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It is common among cash-strapped small businesses for the owners and their employees take on many responsibilities simultaneously. The job of financial accounting and general bookkeeping thus often goes to someone within the business who has not been formally trained for the task. Though this may be an effective way to reduce expenses, it could lead to some costly mistakes down the road.

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Even if your budget is tight, you should make an effort to avoid these common pitfalls in small business accounting:

1. Not hiring a professional or hiring someone who is unqualified for the job. These days cost-cutting has become a top priority among small business owners trying to keep their ventures going. However, there are several instances where the experience, know-how, and counsel of a qualified professional, such as a bookkeeper, tax preparer, or accountant is needed. Cost-cutting sometimes loses its value when the necessary “corners” are cut out.

2. Not establishing formal accounting policies and procedures. Creating clear accounting policies and procedures helps to ensure consistency and accuracy in the processing of transactions. This is particularly important when a business has several employees who may additionally share jobs and responsibilities. Common areas to consider include: the management and usage of petty cash, a system for employees to be reimbursed for business expenses, how to set up the filing system for clients, projects, or complex transactions, and finally how to keep the lines of communication open between management, employees, and the individual(s) who maintain the financial recording.

3. Not making use of available programs and tools. These days small businesses have access to a wealth of software programs and services that are specifically designed to help small businesses with their accounting, payroll, and tax obligations. While some of these options, such as Quickbooks, come at a cost; there are several free or low-cost open source programs available that can do a pretty decent job. There are even some mobile phone apps that can greatly enhance the way the transactions are recorded.

4. Leaving out the fundamentals of bookkeeping. Due to lack of know-how, experience, or time, many small business owners make the mistake of leaving out some fundamental bookkeeping steps, such as reconciling the books and bank statements every month, saving receipts (even for purchases less then $75), and properly tracking reimbursable expenses.

5. Being ignorant of current accounting rules and legislation. Since the person (or people) who are recording the financial information often have received any training, it opens the door to some common, yet potentially costly consequences. Often, seemingly harmless mistakes can attract the unwanted attention of the IRS. A few common examples include: not properly classifying employees versus independent contractors, consultants, and freelancers, not deducting the sales tax from the total sales, not claiming the full amount of tax deductions or using the tax deductions incorrectly, even using nontraditional expense categories or putting itemized expenses in the wrong category.

6. Not setting up back up systems. Business owners who do not establish a system for backing up financial data are asking for trouble- especially if data is only recorded electronically. There are several ways to back up your precious financial information: periodically transferring the data to a CD, purchasing an external hard drive, relying on tape back ups, or using online back-up services. Each option has its pros and cons, and you should do your research in order to find the most suitable match for your business. In addition, it is a good idea to have some hard copies of information on hand.

Even as the economy shows signs of revival, several economic indicators, such as consumer confidence, consumer spending, and the nation’s unemployment rate, suggest that it will still be a tough road ahead for many small businesses over the next few months.

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Those small business owners looking for ways to get through this difficult economic period may want to re-evaluate their employee work week and/or hours of operation. Not only will this help to cut costs and improve overall productivity, but it may also help small business owners to hold on to their workers.

Here are a few of the most popular flexible work scheduling options among employers and their employees:

1. The Compressed Work Week

Many businesses big and small are realizing the advantages of operating on a compressed work week which include: less commuting, a reduction in utility costs, and a more productive workforce. All of this is accomplished without dramatically changing the actual amount of hours an employee works or the business’ operating time. There are several ways to set up a compressed work schedule:

• A 4-day work week with 10-hour shifts

• A 3-day work week with 12-hour shifts

• Working for 9 or 91/2 days, every two weeks

2. Flex Time

With a flex time schedule, employees work their usual amount of weekly hours, but are granted flexibility when it comes to their starting and stopping times. So, for example, one employee might choose to begin work at 7:30 am and end at 4:00 pm with a half-hour lunch period, while another person could start at 10:00 am and work till 7:00 pm taking an hour for lunch.

3. Job Sharing

With this flexible work option, two or more employees share the same position either by being jointly responsible for that position or by splitting up the functions of a particular job. This option is best for those businesses that require additional tasks be done but cannot afford to hire additional workers, or those businesses that have been forced to let some workers go thereby leaving gaps in work productivity.

