Restaurants have been hard hit. Here is a terrific debt workout success story.

Four locations, low end dining, working class customers, a large lunch venue, previously did very well. A direct hit by the current recession, revenues are down, cost of business continues to rise…margins are slim…spells deep issues. Cannot pay debt service on $1.2 million.

A standard secured loan, not an SBA guaranty loan.

We negotiated a debt workout for $120,000. With forgiveness of the remainder. Ten cents on the dollar…..this works. They borrowed the payoff money from family…..Yahoo! Another small business owner saved!

Warning 2010 WILL be dangerous to your business health. Here is how to survive.

I read the blogs, study the economic experts and understand many of the issues. Politicians are not to be trusted or believed; unfortunately they are still controlled by special interest groups, thus, greed prevails and rules. It’s politics as usual. Despite what ‘THEY’ say, we are not recovering and will suffer for a long time.

Our economic leaders, banks, especially, remain committed to their way, and will be of no use next year to the small business man or the economy as a whole.

Unemployment and the real estate bust will continue to hold emergence back. The government hand outs will not break the back of the recession.

There will be no help for the small business owner at all.

If you are to succeed you must do it on your own.

Here is the simple recipe for survival and then success.

Downsize, re-invent your business and workout your debt, reducing it with debt forgiveness to an acceptable level, preferably zero.

Then you can hold on and ride it out, learning how to grow and prosper under today’s conditions, conditions we must endure for a long, long time. What we now have and will have is what it will be for quite a while, many years. So stop thinking trend and thing this is our reality and prepare immediately.

Those that work out their debt and downsize to balance their reduced revenue with their breakeven point will be able to dig in and prosper. Those that do not will fail. It is that simple. Those that reinvent their business equation to reflect the changing times will win, the remainder will lose.

Next year will be dangerous to those that fail to heed the warnings, probably fatal.

Or it could be a great year for those that follow the only possible path to success, downsize, reinvent your business and workout your debt.

You have been warned.

It’s a new year, here is your ONLY new year resolution.

2009 was a year of change, for all of us, especially small business owners, that’s a certainty. Revenues are down, overhead is up, credit is gone, things are very different.

It is time to do one very important task to insure survival and growth though 2010.

Write a new business plan.

Pretend you are just opening up, a new start up, you have a blank page in front of you and you ask yourself, If I wanted to be in the zxzxzx business (the business you are currently in) what would my plan look like?  How much capital would I need and how would I operate, finance it and market my goods or services?

Please do not merely repeat your current situation. This s a huge opportunity to redesign  your business based on today’s conditions. It’s just pencil and paper so anything can be considered, it cost you nothing to ponder viable alternatives.

Consider outsourcing, yes even to China. Consider downsizing dramatically, consider internet marketing, consider training younger newer employees. Reconsider your product line or service. Maybe you need to expand? Maybe you are in the wrong location, maybe you need strategic alliances, joint partnerships. It is time to consider all the options you may have, all of them, even the impossible ones, as anything is possible when you are dreaming or planning.

What would be the perfect equation for you if you were starting out today? Nothing is impossible so dream away.

Then look at what you have planned and plot a path to deliver that dream… a new business plan.

Sure there may be some shortfalls, capital requirements, employees, machinery, an ad budget, but the real question is what plan can you adopt within the resources you have? What changes can you make to bring home a working equation that will yield a profit.

Isn’t this the key question? So once you have freed your mind to wonder the universe and imagine the best plan possible then you come back to reality and using this vision you design a plan that will work and yield a profit given your resources.

What plan can you devise that is built on what you are doing and adjusted by the vision you have conjured and controlled to a certain extent by your available resources, that will bring home a profit, immediately?

What debt workouts must you engage in to survive?

Now we are talking business.

Yes, it may mean letting some trusted long term employees go. Yes, it may mean abandoning non profitable products, activities, clients, sales programs. Yes, it may mean outsourcing. Yes, it may mean skipping wholesale and just going retail, maybe just internet marketing, who knows until you have evaluated the unknown.

This is your new years resolution, create a new business plan based on a clean slate approach.

What if…?

That is the question, with only one rule, it must be immediately profitable.

Then implement it. Do it. You have no option, no alternatives.

What a great new year it will be.

