Stress stinks. I know because of the recent comments I’ve received from staff, family, and friends.
“Zach, you should take a break, you don’t look so hot.” “Zach, you’ve got bags under your eyes and they’re red.” “Zach…”
We’ve all been there. It’s not fun.
Operating a small business requires a few key ingredients; something to sell, people to buy “it,” and cash. If you are missing even one of the three, your small business will end up in the “small business graveyard” with millions of others.
Getting all three in place (something to sell, people to buy it, and cash) is no small feat. Google search “how to sell,” and you’ll find hundreds of millions of results. Research how to develop products/services/solutions that people (or businesses) want, and you’ll find entire “courses,” that will teach you.
Google search “what to do when you don’t have cash,” and you’re SOL (shit out of luck). In small business (and truly in any business), cash is king.
Not having money has its perks (stick with me here…). When you don’t have money you behave differently. Your organization can evolve more rapidly and the iterative process of company development can occur more quickly. Why? Because when there is pressure (and associated stress) to pay staff, bills, and your landlord, you’re forced to think outside of the box.
Status quo in business doesn’t work. What got you to where you are won’t get you to where you hope to go. Developing a stable, secure, and successful organization requires both iterative and innovative evolution.
When money gets tight and you face the stress of not making payroll, you begin to think innovatively. “Okay, what can we do as an organization to spur sales?” That question can be asked when bank accounts are flush, however it seemingly carries more weight when paychecks are on the line.
Of course as a business operator (and financer) you can’t scare staff into looking for another job. You can (and should, if you’re a small team) be transparent with your team. Saying things along the lines of, “It’s going to be all hands on deck for the next few months while we look to weather our cashflow storm,” is a direct, albeit only somewhat nuanced way to inform your team. Heading to an all staff meeting and saying, “We may not make payroll this week,” is a sure fire way to instill fear (and flight syndrome) in your team. Don’t do it.
Cash flow problems come with downsides too. First, when you don’t have money, you begin to think more short-term. “What can I do today to save money today?” May seem like the right train of thought, but you need to manage short-term and long-term objectives. Financing and running a businesses means you make an investment in people, and you don’t want cash flow problems to inspire short sighted layoffs that undercut longer term needs. Of course, you’ll never get to those long-term needs if you don’t make it through the short term challenges you face.
Second, cash flow problems can ruin your books. Accepting subpar financing terms because you’re in a pinch can greatly impair an organization’s future growth. Whenever taking on financing, be diligent, and don’t move too quickly.
All in all, not having money is a good thing. In my experience, cash flow problems have served as the catalyst for dynamic and innovative changes. Where taking potentially risky action would have previously been dismissed, not having money suddenly justified giving them a shot. The result? Meaningful and impactful changes in our company’s growth.
If you’re reading this and you’re strapped for cash, don’t fret. Leverage the situation. Pull out all the stops. Figure out what your customers will pay for and work tirelessly to deliver it. That’s what I’m doing, and even if my eyes do go red, and there are bags below them, it’s some of the most fun, rewarding, and inspiring work I have ever been a part of.