Since 2023 is here and there is the likelihood of a recession hanging over us, the most productive thing we can do now is prepare. Trying to survive a recession sounds scary, but there’s no need to panic. By analyzing the Business Crisis Trend and taking action now, you can ensure your business is ready to take on the economic storm being predicted.
The Business Crisis Trend
The first stage of the Business Crisis Trend is Shock. Understandably, you’ll be taken aback by what has happened and your first thoughts are going to be the effects on you, your family, and your employees. How will this financially impact you, and can you survive it? These are all normal reactions of course, but this is where it’s important to stay calm and not rush to act.
If you panic, you’ll head right into stage 2, Desperation. When you’re in this stage, it’s easy to get overwhelmed, blow things out of proportion, and completely lose your head. It’s normal to feel like you need to take action immediately, but you have to take the right actions to prevent further damage.
The Right Actions
To take the right actions, you need to quickly move into the Evaluation stage. This is your opportunity to be deliberate in your actions and avoid an overreaction and making it worse on yourself.
The first step is understanding your data. If you’re worried about having enough cash to survive through a recession, you need to ensure you know exactly how much you have and how far that will carry you.
When you know how much you have you can start to make a plan, and be sure that plan is to stretch what you have as long as you can. Do this by following some of these tips:
- Suspend, reduce and delay what you can.
- Determine if loans will help; plan for repayment. If your sales won’t return, don’t take the loan. The payback terms are important, not just the low interest rates. Be sure you understand them.
- Understand the payroll laws; does it make sense for you to defer social security?
- Look for other sales opportunities, do you have stale inventory that can move now? Is merchant fulfillment an option, should you move into other platforms that may perform better for you now?
Figure out which option is most important to you and focus on it. When you’re unorganized and unfocused it’s easier to get overwhelmed. We know distractions are everywhere these days, so prepare for them and keep yourself focused. You’ll come through a recession alive and well, and will know how to prepare your business for the next crisis you might face.
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If your ecommerce business isn’t where you’d like it to be in terms of profitability, check out my book, Profit First for Ecommerce Sellers. It answers important questions about how to implement Profit First in an ecommerce business. Take control of your money and your business, and put Profit First to work for you!
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