tough tactics for tough times

I think it's situational. Depends on your business environment & cash flow.



I was reading an article in Forbes a few years back and it was saying that Maine & Louisiana were the two worst states in the union in which to run a business. Add to that .... these are some of the very worst of economic times.

< Gentle laughter > Tough times and tough tactics are the norm here. About 90 - 95 percent of our new business startups fail within the first five years. Your business approach has to be very conservative or you won't survive.

This is a hard time of year here. There's a saying that after Christmas everyone is poor. That's true for businesses as well. Operating expenses run above normal but there's little or nothing coming in. You run in the red till things pick back up in the spring. You want to build enough of a capital reserve fund during the spring,summer, and fall, to carry you through the winter.

I had a credit account with my local building materials supplier for over fifteen years but when things got tough i shut it down. It's bothered the boss there to no end ever since. He keeps trying to get me to start charging things again and i don't quite know why. I explained very tactfully that it had nothing to do with him. It was simply that i felt that it was the responsible thing to do given the circumstance.

It's had a strange effect : Every time i go in, he gives me a discount on the things i buy. If it's something vital for the business the discounts are even deeper.

This is my opinion on bank loans & general credit: Imagine if you went swimming in a pond and came up covered in leeches. You would be disgusted and appalled. You wouldn't be able to get them off you fast enough because those nasty things have attached themselves and are draining your life blood.

It's the same with banking & finance. If you allow it .... these parasitic entities will suck the lifeblood from your business and maybe even kill it. They have all these schemes and have ONLY their self interest in mind. They are not your friend no matter how nice they may be.

It's something to be avoided if at all possible.

Later edited to add an afterthought :

I do have two different debit cards for the business. ( different banks ) They are convenient and the banks offer points programs for those who are interested. The thing with a debit card is that you're on a more solid financial footing. You're not spending money that you don't have and there's no bill to pay at the end of the month.