I am crossing my fingers and holding my breath that the business is up off the matt and can start doing well again. Wow, did it crater my finances, though. I have balances on waayyyy too many credit cards. Worse yet, I've got both business and personal credit cards, and most of them are pretty close to maxed out.
Fortunately, if the business continues to do well, I should be able to climb out a lot faster than I would have if I had a job. I retired over $10,000 worth of credit card debt, alone, just in May so far. That's good news. The bad news is, that really didn't make that much of a dent.
I might be able to retire a comparable chunk of credit card debt in June as well. Beyond that, there's just no telling in this business. July could be great, or it could be awful. I've seen it go both ways.
I'm also making progress on my mountain of fixed-term debt as well. In August, I pay off an equipment note that will free up another $300 a month. After that, though, not much happens until 2013. That year, I'll pay off three more notes, which will free up almost $2,000. Then, in 2014, I'll pay off 3 other notes and free up another $1,500.
The name of the game is survival. If I can just survive that long, I'll have almost $4,000 less debt to service, every single month, just in my fixed-term loans, alone.
Really, that's like $48,000 a year in income. That's almost a job right there.
The key is just surviving. Making payments. Day to day and month-to-month. It'll happen eventually. We have enough equipment that we shouldn't need to take out a note for anything for the foreseeable future. We have what we need and we're in a "make do" mode until we get prosperous again.
In the mean time, using all this money just to pay off debt sorta sucks, but it doesn't suck as much as accumulating debt, and it doesn't suck as much as not-being able to make progress. It took me two years to get to this point. It's feasible that with two good years, I could be pretty much all the way back out again.
Monday, May 23, 2011
Sunday, May 22, 2011
The Last Post... for a while...
Strange, but I started this blog thinking it would chronicle my bankruptcy. I can only describe the last two years of business climate as absolutely, horrifyingly brutal.
The thing I always used to say about small business is that if you invest $100,000 in a business, and it fails, you probably don't lose $100,000. Chances are you'll lose two or three times that amount, realistically.
Why? Because businesses hit rough patches. When they do, you do what it takes to keep them afloat. You don't fire-sale off all the assets every time you hit a bad month or two. Most successful businesspeople can name a time or two (or countless times) when they were on the brink of bankruptcy. If you can't, you've either been exceptionally fortunate, or you just don't own much of a business.
I wish I could credit my survival to tenacity or fortitude or something like that. Mostly, I stuck it out because I didn't have any other good options.
Most business owners will double down in hard-times simply because they don't see another realistic way out.
They go all-in because they have no other choice. If you have another choice, then it probably isn't a business. It's probably more like a hobby.
Right now, the business is rolling again. We are as lean and mean as possible. Things are cruising. I can only thank my employees who have been loyal and hard-working. They're really the ones I owe my success to. It's been that way since about my 3rd year in business.
Once you get a business up and off the ground, you should realize quickly that you can't do it all yourself. The people I have in key positions are all better at their jobs than I would be if I were still filling those roles.
This is not to say I'm totally out of the woods, but for the time being, we're very, very healthy. We should be for the next month or two. In this business, anything beyond that is a guess, at best.
So, I'll close out this blog for now. I'm no longer on the brink. At one point, it looked very likely I was going to have to declare bankruptcy, but right now, I am nowhere near that anymore.
Just hope to keep things rolling. I built this business up from $0 in sales to a million in 4 and a half years. I can build it up from where it is now, to a million or more given the right circumstances. Our foundation is strong and it'll be easier the second time.
On the other hand, I also am acutely aware that things could collapse at any moment. This time, on the ride down, I made a lot of mistakes. I don't regret them because they were almost all in the category of trying not to lay people off. I didn't want to hurt the employees who had done so much for me. I didn't want them to lose their jobs.
To this day, I feel personally responsible for that. I think anybody who has ever had to look another human being in the eye and let them go, through no fault of their own, knows how utterly unfair it is.
Unfortunately, doing so almost put the whole company under. So, in the future, I'm afraid I'll have to react quicker to downturns. It's regrettable and sad, but it's reality. The best I can do is try to grow the business so that we employ more people, not less.
The thing I always used to say about small business is that if you invest $100,000 in a business, and it fails, you probably don't lose $100,000. Chances are you'll lose two or three times that amount, realistically.
Why? Because businesses hit rough patches. When they do, you do what it takes to keep them afloat. You don't fire-sale off all the assets every time you hit a bad month or two. Most successful businesspeople can name a time or two (or countless times) when they were on the brink of bankruptcy. If you can't, you've either been exceptionally fortunate, or you just don't own much of a business.
I wish I could credit my survival to tenacity or fortitude or something like that. Mostly, I stuck it out because I didn't have any other good options.
Most business owners will double down in hard-times simply because they don't see another realistic way out.
They go all-in because they have no other choice. If you have another choice, then it probably isn't a business. It's probably more like a hobby.
Right now, the business is rolling again. We are as lean and mean as possible. Things are cruising. I can only thank my employees who have been loyal and hard-working. They're really the ones I owe my success to. It's been that way since about my 3rd year in business.
Once you get a business up and off the ground, you should realize quickly that you can't do it all yourself. The people I have in key positions are all better at their jobs than I would be if I were still filling those roles.
This is not to say I'm totally out of the woods, but for the time being, we're very, very healthy. We should be for the next month or two. In this business, anything beyond that is a guess, at best.
So, I'll close out this blog for now. I'm no longer on the brink. At one point, it looked very likely I was going to have to declare bankruptcy, but right now, I am nowhere near that anymore.
Just hope to keep things rolling. I built this business up from $0 in sales to a million in 4 and a half years. I can build it up from where it is now, to a million or more given the right circumstances. Our foundation is strong and it'll be easier the second time.
On the other hand, I also am acutely aware that things could collapse at any moment. This time, on the ride down, I made a lot of mistakes. I don't regret them because they were almost all in the category of trying not to lay people off. I didn't want to hurt the employees who had done so much for me. I didn't want them to lose their jobs.
To this day, I feel personally responsible for that. I think anybody who has ever had to look another human being in the eye and let them go, through no fault of their own, knows how utterly unfair it is.
Unfortunately, doing so almost put the whole company under. So, in the future, I'm afraid I'll have to react quicker to downturns. It's regrettable and sad, but it's reality. The best I can do is try to grow the business so that we employ more people, not less.
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