4. Telecommuting/Teleworking

In this scenario, employees work from home instead of commuting to work. Advances in mobile technology, communications, and computing have made home-based employees increasingly more productive and versatile. Some businesses choose to have such employees work exclusively from home; others require a combination of home-based and office-based hours.

5. Reduced Hours, Days Off, and Unpaid Vacations

This final option is typically the least desirable from the employee’s prospective, but it may be a better choice then laying off workers outright. Either employees can cut back their weekly hours, or take days off (for example, not coming in every fourth Friday of the month), or they can be given the option for unpaid vacation time.

In order to be successful these days, many small business owners are recognizing the importance of not only establishing a web presence, but actively using the Internet as a marketing tool and business platform. This can be a bit challenging, however, for those business owners who are not so tech-savvy and cannot afford to hire a professional IT consultant.

Fortunately, there are several web tools (many of which are free or low-cost) to help the Internet-marketing novice along the way:

Website and Webstore Builders

These website builder programs allow inexperienced users to easily create their own websites and online stores. By manipulating the simple user interface, the novice can almost instantly produce a professional-looking, versatile website with no programming or HTML knowledge.

• Sitecube– Website builder and ecommerce solution offering over 9 thousand templates and several stunning features.

• Bluevoda– free, fully- featured, and efficient website builder and hosting with instructional videos

• Homestead- Provides a collection of easy-to-use website design tools and web hosting services to help get your online business up and running.

• Sitesell.com– Provides an extensive collection of tools and services including website building software and instructional Internet marketing videos.

• Netidnow– Comprehensive website builder and ecommerce shopping cart solution

Website Optimization and Analytics

• Google Analytics– Google’s powerful, yet easy-to-use set of tools is the hands down winner of website optimization and analytics solutions, and the best part of it is that it’s free. Innovative and customized reporting used in conjunction with Google’s sister product, the Google Website Optimizer, provides a powerful one-two punch that easily competes with other enterprise-level packages. This analytics package is a must-have for any small business owner operating on the web.

 Internet Marketing

• Google Adwords -This easy- to-use, affordable, and powerful Internet marketing program is well suited to the needs of small businesses. In particular, Adwords provides several helpful tools, such as keyword choice assistance and keyword replacement as well as comprehensive reporting features. Be sure to also check out the AdWords Learning Center for information on using AdWords for your business.

• Aside from Adwords, you should also check out, BidVertiser. This site allows advertisers to choose which website they want their ads displayed on.

 

According to recent research, retail sales have fallen over the last month even as the back-to-school shopping season gets into high gear, and industry forecasters claim that this does not bode well for the upcoming holiday season either.

 

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So the looming question for retailers big and small continues to be how to maintain or even increase sales in such a dismal economic environment.

A month ago I posted this article that briefly examined how some restauranteurs were managing to succeed despite the weak economy. In a similar vein, although the retail industry as a whole is suffering, there are several hot pockets of consumer spending that continue to draw brisk sales. A few big discount retailers, such as Wal-mart, have been able to capitalize on these trends and are focusing on several strategies to keep these consumer dollars rolling in.

Though small retailers may be more limited in their scope then the big discount chains, by studying their strategies, there are several valuable lessons that small businesses can learn and implement. Perhaps the most important of these strategies is that retailers are paying close attention to shifts in consumer attitudes and behavior and then adapting to them.

Here is a brief look at what some of the successful retailers are specifically doing:

1. Focusing on value. Today’s consumers are tech-savvy, bargain hunters looking for the best bang- i.e. value- for their buck. Retailers are concentrating their inventory on what people still need to buy, and then providing it at a low-cost or with some other added value, such as extensive customer support.

2. Promoting a unique brand. It has become increasingly important over the past two years for retailers to differentiate themselves and/or their products and services from those of their competitors.

3. Using aggressive, low-cost marketing tactics. The role that the Internet is playing in consumer decision-making and spending has not been overlooked by retailers, and it is all the more attractive given its low cost. Successful online marketing campaigns include: sending out emails, maintaining a website, offering online coupons, and registering with online directories and Point of Interest databases.

4. Offering promotions. The goal of a successful promotion is to get customers in the door where they will either spend money on other items or services or they will remember the experience and be more likely to frequent the business later on. Some promotion ideas include hosting or promoting events, offering a themed sale, or providing free products or services.

