| By :
Kristin Gabriel
A recent study found most small businesses don't have enough cash to survive another economic downturn. More than 1,750 small and medium sized enterprises (SMEs) were surveyed. About 30 percent of the sample micro businesses employing less than ten employees. It appears as if a number of these small to medium-sized businesses, also called SMEs, believed the worst of the recession is over, however a higher number of businesses - from 31 to 54 percent in each country did not. They instead said they did not have enough cash in reserve to survive another year of financial challenges. In another survey -- the United States the Discover Card Survey of small business -- it was reported that the monthly index rose to 84.2 in October 2010, up 10.4 points from 73.8 in September - which was the biggest one month gain since April. mall business economic confidence rebounded in October as more small business owners reported better economic conditions for their business. After several years of a troubled economy, many small businesses are also asking financial experts what they can do today to prepare for the future. Most of them have already taken the obvious steps over the past three years by cutting down on staff as well as operating costs, reducing pay to employees, depleting inventory and managing through an extremely difficult time. Now is the time to start cleaning up the mess and preparing for an economic recovery. Why? Because assuming that the worst is over, many small businesses have depleted their credit, and so they now must clean up their credit and financials, making certain that solid accounting systems are in place and used properly going forward. Banks are not going to lend money to businesses when there is a lack of financial statements or credit issues. There is one key element advisors recommend, and that is a marketingplan. Most businesses have not had the money or resources to much of it during the last few years. Now it is time to rethink who your customers are today and how have they changed since the recession. Are they online? Are they using social media? Do your homework online about the latest online marketing strategies and tactics so you will be prepared. The types of marketing and advertising that worked before and will probably not work today. In 2011 it will be important to decide what marketing strategies are essential to driving customers and to start implementing these efforts by creating a budget. As the economy begins to recover the marketing strategies executed will bring new customers - all of whom will be looking for the best bang for their bucks, so to speak, and customer service. Begin by using factoring to keep this important tool of the trade handy throughout the year for additional capital to help fund operating expenses, and growth for your business in the future. Clearly as the global economies improve, small businesses may see some growth in the year 2011. However as a business begins to grow, there will usually always be a need for cash to support this growth. Companies can obtain cash fast by way of factoring services. A factoring company will front the funds within as little as 24 to 48 hours in exchange for a small fee. (Source: *Forbes Insights in association with the ACCS Association of Chartered Certified Accountants), Certified General Accountants Association of Canada (CGA-Canada) and the CNDCEC.)
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