Small Business and Recession
Many would be small business owners, are left wondering if the current economic conditions are strong enough to start a business in. However, several studies have shown that a recession may be the best time to start a new business. There have been many now well-known businesses that were began during a recession. If you are willing to do some research, use careful planning and frugality, you might discover that now is the time for you to launch your dream. Here is what you need to know about starting a small business during a recession-
- You must have a business plan-This document should include:the focus of the business, marketing, revenue and any other pertinent details. There are several books and numerous online resources available to help in this process. Taking the time to do the needed research, for your business plan, can pay off big in the long-run
- Choose a business with low start-up costs-Now is not the time to choose a business that requires a large investment and huge overhead just to get started. If possible, you should start your business in your home. Keep in mind that you can purchase second-hand or rent equipment and furniture. You should also realize that investors are a lot more conservative in their investment opportunities during a recession, so you may not be able to find an investor for your business, right at the beginning.
- Do extensive industry research-It cannot be overstressed that you must know what you are doing, and who you are up against. You should also check out your competition,and try to determine what you can offer that will make your target market customers choose you over the others. Closely follow market trends, and make sure that your business can be in the forefront. You need to clearly identify what the needs/wants of your target market are, and how your product or service, will solve that better then your competition. You should also have a realistic understanding of just what is the success/fail rate,for your type of industry in your area. Do not fall into the trap of assuming that your product or service, is good enough, without taking the time to research your market.
- Do not be afraid to market aggressively-Many small business owners make the mistake of deciding they cannot afford to market. This can be a fatal mistake for your business. The reality is that you cannot afford not to market your product or service. There is no denying that marketing costs, however, if you are creative and willing to think outside the box, you can find low-cost, but highly effective marketing strategies. The bottom line is-how will customers know what you are offering, if you don't tell them? You need to be sure to market your product or service, how and where your target market is most likely to be. Be sure to give your marketing strategy careful consideration for optimal results.
- Network, network and then network some more-Networking is one of the most powerful tools in a small business owner's arsenal. This is never truer then during a recession, when all small business owners are looking to cut costs. By networking with other small business owners, you may find resources, for your business that you were not even aware of, and you may be able to join up with other small business owners, to pool your efforts. This can result in lower costs in advertising, marketing and even purchasing. Networking is a great way to strength the profitability and long-term success of your small business.
- Give the best customer service-During a recession, your customers will be even choosier as to where they spend their money. Many small businesses survive and even thrive, during a recession, because of the simple fact that they offer better customer service then their larger competitors. Always go the extra mile for your customers, and your great customer service will encourage your customers to come back, and spread the word about your product.