5. Focusing on customer convenience. Retailers are paying attention to how customers are choosing to make their purchases and then building up these areas. Are customers, for example, using cash as opposed to credit or shopping online as opposed to physically showing up at a brick and mortar location?

6. Initiating cost-cutting tactics and tight inventory management. Even the most profitable retailers out there these days are paying close attention to wasteful or redundant spending and are making sure that capital is not being tied up in unnecessary inventory supplies.

7. Forming partnerships. Some stores are forming partnerships with each other, whether banding together to pool resources or reduce overhead costs or offering discounts to each other’s customers.

If you are thinking about going to small claims court to recover an outstanding debt owed to your small business, you may want to think again. The point of small claims court is that it gives the involved parties a chance to settle disputes while avoiding any more expensive and complicated court procedures later on. But often the hassle (i.e. the paper work, the pre-case preparation, and having to personally go to court) and the cost (in fees) of going through the small claims process outweighs any benefits.

 

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Moreover, even though several states have reported an increase in the number of claims being filed- especially among businesses seeking to recover a debt owed to them or consumers disputing a charge, many of the claimants are unable to collect on their debts even after wining their case. This is due to the fact that a claimant who wins a case is solely responsible for collecting the funds afterwords. Even if the claimant is eventually successful, it will come at the cost of even more time and even more money spent in fees.

If you decide that going to small claims court may still be a viable option for your small business, then you should at least make sure that you go into the process well-informed. For more general information on the small claims process you should consult sites like this one in Florida and this one in Texas. Be sure to also get information specific to the county in which you will be filing.

 

It all seemed so promising…

Last year, Senator John Kerry’s Small Business and Entrepreneurship Committee managed to not only save several small business loan programs that were effectively reduced or completely nixed under the President’s proposed 2009 budget, but they also managed to secure over $100 million in additional funding. This additional funding was supposed to cover “increased loan oversight and reduced fees, microloans, contracting assistance, Small Business Development Centers, Women’s Business Centers, veterans outreach programs, and technical assistance programs…”

Over the year that followed, the SBA has heavily promoted its flagship offerings to small businesses- namely the 7(a) and 504 lending programs. And recently, it caused a stir with its America’s Recovery Capital Program, or A.R.C. Under this program, previously profitable small businesses currently experiencing financial difficulty would be given the chance to catch up on their debt. The A.R.C. loans, which can go up to $35,000, carry no fees and no interest, and are to be used to pay down existing debt. What’s more, the borrowing company does not have to begin repaying the loan until a year after it receives the final installment.

It sounded great, and many small businesses owners across the nation no doubt breathed a sigh of relief expecting that help would come their way. But the help has been slow in coming. Even with all the money and high hopes, banks both big and small and other “preferred” SBA lenders have been reluctant to offer SBA- backed loans (or any loans for that matter) to small businesses (for example, read here and here).

Even though both the SBA and the media have reported that small business lending has increased in the last few months, it is too little, too late for many of the small businesses who need this funding the most.

All disappointment, frustration, (an even anger) aside, the reality is that most small businesses would do better to abandon hopes for a government life-preserver and instead consider alternative forms of financing, such as accounts receivables factoring and merchant cash advances or tapping into the resources of friends and family to stay afloat in these difficult times.

 

 

 

As the recession continues to drone on, stilted consumer spending coupled with restricted (and in many cases nonexistent) credit markets have made it rough going for numerous small businesses and start-ups. At such times, seeking shelter in a business-friendly environment, can mean the difference between success and failure, growth or stagnation.

Virginia is Pollina Corporate's pick for top pro-business state

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Though there are several, often-quoted studies that attempt to classify which states are the most small business-friendly, the truth is that any such measure is subjective. What makes one state more business-friendly than another really depends on the type of business, industry, or stage of development under consideration.

The following are the results of a few studies conducted this year broken down into several key categories: tax environment, the cost of living, the quality and education of the local workforce, the number of healthcare mandates, and finally a state’s overall business-friendliness.

