Business Education

3 Effective Ways to Emerge from the Pandemic Even Stronger

With every crisis, there is a conclusion. Each economic downturn eventually transforms into recovery. Sometimes, the two are extreme and stark contrasts. Other times, they are mildly separated, yet perceptible. It’s how businesses act and react that is most important. Unfortunately, too many business owners react in a reflexive, impulsive way. Meaning, they don’t fully think through the situation overall, rather they merely act in the moment. Conversely, business owners that see long-term benefit even when there’s an economic downturn. Those companies come out stronger after the crisis passes.

Seize Opportunities When they Arise

Property investors who buy when the real estate market slides hold their assets until the market recovers and sell for a profit. Similarly, investors buy stocks when they fall amidst economic turmoil.

When the crisis subsides, the temptation will be to turn back that progress and retreat into old behaviors. But entrepreneurs need to shift from overload to shared load, and to practices that can transform team performance to find unexpected growth–and lower unsuspected risk. —Inc.com

These savvy people also sell when the prices begin ticking up again. There’s most definitely a pattern here and a lesson to be learned. That being, it’s possible to turn an otherwise bad situation into a beneficial one with the right moves. These individuals understand that the laws of physics do work in reverse when it comes to economic circumstances. Ironically, what goes down must inevitably go up. These people use that counterintuitive dynamic to their advantage.

3 Effective Strategies for Emerging Out of an Economic Downturn

So, just how do some business owners make the proverbial lemonade out of a bowl of lemons? These entrepreneurs don’t get caught in a negative mindset. In fact, they look at things pragmatically and create strategies that benefit them. Here are three ways to come out of an economic downturn stronger:

Know the numbers. The very first thing you need to do is fully understand precisely where your business stands at this point in time. If you don’t know the numbers, any plans you come up with will only reveal the true matter of the situation and this could be very costly. Take the time to get into the numbers to know exactly what you’re dealing with.

Devise a realistic, workable plan. Next, you’ll need to devise a realistic, strategic, and actionable play-by-play plan. It’s okay to look at the big picture, but be sure to address possible scenarios with contingencies. You don’t have to plan for every possible set of circumstances, but you should definitely have ways to work through the most likely.

Invest heavily in strategic relationships. Another smart strategy is to invest as much as you can in strategic relationships. Good entrepreneurs know this intuitively and leverage these relationships in ways that benefit everyone. Come up with ways that are advantageous to all parties involved and work towards those goals.

What other steps would you suggest to overcome an economic crisis? Please take a moment to share your thoughts and experiences; it could prove very helpful to others!

Interested in learning more about business? Then just visit Waters Business Consulting Group.

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Key Ways To Make Your Business More Transparent

April 17, 2018 No Comments

No matter what business you’re in, you want customers to have faith in your ability to meet their needs every time. That’s at the very core of being successful. The key to creating and fostering trust in customers often comes down to transparency. You want your customers to feel as though your business is an open book, and that they’ll always know what to expect from you. Transparency is something that’s both simple and complicated for businesses to achieve. It’s simple because it’s a matter of living up to the expectations customers have for your business. Yet it’s also complicated because it involves helping to set those expectations that customers have in the first place. Building a more transparent organization involves creating an internal culture that encourages honesty and transparency as well as building stronger relationships with customers. Transparency begins inside your organization, which means leadership must embrace the concept. You can’t expect your employees to embody transparency with your customers if there isn’t a strong culture to promote transparency internally. An effective way to create that culture of transparency is to encourage your employees to communicate with management as well as with one another. You can do this by establishing an open-door policy and giving employees a platform for expressing their thoughts during meetings. When you communicate with your employees, it can be extremely helpful to be clear with your messaging, avoiding corporate jargon and speaking plainly to your employees. Even if the news is bad, your employees likely will appreciate your honesty and internalize the spirit of transparency in their interactions with customers. Key Ways to Make Your Business More Transparent created by Track Your Truck.

