Colorado Business Success

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Colorado Business Success
Survive and Thrive
Surviving Tough Times Counseling, Tools, and
Resources
Small Business Checkup Clinics
SBA, SCORE, SBDC, COEDIT, CEF, CBA, CHFA,
Office of Govenor Bill Ritter, Jr., Mi Casa, CED
Pueblo, Denver, Grand Junction, Loveland,
Colorado Springs, Durango
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SCORE
Counselors to Colorado Springs Small Business
Surviving Tough Times Counseling, Tools, and
Resources
Ric Denton, Colorado Springs SCORE Chapter
Chair Bob Douthitt, Denver SCORE Workshop Chair

WWW.SCOREDENVER.ORG CALL 303 844-3985
Small Business Survival Clinics
Colorado Springs, CO Atlers Hotel February 11,
2009
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Why Are you Here - Seeking Answers
Is Your Business in the Toilet ?

• Youre out of money
• The news media reports things
• are getting serious
• Customers have disappeared
• You want to know
• What can I do
• Can I get bail-out Money?
• Do I tough it out?
• Can I sell?
• or
• Do I file bankruptcy?

What do we need to cover in this hour?
WWW.SCOREDENVER.ORG CALL 303 844-3985
Colorado Springs SCORE www.coloradospringsscore.or
g 719-636-3074
4
Objectives

• Focus on just whats
• important
• 4 strategies of the
• business RAPP
• Chance to ask
• questions and get
• answers

WWW.SCORE_at_cscc.org CALL 719-635-1571
Colorado Springs SCORE www.coloradospringsscore.or
g 719-636-3074
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First Things First
Do a Business Check-Up
RESEARCH
Start reducing operating expenses - NOW!

• Your business position
• The market
• Your financial standing
• Uncover trends

ANALYZE

• Cash flow position
• Debt to equity
• Market Position
• Risks
• Changes needed
• Uncover problem
• areas

PRIORITIZE

• Yourself business partners
• Family
• Get advice
• Plan changes needed
• Plan monitoring systems
• Solutions to problem areas

PRODUCE

• Make changes
• Track progress
• Make modifications

Dont Stiff the Tax Man!
WWW.SCOREDENVER.ORG CALL 303 844-3985
Colorado Springs SCORE www.coloradospringsscore.or
g 719-636-3074
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Step 1 Research
Take Stock

• You cant fix the problem if
• you dont know whats wrong
• Economic changes impacts
• Test your numbers
• Prepare to do something
• Step outside your business
• and see it from others eyes
• Seek out an advisor or counselor

WWW.SCORE_at_cscc.org CALL 719-635-1571
Colorado Springs SCORE www.coloradospringsscore.or
g 719-636-3074
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Step 1 Research
Take Stock

• You cant fix the problem if
• you dont know whats wrong
• Explore the causes
• Has spending overtaken revenues
• Confirm reason and quantify impact

WWW.SCORE_at_cscc.org CALL 719-635-1571
Colorado Springs SCORE www.coloradospringsscore.or
g 719-636-3074
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Step 2 Analyze
Take Control and Get Focused

• Explore the causes of the problems
• Employee expenses (work hours, pay, bonus, etc)
• Accounts receivable
• Inventory
• Cash, debt, liabilities, and equity
• Marketing/sales Competitor
• Product and services

WWW.SCORE_at_cscc.org CALL 719-635-1571
Colorado Springs SCORE www.coloradospringsscore.or
g 719-636-3074
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Step 2 Analyze
Take Control and Get Focused

• Explore the causes of the problems
• Prepare an honest assessment where you make money
  and where you lose money
• Look at your management style
• Look at your credit

WWW.SCOREDENVER.ORG CALL 303 844-3985
Colorado Springs SCORE www.coloradospringsscore.or
g 719-636-3074
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Step 2 Analyze
Take Control and Get Focused

• Explore the causes of the problems

Character (first impression, reputation and
credit rating) Capacity (ability to repay the
loan) Capital (adequacy of total funds to
generate cash flow) Condition (economy - external
environment) Collateral (assets borrower pledges)
WWW.SCORE_at_cscc.org CALL 719-635-1571
Colorado Springs SCORE www.coloradospringsscore.or
g 719-636-3074
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Step 3 Priortize
Develop a Plan

• What are the solutions
• Where are you going
• How much do you need - money
• What external resources will be required
• What changes do you need to make
• Prepare a budget
• Prepare yourself

WWW.SCORE_at_cscc.org CALL 719-635-1571
Colorado Springs SCORE www.coloradospringsscore.or
g 719-636-3074
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Step 3 Prioritize
Develop a Plan

• Plan for 6 week cash forecast and cash flow
  projection
• Set up system to sign all checks personally
• Uncover places to get operating funds, if needed?
• What strategies will you use with employees
• Could you reduce hours and operate four days a
  week?

