GoFaxer Blog

Today I’m starting a series of articles about business principles that small companies can learn from big companies.

Some people are content keeping their small businesses small. They want their company to feel ma and pa. But I know that many of you are far more ambitious in your hopes and desires for success.

So we’ll be looking at what big businesses are doing to maximize their profits. We’ll look at what they’re doing to move toward a big and unknown future. We’ll look at what they’re doing to stay ahead of the competition.

Improving your business might be as simple as switching to fax to email, and it may be as big as completely redefining your business model, business plan, and marketing strategies. Some of these big companies have truly brilliant leadership and it’s clearly in your best interest to hear what they have to say.

Take Jack Welch’s classic book, Jack: Straight From the Gut. This man outlines his performance as CEO of GE during a time of enormous growth. He attacked his job like an entrepreneur building his business up from nothing, even though GE was hardly nothing when he took over.

There’s much to be learned by looking to the big dogs. I hope that this examination will help.

I see time and time again how small businesses can get themselves into trouble by not having enough money to fund their operation. With great technologies like fax to email, most can figure out how to operate on much less money and infrastructure than is generally perceived as necessary.

But at a certain point all of that cutting back cuts into the bone and muscle of your business. At that point you know that you’ve got to get more cash to increase your effectiveness as a business.

In the past it was relatively easy to go to a banking institution for loans. But with the entire credit crisis in full sway, businesses are finding it much harder to get extra money, even with good credit.

The consequence to this dilemma is that many small businesses are turning to what’s called social lending or peer-to-peer lending or Banking 2.0. Sites that do this type of thing are Prosper, Lending Club, Virgin Money, Zopa, and GlobeFunder.

An article at Entrepreneur.com gives a voice of warning:

“Self-made billionaire and business coach Bill Bartmann says he’s borrowed more than $3 billion in past entrepreneurial ventures. Bartmann believes P2P websites may be the only loan opportunities for some small businesses as credit tightens. But before jumping into any agreements, Bartmann suggests entrepreneurs do their homework first.”

Ultimately, you need to be careful and think it through.  But this could be a viable option for your cash strapped business.

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.