Tax Environment

According to the Small Business & Entrepreneurship Council’s 2009 Business Tax Index, the top ten state tax systems are:

1) South Dakota, 2) Nevada, 3) Wyoming, 4) Washington, 5) Texas, 6) Florida, 7) Alaska, 8 ) Colorado, 9) Alabama, 10) Ohio

While the worst state tax systems are:

40) Nebraska, 41) Idaho, 42) Massachusetts, 43) Vermont, 44) Rhode Island, 45) Iowa, 46) New York, 47) California, 48) Maine, 49) Minnesota, 50) New Jersey, and 51) District of Columbia.

The Cost of Living

According to CNBC’s study on the best and worst places to do business in 2009, the states with the lowest cost of living are:

1) Oklahoma, 2) Arkansas, 3) Georgia, 4) Tennessee, 5) Kansas, 6) Missouri, 7) Texas, 8 ) South Dakota, 9) Alabama, and 10) Kentucky.

The states with the highest cost of living are:

41) New Hampshire, 42) Rhode Island, 43) Connecticut, 44) Vermont, 45) New Jersey, 46) Maryland, 47) New York, 48) Alaska, 49) California, and 50) Hawaii.

Workforce

The CNBC study also conducted a survey of workforce quality among the different states. Here are the top ten:

1) Georgia, 2) North Carolina, 3) Florida, 4) Tennessee, 5) Arizona, 6) South Carolina, 7) Idaho, 8 ) Virginia, 9) Utah, and 10) Kansas.

The bottom ten include:

41) Illinois, 42) Connecticut, 43) Pennsylvania, 44) Wisconsin, 45) Maine, 46) Ohio, 47) Hawaii, 48) West Virginia, 49) Alaska, and 50) New York.

Healthcare Mandates

According to the Small Business Survival Index 2008, conducted by the Small Business Entrepreneurship Council, several states are more lenient in terms of mandated benefits on employer-sponsored health plans, while other states are known for their heavier regulation.

The states with the fewest health mandates include:

1) Idaho, 2) Alabama, 3) Dist. of Columbia, 4) Hawaii, 5) Utah, 6) Delaware, 7) Iowa, 8 ) Michigan, 9) Ohio, and 10) Vermont

Those with the most healthcare mandates are:

41) Connecticut, 42) New Mexico, 43) Nevada, 44) Maine, 46) Washington, 47) Texas, 48) New York, 49) Virginia, 50) Maryland, and 51) Minnesota.

All Arounders

Pollina Corporate Real Estate, Inc. recently published a study to determine the top ten pro-business states for 2009. The comprehensive study involved 33 factors including taxes, human resources, right-to-work legislation, energy costs, infrastructure spending, workers compensation laws, economic incentive programs and state economic development efforts.

The top ten states are: 1) Virginia, 2) Utah, 3) North Carolina, 4) Wyoming, 5) South Carolina, 6) South Dakota, 7) Kansas, 8 ) Georgia, 9) Florida, and 10) Nebraska.

As a tidal wave of business and consumer bankruptcies continues to drown our economy, those who have taken (or are considering) the bankruptcy plunge should at least know that they are not alone. In fact, since the turn of the century the U.S. has seen some of the biggest corporate bankruptcies ever. The following is a brief rundown of several high-profile and influential bankruptcies, all of which occurred over the past 8 years. The businesses are listed in the order of filing.

1. Pacific Gas & Electric Co.- April 2001

With soaring wholesale power costs outpacing retail prices as a result of California’s 1996 deregulation law, which prevents the higher costs from being passed on to customers, the Pacific Gas & Electric Co. filed for chapter 11 bankruptcy in April 2001. Pacific Gas & Electric Co., is a subsidiary of the nation’s largest utility holding company, PG&E Corp which provides power and natural gas to northern and central California. At the time of filing, Pacific Gas & Electric Co. had accumulated $12 billion in debt and $36 billion in assets.

2. Enron- December 2001

With $63.4 billion in assets, the Enron filing was the biggest bankruptcy in U.S. history until it was eclipsed by WorldCom the next year and Lehman Bros in 2008. Immersed in obscure accounting practices that concealed loses worth billions of dollars, Enron’s downfall will certainly be remembered as one of the most notorious scandals in history. In the end, Enron’s stock plummeted from a high of $90 per share in mid 2000, to just $0.10 a little over a year later causing stock holders to lose some $11 billion.

