Small businesses, like many others, are feeling the pinch of these economic times. In this economy, many if not most small businesses are operating on very tight budgets simply to get by. Some call this “bootstrapping” or operating on a “shoestring.” In either case, it is possible to successfully operate a business on a shoestring!

Through good and bad times, business success is not necessarily predicated on a fat wallet. Rather, it comes from good financial management, proper planning, and a relentless drive to succeed.

Here are several tips for entrepreneurs who are operating on a tight budget.

1) Put your money where it will bear fruit. Try to put as much money as possible into working assets (which bear cash and sales), and as little as possible into fixed assets. Also, if you have dead inventory, figure out ways to dispose of it quickly.

2) Push the Sales. Continually work at building sales of your product or service. Be sure to have a plan in place, and dedicate time each day to market your business. It’s really easy to get in a rut and stop effectively marketing your business. But businesses that stop marketing may soon be out of business.

3) Be “Lean and Mean.” Businesses operating on a shoestring don’t need any deadweight. Strive to keep your fixed costs as low as possible, and spend on items that contribute to your bottom line. Every dollar in expense should be directly tied to income. Spend a nickel only when you can get a dime in return.

4) Master the Financial Tools. The business owner is responsible for the life and growth of the business. A clear and total understanding of the finances will give you control over the direction of the business. It is critical to understand your cash flow, income, profit and loss statements, and the overall bookkeeping system. This will tell you where you’ve been, where you’re going, and how fast you’re getting there.

5) Use Available Resources. Resources like the Center’s Rural Enterprise Assistance Project (REAP) are available to assist startup and existing small businesses. Many times, entrepreneurs wait until it’s too late to ask for help. It is up to the entrepreneur to ask for help, which will in turn increase the odds of small business success and growth.

For more information: in Nebraska, contact Jeff Reynolds, REAP Program Director, 402.656.3091 or jeffr@alltel.net. Outside Nebraska, check the Association for Enterprise Opportunity (AEO) website, www.microenterpriseworks.org.