Spring 2010 issue of Horizons

GENERAL TOPICS

Steps for Setting a Solid Foundation The past year has been one of ups and downs. As we embark on a new year, we think of beginnings, a fresh start, new opportunities and innovative ideas to propel us forward. What can be done to jumpstart your business in the new year? Here are some strategies to consider. Of course, depending upon your business, some may be more applicable than others. 1. Increase top-line revenues — A few tactics can come into play here. At the top of the list is building stronger relationships with customers. You should stay close to customers; contact them often to learn more about their business challenges and ways you may be able to assist, even if it does not result in an immediate sale. Expanding your network can lead to generation of business possibilities. Whether it is making new contacts or seeking new ways to collaborate or partner within existing relationships, leverage your company’s strengths and those of others. For example, can you team up to share referrals By Theresa Lynch Ruzicka, CPA

and find ways you can be a resource to one another? This collaboration may be a way to tap into new markets. Have you thought of involving more employees in business development? Even if they are not salespeople on the street, they may be able to identify other opportunities, whether it is with current customers or new customers. Sending the message that everyone needs to pull together to do more can develop a team spirit and positive environment. You may even consider a bonus or referral fee program to reward those efforts. 2. Reduce and monitor expenses — If you don’t already have a cash flow model to budget and track incoming and outgoing cash, make an effort to develop a template or obtain one. There are Internet resources for businesses that have tools available to download. By taking a close look at expenses on a weekly or monthly basis, you can identify nonessential expenditures or monies spent on items not related to core business operations. You also can detect spending patterns that are counter to the direction of the business. Once identified, modifications can be made to curb those expenditures. If your company is in a strong cash flow position, you might consider prepayment of rent if the landlord is willing to accept a reduction in the rent for the next year. The tax impact of that could be positive as well if taking a deduction for those prepaid expenses. Consult your tax advisor for more details. 3. Renegotiate financing terms — While banks have been tightening credit, you still might be able to renegotiate terms to allow for changes favorable to your business. If you have positive cash flow and a strong operating plan, you can make the case for lower rates or expansion of credit to fund growth.

15 u spring 2010 issue