If you’ve been bitten by the entrepreneurial bug in 2009 and plan on ringing in the New Year with a new business of your own, here are some bits of advice for starting your new venture during a downturn in the economy:
- Gain good perspective. Although people are afraid of taking risks during a downturn, that doesn’t mean there aren’t opportunities for success! Don’t be afraid of starting a new business just because of the bad economy; after all, a good business with great service and a quality service and/or product can prosper no matter what.
- Think creatively about funding. Raising capital for a start-up has always been challenging, so the current credit environment isn’t all that unfamiliar to those entrepreneurs that have already gone through the process of getting funding. Think outside the box and instead of traditional bank loans, consider tapping into savings, getting family and friends to invest in the business or using a credit card to get your business off the ground.
- Take advantage of the downturn. With the ailing economy also come some benefits, such as lower prices for purchasing office space or storefronts and reduced leasing prices. You can also find great deals on just about anything, including new office furniture, technology and other supplies.
- Hire exceptional employees. Since big companies are laying off many of their talented employees, now is the best time to hire them for your own business. These people will be willing to take a pay cut and work hard to build a business from the ground up, especially if it involves work they’re interested in doing.
- Soak up all the attention from the press. Since a lot of entrepreneurs will be holding out for a better economic situation, starting a business now will draw more attention than it might otherwise.
- Lock in low advertising rates. With fewer and fewer companies spending money on advertising during the downturn, you can take advantage of these lower advertising rates. And, since there are fewer advertisers to compete with, you may get even better exposure than you thought!
The state of the economy doesn’t have to dictate when you start your business, so do it on your own timing — and remember, there are actual advantages to starting your business now!
As 2008 comes to a close and you begin a brand new business year in 2009, get yourself and your staff motivated to begin a successful year of growth for your business!
In order to keep your employees or franchisees and yourself happy, remember these three simple tidbits of advice for the New Year:
- Establish an active avenue of communication with your employees, franchisees and/or franchisor. Be open to discussing the current state of the business and making plans for improving profitability in the coming year. Keep everyone involved in these discussions, as this will help everyone feel as if they are really contributing to the vision and success of the business. With everyone brainstorming ways to ensure business success in 2009, your business can start the new year on a positive note.
- Set achievable goals for your business in 2009. Work together to set realistic goals for 2009. As you reach each goal, take time to celebrate the accomplishment. That will help boost morale and set the stage for working toward the next goal.
- Treat customers, employees and franchisors or franchisees with respect. If you can create a culture of respect within your business, this will not only help with customer relations, but work as a motivational tool for those within the company. When a high level of respect has been established between all parties, employees and employers alike are more willing to work together and work harder towards achieving a common goal: success for the business.
With 2008 behind us, the New Year presents many opportunities for your existing business, or the new business you will be starting. Wishing you a healthy and prosperous 2009…
With the global economic crisis in full swing, business owners are feeling the effects of the credit crunch. But with some careful planning, your business can survive … and continue to thrive!
Here are some tips to help you get through the current economic situation and retain a successful business:
- Make sure you have an open line of communication between your business and your bank. If you can’t make payments on loans you’ve taken out, let them know why you’re short on cash and when you’ll be able to pay them. This may help you stay in the good graces of the bank, and you should be able to keep the favourable terms you already established with the bank.
- Keep abreast of what’s going on with your bank, and make sure you’re not getting hit with hidden charges. Review your monthly bank statement to ensure the bank charges are correct. If you find that your current bank tacks on more charges than other comparable financial institutions, consider changing banks to reduce your monthly costs.
- Contact your accountant often to discuss your business and its financial situation. Inquire about any money-saving tips and develop a sound financial strategy for your company.
- Aim to maintain little to no credit card debt. You want to pay as little interest as possible, so try to keep your balance down to a minimum. If you have extra capital, you may want to use it to pay off credit card debt.
- Try to reschedule major capital expenditures, if possible. If you absolutely need to make a large investment in necessary equipment or stock for your business, do so. But try to keep spending down to the absolute minimum.
- This is probably not the best time to give out pay raises and bonuses. If you want to reward your employees, it’s best to tie it to company profitability. Encouraging words also work wonders with employees.
These tips should help keep you on the right track to make it through the credit crunch. Remember, keep talking to your banks and your accountants to stay on top of your company’s financial situation. With the right planning and hard work, you can begin 2009 with goals for a successful year for you and your business!
Starting your own business has additional perks other than reaping the rewards of your own hard work and setting your own hours. It can also help you save valuable time and money by shortening or getting rid of your daily commute.
New surveys show that people with their own businesses end up saving about three work weeks per year since they can choose where they work, which often significantly lowers the commute time. This also means the business owners have more time to invest in their business as well as their personal lives, including more time to spend with family and friends.
For one-third of small to medium enterprise (SME) owners, the commute is less than an hour a week, meaning many work from home. The survey indicates that an employee’s weekly commute time is about seven hours and 55 minutes, whereas small business owners commute approximately five hours and 25 minutes a week. That’s a total of 120 hours a week in commute time savings!
Less cars on the road at peak commuting hours have many benefits, including less congestion on the roads and the prevention of accidents on busy thoroughfares, which commonly happen on the commute home between 4-6 PM.
In fact, Work Wise UK even held a Commute Smart Week in late October to encourage commuters and their employers to consider alternatives such as coming to work a bit earlier or later to avoid traffic, telecommuting, carpooling, riding a bike or walking. They encourage this behaviour, which will not only save the commuter money but also promote green solutions to the traditional commute.
With all the benefits of shortening or getting rid your daily commute, starting a new business could save you the hassle and money… and give you the perfect reason to finally begin an independent financial future for yourself.
Taking risks isn’t for everyone. Many people are cautious about the decisions they make, especially decisions concerning their finances and their future. The word “risky” may even hold negative connotations for some people. But if you’re willing to make the leap and take a risk, you may be more likely to succeed.
According to new research from the University of Cambridge, risky decisions can lead to business success. Findings from these studies show that entrepreneurs tend to make riskier decisions when compared to managers who are employed by a company. And for these entrepreneurs, the risks pay off with the heightened potential to succeed.
What risks do entrepreneurs usually take? For starters, rather than working for another company, they are starting their own. By doing this, they are risking their:
- Finances
- Reputation
- Family stability
- Self-esteem
There is a lot at stake for entrepreneurs who decide to start their own business. However, these new studies prove that not all risk-taking is bad. According to professor Barbara Sahakian, lead author of the study at the Behavioural and Clinical Neuroscience Institute at Cambridge, “…risky or ‘hot’ decision-making is an essential part of the entrepreneurial process and may be possible to teach, particularly in young adults where higher risk taking is likely and age-appropriate.”
The published study shows that risk-taking behaviour can be taught, or even enhanced through pharmaceutical drugs.
However, it is important to engage in what prime minister Gordon Brown calls “responsible risk-taking.”
Franchises can mitigate some of this risk by providing a proven business system and ongoing support from the franchisor, who has already taken the leap and started a new business. By learning from their mistakes and using their tried and tested methods, you can take the risk to start your own business, but also have the assurance of back-up from an established company.
