Business owners give up salaries

By Bonna Johnson • THE TENNESSEAN • May 9, 2009

Mary Beth Byrne would do just about anything to see the lumber company started by her father stay afloat.

So, this month she expects to do something she has never done: She will stop paying herself a salary as president and owner of Byrne Plywood to help the small Nashville business survive slow sales.

She isn't alone among small-business owners and entrepreneurs who are cutting and even eliminating their salaries until business picks up. Although it's hard to know how many are using this survival strategy, one recent survey found that 30 percent of owners were no longer taking a salary.

The survey of 727 small-business owners by American Express also found that 27 percent said they had a family member working for free.

Byrne's husband, who left the real estate industry to help out when the company expanded last fall, got one paycheck for running the 6,200-square-foot lumber warehouse before she told him she couldn't pay him anymore — although he still does the work.

"We've been hit pretty hard," Byrne said. She'd already laid off a driver in the home office in Michigan and didn't know where else to cut. The company employs four full-time workers and four part-timers with annual revenues topping $3 million in recent years.