Never Again
Caught unprepared when the business climate suddenly went south? Next time it happens – and there will be a next time – you can be ready.
By Barbara Weltman
Here are four tips to help you anticipate and deal with the next down cycle:
Watch for telltale signs. When major corporations cut back on new investments in machinery and facilities and the number of new jobless claims rises, expect that the economy will falter. By anticipating the dip you can avoid overextending yourself during bad times.
Don’t rely on a few big customers or clients, no matter how profitable they seem to be. A single desertion of a formerly loyal customer can devastate your bottom line. Instead, continually work on customer development.
Stay fiscally strong. Carefully monitor your cash flow so you can pay your bills on time and maintain a strong credit rating. Make sure you have lines of credit in place to help you expand in good times and weather the bad ones. It’s easier to obtain financing during a boom than a bust, so prepare now to seek the financial cushions you need.
Make long-term commitments to staff. Employees are key assets and should not be thrown away when times get tough. Keep a core staff that you can carry through any type of economy, then supplement your payroll during peak activity with outside help such as independent contractors, temporary workers or part-time employees.
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