Small Business Development Center
At Chemeketa Center for Business & Industry
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Monthly Archives: December 2009

Contracts: Are you looking for some?

By Chemeketa SBDC

Everyone knows you can get contracts with the State or the Federal government, but not everyone knows where to look. There must be some kind of secret to finding them, right?

Here’s the secret!

Two websites:

Now you have the secrets – how will you use them to grow your small business?

The dangers of business growth at the holidays

By Chemeketa SBDC

Growth is a good thing for your business. 

Right? Probably, but there are some areas of danger to watch for. Since it’s not likely that you have a large cash reserve sitting in the bank, working with a small cash surplus is risky.  

Here is a possible dangerous scenario, which by the way, is likely to happen during this season of many craft shows leading up to Christmas. You get new orders at the trade shows and increase production to fill these orders. You have enough money to pay the added labor, and your accounts payable is increased as you order more materials from your suppliers. You increase your accounts receivable because you sell on credit. Before you collect the money from your sales, the bills to your suppliers are due. 

Lesson: Fast growth consumes cash quicker than it produces it. 

How can you take advantage of the season and still not destroy the cash credibility of your company? Some things you can consider up front.

Accounts Receivable:

  • Require a deposit when making sales. 
  • Divide your invoices for large, complex items – 1/3 up front, 1/3 progress payment and 1/3 due when delivered.
  • Review your credit policies – print them right on your invoice so there is no confusion about the terms of payments from your customers.
  • Send an invoice as soon as the job is complete.
  • Offer early payment discounts to encourage promptness.

Accounts Payable:

  • Manage your payments by due date rather than by when you sit down to pay bills.
  • Compute your vendor’s payment terms (added cost of extending payments) in the price of your product.
  • Negotiate with your vendor – ask for extended payment terms during periods of obvious growth.
  • Pay your bills on time – take advantage of early payment discounts – during off season times so your vendors know you are a good customer worth keeping.


  • Predict your sales realistically so you can determine your expenses accurately.
  • Don’t buy unnecessary or “add-on” items.
  • Control your overhead expenses – keeping fixed costs as low as possible.
  • Be sure your variable expenses relate directly to the growth/increase in sales.

The upcoming season can be a great boon to your business cycle. Be sure to guard your income and expenses as jealously as if the survival of your business depends on it – it just may.