When times were good, the top executives from the largest U.S. banks made a mint. Below is the total compensation in 2007 for the 9 banks that received the first batch of government aid through TARP.

http://money.cnn.com/news/specials/storysupplement/ceopay/index.html

Fortune Magazine put together a list of the top 10 companies that have never laid anyone off. Great idea.

http://money.cnn.com/galleries/2009/fortune/0901/gallery.no_layoffs.fortune/index.html

Small companies are finding that almost everything is renegotiable these days.

The economic downturn is prompting business owners — by necessity or by opportunity — to re-examine contracts with suppliers, vendors or landlords and come up with creative deals. And in many cases, they are saving a substantial sum of money.

“Most of us grew up knowing that once you agree to something, you don’t back out of it,” says small-business consultant Bill Bartmann of Bill Bartmann Enterprises in Tulsa, Okla. “That rule doesn’t apply anymore.”

In a survey released in September of more than 1,000 small-business owners and managers, about 15% had recently renegotiated long-term fixed-cost supply contracts, according to the Small Business Research Board, a Buffalo Grove, Ill., publisher of the Small Business Confidence Index, which tracks overall business confidence and issues of small-business owners and managers.

One thing that certainly helps is having the cash to pay your bills on time. “If you’re a fast payer, you can negotiate lower rates with your vendors to help the other company, the company you’re paying to, with their cash position,” says Carl Gould, president of CMT International LLC, a small-business consulting and advising firm in Riverdale, N.J.

Atlanta Refrigeration was able to negotiate new jobs for four employees with a supplier. Above, a service manager checks on a pressure gauge.

Tom Long, an Oak Park, Ill., small-business consultant, said 10 of his dozen or so clients have negotiated discounts of 1% to 5% with at least one vendor for paying with cash or personal check, and usually within 10 days of a product or service’s delivery. Most have negotiated these deals in the past 30 days, he says.

“Conversely,” says Mr. Gould, “if you’re an extremely slow payer, sometimes you can get your monthly obligation lowered because of the financial position you find yourself in. The vendor will often accept that because they’re getting paid as opposed to writing off the entire obligation.”

Mr. Bartmann adds that “sadly, there are not many small-business owners flushed with excess cash right now.”

1800Diapers Inc.’s Diapers.com, which sells baby products, was able to use the fact that it had available capital to secure a better deal when it negotiated new leases for two of its warehouses. The Montclair, N.J.-based company was able to shorten the term of the new leases to two years from five, received more space and got conditions on flexibility that would allow it to lease more space if needed. The company wouldn’t disclose how much it saved in operating costs.

Sid Jaridly, chief executive of The Original Mr. Cabinet Care, an Anaheim, Calif., kitchen-remodeling company, saw the market contracting last year and decided to trim supply costs across the board.

Mr. Jaridly talked to about 40 or 50 vendors with the goal of getting a 10% to 15% price reduction from each. He said he got about 25 to 30 to agree to a discount or new deal, saving the company about 15% of total operating costs, or about $400,000 to $500,000, last year.

“We’ve been loyal with some of these vendors for decades and obviously, during an up cycle, we agreed to certain price increases,” Mr. Jaridly says. “During a down cycle, we expected them to also lower their costs.”

Thinknicity Inc., a San Francisco recruiting firm for the technology industry, in May set out to renegotiate its lease as part of an effort to slash overhead costs. In July, it worked out a new three-year lease with its landlord, reducing the space it leased to 3,000 square feet from 4,000 square feet.

But in the third quarter, Thinknicity had to cut back some more, so management decided to go back to the landlord for another round of renegotiations. Helga Grayson, chief financial and operations officer, says she told the building manager that her company’s revenue was down by 50% and it was prepared to walk away and find a smaller space.

A few weeks later, Thinknicity secured a new three-year lease for 1,700 square feet with rent of $3,500 a month, compared to the $5,100 per month it was paying for the 3,000 square feet.

