If you’ve squeezed spending, cut expenses, maximized profitability and still are running in the red, the last options may be to cut back employee services or layoff workers.

Be practical when facing these options. Communicate deteriorating business conditions early to all of your employees. Solicit ideas for reducing employee expenses. For instance, would employees accept wage cuts to prevent layoffs? Would they give up perks?

If layoffs are a certainty, offer as much advance notice as possible. And provide the most attractive separation benefits that your business can afford..

No one wants to put people out of work. But if you’re in business long enough, you may be faced with this unpleasant choice. Don’t beat yourself up too much. A company forced to layoff employees is doing the right thing if it’s the last option for staying in business.

Moreover, if the layoffs make you profitable again, there’s a good possibility of eventually restoring what’s been cut back. But if you don’t make the cuts, bankruptcy and going out of business mean everyone loses now and later.

So, approach layoffs with the understanding that you’re pruning your business tree so it can live on and grow again.

But be humane. Your pruning involves people. And in a real sense you owe them for your successes.

And be practical. These people know your business better than strangers do. When eventually you refill their positions, you can save a bundle of money by re-hiring them rather than training newbies from scratch.

It’s cliché to consider a company as family. But it’s more humane and practical if you do. Layoffs are painful for everyone. Nevertheless, this too shall pass, and you’ll be positioned for recovery.

Finally, don’t neglect addressing the adverse effect on morale for those whose jobs are preserved. Explain to them why they are retained. Give a realistic picture of their futures and solicit suggestions that will help you both.