It’s Christmas, it has been a brutal year for small business owners, here is what you need to do today.

Put on your game face. You are being watched. Watched by your family. For them to be content, happy, they need a sense of well being. The need to know you will can and are providing for their well being. Protecting them. Giving them a sense of security. They need to trust you that you will deliver what they need. This is your job, your territory.

They need not understand the details, nor do they really care. They simply need to know that you believe they are all ok, that you believe you will be able to fulfill your obligation and provide them with security and a sense of well being.

You can be filled with fear, the truth may be screaming disaster, your reality may be shaky, but know this, in the end you will figure it out. You will do whatever you have to do to deliver the sense of well being your family depends upon and needs. This you will do come hell or high water, this you know. So today wear your game face and give them the gift of security by owning it yourself. They will take your personal presentation as the truth; they will be ok if they believe you feel ok. You are their guide, their leader, be calm and project success, everyone else will be happy.

So yes put on your game face. Complain to no one. Buck it up and let everyone know, you are ok, you are confident,  maintain a no problem attitude. They will feel your confidence and enjoy the warmth of feeling protected and taken care of. No need to share any details, just your feeling of success your personal belief that you are ok will spill out to give your family the sense of well being they need to enjoy the season.

No complaints, no grumbling, no outward evidence that anything being wrong. Everything is ok, and all is well, that’s the message you need to be giving, that’s the gift you have for your family. Give it to them, they deserve it, you can return to the war front on Monday, today all is well.

God Bless you all, I understand the pain you are enduring, but that is the job of a warrior, selfless sacrifice, fighting the battles to provide for your family. No applause, no thank you, no slap on the back. Just the personal satisfaction that you are doing your job, no matter how difficult it may be.

That is your Christmas message  to all my small business warriors.

Follow your gut. Your instincts are seldom wrong!

I read an article many years ago, that has suck in my mind ever since. It was about a Harvard study on how the best business leaders make decisions. It went on to describe how they would collect data, test hypothesis, do research, ask others opinions, do the numbers, etc, but in the end universally after doing their best research and evaluation, they all said then they would lean back in their chair and trust their gut instinct…

Wow, I thought, with great excitement, in the end the best decision makers of the time, the leaders of successful corporations trusted their gut instinct to make the most important decisions.

I was both amazed and very excited as I have had a life time of making intuitive, gut decisions, because I get that feeling in me when I know I am onto something good. It is difficult to explain, my wife calls it the ping of truth, it is a sensation, an energy, a feeling, but when it happens I know it, when it is not happening I feel its absence and know that as well.

Very recently I was interested in a building that has been for sale for a while and I have been eyeing it with great interest and I called the broker who informed me it was under contract. I asked him to call me if it fell apart. It did and he called me back. It is an exceptional deal presumably perfect for in many ways for my intended use and I should have been very excited…but I wasn’t. I did not have that gut feeling of excitement, my onward through the fog I go feeling…no yay!…no feeling of exhilaration, no sense of destiny, no ping of truth, no inner belief it was the right decision despite every logical analysis screaming buy, buy, buy!

So I have stepped away, and am not acting on this opportunity. Will I be remorseful when someone else buys it? No! Do I have any reason not to buy it? No, not one! I simply do not have that gut feeling telling me to do it….so I will not.

I am following my intuition, my gut feeling, rather than deciding by empirical evidence, numbers and any other analysis one may use. In fact all other evaluations scream buy it, except the one I deem most important my intuitive, unexplainable feeling of yes.

I believe this is the soul of entrepreneurial decision making, instinct, gut, intuition. I believe the Harvard study I reported about above had it right. The execs used empirical evidence to evaluate and analyze and then rested on their intuitive feelings to make the final decision. If empirical evidence said no, there may not be a reason to go further, if the empirical evidence said yes, then check the gut and decide based on intuition.

If you’re good at this, irrespective of empirical evidence, research or numbers, do whatever your gut says despite what the more traditional evaluation process says…If you are good at this skill.

If this is foreign ground, you can learn to do this. Start with small decisions and try and feel the right decision, Experience success get familiar with the feeling so you can identify it when it happens again, and continue to experiment with it, and see the results. It works. You can develop this skill. It may be a skill you have but have ignored because you did not understand its power.

Now you do, do it, it works.

Trust your gut…it knows.