Entrepreneurship: Five Ways To Steer A Business Slump
A business slowdown or a general economic recession offers challenges in the lives of every entrepreneur. From seasonal slowdowns like holidays or specific offseason phases for a particular business to an overall slump on a national/ regional level due to various factors, a downturn can be a challenging and de-motivating time for people in business, especially the first generation entrepreneurs. Listed here are five effective ways to battle and emerge a winner from the slowdown!
Alter your product/ value offerings:
This is an important aspect and the first line of action for an entrepreneur when trying to cope with a business slowdown. Depending on the overall market scenario, it is wise to modify one's product and service portfolio to match the consumer requirements at the time, and this may vary from business to business. For e.g., to some companies, it would be wise to include additional customer service as a value-add to retain existing customers by giving them a little extra. While for others, it may make sense to cut down on specific discounts or benefits which were previously affordable.
Re-negotiate contracts
Capturing the expenses and optimizing resources is the second most vital step when bracing for a slowdown. However, it does not always mean completely cutting off certain essential business services or vendor contracts. Instead, in the times of the millennial entrepreneurs and disruptive technology innovations, there are several options available for optimizing performance. From modifying exclusive or retainer contracts to as-and-when required services to ‘leasing’ services from various vendors when needed, outsourcing tasks, etc. can help reduce costs without cutting down on essential business needs.
Network and collaborate
A slowdown for any set of business is an excellent time to meet other players in the industry to reach out and network with them to understand the larger picture. This also offers unique collaborative opportunities too, which, apart from helping in business growth, also provide the much needed moral support and confidence required to tide over a rough patch in business. Networking and collaboration during tough times bring out the best in entrepreneurs and maybe the right time to make life-long friends or partners!
Personnel Development
The business slump also offers an excellent time to introspect, analyze, observe, and improve oneself. From an additional training session for the staff and employees to indulging in knowledge sharing with peers, this could be an excellent opportunity for gaining knowledge and personal development. One may also engage in short term business-related courses (several are available on MOOCH sites like Coursera, which are free) or workshops that can help learn essential skills.
Plan for the future
As ironic as it may sound, a slowdown is the best time to chalk out a realistic growth plan and sniff out profitable opportunities within the industry or in allied segments. These may include expansion of services to offer value and thus stay relevant or forge new partnerships to provide innovative solutions that can help beat the slowdown. Many business icons owe some of their most intelligent innovations to a slump period or an economic downturn!
As an entrepreneur, one needs to be well prepared for lull phases in business and also be vigilant and sharp to make the most of the favorable times. Above all, the essential qualities for any successful entrepreneur mainly include a keen sense of observation, an eye out for opportunities, passionate dedication to the business and expertise in the craft, coupled with sharp intuition and people skills, all come to the fore to ensure you can not only survive but thrive the slowdown!