It’s not a pretty picture. Your company’s debt is mounting. Your cash flow is negative…there is more going out then coming in. You feel like you are drowning.  Do you just give up? Almost every entrepreneur has gone bust.  I have. First you need to give up the shame.

Most of us are too optimistic when we look at the future of our finances. We think we will sell our way out of it. Tommorrow’s sales will be better.But, tThe best entrepreneur knows when to keep going and when to give up. In making this decision, you need to look at your passion. Do you want to keep going? Do you still believe you can make a success of it? Do you still have the support of your team and your family? If the answer is yes to these, you then need to look at cash flow to see if a future in your business is possible..

Cash flow is the life blood of any business. Negative cash flow means you are sinking every month into deeper debt. Your plan should include:

1. Don’t go further into debt. It is tempting but don’t use more credit cards, or financing options. Don’t use the payroll taxes you withheld from your employees. The government hates that! and besides, its against the law! Getting more credit is like a drug addict wanting to take one more hit.

2. Don’t invest more of your savings or home equity loans into the company. You need to keep a no touch pile of money. Give it to your spouse, your parents, or your sibling to make sure you don’t use it under any circumstances. You will need money if you need to make a comeback.

3. Prioritize which debt you need to pay first. The order should include current payables like employees, and utilities. Negotiate a lower rent with your landlord. Negotiate with your credit card banks to get lower minimums.

4. Talk to your current inventory or supply vendors. Try to get extended terms. Try pay the past debt over a longer period of time if you agree to pay the current or new debt on time.

5. Talk to your past vendors. These are the companies that will have to be your bank for you. Come up with a payment plan you can afford over a long period of time.

Are there other ideas that have worked for you?