Entrepreneurial

Businesses trim costs to combat lagging sales

USA-RETAIL/BLACKFRIDAYTina Bean’s wish for 2011 is that people will open their wallets more.

“People don’t want to spend money,” said Bean, the owner of Port Arthur, Texas-based pet food dealer, Five Star Feed Store. “They are buying necessities and that’s it.”

Annual sales at Five Star Feed Store have declined approximately $100,000 since the recession, said Bean. She has been forced to lay off three workers and has given pay cuts to the remaining five. The cutbacks have also had a personal effect. “For a long time, I didn’t draw a paycheck,” she said.

Bean’s experience is highlighted by recent financial data from Sageworks Inc., which showed a number of sectors are suffering from declining sales. The report analyzed 2010 sales, profit per employee and payroll as a percentage of sales data for private companies in six major industries: construction, manufacturing, wholesale trade, retail trade, healthcare and education.

All the sectors except health and education experienced a decrease in annual sales. Manufacturing was down 3.6 percent, wholesale trade declined about 4 percent and retail trade dipped a little more than 1 percent in sales for 2010.

Construction showed the most marked decline as sales plummeted by more than 13 percent this year, but that was an anomaly according to Mike Lubansky, a senior financial analyst at Sageworks.

Is your business failing? It’s your fault

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Brace yourself, because George Cloutier has some unsettling news: your failing business is your fault.

Cloutier is the no-nonsense CEO of American Management Services and author of Profits Aren’t Everything, They’re the Only Thing, a literary slap in the face to small- and medium-size business owners who wonder why sales are slipping and cash is tight.

Like the gruff boss he urges small business leaders to be, Cloutier doesn’t waste any time trying to get you to like him — he wants your respect, and his book fires off rules without apology: “Love your business more than your family”, “End your denial” and, perhaps most startling, “Give up golf – it’s a waste of time!”

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