Surviving as a small business is tough work. You are a small fish in a very large pond. More so, an ocean. An ocean where the vast majority of life doesn't even know of your existence, and half of those that do wouldn't think twice about eating you. But do not fear! Even though you lurk in dangerous waters, there is abundance. Find those that align with you, and grow. Grow together. Consider this a business survival guide.
Let's dive in and learn how to better your small business survival skills!
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Overview of Small Business Survival
Now so, more than ever, after making it through the pandemic, which took out over 200,000 small businesses in the United States alone, we can see how easy it is for your small business to fall apart. That is, if you don't have a plan. And this can't be a small "just in case plan". If you want your small business to be recession proof you must have an intricate small business plan. However, due to the vast array of different types of businesses, there is no such thing as a general plan for this. What we can do though is observer the key functions and key behaviors your business will have to follow in your personal small business survival plan.
During economic downturn and recession, or really any disaster your business is facing, there are certain things you should never stop doing. Marketing is one of those things. Marketing is the life blood of your business. Now in survival mode, how you go about marketing might shift, but make sure it is a part of your plan.
During an economic turndown it might be a good idea to add short-term price incentives that match the climate in the economy. Only do this if these are price cuts you can afford. It might seem counter productive to add price cuts at a time when your business needs more money than ever, however it is important to realize this is meant to give your small business a boost to make it through the recession. Oftentimes the businesses that do this are the ones that make it through.
There's a saying that goes "A big crisis opens doors for big changes and improvements." This is so because crisis opens our eyes to our weakest areas. Oftentimes, we don't even realize our weakness until it causes us lots of trouble. This one is hard to plan for, since adaptation is dependent on the situation at hand. However, keep this in the back of your mind.
There are certain things I'm sure your company could do that might be more expensive, but would keep you business alive. For instance, during the Covid-19 pandemic, many small businesses started doing home deliveries. Do you think this was cheaper for them? No way! But some money is better than none at all.
One of the most dangerous things during a time of downturn for your business is how it effects your psyche. Your business survival plan, and even more so, just how you run your business needs to include ways to stay calm during times of financial pressure. Sometimes it helps to just realize the things you can do and accept the things you can't. When you have that mindset you can actually take proactive movement towards saving what might seem like a lost cause. More often than not, what seems like a lost cause will turn out for the better for your small business in the long run.
First, make sure to take care of your health, physically and mentally. What you do, and what you can do is greatly effected by your health. After all you can never perform better than your health allows you. And your mental health is linked to your physical well being. No matter how hard it seems, always get some exercise. Go for a run, or a walk. Do something physical. Eat healthy and take time alone to be with your thoughts and confront them.
Second, it's important to be in close touch with your values. Regardless of what happens around you, your core values should lead you to always do the right thing. Your small business survival plan needs to incorporate ways to remind you of your values everyday. When you are faced with difficult decisions, make them based upon your values. Don't cross them.
Third, don't just focus on the bad. Focusing on the bad makes you subconsciously assume the worst, and to, in-turn, make actions preparing for the worst to happen rather than taking steps to prevent the worst from happening. One thing that I find super helpful is to every day just write down one thing you are grateful for. This is a good life-habit to adopt. No matter how hopeless things may seem, there is always one thing to be grateful for.
Your small business plan should include a list of items that can be trimmed down. These are things that during normal times are profitable and useful to your business, but during a downturn the extra cash saved from not doing these things can allow your business to keep up the fight longer. And not doing this things will not mean the imminent doom of your small business. Once business picks back up again, bring these things back. But always have this list in your business survival plan.
This is definitely one to add to your small business survival plan: Bill prioritization. This is also something you can start doing today. Put together a list of every bill your business has to pay. Then, go through this list and rank them based on priority. Priority meaning the ones with the largest consequences if paid late. The ones with the highest cost if late should be at the top of the list.
This is not advocating for paying your bills late. However, when times turn dark, and no matter how the dice land you're going to end up paying some late bills, be smart in the ones you choose to put off. Putting off the wrong bills can be the difference between your business surviving or dying.
On the note of bill prioritization, one thing you should be doing as a business now, during good times, is paying off your debts as early as possible. This will diminish how much your business will be spending on bills, which you'll thank your past self for during the hard times.
This is less of a thing to go on your business survival plan, but more of a practice you should adopt today. Adopting this process today will help you immensely during a time of struggle. You, and your business needs to get exceptional at monitoring your spending. This does not mean seeing how much you owe on a monthly basis. This means knowing where all your money is goin, and exactly how much is going where. You do not want to run your business from the rearview mirror.
Especially in times of struggle for your business, this will save you a lot of headache. It's easy to get blindsided by unexpected bills at the end of the month if you are not keeping a close eye on your expenses.
Just like an individual should have a "rainy day" fund, a small business should have an emergency fund. This is something your small business needs to start saving for today. This fund should have enough money to continue to allow your business o operate at normal procedures for three months. Wow! That seems like a lot of money to save. And it is! but imagine how much money, and stress it will save if there ever comes a time when you need it.
Your business survival plan should include this emergency fund, and depending on how severe the downturn, this fund can be made to last longer by including the other things on your business survival plan to cut down on expenses.
Conclusion and Generating Your Small Business Survival Plan
Once you have crafted this business survival plan it's best to present it to a few close employees and talk out any possible improvements. Start making this plan today! Remember, the last thing you want to happen is there to come a time you need this plan and you don't have it. The time spent creating this plan during a crisis rather than preemptively having it is time wasted not implementing your plan, which can save your business from going under.
Not to mention, having this plan in place just feels good! There is a certain amount of security knowing that you are prepared for dire circumstances.
Catch you on the flip,
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