The Reluctant Entrepreneur: Turning Dreams into Profits

CREATE A CULTURE THAT RESPECTS MONEY

I like spending money—but I make an effort to count pennies when it comes to business.

For one thing, there are times when your business can’t be forced into growth. When increasing sales is not an option, cutting costs is often a necessity. If you don’t do it, your bottom line will disappear—one dollar at a time.

Plus, when you spend money carefully, you feel both smart and virtuous. It is just plain foolishness to throw income away on something unnecessary, unplanned, or unwanted.

If you can get everyone in your company to be respectful of money—to value saving and be critical about spending—a surprising camaraderie will develop. People will work together to keep costs down. They will take pride in their frugality.

I’m not talking about cutting salaries and benefits. I don’t believe in that. I’m talking about:

• not buying a new photocopier when you can repair the old one
• being willing to switch vendors when the old ones can’t be competitive
• reprocessing paper so that both sides get used

That sort of thing.

Profits are the residue of extraordinary effort. If you don’t constantly push to make more sales and reduce spending, your profits naturally and inevitably shrink to nothing. By keeping the pressure on—both to increase the top line and decrease expenses—you create something that is the product of all that hard work.

Respect the money your business makes. Spend it cautiously. Reinvest it wisely. Understand what it represents. Communicate ...