Creative financingTom Violante, a popular Royal Oak,...


Creative financing

Tom Violante, a popular Royal Oak, Mich., grocer, isn't letting the credit crunch on small businesses curtail his dreams.

To fill the gap between a $750,000 bank loan and $1 million in expansion plans, Mr. Violante is offering Holiday Market customers a deal: Lend him $100 now and he'll give them $110 in groceries six months from now. Within days of announcing the deal, more than 100 customers had come forward.

"We do a lot of goofy things here," Mr. Violante said. "We're not your usual grocery store."

But finding alternate sources of financing is not so goofy.

Businesses needing funds to expand or just to get by are turning to customers, suppliers, even total strangers for financing after the bank says no.

For example, people interested in starting new businesses can often find a successful, existing business to buy from a retiring business owner. By using a land contract to finance the deal, the initial costs are less and the risks are smaller than starting a new business.

Other sources of funding:

* Creditors. For failing companies needing financing to survive, try going to creditors and asking them to accept 20 percent on the dollar to settle the debt.

* Bartering. Some contractors have borrowed money from individuals and paid it back by putting in a garage or doing home renovations.

Catering to customers

Companies today have to do right by the customer every time, says consultant Richard Whiteley in his book, "The Customer Driven Company."

Mr. Whiteley's research identifies the major reasons companies achieve a reputation for exceptional customer treatment:

* Customer vision. Employees in customer-driven companies share the vision of gaining and retaining customers. Typically, the top manager is the head cheerleader for customers.

* Listening to the customer. Management must seek out the customer's voice. Some examples: detailed market studies, toll-free telephone numbers and mingling with customers.

* Studying successes. Customer-service practices are not secret, and they are not hidden. Managers seek the champions of customer service and eagerly study their methods.

* Supporting customer champions. Seek out and reward employees who treat customers well.

* Eliminate service barriers. Many well-intended procedures regarding invoices, returns, guarantees, billing, order-filling and the like actually reduce employees' ability to deliver quick, efficient customer service.

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