5 Reasons Why This Recession is Different for Middle Managers

It is without dispute now - the current economic climate is uncertain and volatile. Recession is looming on the horizon. This uncertainty is compounded by inflation. Today, it is difficult for businesses to plan and budget for the future.?

How Does Recession Impact Middle Managers??

As a middle manager, you must be aware of these economic factors and how they may impact your business. You need to be ready to adjust your approach. You must make difficult decisions in order to keep your business financially stable during these tough times. The first step – be aware of the common cash traps that can undermine your financial health. Take the necessary steps to avoid them.?

Five Common Cash Traps You Must Avoid

1. Giving Unnecessary Discounts: Do not be tempted to give out discounts when not necessary. Rely on customer loyalty. Discounts may attract customers, but cash is king during a recession. The bottom line must be managed. Only give discounts when they benefit your bottom line.
2. Not Paying Suppliers in Time – Creating Credit Crunch: Now is not the time to lose trust in your suppliers. Failure to pay will create a credit crunch that can put your business at risk. Track when payments are due and make those payments in a timely manner. Use digital tools to help. Not only will this create a good reputation, but it helps develop good relationships with suppliers.
3. Paying Account Receivables: While it's important to keep your customers happy, paying receivables too soon will put a strain on your cash flow. Instead, try to negotiate longer payment terms or consider using a factoring service to help manage your cash flow.
4. Getting Upfront Discounts from Suppliers – Creating Cash Crunch: You may be tempted to agree to upfront discounts. Don’t. While this can be a good way to save money, it can also create a cash crunch if you're not careful. Put cash back into covering your operations.
5. Over-Purchasing Inventory: This is a sure way to tie up your cash. You must meet your financial obligations and have enough inventory. Manage this carefully, but make sure you're not buying more than you need.

Most importantly, keep a close eye on your cash flow and be proactive when it comes to managing your bottom line and communicating with senior management.

A Guide to Navigating the Recession

When you avoid these, you are actually playing a critical role to keep the financial health of the company in good shape. You are a decision-maker and a leader. Do not forget that and do not doubt your instincts. Be cautious and aware of any potential cash traps. Take actions when they arise. Communicate with accounting departments.??

Leading Through Inflation: And Recession and Stagflation is the middle manager's guide to navigating the forthcoming recession, and it’s a critical read for people at any level of the organization.

Order your copy today to avoid the pitfalls, get ahead, and help save your company.