A number of small-business owners have stopped paying themselves as they struggle to keep their companies afloat.
It’s impossible to know just how many owners are affected. They were no longer taking a salary. That’s a troubling sign for small businesses, which have created a significant share of the new U.S. jobs in recent years.
During past downturns, business owners might have turned to a home-equity line of credit, a personal loan or credit cards to shore up finances. But this time, real-estate values have plummeted, leaving many with less equity to tap, and bank credit is virtually nonexistent.
It’s not uncommon for owners to give up salaries from time to time to give their companies a temporary lifeline, but owners say the prevalence of salary cuts now is unusual even for a recession.
Surviving on credit cards and not qualifying for small-business loans in this credit environment is not the way to go….In mid-February, Eric W. stopped paying himself for the first time since he took over a Bar/Restaurant business in Atlanta, GA.
Some executives are forgoing salaries to avoid deeper cuts elsewhere. he says. It’s not the employees fault.
Alternative Solutions -www.1stFederalAdvance.com or 888 342-4FFA (4332)
1 response so far ↓
phanio // May 12, 2009 at 2:06 am |
Business Cash Advances are one of the fastest growing small business financing vehicle in the market today. Not really a loan but an advance against future sales. These are expensive but they are also fast and effiecient.
Business Money Today
- http://www.BusinessMoneyToday.com -
You must be logged in to post a comment.