Many of you may cringe at the idea of starting a company in a down economy such as ours (United States), however, it may not be as bad as you think. Starting a business in a bad economy will teach you how to manage your money. It will teach you the “real” value of a dollar. Many companies don’t know how to take a dollar the extra length, however the companies that you see surviving when the economy is low, are those that come back the strongest and dominate the market in 5-10 years.

You have all heard the stories of start-ups flopping and never getting off the ground, and you may think that it’s even more likely in a recession / terrible economy. But the way I view this, is that start-ups fail because of the owners and their inability to properly run a business.

Most people are to “scared” to go outside of their “security bubble”. The idea of going off on your own is a scary thought in any economy (good or bad). However, the same thing may happen to you while working for a “Big Corporate Company”. Even if it is established the life expectancy of keeping that job now a days is slim. Unemployment is skyrocketing and their is nothing you can do about it. Business owners are trying to cut expenses (i.e., you). The thing about working for yourself is that you don’t have to wake up every morning thinking you might get the boot. You’re responsible for what happens and what the future holds for you. The decision process is up to you.

Start off without risking to much. Don’t throw all your eggs in one basket. If you’re n entrepreneur, and in this economy, you can start your business slow. Sort of like test driving the business before investing more. If your business starts to pick up you can transition into investing more time and money into it. Or you can earn extra cash on the side while keeping a job. The thing about starting a business is that you don’t have an “office”. Your home is your office. By running your business from your home you save money you would otherwise be spending on rent and utilities. Don’t incur to many costs. You have to adapt and listen what’s going on around you. Love your customer more than you love your product.

You should seek advice from mentors and customers. Before you start a pouring all your money into your business, make sure you know what your customers want out of the service or product you’re offering. Ask what your competition is missing and implement it. You want to have “bait” to lure your customers. Something that sets you apart from everyone else. Seeking advice from mentors and fellow entrepreneurs is one of the better things you could do. No one knows more than others that were in the same footsteps as you years earlier. But, they have made the mistakes and you can bypass making the same mistakes by learning from them. Ask them obstacles they ran into when they were starting out, and what they did to keep from closing doors in down economies.

Many people have the mentality “Why would he want to help me”, but what I have observed is that most people are willing to help, and you need to take advantage of that. It’s kind of funny how people similar to you have an understanding with each other before even speaking. I would say entrepreneurs is an “inclusive group” where everyone admires each others ambition and desire to succeed. If you’re not a direct competitor, owners are willing to help you. These are networks and relationships you should start and keep. You’re sticking your foot in the door, and who knows, they can become future business partners with you.

The most important aspect is to provide unbeatable customer service — true in both a good and bad economy. However in the bad economy, people make sure they are getting a lot of bang for their buck. Being a small / mid sized business owner, you have an advantage over larger competitors because you are in position to provide consistent, outsanding service. You’re more flexible and can meet clients needs as they arise.

In the end it matters who you are, not what you do. If you’re the right sort of person, you’ll win in a bad economy, and if you’re not, then a good economy wont even save you. Don’t turn to the news if you’re worried about the survival of your business, look in the mirror. You will have to win over investors because they are going to be reluctant to invest in good start-ups and ideas. You have to adapt to this. My professor said something along the lines ‘last year you had to be prepared to explain how your start up was viral, and next year you’ll have to explain how it’s recession-proof’. To make a start up recession proof is what you should have been doing the whole time — run it as cheaply as possible. The saying “Cash is King” is not a phrase to take lightly, because Cash really is King in the business world. The death of start ups usually come because they run out of money, so the cheaper your company is to operate the harder it is going to be to kill.

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