Mr. Fix-It The man to call when your business's finances are more fixer-upper than fantastic
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When Marc Kramer was first asked to revive a small, troubledInternet company, he couldn't find any book to guide him. Threeother saved companies later, he decided to write a handbook aboutwhat he learned in the process: Streetwise Small BusinessTurnaround: Revitalize Your Struggling or Stagnant Enterprise(Adams Media). Now president of Kramer Communications inDowningtown, Pennsylvania, he offers these hard-won lessons:
What's the hardest part of reviving a business?
Letting good people go and keeping up the morale of the otherpeople.
How do you keep morale up?
First, the leader has to look and act confident. Second, he hasto develop a business plan and involve employees in the plan'sdevelopment. Third, he has to remind employees what they'vedone right and continue to point out star players. Fourth, he hasto be honest with them about the situation and let them know heneeds their help to fix the problems. Everyone likes to knowthey're needed and won't leave if they trust theleadership.
What do you do when you owe vendors money?
Businesspeople in trouble have to remember thateveryone-from former President Harry S. Truman [once abusiness owner] to Donald Trump-has run into trouble. Runninga business and maintaining profitability isn't easy. Things gowrong. What you don't want to do is destroy your reputation forhonesty and integrity.
The best thing to do is to write a letter to each vendorexplaining the situation and how you plan to fix your problems.Encourage them to call or visit if they have any questions. Offerto show them your financial records.
I've never encountered vendors who wouldn't work with acompany in trouble if the company was honest, upfront andaccessible.
When should an entrepreneur file for bankruptcy?
I've avoided it. The only people who make money on that dealare the lawyers. I tell all the vendors I'd rather pay themthan the attorneys, and they go along with [my plan].
What if you owe the IRS?
I was brought into a company that owed the IRS a large sum ofmoney. I brought our business plan [to the local IRS office] andwalked them through what we planned to do. They were completelysupportive. They were thrilled they didn't have to chase us. Webuilt instant credibility.
