{"id":61,"date":"2009-02-07T13:08:00","date_gmt":"2009-02-07T13:08:00","guid":{"rendered":"http:\/\/watt-media.com\/b\/?p=61"},"modified":"2025-01-24T04:52:13","modified_gmt":"2025-01-24T09:52:13","slug":"running-a-business-in-a-recession","status":"publish","type":"post","link":"https:\/\/wattmedia.com\/blog\/running-a-business-in-a-recession\/","title":{"rendered":"Running a Business In a Recession"},"content":{"rendered":"

\"Business<\/a>It\u2019s hard to believe that I wrote my last article on this topic about a year ago, but I guess recession fears were brewing even last March.\u00a0 <\/span>Now we already know that we\u2019ve been experiencing a real recession for several months.\u00a0 <\/span>I have never owned a business in this type of economy, and I\u2019m sure many business owners would say the same thing; so it\u2019s a bit hard to know how to navigate through it.\u00a0 <\/span>I believe that, as always, careful planning and sensibility will get you through it, so here are some ideas:<\/b><\/span><\/p>\n

Proper planning is crucial.<\/span><\/b>\u00a0 <\/span>We\u2019ve all heard about the importance of writing a business plan, and while many businesses thrive without one, now more than ever, planning is crucial.\u00a0 <\/span>I normally create a budget for my business each year, but this year I created three.\u00a0 <\/span>The first one is for a regular, non-recession year.\u00a0 <\/span>The second is identical to last year\u2019s, in case it\u2019s a flat year, and the third is a contingency budget, in case sales are down by as much as 30 percent.<\/span><\/span><\/p>\n

I always want to make sure that I get paid first, so my goal with each budget is to ensure that I\u2019d have enough to take home in all three cases, especially in the worst case.\u00a0 <\/span>Even with sales down 30%, my contingency budget allows for me to make almost as much as I did in a good year.\u00a0 <\/span>(This is accomplished by cutting other expenses of course.)<\/span><\/p>\n

This is the time to slim down and run a lean ship.<\/span><\/b>\u00a0 <\/span>Review all of your expenses and cut anything that isn\u2019t needed.\u00a0 <\/span>Reevaluate your marketing plan. For the past few years, we\u2019ve been doing trade shows \u2013 up to ten per year, but they have started becoming less effective.\u00a0 <\/span>Based on an educated \u201chunch\u201d that sales would continue to decrease due to a continued drop in attendance, I decided to cut tradeshows from the budget completely \u2013 that\u2019s over $15,000 in expenses which I will use towards hiring a sales person.\u00a0<\/span><\/span><\/span><\/p>\n

We have a classified ad in a trade magazine that hasn\u2019t been getting results \u2013 it\u2019s not likely to do better this year \u2013 so I\u2019ve decided to cut it.\u00a0 <\/span>I had to hire a new production person, who previously worked 25 hours a week.\u00a0 <\/span>I found that 20 hours was sufficient, so I placed an ad for 20 hours and cut some extra spending there as well.\u00a0 <\/span>Last year, I ate lunch out 3 or 4 times per week, now I bring lunch from home and eat out once a week. \u00a0<\/span>All of these things add up.<\/span><\/p>\n

Be careful not to cut too much, and make sure you cut in the right areas.<\/span><\/b>\u00a0 <\/span>Marketing and advertising are needed now more than ever, so try to look for different, more creative forms of marketing. \u00a0<\/span>Our search engine marketing efforts over the past two years have begun to pay off; now we get about 2 calls a day from prospects that have found us online, and we\u2019ve already generated sales from those calls.\u00a0 <\/span>We\u2019re launching some new side services and going back to our current clients \u2013 these are our best source for more business!<\/span><\/span><\/p>\n

I\u2019m also looking into buying a small book of business.\u00a0 <\/span>Since sales may be down, why not acquire another business?\u00a0 <\/span>It\u2019s an automatic way of increasing your customer base, and as mentioned above, customers are your biggest asset!\u00a0 <\/span>They have already purchased from you, so why not go back to them and offer them other services?\u00a0 <\/span>You\u2019re also more likely to get a good deal now, since many small business owners are hurting and looking to cash out.<\/span><\/p>\n

With proper planning, you can hold on and make it through this tough time.\u00a0 <\/span>Rather than making deep cuts in every department, make them where appropriate, but keep on finding ways to generate business.\u00a0 <\/span>It will be tough, and slow, but if you can hold on, you\u2019ll still be in the game to reap the rewards when the economy bounces back up.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

It\u2019s hard to believe that I wrote my last article on this topic about a year ago, but I guess recession fears were brewing even last March.\u00a0 Now we already know that we\u2019ve been experiencing a real recession for several months.\u00a0 I have never owned a business in this type of economy, and I\u2019m sure […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[],"class_list":["post-61","post","type-post","status-publish","format-standard","hentry","category-small-business-tips"],"_links":{"self":[{"href":"https:\/\/wattmedia.com\/blog\/wp-json\/wp\/v2\/posts\/61","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/wattmedia.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/wattmedia.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/wattmedia.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/wattmedia.com\/blog\/wp-json\/wp\/v2\/comments?post=61"}],"version-history":[{"count":3,"href":"https:\/\/wattmedia.com\/blog\/wp-json\/wp\/v2\/posts\/61\/revisions"}],"predecessor-version":[{"id":1629,"href":"https:\/\/wattmedia.com\/blog\/wp-json\/wp\/v2\/posts\/61\/revisions\/1629"}],"wp:attachment":[{"href":"https:\/\/wattmedia.com\/blog\/wp-json\/wp\/v2\/media?parent=61"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/wattmedia.com\/blog\/wp-json\/wp\/v2\/categories?post=61"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/wattmedia.com\/blog\/wp-json\/wp\/v2\/tags?post=61"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}