Part 3 of a 3 part series

Warning Signs:

• Increasing net sales to net working capital.
• Rising net fixed assets to tangible net worth ratios.
• Rising debt to tangible net worth ratios.
• Difficulty borrowing funds.

Steps to Improve: STRETCHING YOUR CASH / MINIMIZING BORROWING

• Use customer provided capital; encourage advances, progress payments.
• Negotiate special terms to stretch cash flow.
• Use supplier capital; negotiate storage, price, shipment breaks, terms.
• Use customer capital; sell from catalogs.
• Use third party credit (credit cards, direct finance); not house credit.
• Tap your life insurance for last resort financing.
• Tap outside investors for capital.