“The curious mind embraces science; the gifted and sensitive, the arts; the practical, business; the leftover becomes an economist” Nassim Nicholas Taleb
The number one thing is to keep hope. There are 7 bn people in the world. They are consuming for their survival. There are renowned economics and Governments working to avert a sustained downturn. Therefore, any downturn will end sooner than expected. All gloomy scenarios can change overnight. The longest recession of 2008 lasted for 18 months. Many times downturns are due to the structural changes in the economy.
Be that as it may, it can’t last.
“As sure as the spring will follow the winter, prosperity and economic growth will follow the recession.” Bo Bennett
The important lesson for entrepreneurs and employees is to manage the debt level at a reasonable level. Reckless borrowers are the first ones to take a hit.
The problem with the downturn is it’s contagious and has a psychological impact. Many people keep talking about it even if they are not impacted. Most of the talk around you about the downturn is exaggerated. Another important lesson is not to become hopeless.
Here are some of the things you can do as an entrepreneur to thrive in the economic downturn.
Manage Your Customers
Get closer to them. This is a time to meet them, know their pain points and realign your services and customer experience.
This could be an opportunity to learn from each other and extend business opportunities
Manage Your Cost
This is a good time to manage your costs. Lay off is the easiest way to save cost but there are many other avenues. Doing things differently, adapting technology, digital platform, smart way of working, there could be several ways you can cut costs, refine processes and lean your operations. Lay off should be the last option as you will need people to get ideas and implement ideas. Laying of means laying off huge tactic knowledge of your business.
Spend on Innovation
Like a parachute, our brain works when it’s open. In economic boom time, no one has time to think and people are busy selling and executing. In downturn when we have time and survival looks challenging, our mind opens up for the new ideas.
“Regardless of whether we are in an upturn or a downturn, our goal is to ensure the Volkswagen Group reaches the top of the automotive industry. ” Martin Winterkorn
Invest in new ways of doing things. New ways of servicing customers, news processes, new products. Have start-up a mindset and challenge your offerings.
Explore New Market
It’s time to explore new markets and create a blue ocean. The economic downturn is the time to think and pause. What you can’t do in boom time can be done in the downturn.
Usually, people stop experimenting in a downturn, but winners invest in innovation and experimentation during the lean time. Get yourself future ready during the economic downturn and structural changes in the economy.
Stock market investors know a downturn is the best time to buy stocks. Those who become dejected and are in no mood to invest lose the opportunity. Entrepreneurs also must know downturn is the best time to rejuvenate. Invest in what matters and what ensures the future survival of the business.
Retain Valuable Staff & Layoff Non-productive Assets
This is the key. Keep people. Laying off is easy but keeping them is bold. Use their insight about the business for the revival of the business.
Over the period, an enterprise creates unwanted assets that do not generate an adequate return on investment. It also affects the good business. Lay off unproductive assets and non-core businesses to refocus the business. Learn to read and making sense of your financial statements.
Lowering inventory, recover fast from the debtor, and pay later to creditors, restructure loans if necessary. are some of the common-sense approaches worth not mention.
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Employees Facing Retrenchment Can Reskill, Unlearn and Relearn
If you are an employee and facing layoff don’t worry. Your worth is not determined by what your employers think about you or his financial condition. Take this opportunity to reskill and relearn new things. This is a great time to learn new things add to your self-worth.
Manage your finances with care, spend some money from your savings to survive the downturn but don’t give up or get dejected. You are more than your economic condition.
Relook at your strength, explore new avenues, ventures, freelancing, fitness and you never know this could be the biggest positive life change economic downturn you might have encountered.
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“I’ve heard there’s going to be a recession. I’ve decided not to participate. ” Walt Disney
If nothing works out the way you wanted, follow Walk Disney. Enjoy what you have and wait or the upturn but do not participate in the downturn.
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