Increasing Working Capital
Depending on how you define small business, working capital is often an issue that makes expansion difficult. Growth only compounds the problem. There are many ways to get access to capital besides the usual ones.
I know someone who was moving the company's offices but ran into a cash flow crunch. He was paying rent on two buildings and didn't have the cash to complete the buildout on his new space. His current landlord was pressuring him to move as he had a hot prospect for his current space. So the entrepreneur went to his current landlord and proposed borrowing the money from him to finish out his new space if he would commit to move by the desired date. The landlord agreed.
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Vendors are another place where capital can be found, if not cash at least trade credit and extended terms.
In terms of where to find opportunities, the best place to look is your customers. First of all they know you already so you don't have to sell yourself to get in the door. Take them to lunch, find out where they have pain. See if you have the core competencies to take away their pain and become more important to them. The fastest path to profit is to sell more stuff to your existing customers more often.
Lanny Goodman is a strategic planning consultant and president of Management Technologies Inc.. Since 1980 he has helped entrepreneurs build highly vital and productive companies. Lanny has developed a unique process to create self-managing companies based on the emerging scientific principles of self-organizing systems. His company works in a very wide variety of industries in the services, manufacturing and not-profit for industries with clients ranging from $1.5m to over $1b in sales. Contact Lanny at www.lannygoodman.com
