Business Education

How to Patch-Up a Sour Business Relationship for the New Year

Just about any type of relationship can go bad at practically any time. Business relationships are no exception to this sad phenomenon. Even Dave Ramsey says often, “The only ship that won’t sail is a partnership.” Statistics certainly prove this point true. But, it’s not just professional partnerships. Small business owners enter into many working relationships and any one of them can go bad. So, if you experienced this type of situation, there are ways to get back to doing business together, though both of you will need to make a commitment to make it work.

Alternatives, Options, and Change

If the relationship is irreconcilable, or it’s just not possible to do business again (because of an extraordinary circumstance like death, retirement, or the person has gone out of business), you’ll have to rely on other options, which can mean going with an alternative. But, before you jump right into another relationship, it’s usually best to try and work things out first.

The common thread among all damaged relationships is the trust between both parties has been broken. Trust is the underrated lubricant for success in business, and rebuilding that trust is the first step in repairing any business relationship.–Inc.com

After all, if you had a working relationship with this individual before, you both benefited from it and it makes sense to continue so neither one of you is forced to start from scratch again. However, if this isn’t feasible or even possible, make a list of alternative options and write down each one’s pros and cons. Make some preliminary contact and explore working together. You could even give one or more a trial run in order to determine how well it does or doesn’t work.

How to Patch-Up a Sour Business Relationship

Now, if there is a possibility that the relationship can be reconciled, there’s no real good reason not to try. Although, it will take quite a bit of commitment from both parties in order to have a viable future. Here is some effective advice for how to mend a broken business relationship:

Start with introspection. Humans are keen on shifting blame away from themselves. People not only dislike making mistakes, but they also do not like being in the wrong. So, it’s up to you to take a good look at yourself first and be willing to accept any blame you deserve.
Be humble but honest in your approach. Next, try to reconnect on a casual basis. If you have mutual interests, that’s a good place to start to reconnect. If necessary, take a gradual, measured approach and go slow. When the time is right, you can have a more candid discussion about what transpired but, don’t be blameful.
Agree to leave the past behind for the sake of the future. Both of you will have to keep this promise in order to have any chance of working together again. Make it a point to put sensitive topics or events off-limits and focus on your future working relationship instead.
Keep an open line of communication flowing. Once you agree to work together again, don’t let the same things get in the way. Stay in regular contact so that everyone’s expectations and needs are known. This will be a great way to help the relationship flourish and be beneficial to both parties.

What other advice would you give entrepreneurs about patching up a sour business relationship? Please share your thoughts and experiences so others can benefit from your perspective! Interested in learning more about business? Then just visit Waters Business Consulting Group.

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How Do I Actually Collect My Business’ Account Receivables

March 15, 2021 No Comments

How do businesses actually collect their accounts receivables? It’s a tricky and often unpleasant process. But, one that’s absolutely necessary because it’s not only money owed, it’s time and effort already spent. More particularly, you can’t just avoid or ignore unpaid invoices. After all, your company depends on the money, regardless if you take up the task yourself or hire someone. Unfortunately, it’s a bigger challenge during such uncertain economic times. Biggest Obstacles in Getting People to Pay Up The most common difficulties in collecting accounts receivables can be enough to convince you to give up. People stonewall. They sometimes partially pay. Other outright elude. There are even individuals who’ll send in checks they know won’t clear the bank. All of these behaviors are sadly normal. But, making it all the more difficult is the current economic uncertainty. Your business’s accounts receivable are an important part of calculating your profitability, and provide the clearest indicator of the business’s income. They are considered an asset, as they represent money coming into the company. —Business News Daily The pandemic response resulted in both short- and long-term shutdowns. That put undue strain on many businesses. So, it’s understandable some would fall behind financially. Although, after a little while, you expect something out of them, even if it’s only an explanation as to why they can’t pay and a sincere apology. (Regrettably, the latter might just well be all that you’ll get.) Ways to Collect Business Account Receivables First of all, it’s critical that you have good accounts receivable practices. Being proactive definitely benefits your business. But, when invoices continually go unpaid, there are actions you can take. Here are three effective strategies to collect your business’ accounts receivables: Act quickly when a payment is late. Do not make the mistake of letting receivables age. The longer an invoice goes unpaid, the less likely it is to ever be paid. Sure, it’s uncomfortable to pursue payment, but it’s necessary. Be kind but persistent and also be consistent as to your collection demeanor and actions. Reach out with friendly but stern reminders and follow-up regularly. Offer recipients a decent discount. Of course, you naturally want every penny that’s owed to your business. But, if offering a discount means collecting the majority of what’s due, then it’s more than worthwhile. But, do not make the mistake of discounting further because it will only weaken your position. (Plus, there’s a cut-off point where it’s financially unfeasible.) Provide an easy repayment plan. You can also provide recipients with a repayment schedule. Breaking up the total amount into a few or several installments might just do the trick. You can even charge a fee for late or missed payments. You can also suspend any new business during the repayment timeline. Consistent communication. Most important, communicate to your customer, that they must communicate promptly and consistently and follow through with their commitments. What other methods would you suggest to collect account receivables? Please take a moment to share your thoughts and experiences. Your unique perspective could very well help a fellow entrepreneur out! Interested in learning more about business? Then just visit Waters Business Consulting Group.

