Six Tips For Small Businesses Waiting For Economic Recovery
Business consultant Jim Muehlhausen, author of “The 51 Fatal Business Errors and How to Avoid Them“, believes that even as the U.S. economy recovers, small businesses may feel the pressure ease but that doesn’t mean it’s “business as usual”.
Muehlhausen has narrowed down the reasons why small businesses tank during the lean times. He says that small businesses face more challenges than the large corporations with huge cash reserves to help them through financial crises. They are also more susceptible to market fluctuations, have fewer clients to support them and generally have more transient staff. On the flip side, they also make up 70 percent of the businesses in the U.S., so as goes small business, so goes the economy.
In order to prevent the ensuing panic and confusion to consume your business, Muehlhausen has devised six basic rules that can help steer small businesses clear of the pitfalls of recession:
Pay more attention to your business model and your business, and pay less attention to the economy. Keep your eyes on the road, and not the landscape, and you’ll get where you’re going.
Don’t Throw the Hail Mary.
Don’t make dramatic changes. Work on the tactics already in front of you. Keep moving and keep working at the tasks that have traditionally helped your company succeed and don’t count on that big order or some other source of instant salvation.
This is a terrific time to tune up systems, make large time investments in future products/services that you just did not have time for when times were good. Rather than lamenting bad times and wasting time on activities aimed at making things better right now, focus on two years from now while everyone else is short-term focused.
Buy a competitor.
Now is a great time to buy weaker competitors. Prices are low and rolling their business into yours can add valuable employees and sales at bargain prices.
It’s not the economy, it’s your model.
The weak economy has hit businesses with weak business models MUCH harder than those with solid models. If the economy has hit you hard, this is not bad karma. It is a sign that you need to tune up your business model.
Ignore Web 2.0 at your peril.
Yes, Web 2.0 is just as valid for B2B as it is for B2C. Web 2.0 has very little to with Facebook and Twitter. At its core, Web 2.0 is nothing more than an automated referral system. If your business does not need additional referrals, ignore Web 2.0, but beware that traditional marketing methods will continue to loose effectiveness while Web 2.0 methods will continue to improve.
Far too many business owners, Muehlhausen says, let fear affect them and their choices. “Times are not great, but people still have money and companies are still spending. For every business that is closing, ten more are surviving. So, relax, focus and get smart about how to navigate the tough times. You may find you wind up doing even better than before.”
Jim Muehlhausen CPA, JD graduated from Valparaiso University with a B.S. in Accounting, passing the CPA exam while still in college. While subsequently attending the Indiana University School of Law, he became the youngest franchisee in Meineke Discount Muffler history (1987-1991). After successfully selling that business, Jim founded an automotive aftermarket manufacturing concern. During his 9-year tenure, the company achieved recognition from Michael Porter of the Harvard Business School and Inc. Magazine in the INC 100 Fastest Growing Businesses. Over the past eight years, Jim has personally coached hundreds of business owners in more than 3,500 face-to-face coaching sessions and has clients in North America, Europe, Asia, and the Middle East.
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