• Don’t  set  impossible  quotas. Many managers automatically in- crease individual sales quotas ev- ery year so that salespeople have to book more business before they can earn incentive income. This is a common approach to keep- ing costs down, but it can have an adverse effect on sales because salespeople become discouraged by quotas which are impossible to reach and may leave the company for greener pastures. If selling costs are a real problem, it’s usually a bet- ter strategy to keep sales quotas re- alistic and offer lower commissions instead.

• Don’t limit income potential. Putting a ceiling on total sales commissions and bonuses tells salespeople that once they’ve reached the limit, there’s no reason for them to continue to work for additional sales.

• Don’t  waste  sales  ability. Good salespeople need new challenges. Selling the same customers over an extended period may …

When payroll cuts become necessary, many companies face a drop in employee morale that can seriously damage operations. Key employees frequently become less productive and are more receptive to other job opportunities.

Here are some proven strategies that can help you make overhead cuts with- out damaging employee moral.

• Tell your employees how the cuts will actually strengthen the business. For example, explain that the money saved will be invested in new equipment and more advertising to make the company stronger. Never announce that people must be terminated because expenses are too high.

• Make your cutbacks equitable. Don’t create unnecessary resentment by keeping excessive top management perks.

• Use incentives to encourage voluntary resignations. Consider options such as early retirement packages. Or help employees set up their own businesses with you as their first customer. Custodial workers, graphic designers, and others can often …

Let your customers tell you what quality is.

Make sure that efforts to improve quality are driven by customer needs. You don’t improve quality unless you improve a product in a way that customers welcome and appreciate. Before you undertake a quality improvement effort, always ask yourself whether your customers will see it as a benefit to them.

Improve collections with a well-designed invoice.

A few key tips:  Keep the invoice clean and simple and test it on someone who’s not familiar with the business. Make sure the form is titled with the word “invoice.” Use a special typeface for critical information such as the outstanding balance and the item purchased. Use action words such as “please pay” instead of “amount due.” The invoice should have an area where the customer’s purchase order number can be indicated. Including a self-addressed return envelope will …

I t’s widely acknowledged that bank credit standards vary among banks and that, even with one bank, its credit policy will vary depending upon chang­ing economic conditions. Coupled with the cost of borrowing, tougher credit standards mean you should make every effort to keep your borrowing require­ments down. But when you do have to borrow, here are four tips to help you keep the cost of borrowing to a minimum.

1. Negotiate interest rates.

Not all banks will immediately quote their lowest rate. If you can’t get a some­what better rate by asking a few ques­tions, it might pay you to shop around – preferably with your bank’s biggest competitor.

2. Don’t borrow more than you need.

In most cases, the best strategy is to establish a line of credit for a given period of time. However, be sure to keep a close watch on …