GoFaxer Blog

It was announced yesterday that Bear Stears got sold to JPMorgan Chase for a rock bottom price. All other banking institutions are a little bit concerned, to put it mildly. If it could happen to a company like Bear Stearns, it could happen to almost anyone.

The entire move was facilitated by the Fed, along with a new startling announcement: The Fed will be lending directly to security dealers, something that hasn’t been done since the 1930s.

Although I don’t think anyone really believes that this will be as bad as the Great Depression, which stands as the monoliths of financial disasters, many economists are speculating that we’re in for a world of hurt. In other words, this may not just be a recession. It could be a really bad recession.

So what do new entrepreneurs do in the face of almost inevitable financial hardships. Well, for one thing, your business concept better be solid. And it also better not be relying on consumers having a lot of extra cash.

It also means that you’re going to have to be super smart with your money. You will most certainly need to take advantage of smart technologies like email fax. You will have to watch your costs like a hawk.

But in the end, we don’t want to panic, because that’s the very thing that will make it worse. We must move forward cautiously, but still move forward.

There are so many cool services out there that will make your small business run like a big business. And like Internet fax technology, they’re very inexpensive. Did you know that you can get free conference calling? Gene Marks, in his article at Businessweek.com, points out this great service to check out.

He does clarify that they you do have to pay for the actual call. If you’re going to have a 10 hour convo with a vendor in Moscow, that could get spendy. But conferencing others into that call is free. You can have you’re whole company on that one call for nothing. For some of you, that might only be two people working out of a basement. Which is what this technology is for–small businesses that don’t have a lot of extra money to spend on office supplies and services.

How exactly does this work?  Marks explains:

“Once you sign up on this Web site (no credit card needed) you get assigned a unique conference code and a regular phone number to call. Mine starts with 712, which I’m told is in Idaho. Who cares? I pay for my call only. Everyone else calls the same number and uses the conference code I give them.”

Sounds like a great service worth checking out.

Has starting your own small business become too easy? Creating your own start-up in recent years has become as easy as owning a computer. You no longer need a fax machine. You can do it through email fax. You don’t need a business phone. You can use your cell phone. You don’t need a corporate email account. You can use a g-mail account.

It’s become so easy in recent years to start your own start-up, I worry that too many people are hurting themselves by jumping too quickly and aggressively into something that they are ill prepared to take on.

The fact of the matter is that not all people are meant for business ownership. Many people are far happier having a comfortably specific role in a large company. Many people don’t want the pressure of feeling the whole business rise and fall on them. If you don’t want that kind of pressure, don’t feel like you have to have it.

There are lesser ways to feel ownership in things without being the full and complete owner. You can invest in other’s businesses. You can invest in the stock market or real estate. You can even buy a franchise, a prefabricated small business that basically runs itself

Whatever you decide, be honest with yourself about what really makes you happy.

The best companies are so efficient, they’ve analyzed their business down to the tiniest degree, and they’ve made it as efficient as possible. Fax to email services are a sign of this kind of efficiency. These owners know how to make every dollar count.

Another sign of successful businesses is a business plan. Studies have shown that businesses that don’t have a business plan in place before they do business are more likely to fail. Yet it’s a common mistake for many small business owners to skip this vital step. Why is this the case?

It’s a common trait of many small business owners to want to get to work and not spend too much time playing around with plans. One time I was managing a store for some small business owners. I completely renovated their entire store operations and I sent them an outline of the plan. They sent me an email back saying, “Wade, this is very impressive. But who was taking care of our customers while you were typing this up?”

I assured them that our customers were being taken care of. And I further assured them that this plan would help me and future managers run their store better than it had ever been managed. Because the more organized and efficient you are in your operations, the more opportunity for making the sales.

See pt. 2 for a continuation of this discussion about business plans.

It’s beginning to feel a lot like 2001. That’s right. Everyone’s saying the big “R” word. In case you haven’t been reading the economic headlines, “R” stands for recession.

Yesterday the Fed cut interest rates by one half of a point. That’s good for people looking for loans but it’s bad for the economy in general because it means the ship is going down. Interest rate cuts are the ship Captain’s way of throwing out the life boats.

A recession is defined as a widespread decline in economic activity lasting more than a few months. Many economists are speculating that we’re already in a recession. But it’s one of those things where you don’t really know until you’re well into the recession.

