SmallBusinessNewz

Doug Palmer of Palmer Financial created several survival tips for small businesses in the down economy. These are tips that can and should be used all the time but are extremely important now.

Since cash is what usually keeps businesses going, most of Palmer's advice deals with cash. If you don't properly manage your cash, you will hurt yourself and your business.

Palmer says, "Cash flow is probably the biggest area in which mistakes are made."

For a company with revenue coming in, Palmer suggests having at least 3 months of cash reserve in the bank. For venture-backed companies, he recommends having at least a year's worth of cash in the bank. Keep those reserves in the highest rated money market account available.

Next, manage account receivables. Palmer says the most important thing with managing account receivables is conducting weekly follow-ups. Make sure they don't forget to pay you!

Because you are forced to assume the worst, try to have your customers pay up front.  Also have a written contract that, if not followed, has consequences such as a high interest rate.

Don't forget to manage your inventory and fixed assets. You want to turn as much as is possible into that much desired cash. With inventory, maybe order less, reduce prices, or ship what you don't use back to the manufacturer.

With fixed assets, do the same thing. If you have equipment lying around that you never use, get rid of it.

For more details on these survival tips, watch the SmallBusinessNewz video. Make sure you also watch for the rest of the survival tips that will be coming in the next few days.