As "Dragon" eyes up Woolies, what lessons can be learned by small business owners?

According to a number of Sunday papers, the Dragons' Den star met with Deloitte, the administrators for the fallen retailer, on Friday. Paphitis has a long history of buying troubled firms and turning them round.

Alongside Rymans the Stationer, the "Dragon" famously rescued underwear chain La Senza, buying it for a pound and selling it on to a private equity firm in 2006 for £100m.

Businessman Ardeshir Naghshineh, who owns 10% of Woolworths is understood to have an interest in bidding for part, or all of the company.

Dan Butters, reorganisation services partner at Deloitte, commented: “We will be looking for a suitable buyer for all parts of the business. In the last 24 hours we have received expressions of interest from a number of parties for both the retail and wholesale businesses. We are working hard to ensure that any sale of the business, in whole or part, will preserve jobs.”

Woolworths has been criticised by many for its poor management, and failing to keep up with its competition. Given the power of the brand, it seems quite possible that the parts of the Company could continue to operate in some way.

Perhaps if the management had followed some of the business tips published on Bytestart they may have saved the firm from administration.

How to survive in business during the downturn

In difficult times, business owners should pay particular interest to their cashflow situation, and look at making efficiency gains in all parts of their business operations.

The Woolworths model has been widely criticised as it tried to sell everything and appeal to everyone, rather than concentrating on its core product offerings, suggesting that businesses should concentrate on their strengths to ensure their survival during less prosperous times.

Additionally, now is probably not the best time to cease marketing - there are plenty of ways to promote your business without breaking the bank.

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