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3. Global Crossing Ltd.- January 2002

Plagued by a combination of waning demand for telecommunications services in addition to reckless corporate and executive spending, the fiber-optic network operator Global Crossing Ltd, filed for bankruptcy protection in January 2002. At the time of its filing, Global Crossing had assets of $25.5 billion and liabilities of $14.6 billion, making it one of the biggest bankruptcy cases in U.S. history.

4. Adelphia Communications- June 2002

At its height, Adelphia Communications was the fifth largest cable provider in the United States. But that came to a pitiful end when founder John Rigas and his son Timothy were convicted for embezzling millions of dollars from the company, hiding $2.3 billion in debt, and deceiving investors about Adelphia’s profit and subscriber growth. Father and son received prison sentences of 15 and 20 years, respectively, and the company’s assets were later snapped up by Comcast and Time Warner in bankruptcy court.

5. WorldCom- July 2002

Just before filing for bankruptcy, WorldCom was considered one of the biggest long-distance companies in the U.S. With approximately $107 billion dollars in assets, its case was the second largest bankruptcy in history. WorldCom’s financial decline revolved around a massive accounting scandal in which the company’s total assets had been inflated by an estimated $11 billion.

6. Tyco International Ltd.- July 2002

In yet another example of executive scandal and corporate excess, former CEO Dennis Kozlowski and CFO Mark Swartz of the electronics giant Tyco International Ltd were found guilty of embezzling about $600 million from the company. Tyco filed for bankruptcy shortly thereafter.

7. US Airways- August 2002; September 2004

This troubled East-Coast airline filed for bankruptcy twice within a two year period. Though US Airways had a history of financial difficulty, the first bankruptcy filing was precipitated by September 11th terrorist attacks. The Reagan National Airport in Washington D.C., a major US Airways hub, stayed shut longer than any other airport. Even when the airport reopened, security delays mixed with a general reluctance to flying, adversely affected its profitable shuttle service between Washington, New York and Boston. Though it was able to get out of bankruptcy in 2003 after receiving a $1 billion loan from the Air Transportation Stabilization Board, it filed for bankruptcy again a year later after the airline was unable to secure $800 million in annual cost cuts from its workers’ unions.

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8. Conseco- December 2002

Struggling with a $6.5 billion debt load, Conseco Inc. a well-known finance and insurance company, filed for chapter 11 bankruptcy protection in December 2002. Much of its debt was attributed to a string of impetuous acquisitions made during the 1990’s, including the ill-fated $6 billion purchase of Green Tree, the nation’s largest lender to mobile-home buyers. The company is also known for its generous spending. Shortly after the Green Tree acquisition, Conseco offered a $75 million contract to former GE executive Gary C. Wendt in the hopes that he could turn the beleaguered company around.

9. Trump Entertainment Resorts- November 2004; February 2009

Citing high interest payments on financing that prevented the refurbishment and expansion of its gambling hotels, Trump Hotels and Casinos filed for bankruptcy protection in November 2004. Though the company emerged from bankruptcy a year later under the name Trump Entertainment and Resorts, its financial difficulties continued as the current recession took hold causing a slump in the gambling industry. In February of this year, the company sought bankruptcy protection again a few days after founder Donald Trump quit the board. At the time of filing, Trump Entertainment listed assets of $2.06 billion and debt of $1.74 billion.

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10. Delta Airlines- September 2005

After failing to post a profitable quarter since the year 2000, Delta Airlines, the nation’s third largest airline, could not sustain the sudden spike in fuel prices that came in the wake of Hurricane Katrina in addition to rising competition among low-fare carriers, such as Southwest Airlines. Another factor in Delta’s financial struggle included high labor costs, from which it was unable to secure concessions. Delta eventually exited bankruptcy in April 2007.

11. Northwest Airlines- September 2005

Just minutes after Delta Airlines announced that it was filing for bankruptcy, Northwest Airlines, the fourth largest carrier in the U.S., followed suit. Like Delta, Northwest was unable to sustain the increase in fuel prices and competition among low-cost carriers in addition to its high labor costs. The airline eventually emerged from bankruptcy in May 2007.

12. Delphi- October 2005

The bankruptcy case of Delphi, the largest auto parts maker in the U.S, has been shrouded in controversy. Delphi was originally established as a spin-off of GM, becoming a publicly-traded corporation in 1999. But it has since remained dependent upon GM for a significant portion of sales.

