Our small company is still treading water after all these years. I'm trying to analyze what factors in our short history have prevented us from growing and becoming profitable.

The first thing that jumps out is a lack of follow-on products for our growing customer base. The lack of additional products is not because of lack of ideas. We have several that our present customers would love to buy. But, rather, it has been a lack of resources, both time and money, that have prevented the development and introduction of new products.

And why is there a lack of vital resources? It goes back to starting out undercapitalized and incurring too much debt along the way. When you spend all your effort just to survive, you have no resources left to grow. If you spend all day stamping out fires, then you can't develop fire prevention. If all your profit goes to debt service, then you can't afford new product development. If you seek some balance in your life, then you are probably working as many hours as you can without going nuts.

The answer would seem to be sufficient startup funds and a realistic business plan which shows a clear path to success. The key words are "sufficient" and "realistic". You need more money than you think you do and the clear path you envision can get choked with the weeds of day-to-day business problems. It is almost impossible to determine if your business plan is realistic. What is true today will not be tomorrow. Be careful and conservative!

What do you do if you are in the position we are in? We have a steady business that keeps the door open and usually pays the bills on time. We have managed to pay down some debt, but it is a slow process. We need to develop new products on the cheap, but aren't sure the best way to go about it. We need to convince the bank we should stay in business when some days it is hard to convince ourselves. We need to convert our present manufacturing processes to cleaner, more efficient ones. We need to improve our quality while lowering costs. We need to redesign our current products whose designs are old and tired. We need a miracle.

Well, maybe not a miracle, but a plan to get everything done, complete with deadlines and the will to meet those deadlines. I hesitate to call this a "business plan" because the term suggests more -- blue sky guesswork. I think project planning and management are more what's needed. I also need to hear from anyone who may have been involved in a similar situation and who may have words of wisdom.