Business Bankruptcy Alternative: Turnaround Expert Reports ‘Shocking' Strategies for Avoiding «The Big ‘B'»
31 May 2006 Las Vegas, NV (PRWEB) May 30, 2006 -- «Business bankruptcy is not the answer for small companies gone bad,» says Sue Canyon, author of a new publication that offers failing business owners little-known solutions for make their companies profitable.
«Bankruptcy should be the last choice,» she says.
«You won't find the answer in maxed-out credit cards and costly consultants; nor will you discover it by depleting your retirement fund or taking out home equity loans. Just because you're sick of sweating out paydays, showing no profit, arguing with suppliers and dealing with difficult customers doesn't mean you don't have alternatives,» says Canyon.
«However, alternatives are not always where you think they are.»
Generating the cash needed to keep a company afloat means owners must «summon the courage to ask hard questions they may never have considered before,» says Canyon. «Many people never grasp the concept that running a ‘good' business means a whole lot more than selling beautiful flowers, laying smooth asphalt, tossing a mean pizza or repairing cars to spec.»
The West Coast analyst raises three tough questions for small business owners facing a sinking ship.
1. Accounting Records – Just how good is my bookkeeper? Do I know if my internal accounting records are correct? Do I know how to tell if they're not? Can I even read them? Am I making fatal strategic decisions based on information provided by a casual or incompetent bookkeeper?
Expert's Comment:
»Making decisions based on faulty accounting records is the number one reason most small business fail in this country,» says Canyon. «Ignoring the need for good numbers sets any business up for failure. Only an owner's sheer energy and personal resources can keep a business with bad records afloat – and then only until those two resources are depleted.»
Canyon talks about the client who trusted his CPA to provide costing information. «Unwise move,» she says. «The fact is, CPAs rarely work with costing. They typically focus on general accounting – costing is another animal entirely. When we figured the costing properly, what we discovered was a disasterous strategic turn the owner committed four years earlier. Correcting this blunder netted his company $450,000 in profit within a year -- on sales of only $3 million.»
2. Vendor Theft - Are my vendors – even the ones I've been using for years – stealing from me?
Expert's Comment::
«My experience shows that vendor theft trumps employee theft any day of the week, at least when it comes to materials,» says Canyon. She recalls a manufacturing client who regularly ordered tons of gravel but discovered he was receiving only three-fourths of what he was paying for, day-in-and-day-out. The owner would sign for 24 yards of gravel and only 16 yards would be dumped in the storage bin. It turns out the vendor was stealing more than $200,000 a year without ever delivering the product to the yard!»
3. Production Efficiency - Is my production process (or service delivery process, or order entry process or a hundred other processes) killing my company? How can I know?
Expert's Comment:
«I once consulted with a company that was in line to lose a $10 million government contract if they didn't clean up their performance,» says Canyon. «The client got huffy,» she says. «‘What makes you think you can come in here and tell me how to do this better when we've been doing it for four years?' I proceeded to inspect his production line and discovered … he had NO PRODUCTION LINE! The thing is, most employers don't know what's wrong because they only know what they can see, and quite frequently, that's not enough. My team and I put in a production line, met the shipping deadline a week later and voila! – saved the contract. It's not always important what you know. Often, it's what you DON'T know that counts.»
Visit www.businessbooming.com/shocking%20report.pdf to read Sue Canyon's free «Shocking Report.» It reveals ten business fallacies that failing small business owners believe – and base critical decisions on every day.
About Sue Canyon: Sue Canyon is a leading business research analyst who specializes in repairing small companies in trouble. For more than 30 years, she has helped turn around companies operating in the manufacturing, service, retail, distribution and sales sectors. Canyon is the author of «Pocket Mentor,» an advice guide that focuses on cost and production management. Her newest work, «Grand Unified Theory of Everything for Small Business,» will be published early next year.
Source: prweb
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