As the economy falters, experts say small businesses must recognize runaway costs early and start making modest cuts. Back in 2002, Scott Chatel's business remodeling brownstones and apartments in Brooklyn and Manhattan was so good that he set a goal to increase annual sales from $2 million to $5 million by 2005. He signed a three-year lease and renovated new office space, expanded his staff, and printed four-color brochures. His firm, Chatel Contracting, was busier than ever, but the costs of expansion erased Chatel's profits, leading him to take on debt. "It was the overhead that was doing us in. The jobs were always profitable," Chatel says. By the end of his lease in 2005, Chatel dropped his expansion plans and went into cost-cutting mode.