The faltering economy is forcing many entrepreneurs to take another look their balance sheets, but experts caution against letting the grim numbers put you into a panic. Firing highly paid employees can cost you top talent, while cutting benefits saps the morale of those you keep around. And don't assume the marketing budget should be the first to go, says Ira Davidson, director of the Pace University Small Business Development Center. "Now might be a good time to increase spending ... You may be able to pick up customers or market share because other people are cutting back."

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