How long ago was it when your business was nothing more than an idea in your own mind? Whether it was less than a year ago or several decades ago, you likely recall what it was like to have a dream and wonder if you’d ever be able to bring it to fruition. You did. You succeeded, and if you’re like many California business owners, you probably had to overcome numerous challenges along the way.
If your current business financial status includes serious debt, you’re definitely not alone in your struggle. The good news is that most financial crises are temporary. Business owners can often get things back on track by being proactive and implementing various strategies to secure debt relief and lay the groundwork for restored financial stability. It can help to talk to someone who has experience helping companies through these turbulent times.
Write a list that itemizes your debt
It’s one thing to say that your company is financially struggling and quite another to know exactly what is causing your debt. Taking a debt inventory is a first logical step to planning a way out. You’ll want to include on your list, business credit card balances, bank loans, payments due to vendors and any other sources of liability your company currently has.
Don’t throw in the towel just yet
Financial crises are typically stressful. You might be tempted to just hang up a “closed permanently” sign, but you might also think that would be going against the drive, ambition and innovation that helped you rise to success before financial trouble hit. Instead of shutting down, you might want to think of creative ways to boost your sales.
Maybe you need to be more active on social media, which is a popular marketing venue nowadays. Perhaps rewarding your regular customers will give them incentive to stay loyal and to spread the word to others to buy your products or services.
Costs you can usually cut
Debt reduction may be possible if you carefully review your costs to see where you can make some cuts. Is there equipment sitting around your office or warehouse that you hardly ever use? Why not sell it? Some business owners find that downsizing is a way to swiftly and sufficiently lower costs.
You might even be able to connect with other business owners whose companies are similar to yours to present the idea of sharing resources, thereby cutting costs. Changing payment collection terms from 90 days to 30 days with your clients may also be a way to bring invoices up to date.
When all that is not enough
You might try one or more of these options and still find that your business is unable to rebound. In such situations, it often helps to consider refinancing or speaking with someone well-versed in bankruptcy law. Filing for bankruptcy can be a valuable tool that allows a business to remain in operation but also provides a path to debt relief, thus keeping a company afloat and pointing toward a stronger financial future.