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									  Colorado Business Success
                           Survive and Thrive
                                                     Surviving
      Small                                        Tough Times:
      Business                                      Counseling,
      Checkup                                        Tools, and
                                                     Resources
      Clinics
SBA, SCORE, SBDC, COED&IT, CEF, CBA, CH&FA,         Pueblo, Denver, Grand Junction,
                                                    Loveland, Colorado Springs, Durango
Office of Govenor Bill Ritter, Jr., Mi Casa, CED
                       SCORE   ®


Counselors to Colorado Springs’ Small Business
                              Surviving
                            Tough Times:
Ric Denton,
Colorado Springs             Counseling,
SCORE Chapter
Chair                         Tools, and
Bob Douthitt, Denver
SCORE Workshop                Resources
Chair

Small Business                      Colorado Springs, CO – Atlers Hotel
                                   WWW.SCOREDENVER.ORG

Survival Clinics                             February
                                   CALL 303 844-3985 11, 2009
Why Are you Here - Seeking Answers
          Is Your Business in the Toilet ?
• You’re 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
                                           Colorado Springs SCORE
                                           CALL 303 844-3985
                                           www.coloradospringsscore.org 719-636-3074
             Objectives
• Focus on just what’s
  important
• 4 strategies of the
  business RAPP
• Chance to ask
  questions and get
  answers

                          WWW.SCORE@cscc.orgSCORE
                          Colorado Springs
                          CALL 719-635-1571
                          www.coloradospringsscore.org 719-636-3074
                 First Things First
                               Do a Business Check-Up
RESEARCH
•Your business position                                                   Start reducing operating
•The market                                                                  expenses - NOW!
•Your financial standing
•Uncover trends
                           ANALYZE
                           •Cash flow position
                           •Debt to equity
                           •Market Position
                           •Risks
                                                 PRIORITIZE
                           •Changes needed          •Yourself – business partners
                           •Uncover problem         •Family
                            areas                   •Get advice                            PRODUCE
                                                    •Plan changes needed                •Make changes
   Don’t “Stiff” the                                •Plan monitoring systems            •Track progress
      Tax Man!                                      •Solutions to problem areas         •Make modifications


                                                                                    WWW.SCOREDENVER.ORG
                                                                                    Colorado Springs SCORE
                                                                                    CALL 303 844-3985
                                                                                    www.coloradospringsscore.org 719-636-3074
 Step 1: Research
               Take Stock
You can’t fix the problem if
 you don’t know what’s 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@cscc.orgSCORE
                                     Colorado Springs
                                     CALL 719-635-1571
                                     www.coloradospringsscore.org 719-636-3074
 Step 1: Research
              Take Stock
You can’t fix the problem if
 you don’t know what’s wrong
• Explore the causes
• Has spending overtaken revenues
• Confirm reason and quantify impact




                                       WWW.SCORE@cscc.orgSCORE
                                       Colorado Springs
                                       CALL 719-635-1571
                                       www.coloradospringsscore.org 719-636-3074
 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@cscc.orgSCORE
                                  Colorado Springs
                                  CALL 719-635-1571
                                  www.coloradospringsscore.org 719-636-3074
   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
                                     Colorado Springs SCORE
                                     CALL 303 844-3985
                                     www.coloradospringsscore.org 719-636-3074
 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@cscc.orgSCORE
                                      Colorado Springs
                                      CALL 719-635-1571
                                      www.coloradospringsscore.org 719-636-3074
    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@cscc.orgSCORE
                                     Colorado Springs
                                     CALL 719-635-1571
                                     www.coloradospringsscore.org 719-636-3074
    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.SCORE@cscc.org
                                     WWW.SCOREDENVER.ORG
                                     Colorado Springs SCORE
                                      CALL 719-635-1571
                                     CALL 303 844-3985
                                     www.coloradospringsscore.org 719-636-3074
    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.SCORE@cscc.org
                                    WWW.SCOREDENVER.ORG
                                    Colorado Springs SCORE
                                     CALL 719-635-1571
                                    CALL 303 844-3985
                                    www.coloradospringsscore.org 719-636-3074
 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.SCORE@cscc.org
                                        WWW.SCOREDENVER.ORG
                                        Colorado Springs SCORE
                                         CALL 719-635-1571
                                        CALL 303 844-3985
                                        www.coloradospringsscore.org 719-636-3074
      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@cscc.orgSCORE
                                Colorado Springs
                                CALL 719-635-1571
                                www.coloradospringsscore.org 719-636-3074
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@cscc.orgSCORE
                                     Colorado Springs
                                     CALL 719-635-1571
                                     www.coloradospringsscore.org 719-636-3074
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@cscc.orgSCORE
                                 Colorado Springs
                                 CALL 719-635-1571
                                 www.coloradospringsscore.org 719-636-3074
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@cscc.orgSCORE
                                     Colorado Springs
                                     CALL 719-635-1571
                                     www.coloradospringsscore.org 719-636-3074
   Restructure Debt
• Negotiate
  – Win over important creditors with
    reorganization plan
  – They want their money so they want your plan
    to work
  – It’s unlikely that all creditors will be paid
    everything they are owed
    • Some money is better than no money
                                   WWW.SCORE@cscc.orgSCORE
                                   Colorado Springs
                                   CALL 719-635-1571
                                   www.coloradospringsscore.org 719-636-3074
             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
                                     Colorado Springs SCORE
                                     CALL 303 844-3985
                                     www.coloradospringsscore.org 719-636-3074
               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@cscc.orgSCORE
                              Colorado Springs
                              CALL 719-635-1571
                              www.coloradospringsscore.org 719-636-3074
                  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
                                               Colorado Springs SCORE
                                               CALL 303 844-3985
                                               www.coloradospringsscore.org 719-636-3074
       Final Final Thoughts...
            Five ways to Fail Faster


1.   Use Check Book accounting
2.   Be inflexible
3.   Isolate Yourself from Employees
4.   Don’t take risks
5.   Don’t ask for outside help

                                 Colorado Springs SCORE
                                 www.coloradospringsscore.org 719-636-3074
          SCORE
      Counselors to America’s Small Business
                                                 ®
               6 South Tejon Street, Suite 700
                Colorado Springs, CO 80903

      Colorado Springs’ Small Business
      Counseling and Workshop Experts
         www.coloradospringsscore.org

                   719-636-3074
A resource partner with Colorado Springs SBDC www.cssbdc.org

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