How is your Small Business Handling the Economic Crisis?
Is the economy adversely affecting your small business?
- I'm definitely feeling it. (31%, 11 Votes)
- Same ol, same ol (22%, 8 Votes)
- It's killing my business! (19%, 7 Votes)
- We're a bit slow, but could be other issues. (17%, 6 Votes)
- Economy Shmonomy- business is booming! (11%, 4 Votes)
Total Voters: 36
Loading ...6 TIPS TO HANDLE THE ECONOMIC DOWNTURN
Friends, we are looking at an unbelievable financial meltdown right now, and i’m not sure that it’s really sunk in yet. We now have the highest unemployment rate since 1994, and my belief is that it will get significantly worse after an expected dismal shopping season. Right now, banking, real estate/mortgage, energy (oil) and retail are reeling, and I personally feel that we haven’t seen the worst yet. As our baby boomers have just lost 40% of their portfolio, many are looking for jobs or ways to generate income again. A friend/relative of mine who is a senior investment analyst felt that it would take up to 6 years for a full recovery from this disaster. GM’s is about to go bankrupt (although, i bought their stock, i just can’t see GM going out of business!). As more people lose jobs, less money is being spent, and we are all affected. So, how are you preparing your small business?
1) Sounds simple, but DON’T PANIC! Your employees, and customers, need you to think clearly and lead your company. If you begin unnecessarily cutting costs and letting staff go, you could inflict damage on your company that isn’t necessary.
2) Build your business the right way. Something that i’m proud that our company, Logo Design Guru has done, is build a profitable business with no debt. We bankrolled our company on a shoestring in the beginning (quite painful), but now, we owe nothing. As we have become profitable, we’ve managed to save money for opportunities, and for tough times like now. This will allow us to ride out the tough times. Far too often I think that companies get cute with their business model and financing and build their business with investors before they have a solid model. As soon as the company has a hiccup- they’re gone.
3) Eliminate waste. Take a look at all your commodities, suce as merchant accounts, payroll services, phone company, healthcare services (although this is more sensitive), office supplies and “fun stuff”. Take the time to renegotiate with your vendors, or change vendors.
4) Be open with your staff. Let them know the financial status of the company. It’s ok to tell your employees that raises are frozen as a result of the economic conditions. No one likes surprises. Also, look closely at your staff. Maybe you’ve had a pathetic employee that you didn’t have the heart to let go. Well, now’s the time, unless you want to allow those “anchors” weigh down the whole company. Of course, be sure to let people go “properly” and give them a fair severance.
5) Plan! Work out several financial scenarios, “if we make x amount, where can we cut costs?”. This way, you have a plan in place, and you simply have to execute that plan rather than freak out when your sales are lower than anticipated.
6) Look for opportunities! Don’t stop marketing, in fact, get creative and aggressive with your marketing. Look for opportunities to build new relationships, as other companies will be looking for new sources of revenue also. If you can ride out the bad times, you should be able to pick up market share and come out smoking when this mess is over.
If you enjoyed this post, please consider to leave a comment or subscribe to the feed and get future articles delivered to your feed reader.
What happened to this blog? There have been no updates after 7th Nov… I used to be a regular visitor like so many others but it seems that the new blogger CJWitte seemed to have lost this blog some serious visitors… No more posts