Boomer Business Owners – Has the “Credit Crunch” affected your collections?
October 1, 2008 by Jean Murray
Many business owners have said they are being affected by the credit crunch in two ways:
1. They are unable to borrow money to pay their bills.
2. Their customers are taking longer to pay.
The availability of credit is a serious problem for any small business. It’s about survival. Believe me, I’ve been there. The problem may start out as a small amount that you need, “just to make payroll,” and it grows. Pretty soon, you’re using your credit cards to put money into your company to pay your business bills and pay employees. And it gets worse. If your business has no assets to borrow against, and sales are stagnant or declining, you face the prospect of having to lay off people, cut back inventory, and delay payments to vendors.
2. Which brings us to the second issue – delayed income. One recent report in USAToday said that trade credit (extended from one business to a business customer) is being strung out longer, and customers are taking longer to pay.
How is your business doing? Are you hanging on? Are you getting paid by customers? Any suggestions for other boomer business owners? Comments appreciated.