The Financial Crisis: What Can Small Businesses Do To Survive?
There is a lot of anger on Main Street and from small businesses about the government package to bail out greedy Wall Street moguls. The anger is justified because no one will be there to bail out the small business. While we are told that these giants are too big to fail, there is a fact that is rarely paid attention to, which is according to the SBA, businesses with 10 or less employees account for over 90% of the employers in the USA. Thinking about it that way, small businesses are the life blood of communities and a keystone of our economy.
What can they do to survive in these perilous times? For starters, this is no time to worry about how did we get where are, who’s to blame, of dwell on mistakes we have made. Now is the time to act deliberately and with dispassion. It is time to get out or create a budget and figure out your cashflow. This will tell you how dependent you are on your lines of credit. Look at how you can lower your overhead without cutting so deeply that you mortally wound your business. Another common mistake during tight economic times is to completely pull back from everything until the ’storm’ passes. In doing that, you can miss opportunities, lose visibility, and potentially contact with your customer base.
This is the time to act strategically, to have a plan, and get different perspectives. The next few months may not be easy. Opportunity will belong to those who actively manage their business rather than just react to problems as they come. In crisis there is always opportunity. And, as we saw, good times without management can lead to peril.