Some small businesses are even negotiating on behalf of employees, as was the case with family-owned Atlanta Refrigeration Service Co. Dave Brautigan, chief operating officer, in November approached a major supplier, Heritage Food Service Equipment Inc., asking it to take on four Atlanta Refrigeration employees whose job it was to acquire parts for the commercial refrigeration and air-conditioning company. In return, Heritage would become the only supplier for Atlanta Refrigeration, which also would be willing to pay more for parts like thermostats and motors.

The result: Atlanta Refrigeration was able to save more than $250,000 in payroll and benefits costs. And Heritage, of Fort Wayne, Ind., was now poised to gain $1 million in business from Atlanta Refrigeration.

“It has made our relationship with that contractor better,” says Mr. Brautigan. “Because these people used to be employed by me, they know the unique urgency and the systems that we have in place.”

At first, Dave Morris, vice president of Heritage, wasn’t sold on Mr. Brautigan’s presentation, but was convinced when the talk turned to how much more business Heritage could get. “As they grow their core business, as their supplier, our volume goes up with them,” Mr. Morris says. Atlanta Refrigeration generates $12 million a year in revenue and has about 100 employees.

Some companies have found that negotiating better terms sometimes isn’t enough, however. Take New York-based Proximo Consulting Services Inc., an information-technology consulting company in New York that has been feeling the cutbacks from its large clients.

“Being a small company, there’s a lot less fat to cut when you’re looking at making cost cuts,” says David Ricciardi, president of the 25-employee company. “It’s not like I can lay off 1,000 people.”

In April, Proximo was set to stop outsourcing hardware and network support and bring the work in-house. But the vendor, New York-based Perry Technology Group Inc., a technology consulting-services company that monitored servers for Proximo for about four years, came back with another suggestion: Keep us on until the end of the year, but for monitoring of only half of Promixo’s 32 servers. That would lower the contract’s cost to $1,400 per month from $4,000.

Proximo agreed and internal staff began monitoring the other servers. Perry “understood the situation and were very willing to work with us to do that,” Mr. Ricciardi says.

Still, in December Proximo ended the provisionary contract altogether because the company couldn’t afford it anymore. Mr. Ricciardi says when business swings up again, he’ll definitely consider bringing back Perry as a vendor.

[via WSJ Small Business] by Raymund Flandez at raymund.flandez@wsj.com

Venture capitalists are reining in spending amid the financial downturn, a shift that has implications for entrepreneurial activity.

According to two sets of data pegged for release Saturday, venture capitalists did fewer new financing of companies and spent less money in the third quarter than they did a year earlier. Venture capitalists typically put money into young companies, with the aim of profiting later when those start-ups go public or are acquired.

Venture capitalists arranged 571 financings totaling $7.2 billion for the third quarter, down from 651 deals totaling $7.8 billion a year earlier, according to research firm VentureSource. VentureSource is owned by News Corp., which also publishes The Wall Street Journal.

The National Venture Capital Association, a trade group, and PricewaterhouseCoopers found a similar trend, noting that venture investors put $7.1 billion into companies in the third quarter, down from $7.8 billion a year earlier.

The amount invested was the lowest quarterly number since late 2006.

The slowdown has repercussions for entrepreneurs in sectors such as technology and life sciences, many of whom rely on venture funding to kick off and grow their companies.

“Entrepreneurs are seeing lots of their traditional avenues of finance getting whittled away,” says Mark Heesen, president of the National Venture Capital Association. He adds that he has a “high level of concern” for the overall health of the venture industry.

The pullback comes as venture capitalists have been hurt by a gyrating stock market, which has put a crimp in the market for initial public offerings, which the industry depends on to generate returns.

Merger-and-acquisition activity — another route to returns — has also tanked. And many venture capitalists are also facing difficulty raising funds as their investors grapple with hard-hit portfolios.

The information-technology sector took a particular hit in the quarter. According to VentureSource, 270 financings totaling $2.7 billion took place, down from 342 deals totaling $3.4 billion a year earlier.

Other sectors, such as health care, were relatively stable.

[via WSJ Small Business] by Pui-Wing Tam