Tesla is Now Asking Suppliers for Cash Back, Here’s How to Avoid that Scenario

August 14, 2018 No Comments

Tesla is back in the news. Headlines proclaim the electric car manufacturer actually approached some of its suppliers, requesting cash back in an effort to realize profitability. Elon Musk quickly reacted to the reports. Now, it’s a he-said-she-said storyline. But, that’s just another fight the media will happily play up for clicks and tune-ins. The reality is Tesla is not a profitable company. Even though it enjoys so much buzz and customer loyalty, it can’t turn a profit. The Top Reason Small Businesses Fail The company reportedly burned through $1 billion in a quarter. And, it’s promised to bring its expenditure to under $3 billion this year. That, after it went through $3.4 billion last year. Not to mention, it lost $710 million in Q1 of this year alone. Just as good cash flow keeps a business afloat, poor cash flow can sink it. In fact, poor cash flow is a big reason why one in every four businesses doesn’t make it past the first year. And why more than half don’t survive past the fifth. —Fresh Books.com It gets worse. The company might not reach a stock conversion price of $560.64. Which means it will have to shell out $230 million to obtain a convertible bond in November. Its stock fell by nearly 4.5 percent just in the last twelve months and continues to struggle. This is an important lesson to those who’d like to start a small business because it’s one of the main reasons startups fail in the first place: inadequate cash flow and reserves. Problems with cash is typically the reason small businesses fail. Top Small Business Cash-Flow Mistakes to Avoid So, if cash is the biggest reason new companies fail, then how do they actually get into such a pickle? Well, it’s not just avoiding bad business ideas (although that’s certainly helpful), it’s more about being smart with money in the first place: Impulse spending. We all know retailers embrace this practice. But, it’s far too easy to fall into the trap of impulse spending, particularly during the startup phase. It’s also a shortcut to failure because it’s the ultimately lack of responsible cash management. Past-due receivable apathy. When cash is rolling in, it’s very easy to let an invoice or two or more slide. After all, there’s plenty of money coming in, so why bother? It’s important to stay on top of receivables because it sends the wrong signal when you become apathetic. Plus, you might be able to put that money to good use in the future. Not sticking to a real budget. You wouldn’t spend more money that’s in your personal bank account. However, when it comes to business finances, too many owners just don’t adhere to a realistic and strict budget. And, that’s a recipe for failure. Failure to put some cash aside. Feast or famine. That’s an old cliché but it’s entirely true for many businesses. That reality means it’s best to have some cash on-hand when needed because it’s very likely that time will come. What other ways do small business mishandle cash? What other advice would you give about maintaining positive cash-flow? Please share your thoughts and experiences! Interested in learning more about business? Then just visit Waters Business Consulting Group.

How to Support an Employee Going through a Crisis

May 1, 2021 No Comments

One employee’s personal crisis can become a big problem for your business in an instant. That’s unfortunate and even inconvenient but it can easily become a reality. (Especially during a time of disruption, caused by a global pandemic and subsequent shutdowns and re-openings.) When employees return to work — or continue to work through such turbulent times — crisis can manifest in various ways. When it affects an employee, it can likewise have a substantial impact on your business. Crisis Comes in Many Forms We’ve all heard the statistics and figures about the toll the lock-downs have taken. Drug use and overdoses are at historic highs. Depression runs rampant. Job losses are also a huge problem and with those losses, undue financial pressure. Then, there’s just the matter of separation of family members and close friends from one another. We all have life events that distract us from work from time to time — an ailing family member, a divorce, the death of a friend. You can’t expect someone to be at their best at such times. But as a manager what can you expect? How can you support the person to take care of themselves emotionally while also making sure they are doing their work (or as much of it as they are able to)? —Harvard Business Review The divorce rate is also expected to spike when all the data is calculated. Plus, births have actually fallen — not risen — as formerly expected. The point is crisis comes in many forms and can emerge in any one (or more) of your employees’ lives. When this happens, it can have a profound effect on your business. Ways Businesses can Deal with an Employee in a Crisis Situation Fortunately, there are ways businesses can deal with an employee in a crisis situation. Nearly regardless of the circumstances, you can help your team member get through and stay a productive part of your company. Here are some of the most effective strategies to help employees cope with personal crisis: Encouragement. Okay, let’s begin with an obvious need — being supportive. Offering your support and encouragement can do a lot — a whole lot — for someone experiencing uncertainty and anxiety. A few kind, supportive words occasionally can have a really big impact on his or her attitude, work quality/quantity, and more positives. Incentives. Another way to help an employee in a crisis is to reward them with incentives. Just a small reward can help lift up a person’s spirits in profound ways. If you can find the right rewards, they will indeed big a real return on investment. Flexibility. Of course, offering him or her the flexibility they need will also do a lot for their mental and emotional health. By letting them customize their schedule and offering a combination of work-from-home and on-site, you can help them get through a very tough time. Contingencies. An employee experiencing a personal crisis might not be able to maintain a routine schedule. If you are confident this will only last for a short amount of time, you can have someone else step in and take some of their workload. Referrals. Unfortunately, not every situation will come to a positive end. Some crises are just too much and result in having to let an employee go or accept a resignation. If this happens, you can always offer a referral to help him or her to help them secure a new position. What other suggestions do you have? Please take a few minutes to share your own thoughts and feelings so that others can benefit from your experiences and perspective! Interested in learning more about business? Then just visit Waters Business Consulting Group.