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How To Bullet-Proof Your Business

Thursday, 24 Jul 2008 | 7:11 PM ET

A weak U.S. dollar, slumping home values and higher costs on everything from postage to tomatoes are taking their toll on independent companies.

Here's how your business can weather the storm.

1. Trim the fat. Review your general ledger, and cut out anything you don't need to spend money on right now, such as office supplies, travel and entertainment.

2. Ratchet down your inventory. You don't want shelves full of products you can't sell.

3. Maintain your prices. You may be tempted to offer discounts, but you don't want to cut too deep into profits or dilute your brand. (If anything, offer special prices to your most loyal customers only).

4. Treat customers like royalty. It doesn't cost much - and it's a great way to make your business stand out.

5. Negotiate. Especially if leases or contracts are coming up for renewal, now's the time to ask for a reduced rate.

Many business owners right now are complaining that soaring gas prices are hurting their bottom line. For specific ideas on how to save on fuel costs, click here

And don't forget: now's a great time to start a business. Resources are cheap, highly skilled workers are available, alternative financing is on the rise and you'll learn how to make more with less. Read our story about entrepreneur Rich Maggiotto, who was starting four new companies when the dot-com bubble burst. Thanks to smart practices, he not only made it through the worst of times but he's enjoying success today.

- Colleen