Who knows how the current financial dramas will play out? There will be all kinds of rhetoric and conspiracy theories, but the only way we will really know and understand the economic crisis is when we get to read the reports and books written a few years after it has all finished.
Personally I don’t intend sitting on my hands waiting to find out. I wrote a post a few days back about getting prepared for the coming storm and surprisingly I had a some interesting responses. Some people got grumpy because I dare to suggest that times are going to get tough. Others are really scared and don’t know what to do. Seasoned small business owners agreed with every word – get ready and get ready now.
Well regardless of what does or doesn’t happen there is no doubt that now is a time to get your ducks in a row and do whatever it takes to make your business rock solid. This means getting back to the very basic fundamentals of running a small business. Here are a few more ideas for anyone wishing to get prepared by planning for the worst but hoping for the best –
1. Be totally in control of your finances – now is the time to keep on time of your income and expenditure. If you don’t have to spend it, don’t. Look at ways of cutting costs without going crazy. Keep your accounts totally up to date. Get a little tougher on slower paying customers if you have any. Watch your stock levels and don’t get tempted by great purchasing deals to stock up. Your suppliers may simply want you to carry the debt of large stock levels. In other words, now is the time to be totally on top of your finances, every day and keep money in your business just in case.
2. Get marketing – whilst everyone else is freaking out or in denial, start marketing. Get out there and start chasing some new customers, ensure the relationship with your existing customers is rock solid, look around and see what your competitors are doing and most importantly, keep actively marketing your business. Unfortunately, most small businesses stop spending on marketing the minute things start to look tight.
3. Have a plan and know exactly what you will do if things get really tough – think through the worst case scenarios and most importantly, what you will do if these challenges come to reality. If your sales drop at what rate do you have to lay of staff and downsize. Know the numbers, meet and talk to your accountant if you are not sure and be prepared to take action immediately, no matter how tough it may be. Better to have to lay off a few staff rather than go broke and everyone lose their job.
4. Talk to other business – keep abreast of what is going on. I am not suggesting a whinge fest, but I think it is important to get stay informed and aware of what is going on in your area of operation. Remember, opportunities will be there, you might just have to look a bit harder for them. This is also a good time to have the support of mentors and people you can talk to. It is much better to be able to get your concerns off your chest rather than carry them around all day.
5. Take care of yourself – in stressful times many people stop looking after themselves. They get all stressed worried about money and the future, so they work harder and longer hours, they worry 24 hours a day, they are fearful of the decisions that they may have to make or the ramifications of a down turn. This is the time that we all need to eat well, exercise, relax and sleep well. If your body is fit and healthy everything else will be easier to deal with.
So get prepared, be alert but not too alarmed to coin a well worn phrase. I still believe that there will be amazing opportunities that come out of this situation, but you have to survive it to take advantage of them. There will be many business closing down, this is happening now and most industries will have a rationalisation. Hang in there, be prepared and do what you can now to get prepared.