Why Too Much Business is Bad for Business

May 24, 2017 No Comments

We all know that a business without much business, that is sales, usually sails slowly into the abyss. In some scenarios, a lack of sales starts a fantastic slide into oblivion quickly, causing the organization to grind to an abrupt halt. Regardless if it’s a slow bleed to death or a rapid demise, the end results are the same. This is what most first-time entrepreneurs know and fear, which is why they put all their resources into an astonishing effort in a race to success. While this scenario is certainly common and there are countless examples of companies wanting to dissolution, there’s another situation which can manifest and cause the same outcome — too much business. Why Too Much Business is Bad for Business Sure, it’s paradoxical, but nonetheless true: too much business, too many sales, is bad for business. It’s a strange phenomenon, but, it can’t be allowed to become a reality. When a business grows too fast, it runs the risk of outpacing its own abilities and that can cause customers to be shortchanged and to outpace the businesses capital resources. That’s nothing short of a disaster waiting to unleash itself, sabotaging a company from the inside. Incremental change rather than big splashy launches? Caution rather than risk? That may not sound like the profile we’ve come to associate with entrepreneurs, but it’s exactly this somewhat paradoxical mix of creativity and innovation combined with restraint, regulation and caution that is driving the next phase of [the country’s] business growth. The culture of prudence that has sometimes led [the country] to be seen as an economic lightweight has, in these tough economic times, proven to be our greatest asset. –Ivey Buiness Journal A company can’t overreach or it will be overwhelmed. We’ve all seen the real world effects when Fortune 500 companies rush a product to market. The Sony Betamax, New Coke, the Apple Newton PDA, and Facebook Home are some of the most high profile product failures. These demonstrate that not every new product will work, and, show that even large companies can make huge marketing mistakes. These major brands, though, can push through such bad experiences because they have the capital, brand recognition, and diversification. For a small to medium-sized business, this usually isn’t the case and there are real dangers in growing a company’s sales too large, too quickly because: Your team members can’t keep-up with the demand. While it’s great to see a steep increase in sales, that means having to meet the demand. If your team isn’t large enough, you’ll probably opt to squeeze more out from each employee. Quality will suffer as a result and when you sacrifice quantity for quality, you’re doing your customers and company a disservice. You rush through the hiring process. Another option you might exercise is to bring on new team members. The problem with this is, in an environment where there’s not enough hands-on-deck, you’ll have to expedite your hiring process. This can easily lead to bringing people on-board without the proper skill-set, attitude, or work ethic. So, you’ll have to suffer the pain of replacing employees and incur the expense of additional training. You need additional tools to sustain output. The tools of the trade are hugely important to providing quality work. When there’s a hurry to get things done, you might not have enough at your disposal. The remedy will probably be impulse purchases and that means heavily risking buyer’s remorse. You can’t effectively manage the company. Every successful business owner knows that it takes time to find and mentor good organizational leaders. This will become unavoidably apparent when there’s too much going on for your personal attention to all the moving parts. Your steep growth strains your cash flow and drains your capital reserves. Most successful business owners recognize the need for capital to start a business, but sometimes fail to realize that more sales requires more capital. Sometimes a business owner believes that more sales brings more revenue and that revenue will capitalize the business growth. Although a business owner can strategically manage the business cash flow and growth with sales to capitalize it, this must be balanced carefully and strategically. Think of the strategy like flying a plane. When a pilot takes off, the plane is on a steep but controlled ascend and then the pilot steadies the climb. If a pilot were to pull back for a steep climb and try to push the throttles and the jet to climb faster than the aircraft was capable, the pilot would burn too much fuel, create too much force and the potential risk of having the plane stall. This is similar with a business owner who pushes too many sales too fast, business runs out of cash and it stalls leaving the business to nose dive. Yet another unpleasant consequence of increasing sales beyond capacity is that you’ll have trouble responding to customer needs. If anyone is going to recognize this shortfall immediately, it will be your customers. This is why incremental growth is a sound policy. It allows you to identify gaps, learn from your small mistakes, and, to adapt at a realistic rate. Want to find out about what a business coach can do for you? [shareaholic app=”follow_buttons” id=”26833294″]

Small Businesses are Increasingly Turning to Alternative Lenders – Here’s What You Need to Know before Borrowing

April 28, 2023 No Comments

Even before the collapse of Silicon Valley Bank or SVB, there was a tightening in the commercial credit market. Post-collapse, small businesses have found it increasingly more difficult to secure capital from traditional lenders. Still in need of cash infusions and lines of credit, small businesses are turning to alternative lenders. Advantages and Disadvantages of Borrowing from Alternative Small Business Lenders Alternative small business lenders are non-bank lenders that provide financing to small businesses. They offer a variety of loan products, including term loans, lines of credit, and equipment financing. Alternative lenders often have more flexible lending criteria than traditional banks, making them a good option for small businesses that may be turned down for a loan from a traditional lender. Of course, even though all of this sounds good, there are reasons small businesses have historically relied on traditional lenders. This is due to the fact that there are not only upsides but also, downsides to using an alternative lender. So, let’s take a look at the pros and cons of borrowing from alternative lenders. Pros of Borrowing from Alternative Lenders Faster approval and funding. Alternative lenders often have a streamlined application process that can be completed online or over the phone. This can lead to faster approval and funding, which can be critical for businesses that need money quickly. More flexible terms. Alternative lenders may be more willing to work with businesses that have less-than-perfect credit or that are in the early stages of growth. They may also be more willing to offer loans with longer terms or lower interest rates. More options. Alternative lenders offer a wider variety of loan products than traditional banks. This includes term loans, lines of credit, and merchant cash advances. No personal guarantee required. Some alternative lenders do not require a personal guarantee from the business owner. This means that the business owner’s personal assets are not at risk if the loan is not repaid. Although these are some quite compelling reasons to seek out capital from an alternative lender, there are also a few considerations you should take into account so you have a better understanding of how these lenders work. Cons of Borrowing from Alternative Lenders Higher interest rates. Alternative lenders typically charge higher interest rates than traditional banks. This is because they are taking on more risk by lending to businesses that may not be as creditworthy. Shorter terms. Alternative lenders often offer loans with shorter terms than traditional banks. This means that the business owner will have to make larger payments over a shorter period of time. Hidden fees. Some alternative lenders charge hidden fees, such as origination fees or prepayment penalties. These fees can add to the overall cost of the loan. Less customer service. Alternative lenders may have less customer service than traditional banks. This can make it difficult to get help if you have questions or problems with your loan. Now you have a better idea of what to expect from alternative lenders, you are more informed about your options and this will give you additional choices. Taking it a step further, you should also consider the following if you are in need of a line of credit or some operating capital. When to Borrow from an Alternative Lender Alternative lenders can be a good option for small businesses that need money quickly, have less-than-perfect credit, or are in their early stages of growth. However, it is important to carefully consider the pros and cons before choosing an alternative lender. If you are considering borrowing from an alternative lender, be sure to shop around and compare rates and terms from multiple lenders. You should also read the fine print carefully to understand all of the fees and conditions associated with the loan. Interested in learning more about business? Then just visit Waters Business Consulting Group to learn more about us and the services we offer.