The past few weeks I’ve been talking about Lifetime Value of a customer and Acquisition Cost of a customer.  Why?  Here’s my point.  It costs you up to six times more money to acquire a new client than to get an existing client to buy again.  If you don’t have the cash flow to support marketing for new clients, why do it?  If you increase your cash flow by getting current clients to buy again, do you now have a little money to spend on marketing to find new clients?  Get my point now?

So, here’s a new challenge that will get you even more fired up with me than you may have been before.  If you’re not profitable, or more importantly, running negative cash flow, what are you doing about it?  What are your plans to fix it?  Who is responsible to fix it?  How can you fix it?

Over the past few weeks I’ve been talking with friends and acquaintances who own businesses about what they’re doing in response to the economy.  Virtually every one of them is cautiously optimistic.  Every one of them is also cutting costs in every way they can and in some (at least in today’s perspective) creative methods.  Several have given up the office and moved back home.  A couple are even at card tables set up in the basement.  One has turned his company paid car back in and is driving the company dump truck back and forth.  Several high school children are really upset about their new, not so cool, cell phones and cell phone plans and the loss of their cars. More than a few have taken paid for cars off the insurance and parked them in the driveway.  The family just has to figure out how to use fewer cars for what they need to do.  All of them remarked about family meals at home being way more common than ever before. A couple have employees making polite, gentle calls to accounts receivables to remind them that they’re slightly past due with their payment.  Virtually all of them are calling active customers and clients “just to touch base to see how things are going”.  Nearly all of them have told their employees that lay offs are the step of last resort, but at the same time, don’t look for much paid time off this year either.  Some are no longer employees but are independent contractors now.

You see, each of these people I’m talking about has reached that decision point in their business and they’ve decided to fight and do whatever it takes to hang on, stick around, gently look for more business.  What about you?  How much fight have you got left?