Da Buyer"
Kizer & Bender
Memory, Paper & Stamps
Category Reports
Designing Perspectives
Scene & Heard


Creative Leisure News
306 Parker Circle
Lawrence, KS 66049
Phone: 785-760-5071
Email: mike@clnonline.com


 


Challenges, problems, and triumphs -- from a manufacturer's perspective.

Printer Version

Is Your Company on the Verge of Bankruptcy? 5 Survival Tips

Time for a reality check.

by Susan Tose Spencer (June 20, 2011)

If you are a small business owner that is still in business after the most recent economic downturn -- that doesn't mean you are out of the woods. There are many telltale signs that you need to consider, face the facts about the health of your business, and then come up with a strategy.

I owned a company that inevitably failed and I remember the financial toll and the emotional beating that goes along with trying to save a company on its last legs. But here are the five strategic moves I made which worked for me and I know can work for you. Here's how to make the best out of a negative situation:

Tip 1: Face the Truth

Is your company running a negative cash flow on a regular basis? If the answer is yes, it's time to consider your options. Are you prepared to put more personal money into your business? If the answer is no, you probably will not be able to arrange a loan from any conventional sources, and unless you can quickly turn around your cash flow, you might run out of gas.

Tip 2: Maximize your Cash Management

Can you stretch your payables further by negotiating longer payment terms? Can you speed up collection of your receivables? Can you reduce your operating expenses and furlough or convert employees to part-time workers?

Tip 3: Look Objectively at Hard and Soft Assets, and Customer Lists

If you have been in business a few years, it is likely you have transferable assets with real value (actual and intangible) to a competitor. Examine your unique systems, formulas, and operating procedures that can add value to another company. Take a thorough inventory of everything the company possesses.

Examine your customer list one customer at a time and consider how each customer would fit in with another similar company and whether you could convince them to make that transition.

Tip 4: Identify Competitors That Might Be Interested in Your Company

The most positive solution to closing a business is to find another company that will benefit from what you have and will pay money (or assume debt) for it

Select no more than two potential targets (your best picks) because if the word gets out that you are selling your company, you might lose customers and employees before you can work out a suitable transfer.

Remember this is a "beauty contest," so plan every detail before you approach a competitor and keep it 100% positive.

Before you "pitch" a competitor know what you want out of the deal.

Keep your activities under the radar screen for maximum benefit.

Tip 5: Know What You Are Selling and Have Facts and Figures Ready

Make sure you exchange confidentiality agreements before you start.

Give your best sales pitch on how your competitor will benefit by adding your company and its customers.

If there is real interest, walk away with an agreed upon outline.

Follow-up quickly and try to wrap up the transfer in 30 days max.

Make the deal and take a long, hard, sigh of relief, as I did, that you can walk away with something to show for all your effort and then move on!

(Note: Susan Spencer is an entrepreneur, award-winning author of Briefcase Essentials, lawyer, and former minority owner, GM, and VP of the Philadelphia Eagles football team. Spencer attended Boston University where she earned a BA. She later received her MA in Education/Economics from Hofstra University and received her law degree from Villanova University.)

xxx

 

horizontal rule

horizontal rule



   
   

Vinny's Recent Columns...
ADVICE ON EXPORTING TO THE UK AND EUROPE; An interview with the former CEO of HobbyCraft.

THE HISTORY OF WALNUT HOLLOW; One of the genuine pioneers of the modern craft industry.

HOW MICHIGAN SCRAPBOOKER WAS LAUNCHED; Substantial growth in 3+ years.

THE HISTORY OF PLAID ENTERPRISES, INC.; It's come a long way in 36 years.

"FLASH" SALES COME TO THE INDUSTRY; Q. & A. about the newest way to introduce new products or dispose of overstocks.

SITTING ON A BULLS EYE; What to do if competitors want your market share, or customers want to cut costs.

IS YOUR COMPANY ON THE VERGE OF BANKRUPTCY? 5 SURVIVAL TIPS; Time for a reality check.

FIVE COMMON AFFLICTIONS OF SALES TEAMS; The result: Bad morale and lower sales.

BEYOND MARKET MULTIPLES: INCREASING THE VALUE OF YOUR COMPANY BEFORE THE SALE; How to create a company with greater appeal to buyers.

CHA SHOW NEW PRODUCT REPORT; Hundreds (thousands?) of products, many from new exhibitors.

THE SOLUTION TO MEXICAN DRUG CARTELS; A sure fire way to inspire them to quilt.

ATTRACTING YOUNGER CUSTOMERS; Yes, we aren't our mothers' knitters.

NEW PRODUCTS TO BE UNVEILED AT THE CHAS SHOW; Two parts: new exhibitors and veterans.

WHAT SCRAPPERS ARE SAYING ABOUT MANUFACTURERS AND PUBLISHERS; Scrapbook Updates' readers analyze the problems.

ANALYZING THE CHA ATTITUDE & USAGE STUDY; The rationale and the science behind the number.

REST IN PEACE: JEAN HOWARD BARR; JHB International's Founder and CEO.

POSITIVE NEWS ABOUT THE INDUSTRY; What they want/need from the industry.

