Focus on thriving in a bad economy

By Kathy Dean-Bradley

Credit is tightening, portfolios are falling, and consumers are bracing. How can your business succeed in the current economy? Now more than ever you should rely on many tools and services available to the small business owner. John Osoinach of the Delaware Small Business Development Center, Jayne Armstrong of the U.S. Small Business Administration, and Kenneth Godwin of Belfint, Lyons & Shuman, P.A. highlighted some of the key strategies for success to a group of bankers, accountants, and small business owners at the annual seminar hosted by Belfint, Lyons & Shuman, P.A., a Wilmington, DE CPA firm.

The Delaware Small Business Development Center is a partnership with University of Delaware and offers training, education, and advisory services to help the small business owner move towards growth and to develop management systems. John's "back to basics" advice is to revisit and update your business plan. Regular quarterly plans and budget projections will help minimize the uncertainty of the current environment and allow you to make better decisions.

Focus on your customers: Know who they are, and understand what motivates them to purchase your product or service and use that to your advantage. Analyze your financial statements. Look frequently at your income statement, balance sheet, and cash flow statement, and work closely with your accountant to use liquidity, operations, and profitability ratios which will provide the most insight into your particular business. Maximize your cash flow. Review carefully your relationships with creditors and customers to whom you have extended credit. Now may be the time to renegotiate with suppliers and tighten inventory. The goal of management is to stay flexible in these times; challenge the way you have been doing business, and expose inefficiencies.

The Small Business Administration can be an important source of resources and resource partners as you are starting or growing your business. Contact your local district office. There you can take advantage of the counseling arms such as SCORE (Service Corps Of Retired Executives), Women's Business Centers, and Veteran's Business Outreach Centers. The SBA offers a number of financial assistance programs and stresses that for many loans the paperwork is minimal and funding can be obtained in as little as a few hours. These programs are streamlined, easy, and should be utilized by the small business owner. Specialized programs such as the 504 loans provide an opportunity for owners to secure lending for commercial real estate and heavy equipment with low fees, long-term rates, and low down payments. Work with your district office and discover all the options available for your needs.

Remember that Congress has passed recent legislation to stimulate the economy and generate revenue. Explore the recent changes with your accountant and see how they may benefit your business. The increase in business mileage rate per mile, bonus depreciation and Section 179 fixed asset deduction can increase your cash flow and cut financing costs.

Don't face these tough times alone. Use your advisors and resources and make the right decisions for your business.

About the author
Kathy Dean-Bradley is a senior tax and small business accountant with the Delaware CPA firm of Belfint, Lyons & Shuman, P.A.. She is involved with tax planning for businesses and individuals and is specializing in providing tax planning and compliance services for the medical and nonprofit industries.

You may like these other stories...

The Financial Accounting Standards Board (FASB) had hoped to issue a final standard on revenue recognition during the first quarter of this year. However, the standard-setting organization confirmed today that the timetable...
IRS revokes group’s tax exemption over anti-Clinton statementsGregory Korte of the USA Today reported on Monday that the IRS has revoked the tax-exempt status of a conservative-aligned charity, the Patrick Henry Center...
CFOs are having a tough time filling vacancies quickly in their accounting and finance departments, according to a new survey from staffing services firm Robert Half.Open staff-level positions in accounting or finance take...

Upcoming CPE Webinars

Apr 24
In this session Excel expert David Ringstrom, CPA introduces you to a powerful but underutilized macro feature in Excel.
Apr 25
This material focuses on the principles of accounting for non-profit organizations' revenues. It will include discussions of revenue recognition for cash and non-cash contributions as well as other revenues commonly received by non-profit organizations.
Apr 30
During the second session of a four-part series on Individual Leadership, the focus will be on time management- a critical success factor for effective leadership. Each person has 24 hours of time to spend each day; the key is making wise investments and knowing what investments yield the greatest return.
May 1
This material focuses on the principles of accounting for non-profit organizations’ expenses. It will include discussions of functional expense categories, accounting for functional expenses and allocations of joint costs.