Many contend that the real purpose of Delphi’s creation was to prepare for a deep round of layoffs and wage cuts at both companies, and to shift pension obligations from the parent company to its spin-off. By filing for Chapter 11, Delphi was able to accomplish all this without union approval. Moreover, critics have been quick to harp on the fact that just a day before filing for bankruptcy in October 2005, Delphi increased the severance packages for 21 top executives claiming that it would be needed to keep them loyal to the company. The Delphi bankruptcy also paved the way for a series of sweeping rollbacks on auto workers at the Big Three in 2007, as well as the bankruptcies of GM and Chrysler.

13. Refco- October 2005

On October 17, 2005, just a mere three months after going public, Refco, a New York-based financial services company filed for Chapter 11 bankruptcy protection. The company’s financial downfall and eventual disintegration was attributed to a wide scale financial fraud in which Refco’s CEO and chairman, Phillip Bennett hid over $430 million in bad debt. At the time of filing, Refco posted assets of $33.3 billion and a debt that totaled $16.8 billion.

14. IndyMac Bancorp Inc.- July 2008

IndyMac Bancorp, based in Pasadena, California was at one time one of the largest mortgage lenders in the U.S. IndyMac once specialized in “Alt-A” home loans, those ubiquitous financial products that often did not require borrowers to fully document either their income or assets. As the rate of defaults increased, the lender eventually collapsed. Following comments made by U.S. Sen. Charles Schumer questioning IndyMac’s survival, customers scurried to withdraw more than $1.3 billion of deposits over 11 business days. Federal regulators seized the company, and less than three weeks later, it filed for Chapter 7 bankruptcy protection. At the time of filing, IndyMac’s assets totaled $32.7 billion, and its liabilities ranged between $100 million and $500 million.

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15. SemGroup- July 2008

SemGroup, a major U.S. oil marketing company, filed for bankruptcy protection in July of last year after succumbing to $3.2 billion in losses on energy futures and derivatives trades that were supposed to hedge its physical oil trading business. On the surface, the Tulsa, Oklahoma-based company suffered from a combination of record high crude oil prices ( up to $150 a barrel) and a volatile credit market. But some assert that a scandal was brewing behind the company’s outstandingly poor performance. At the time of filing Semgroup had $6.1 billion in assets and $7.5 billion in liabilities.

16. Lehman Brothers- September 2008

The announcement a year ago that Lehman Brothers that had filed for Chapter 11 bankruptcy protection is considered the biggest and most complex bankruptcy case in history with company assets totaling over $600 billion. But greater than that, the downfall of Lehman Brothers, a financial behemoth and seemingly invincible Wall Street icon, sent waves of shock and disbelief across the world in a way that no other prior bankruptcy was able to accomplish. As the news spread, financial stocks plummeted world-wide. Many cite Lehman’s cultivation of a culture of corporate excess and risk taking, while shunning accountability at the major cause of its financial decline.

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17. Washington Mutual- September 2008

“The Power of Yes!” The financial implosion at Washington Mutual (WaMu) was one of the most telling examples of the reckless lending and fraud that has helped fuel the current economic crisis. Several former employees have come forward to offer disturbing accounts of high risk loans being approved with little or no oversight and of a corporate culture with a “sweat shop” mentality. In the end, J.P. Morgan Chase purchased the failed bank for $1.9 billion in a deal brokered by federal regulators.

18. Tribune Group- December 2008

At the end of last year, Tribune Group, the newspaper and television chain that publishes The Los Angeles Times and The Chicago Tribune, filed for Chapter 11 bankruptcy protection. Part of the company’s financial problems stemmed from a sharp drop in advertising revenue brought on by the recession as well as a general shift of advertising to the Internet. But Tribune’s financial position worsened significantly by an attempt made by the company’s CEO Sam Zell to take the company private and thus claim a tax-exempt status. The move resulted in an employee stock ownership plan, which was basically wiped out after the company declared bankruptcy.

Another bizarre twist to the troubled company’s case allegedly involved former Illinois governor Rod Blagojevich. According to a criminal complaint filed against Blagojevich, the former governor was upset with editorial pieces that were critical of his performance and devised a plan to get the editorial writers fired which included a threat that the governor would block money for renovations to Wrigley Field (one of Tribune Group’s assets).