COMMENTS FROM INDIE CRAFTERS; What they want/need from the industry.

UNDERSTANDING INDIE CRAFTERS (BY AN INDIE CRAFTER); What they want, what they buy, and how to reach them.

CHA EVENTS FOR MANUFACTURERS; How to get more out of a trade show besides selling your products.

CREATIVE INDUSTRY TURNS TO EDUCATION TO BEAT RECESSION; Simple solutions for vendors and retailers to create online video classes.

WHAT HAPPENED TO CREATIVE MEMORIES? Not adjusting to the times.

COMPLAINING ABOUT SHORT-SHIPMENT PENALTIES; Who pays retail? The vendor?

HOW A VENDOR SCAMMED A SCAMMER; A sharp eye, a sense of humor - and be wary.

HOW A SMALL VENDOR WAS ALMOST SCAMMED; A savvy, suspicious mind averted a serious financial loss.

COMPANY FOR SALE; The owner is retiring.

EXHIBITORS: YOU'RE WASTING YOUR MONEY! Check your customer list before pre-show mailings.

PLAID CONSERVES TO PRESERVE; Simple changes can mean big savings.

SUGGESTIONS FOR THE CHA SHOW; How to attract more buyers and exhibitors.

CHANGES AT A.C. MOORE; They may not be what they seem.

THE TERRI O SHOW IS COMING; Building industry sales by empowering consumers' creativity.

SOME THOUGHTS ON BANKRUPTCY; It's unfair, but...

BOTTLES OF HOPE; A polymer clay grassroots movement.

SEWING SMILES FOR KIDS; Pillowcases and quilts for kids in hospitals.

HELPING THE WORLD IN MORE WAYS THAN ONE; Mrs. Grossman's, C&T Publishing, and Tara Materials.

HELP PEOPLE -- AND THE WORLD; How one company contributes to charities and to Mother Nature.

TAKING CARE OF BUSINESS AND HELPING THE WORLD; Plaid employees' long list of charitable activities.

A SAVVY WAY TO INTRODUCE A NEW LINE; Put it in the hands of consumers and teachers.

CHA AND PMA: SHOULD IT BE EITHER/OR? Why not take the best of both worlds?

A VENDOR'S RESPONSE TO THE PROVO/CRICUT ISSUEE; It's not easy to take sides.

RESPONSES TO CLN'S CODE OF ETHICS...from chain store execs, vendors, and reps.

PROVO RESPONDS TO CRICUT CRITICS; Unexpected demand caused problems.

ADVICE TO VENDORS; Common sense, please!

HOW TO HAVE A GREAT TRADE SHOW; It takes more than great products.

KEY CHALLENGES/OPPORTUNITIES FOR THE CRAFT INDUSTRY IN 2006; Office supply, private label, and direct import.

IS MIKE DUPEY RIGHT? The industry's retail pioneer's criticism of chain stores elicits strong reactions.

RETAILERS: CREATE A "PLACE," NOT A STORE; Customers return if they feel a sense of community.

"HOW AND WHY WE CHANGED OUR BUSINESS"; Sometimes necessity forces gutsy businesses into new, scary areas.

WHY INDEPENDENTS ARE DECLINING AND THE INDUSTRY IS SOFT; We can't improve the situation until we understand the causes.

HOW TO MAKE THE SCRAPBOOK PIE LARGER; "Keep it simple and non-threatening."

INDEPENDENTS: SUPPORT VENDORS WHO SUPPORT YOU; "Support goes both ways. It is a relationship of trust and consistency."

WHAT MAKES A GREAT SALES REP? Colleagues and customers remember the late Bob Watikins.

TRADE SHOW PRESS POINTERS; Maximize your publicity for a minimal cost.

HOW CAN A SCRAPBOOK START-UP SUCCEED? The answer may be a "Group" away.

DO TRADE SHOWS REFLECT THE STATE OF THE INDUSTRY? If we're like other industries, trade shows may be in trouble.

DO TRADE SHOWS REFLECT THE STATE OF THE INDUSTRY? And if so, are we in trouble?

THE STATE OF THE FLORAL MARKET; A blunt interview with Aldik's Larry Gold.

YOU WANT JUNK? YOU GOT IT; Pricing pressures are ruining good categories.

PLANNING THE PERFECT TRADE SHOW; Ten tips for CHA Winter Show exhibitors.

MORE VENDORS RESPOND...; A dialog between vendors and a savvy but unhappy independent.

VENDORS RESPOND TO INDEPENDENT'S PLIGHT; Why vendors have minimums and what retailers can do about it.

RETAIL, E-TAIL, AND "UNFAIR COMPETITION"; Expensive advertising, false promises, and little education.

THE TRIALS OF A SMALL COMPANY, PT. II; Expensive advertising, false promises, and little education.

THE TRIALS OF A SMALL COMPANY; Talent, drive, and product -- but no money.

GETTING READY FOR A TRADE SHOW; Go MAD at HIA.

THE THREE L's: YOU CAN'T SELL WITHOUT THEM; How to look, listen, and learn.

IT WASN'T ALWAYS THIS WAY...; but why does that matter?

WHATEVER HAPPENED TO STRAWBERRY?; Does every new product have to be cheap?