The signs are not looking good. Today, with the announcement of the rate cut, the market seemed to increase, only to collapse by the end of the day. And there’s no immediate solution to the housing marketing struggles. Real estate is not likely to improve for another year or so.

So what’s a small business to do when faced with these almost eminent challenges? You’ve got to start shoring up cash anyway that you can. You want to make payroll and prevent lay-offs Now is the time to be more efficient than you’ve ever been. The first thing to do on your list is to get rid of the fax machine and start using Internet fax. It’s one of many solutions to a world wide challenge.

No government intervention is going to save a struggling business. Those businesses who continue to fail to innovate with great new technologies like Internet fax will certainly continue to fail.

But the government is doing their best to help struggling companies stay afloat with the new stimulus package. This could be very important for specific businesses that would be strong otherwise, but do to certain economic factors, are particularly struggling—the real estate industry comes quickly to mind.

Fortune magazine reports:

“First and foremost, the Senate bill, proposed by Senate Finance Committee chair Max Baucus (D-Mont.), would extend a helping hand to businesses facing large operating losses in either the 2006 or 2007 tax year, allowing them to write off those losses against gains as far as five years back, rather than the current two-year limit.”

This comes as handsome news to the aforementioned businesses that are struggling. I was concerned that all of the talk of giving tax refunds to the poor and middle class were ignoring businesses that might need that extra boost to keep afloat during the slow-down.

I was pleased to see that there will be a total of $31 billion given out in tax savings to business owners in 2008. Let’s hope the bill is quickly ratified.

Karen E. Klein of Business Week tells the story of Muhammad Hassaan Khan, from Pakistan. He’s a 19-year old business student who’s started his own business. Although political upheaval is evident in his country, he sees positive changes thanks to the accessibility of business opportunities through the Internet:

“No matter where they are located, as long as they have Internet access entrepreneurs can create an online business, Toren says. The companies they are creating range from successful e-commerce sites selling specific local products to popular bloggers making income from advertising revenues.”

Perhaps no trend in technology exemplifies this movement like Internet fax. Entrepreneurs can start their small businesses without the need for expensive office equipment. Many a small business is run on a computer that sits on your lap. A company can choose to be paperless, running everything electronically.

This gives a huge advantage to the smart young business minds, regardless of their location and regardless of their circumstances. Most people in the world can acquire a computer and they can acquire access to the Internet. And if you’ve got those two tools, you can be in business in many industries.

I can’t help but think it will be better for the world having more competition from small and ambitious business owners. Products will be better and services will be better as everyone is trying to compete.

It amazes me how quickly the economy can rebound with one announcement. Last week George Bush announced that there would be an economic stimulus package put in place this year to mitigate the effects of several poor economic factors. Wall Street made an almost immediate comeback.

Jim Jubak suggests that the reason Wall Street recovered so quickly is that it believes that government intervention by the President, Congress, and the Fed can keep the economic downturn short.

Over the past two decades, recessions have been quite short. The assumption is that we’ve gotten really good at keeping the economy growing without severe downturns.

Jubak does point out, however, that there is a very real danger that this slowdown or recession could be worse than usual:

“Because so many consumers got used to drawing against their rising home equities to fund their spending, the bursting of the housing bubble and the crisis in the subprime-mortgage market have resulted in far more damage than usual to consumer cash flows.”

What does this mean for small businesses that have less available cash and profit to protect them in tough times? You must find every smart way to cut costs. And you must spend your money in wise ways that will increase your sales. In other words, it’s time to take that step to switch over to Internet fax and other technologies that will save you money and help you weather what will be a small or large storm.

MSN.com reports that many millions of families are going to be receiving a tax rebate this year.

“The one-time tax rebates are at the center of a hard-won agreement to pump about $150 billion into the economy this year and perhaps stave off the first recession since 2001.”

This comes as good news to business people worried about a sketchy economic forecast. The hope is that a huge influx of cash given to lower to middle income families will give the economy a needed boost. The assumption is that giving the money to these groups where it will get spent will prime the pump so to speak and get things moving along.

Many economists question whether such a move will really do the trick. Will an extra 600 bucks in your pocket really prevent a recession? If anything, the act by the government creates a feeling of optimism about the future, and investors like optimism. And when investors invest more money into the economy it’s likely to continue growing.

It was also announced that “Businesses would get $50 billion in incentives to invest in new plants and equipment.”

Hopefully many small businesses will receive this cash and take advantage of new technological advances like fax to email, making them more competitive in the world market, and more profitable.