19. General Growth Properties, Inc- April 2009

General Growth Properties (GGP), the second-largest real estate investment trust and mall operator in the nation, filed for bankruptcy earlier this year spearheading one of the biggest commercial real estate bankruptcies in U.S. history. Facing a tight credit market and a weak economy that dampened consumer spending and put many mall occupants out of business, the Chicago-based company was unable to support the $27 billion in debt it had amassed in previous years by buying up malls and shopping centers. A large portion of that debt came from GGP’s 2004 strategic acquisition of Rouse Co., a Columbia, Md.-based real estate development and management company. The bankruptcy filing made in New York included most of the GGP’s malls which will continue to operate.

20. Chrysler- April 2009

On April 30th of this year, Chrysler became the first of Detroit’s Big Three automakers to file for bankruptcy protection largely in response to a dramatic slump in sales that has plagued the company since last fall. Touted by President Obama as a “pillar” of the industrial economy, Chrysler has already received some $7 billion in tax payer bailout money ($4 billion of which was handed over during the Bush Administration). The Obama Administration rushed to move the ailing automaker into bankruptcy protection so that the company could close a strategic alliance with Italian automaker, Fiat. There has been much public outcry over Chrysler’s bankruptcy case, especially over its new ownership structure as well as the recent “revelation” that the bailout money will not be repaid.

21. General Motors- June 2009

Just one month after Chrysler filed for bankruptcy, General Motors (GM) followed, earning the “distinction” as the fourth largest bankruptcy case in U.S. history. Even $19.4 billion in federal help was not enough to keep the trouble automaker out of bankruptcy court, and the government has further pledged another $30 billion to help the company during its reorganization. A “new GM” is expected to emerge out of bankruptcy that will revolve around a mere four brands, Chevrolet, Cadillac, GMC and Buick, as well as a few of its overseas operations.

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In its wake, GM’s bankruptcy will have a major impact on a cross section of Americans. The move will result in the closure of numerous plants and dealerships, which means thousands of U.S. employees stand to lose their jobs. Moreover, approximately 650,000 retirees and their family members who rely on GM for health insurance will suffer cutbacks in their coverage. Investors holding $27 billion worth of GM bonds, stand to receive new stock in a reorganized GM worth a fraction of their original investment. Owners of current GM shares, will see their investments disappear.

A few weeks ago, I posted this article offering a few tips on how small business owners can grow their businesses during the recession. As I noted in the post, even in this dismal economy some businesses are thriving.

But for the majority of smaller businesses the focus has become just trying to hunker down and survive the economic storm while remaining somewhat intact.

One of the best examples of small business survival has been in the restaurant industry. The restaurant industry as a whole has seen both ups and downs over the past two years. Price increases in products and supplies, lower consumer confidence, changes in consumer behavior and demand, and less available credit have all had their impact on food services businesses. Yet many are proving to be surprisingly resilient and are successfully weathering the storm.

What’s their secret?

Successful restaurant owners are paying close attention to changes in the market and then adapting to them, they are also focused on developing and defining their brand..

So what specifically are some restaurants doing? Here’s a brief rundown:

Paying attention to quality:

Many restauranteurs are focused on the quality of the experience their customers have when they come to their eateries. This translates into the quality of the food, the service, and the overall level of hospitality. By providing an enjoyable experience, restaurant owners are giving their customers the opportunity to break away from all the dreariness and are in the processing cashing in.

Creating the perception of value:

These days as people look for ways to save money, they need a lot more incentive to spend it on eating out. Put simply, customers are looking to stretch their hard-earned dollars as far as they will go. One successful strategy used by restaurant owners is to focus on their customers’ perception of value. 

But communicating to customers that they are getting a good value (in terms of food quality, portioning, or ambiance) while at the same time not cheapening the perception of the business is actually a delicate balancing act.  It requires sound pricing strategy, menu planning, and marketing. Several restaurants have begun bundling meals, increasing portion size, or adding extras, like a free dessert, to add value while avoiding the appearance of discounting.

Using promotions to draw customers:

Many restaurant owners are also trying to draw customers with a variety of promotions and specials. Some examples include: having a night where kids eat for free or for a small charge, having a theme night, or setting aside slower times of the day or week for special value deals or unique events. Other restaurant owners are experimenting with cooking classes, dietary workshops, or birthday promotions.

