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When you have no market and no chance of the market growing that is a fundamental problem. Go visit a small town. If you arent making money this year the next 5
by geggam 9y ago
When you have no market and no chance of the market growing that is a fundamental problem. Go visit a small town. If you arent making money this year the next 5 years arent likely to change.
- afuchs 9y agoI've visited small towns. I disagree. Most businesses aren't immediately profitable when they start. On the topic of cash flow: Let's pretend that you build houses. You are paid by your customers only after you finish each house. Before you can even start to build one of these homes, you must first buy and pay for the house's materials. If you don't have enough money to buy these materials, then you can no longer build houses for your customers. This means that you would be in trouble if one of your customers doesn't pay you (i.e. a hypothetical real estate developer who dabbles in reality tv). In this situation, you have a couple of choices. You can decide to go out of business. Alternatively, you could try to find more money in the form of a loan or investment, which would allow you to rebuild your business and recover. If you don't have any way to get this money, your only choice is to close down.
- Spooky23 9y agoRead the article. The first and more important example, is the business that wanted to expand its peanut processing operation. That highlights the danger of centralization of finance. Some regional commercial banker at Bank of America or whatever doesn’t care about a small loan for a peanut processing facility. It’s not worth doing the paperwork to write that loan. The local banks did. Local banks fold up mostly because of the ridiculous monetary policy where large banks get free money conjured up by the Fed. Read “The Silicon Valley Way”. These types of issues are actually covered.