| Everyone, eventually, faces a time when their home-based business is in danger of failing. Here are 10 things to do when a cash crunch hits or things look bleak: -
Work your Rolodex. Then work it again. Call everyone you know and let them know how available you are for work. Erica freelances as a writer and editor. At the first sign of the slightest lull, she works the phones and let's EVERY client know she is "available" to take on a project. By the end of the day, she usually has three offers ”minimum. -
Let your accounts payable know you have a cash crunch. Offer a small discount for paying early. -
Go outside your comfort zone. Call a friend of a friend of a friend about your business. Go to a networking happy hour even if you don't know anyone else and force yourself to talk to five people. Don't leave until you do. Comfort zones can keep you trapped. -
Think diversification. Are you a PR writer specializing in brochures ? Can you write radio commercials for a local station, too? Can you translate your skill in one area (writing and designing PR materials) to a second area (writing radio commercials)? You make desserts? Can you also teach a cooking class for both exposure to new clients and as a source of income? -
Be persistent. Someone may have said no last month, but catch the right person on the right day and a no may turn into a yes. -
Sell your receivables if you have a business that uses them. A 6 or 8 percent factoring charge may not be pleasant, but if you need the cash, you need the cash. Basically, this means a factoring company will advance you the money you have in receivables less 8 percent. When the money comes in, you have to sign over your checks to them. -
Raise your prices. Sure, most people starting a business think they have to lowball to compete . They may find they've lowballed themselves into a cash-poor situation. You're worth it. Believe it. Charge it. Practice asking for it until you get comfortable. Face yourself in the mirror and say, "My fee is $1 million!" (Think big!) Then go after some new clients, and believe it or not, some people feel by paying more they're getting "the best." Have you ever bypassed a $14 polo shirt for a $30 one because you assumed the more expensive one was better? Granted, you may have felt the material and realized the quality was for the more expensive product, but the instinct that drove you to look at the more expensive one also drives your customer. -
Sell more product (or services). Maybe in the past you never thought of tying two products or services together, but can you? Can you offer a deal where the customer gets a brochure done at a certain price if the customer also buys your press kit writing package? Maybe they called for the brochure only. Sell them more. Make it seem like a great "deal." -
Get lean. Do you need the laptop you actually only use to watch movies on your business plane trips? Do you need to have a car and driver take you to the airport or can you park in long- term parking and save money. In tough times, big companies cut down on chauffeured limousines, parties, and perks. Do the same, even if your "perks" are considerably less grand. -
Economize on travel and entertainment (if applicable ). With teleconferencing, trips aren't as important as they used to be. And with all the extra security at airports, it's not as pleasant either (not that it ever was all that pleasant). Challenge yourself about expenses of eating out and travel. If you must travel, check out www.expedia.com and other Internet services that find rock-bottom bookings. |