Using the Internet to advertise:

The Internet can be an effective and often cheap means of advertising a small business, and this has not gone unnoticed by many restaurant owners. Many restauranteurs rely on a conscientious email marketing campaign, are making sure their business is listed on the popular online directories, and are a maintaining a website.

Emphasizing their unique brand:

All of the previous points are included in this one. The most successful restaurant owners understand the experience and the occasions that their business (i.e. their brand) is positioned for and are focused on building up these areas.

In short, whether you run a foodservice business, or another kind of small business, there are definitely a few lessons to be learned.

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When it comes to mobile phones and business use, RIM’s Blackberry series of feature-rich smartphones might immediately come to mind. But a wide and versatile range of apps are actually making Apple’s iPhone an attractive business tool for those on the go.

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Here are my picks of some of the most practical and useful iPhone apps for small business owners. Some of these apps are available free of charge at the iPhone App Store, others can be acquired for a nominal fee.

Personal Assistance and Time Management

• reQall: A powerful speech-to-text task manager.

• LiveTimer: A simple and easy to use online time tracking service.

• Todo: This simple task management app can be used by itself or synchronized with tasks on the web or desktop.

News

• Google News: Straight-forward app that keeps you up-to-date on the lastest headlines from news outlets worldwide.

• Spreed: If your time is limited, then you can try this application that helps users read bits of news and blog posts faster and easier.

Business Tools

• JotNot: This amazing app turns your iPhone into a document digitizer. JotNot enhances captured images and turns them into documents to be e-mailed.

• FedEx Mobile: Get up-to-date shipping and tracking information, arrange ground or express shipping, find a FedEx location, or create labels on the go.

• iTrack: Easy to use multiple-carrier (FedEx, UPS, USPS, and DHL) package tracker.

• Gmail: Look up recently read messages while you are off-line, compose multiple drafts, and view attachments with Google’s easy-to-use format.

• Epiphany Recorder: This must-have audio recorder can even record moments that already happened! Tap the “Remember That” button and it saves the previous two minutes of audio and continues recording as long as you want.

• Fring: Users can connect to their Skype VOIP account to make free calls anywhere in the world.

Finance

• BalanceDo: Send customer invoices, track receivables, and even manage payments through PayPal.

• Billing Manager: A focused and easy-to-use invoicing app created by Inuit.

• MerchantWare Mobile: Perform credit card transactions directly from your iPhone with a Merchant Warehouse account.

• BizExpense: This app helps track and report business expenses. Great for those who conduct business on the go.

• Timewerks: This time-tracking and invoicing app helps you keep track of your time and materials as well as send invoices.

Information & File Management

• SugarSync: An amazingly versatile and easy to use app that lets you remotely access any computer (even if it is turned off) and view files in several formats, including Word, Excel, PDF files, Powerpoint, videos, and MP3. SugarSync also supports an impressive file sharing feature.

• ReaddleDocs: A comprehensive document and file management app that can access and store documents from computers, web sites, email attachments, MobileMe iDisk as well as other online file storage solutions. ReaddleDocs features a document viewer, file manager, network file server, web storage client and a web browser.

• Print & Share: Print emails, mail attachments, photos, documents, contacts and web pages from your iPhone to a local printer.

• Quickoffice Mobile Office Suite: View and edit Microsoft Word and Excel docs. Also accesses files from MobileMe or networked computers.

• QuickBooks Online: Check your accounts receivable and payable, vendor, customer, and employee info, bank account and credit card balances, balance sheet and profit & loss reports. You can even look up vendor and client addresses using Google Maps.

• Google Analytics: Check the data from multiple Google Analytics accounts in a user-friendly format.

Business Travel Tools

• FlightTrackPro: Get real-time itinerary updates for flights around the world. Stay current on airport delay and closure warnings, conduct alternate flight schedule searches, look up weather forecasts and TripIt flight itineraries.

• Gas Buddy: The most comprehensive source of gas prices in the US and Canada; this app will tell you where to go to get the cheapest gas.

• MileBug: Keep track of your mileage for one or more businesses.

• Superpages Mobile: Find local businesses by searching the Superpages directory of over 20 million US businesses, get directions, and submit a business review. You can even use this app to look up people, get movie info, and locate local WiFi hotspots.