Economic downturn, recession, slow season. Whatever happens to be the term assigned to a lagging economy, there are things you can do to protect your business.
Here are five tips to do today to help you prepare:
- Plan for the good times, and the bad.
Knowing that bad times will come, at some point, will be part of what helps you get through. When you create a plan, you'll be more confident. Have a list of things you'll cut out when you notice business slowing down. Extra phone lines; company-paid meals; office cleaners. Of course, some expenses like taxes and business insurance are necessary. Just know which ones you can drop, and be ready to do that.
- Increase your marketing efforts.
You should always be marketing, but now's the time to ramp it up. Have you been making 10 calls a day? Increase that to 20. Did your last seasonal promotion bring in a new stream of clients? Freshen up your marketing content and reuse it again.
- Diversify your income streams.
Take a look at the products or services that you sell. When people start to feel the pinch in their pockets, how will it trickle down? Consider offering a lower-priced package. If you're not online, create a website and social media presence to get a broader audience.
You might not be able to take your handyman services out of state. Still, you can sell tutorials on how to start a similar business. Make YouTube® videos on how to do basic home repairs and get a share of the ad revenue.
Get serious about paying off business debt now. The company car loan, the office furniture lease, subscriptions you rarely use. These are all expenses that are hurting your bottom line. Pay off the car, buy nice but inexpensive furniture, drop the subscriptions.
- Build up a generous emergency fund.
Just as your household budget needs a fund for a rainy day, so does your business. Aim to have at least 12 months-worth of expenses saved. Increase that to 24 and 36 months as you are able.
It's inevitable that at some point business will slow down. You can combat this in two ways: being proactive with getting business, and saving up so that you have funds to get by until the economy picks up. Use these tips and you'll find fellow business owners asking for your secrets to making it through.