WWW.SCOREDENVER.ORG CALL 303 844-3985
WWW.SCORE_at_cscc.org CALL 719-635-1571
Colorado Springs SCORE www.coloradospringsscore.or
g 719-636-3074
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Step 3 Prioritize
Develop a Plan

• Can you step up collection efforts?
• Can you offer discounts for early payment?
• Can you change terms and add interest on late
  payments?
• Can you sell off (donate) slow moving
  merchandise, inventory control
• Return unopened raw materials

WWW.SCOREDENVER.ORG CALL 303 844-3985
WWW.SCORE_at_cscc.org CALL 719-635-1571
Colorado Springs SCORE www.coloradospringsscore.or
g 719-636-3074
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Step 3 Prioritize
Develop a Plan

• What payments do you have can you stretch them
  out? (NOTE Taxes always the exception)
• Can you work out special terms with vendors?
• Are there opportunities created by other
  businesses out of business?
• Microsoft and Oracle
• FedEx and USPS
• Google

WWW.SCOREDENVER.ORG CALL 303 844-3985
WWW.SCORE_at_cscc.org CALL 719-635-1571
Colorado Springs SCORE www.coloradospringsscore.or
g 719-636-3074
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Decisions - Decisions
?? Grow the Business ??Positive cash flow makes
it possible ?? Sell
the Business ?? If there is evidence of owner
burnout ?? Positive cash flow makes it
salable ?? Another strategy
WWW.SCORE_at_cscc.org CALL 719-635-1571
Colorado Springs SCORE www.coloradospringsscore.or
g 719-636-3074
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Step 4 - Produce
Implement Plan

• Cut cash outlays immediately
• Reduce operating costs
• Drum up additional business
• Raise additional funding
• Sell off inventory, equipment, return purchases
• Get new customers
• Hold everyone accountable

WWW.SCORE_at_cscc.org CALL 719-635-1571
Colorado Springs SCORE www.coloradospringsscore.or
g 719-636-3074
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Step 4 - Produce
Implement Plan

• Daily and weekly tasks
• Monday cash meeting
• Monitor cash flow daily/weekly
• No management by committee Owner must be
  undisputed authority
• Hands-on management
• Openly ask for rumors and respond to them

WWW.SCORE_at_cscc.org CALL 719-635-1571
Colorado Springs SCORE www.coloradospringsscore.or
g 719-636-3074
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Step 4 - Produce
Implement Plan

• Decide who to pay this week
• Analyze results to budget
• Visually plot progress/scorecard
• Conduct renegotiations with creditors, vendors,
  etc

WWW.SCORE_at_cscc.org CALL 719-635-1571
Colorado Springs SCORE www.coloradospringsscore.or
g 719-636-3074
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Restructure Debt

• Negotiate
• Win over important creditors with reorganization
  plan
• They want their money so they want your plan to
  work
• Its unlikely that all creditors will be paid
  everything they are owed
• Some money is better than no money

WWW.SCORE_at_cscc.org CALL 719-635-1571
Colorado Springs SCORE www.coloradospringsscore.or
g 719-636-3074
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Step 5
The Future

• Stay focused
• Navigate the course you charted
• Monitor continuously
• Keep looking for signs of problems
• Survive and Thrive Practice what you learned!
• Now - What do you do?

WWW.SCOREDENVER.ORG CALL 303 844-3985
Colorado Springs SCORE www.coloradospringsscore.or
g 719-636-3074
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Some Resources

• www.firstgov.gov
• www.irs.gov
• www.bplans.com
• www.sba.gov
• www.sos.state.co.us
• www.taxcolorado.com
• www.coworkforce.com
• www.dot.state.co.us
• www.revenue.state.co.us

WWW.SCORE_at_cscc.org CALL 719-635-1571
Colorado Springs SCORE www.coloradospringsscore.or
g 719-636-3074
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Final Thoughts
for Now

• There is no single answer on how to be
  successful in business
• Or is there a magic fix it pill
• Success requires focus and work
• Do you want to be part of the solution or part
• of the problem?
• The only place success comes before work is
  in the dictionary!

WWW.SCOREDENVER.ORG CALL 303 844-3985
Colorado Springs SCORE www.coloradospringsscore.or
g 719-636-3074
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Final Final Thoughts...
Five ways to Fail Faster

• 1. Use Check Book accounting
• 2. Be inflexible
• 3. Isolate Yourself from Employees
• 4. Dont take risks
• 5. Dont ask for outside help

Colorado Springs SCORE www.coloradospringsscore.or
g 719-636-3074
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SCORE Counselors to Americas Small Business 6
South Tejon Street, Suite 700 Colorado Springs,
CO 80903 Colorado Springs Small
Business Counseling and Workshop
Experts www.coloradospringsscore.org 719-636-307
4 A resource partner with Colorado Springs SBDC
www.cssbdc.org