How small businesses can survive an economic recession
Business owners all over the United States are bracing for the economic recession that most experts are predicting will occur as a result of the Coronavirus pandemic. Although the circumstances that have brought about the latest economic downturn are unusual, ups and downs are a normal part of the economic cycle. A drop in the economy can happen at any time without warning, so developing a plan regarding how to survive a recession is a vital part of any business’ success.
Working with small business consultants is a good way to help you prepare for the difficult times that are inevitable in business. They can help you put together a comprehensive plan that outlines ways to keep cash flow going, while also identifying areas where expenses can be reduced. Getting advice from CPA’s on ways to “recession-proof” your business will pay off ten-fold in difficult times.
What you need to start doing today
Business closures and shelter-in-place orders due to the pandemic, are combining to create a downturn in the economy. It’s important to put measures in place immediately to safeguard your business. Protect your cash flow by implementing strategies that increase sales or billable hours and cut unnecessary expenses. Reduce inventory costs by searching for less expensive suppliers or locating a drop-shipping alternative that can eliminate the cost of storing and shipping your product. Now is not the time to expand or diversify, but rather hone your focus on core services.
Another very important strategy to protect your business during a recession is to maintain marketing. Continue to expand your customer base by working to win over competitors, meaning find out what clients like and dislike about similar businesses and tweak your goods and services to reflect this data. Finally, pay bills on time in order to stay on top of your credit score. If you should need to seek out a loan, you want a good credit rating to take to the bank.
A customized approach
During an economic recession, it’s more critical than ever that you develop, follow, and continue to improve your business plan. As the economic climate changes, so should your approach.
The business financial advisors at GYL can help you put strategies in place that will assist you in weathering the current downturn as well as maximize earnings when the economy begins to recover. Call today for a free consultation with one of our team members and find out how we can help strengthen the current and future financial health of your business.