By Andrew Griffiths
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Extra resources for 101 Ways to Boost Your Business
As much as it might really aggravate you, there is a time when you have to let go of a debt and use it as a tax loss. This is particularly important when it comes to collecting small debts that can easily cost more to collect than the value of the 36 FINANCIAL BOOSTER TIPS debt. An associate of mine had worked out that it cost his company $100 per month to chase each outstanding account. Obviously, what for them was a small account of a few hundred dollars would soon be used up in collection costs.
This costs me around $200 per month. For the peace of mind it gives me this is a small price to pay. 38 FINANCIAL BOOSTER TIPS 16 Keeping costs down without losing customers I often see companies that are going through difficult financial times trying to cut costs. The problem is that the areas where they are cutting costs are causing them to lose customers. This clearly compounds the problem and sends the business into a downward spiral. It is smart business to keep your costs down as much as possible.
The point that he was making is that when you expand, you are basing the expansion on 32 FINANCIAL BOOSTER TIPS increasing revenue from more customers. If, for some reason, that suddenly stops, it’s very hard on everyone to shrink the business down to a profitable level. Staff have to be laid off, office size reduced, debt decreased, and so on. The main point of this booster tip is that if your business is growing due to demand, that’s great. But be careful about how you manage that growth, and build into your business plan the fact that one day you might need to downsize.