12/31/2023 0 Comments Helping them keep afloat![]() ![]() If you need extra funding to increase your cash buffer or keep your business profitable once the recession hits, apply for an Asenso small business loan today.At CE Thorne CPA, our focus is small businesses. With enough planning and the right strategies in place, you should be able to keep your business afloat until the economy bounces back. What it’s not, however, is an insurmountable problem. Without a doubt, recessions are terrible for businesses. Otherwise, it’s just another company expense for you to worry about. Instead, you need to know exactly how you’ll convert the debt into something that helps your business make more money. The good news is there are other options available to you.īefore you go out and apply for a business loan, though, you need to understand that it’s not something you should do just to keep your doors open a bit longer. With people getting laid off and businesses declaring bankruptcy left and right, it’s only natural for banks to be pickier when it comes to choosing who to lend money to. The only problem: it’s much harder to get your loan application approved during a recession. Not only will it give you the much-needed cash buffer you need to keep your business afloat until the economy bounces back, it will also give you access to much lower interest rates because banks are eager to get the economy moving again. If you sell services or digital products, then you can offer lower-priced packages with fewer bells and whistles.įinally, you can also get extra funding from the bank in the form of a business loan. Third, depending on your business, you could explore implementing a subscription-based model instead of charging full price up front.įinally, you can offer your products in smaller, more affordable sizes. Second, you can offer more flexible payment plans so your customers can spread the cost of their purchases over a longer period instead of spending a lot up front. While this may eat into your revenue in the short term, it’s still better than not selling anything at all while waiting for the economy to bounce back. If you can help them do that, they’re more likely to buy from you.įirst, you can offer discounts and special deals to your customers. Make it easier for your customers to buyĭuring a recession, people are looking to make whatever money they have last for as long as possible. Identify and cut unnecessary expenses such as underutilized subscriptions.Focus on the products and services that bring in the most money and put all others on hold.Streamline your operation (i.e., only keep the necessary people and equipment).Temporarily reduce your operating hours. ![]() Renegotiate deals with your vendors (who are more likely to agree because they can’t really afford to lose any clients during a recession).Temporarily (or maybe even permanently) switch to a fully remote working setup so you don’t have to rent an office.Temporarily switch to an online-only operation so you don’t have to pay rent to run a physical store.So, how do you cut your spending the right way? Backing off on your marketing efforts is the exact opposite of that. Your customers are already hesitant to spend their money, which means you need to work extra hard to get them to pull their wallets out. Marketing, for example, is one area of your business that you should not pull funds out of. Otherwise, you may end up also compromising your business’ ability to make money. You need to know exactly what to skimp on. While it may sound simple at first glance, it’s actually quite tricky to execute properly. Now, while there are things you can do today to recession-proof your business, it’s also important to know what to do if and when a recession happens-which is what we’ll talk about today. No matter the size of your operation, your customers deciding to hold onto more of their money can seriously affect your bottom line. Of course, this could spell disaster for business owners like you. While experts still couldn’t decide whether we’re in a recession or not, one thing’s for certain: the economy isn’t doing so well and a full-on recession may still very well be just around the corner. ![]()
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