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Don't Let Financial Woes Drag
the Business Down
By Missy Turner
San Antonio Business Journal
Published: March 8, 1996
Bob Swartz, owner of debt-management firm Financial Technologies, advises that small businesses with financial difficulties are better off coming to grips with the problems early, before lawyers and the courts get involved.
Even though Financial Technologies is in the business of dealing with grim financial situations, owner Bob Swartz keeps a sense of humor about his job. He offers these warning signs of financial trouble to business owners. You know you are in financial trouble when:
- You check your bank account at least twice a day.
- You know the call from your banker is not an invitation to lunch.
- You stop returning phone calls, including the ones from your mother!
But according to Swartz - all joking aside - when a small business owner is spending more time dealing with harassing phone calls from creditors and collection agencies than he or she is spending on running the business, it's time to get help - and Swartz says he's just the man to call.
Financial Technologies is a locally based debt-management firm that specializes in pulling companies out of financial tailspins and getting them back into the black. Since 1987, Swartz has helped work out financial woes for businesses ranging in size from small ma-an-pop operations to large international companies. But, most clients are small business owners, he says.
Through the power of an attorney, Swartz deals with a business' creditors and collectors himself. This frees the owner to run the business. "We deal with creditors...and leave the business owner to run their business. We offer management suggestions and work with them to correct the problems and work with outstanding debts," he says.
Swartz says that if financial trouble is addressed early on, lawyers never need to be involved. Small-business horror stories, such as court battles and bankruptcies, can be prevented if the owners realized the need help, he adds. It's crucial that business owners, who find themselves in a financial quagmire, seek help before bankruptcy, because things can be turned around, Swartz stresses.
"If we can catch people before the bankruptcy stage, then it'll be a lot easier for everyone," Swartz says. "If we could get people before lawsuits, we could help a lot of businesses." But debt and financial trouble are touchy subjects. Sometimes getting business owners to admit they need financial help is like pulling teeth. "It's like a toothache. You could sit there for days with it hurting, or you could see a dentist. It's the difference between a filling and an extraction. We're the filling and the lawyers are the extraction."
The clients that most often resist admitting they have financial problems are small-business-owners, Swartz says. Because they are entrepreneurs, Swartz says, the owners of small companies tend to be more attached to the business. The business becomes such a part of the owner that often the company's problems have the same emotional impact as personal problems. "To be a small businessman, you have to have that entrepreneurial spirit. Somewhere in entrepreneurial spirit is ‘gambler,' and ‘optimist.' They're dealing with a dream," Swartz says.
Often, though, debts can be worked out if a business owner can convince bill collectors not to force the business to shut down, Swartz says. If the business is allowed to continue operating, debts will eventually be settled, Swartz adds. "Bankruptcy is not the only answer to severe financial problems," he says.
Only in rare situations might a business have to call it quits, Swartz says. "When the business owner loses the ability to acquire raw materials, then it's time to shut down," he explains. "It does happen." But Swartz does his best to prevent it, he stresses.
Swartz's company, which operates out of a local office at 15600 San Pedro, has a total of six employees. Financial Technologies also provides services to companies in the Houston and Austin markets.
Fees for Financial Technologies' services are based on the company's success rate. "When (business owners) hire us, we get a retainer. Our fees are based on successes. If we're not successful, then we don't get fees," Swartz says.
Swartz says marketing debt management service is difficult because of the nature of the business. Even referrals are hard to get because business owners often don't want to admit to others that they've had financial trouble.
Swartz says he's tried some advertising, but he mostly relies on getting his name out in the public by networking and word-of-mouth referrals. He's also considering creating a home page on the Internet.
"Our service is not the kind of thing you shop for," Swartz says. "You have to be led to us."
