RECESSION-PROOF YOUR BUSINESS
In a recent article the headline stated that 43% of small businesses believe that a recession is on the horizon. You should not slow your growth action in anticipation of a recession which may or may not happen. However, there are things you can do to help you survive a recession should it happen.
► My number one recommendation is to have sufficient funds set aside to survive a recession or to re-invent your business to provide timely, needed goods and services.
Emergency funds: many small business owners put all their excess earning back into their business. The first plan of action is to establish a 6 month survival fund that includes both your business and personal financial needs. As an example, don’t buy a new state of the art computer if your existing one can do the job. Put the money into your survival account. Learn to add between 5 and 10 % of every sales proceeds to that account on an ongoing basis. In other words, don’t stop adding to that account when you reach your 6 month reserve goal.
► Know your customers and target market. Don’t assume that you know the needs of your customers and target market if you are not reaching out to them at least once every 4 months. That requires in person communications, either one on one or focus groups. Stay on top of trends in your industry.
►Change is inevitable! Always be on the lookout for new, related products/services that your customers and prospects can use. In the last “recession” unemployment peaked at 10%. A better way to look at that is that 90% of the people are still working and buying products and services. Don’t get caught in the “downspout”; a positive and action-filled business approach will help you survive and grow.
These three suggestions, if adopted, may be enough to propel you through any downturn.
Tips & Advice by Nick Petra, CFP – Founder of Strategic Duck and BizQuack
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