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Tips for Starting a Business in an Uncertain Economy

Key Points

Learn what industries were affected during the pandemic along with tips for testing the waters for your new business venture.

Starting a small business is hard work in any environment, but it’s even more challenging in a tough economy. Small business owners must hone their business plans. If you create a thorough business plan for starting and growing your company you can stay focused on your goal when things inevitably get tough.

If you are thinking of becoming an entrepreneur, consider the following tips for successfully building your business in a challenging economy.

Tips for Starting a Business in an Uncertain Economy

1) Be Real with People.

Don’t gloss over the realities people are facing. Offer support.

2) Prepare to adapt.

Prepare for business to be slow, but also be open and willing to adapt. You may have to broaden your horizons or niche down.

3) Track your expenses.

Keep track of your finances. You need to know where every dollar goes. Cash flow is crucial in times of uncertainty.

4) Get clear on your audience and their problems.

Know the problems they face and how you can solve them. Don’t start a business if there is no need for your product or service. 

5) Build an audience first.

Network and build an audience before launching. You can build an audience for free through a blog and on social media. Make sure to collect feedback — it will tell you whether or not you’re heading in the right direction.

6) Get moving.

Crises inevitably end. If you start moving now, you’ll be the one standing while others take time to get back up and running. Start small and grow over time.

7) Do your research.

Nearly 50% of small businesses fail within the first five years. That number jumps to almost two-thirds by 10 years. There are plenty of reasons why a business fails, but CB Insights found that 35% of startups fail because there’s no market need.  The way around this is to research your target audience before starting a business. Look into economic trends, consumer behavior, audience demographics, and competition.

The Truth About Uncertainty

Economic Uncertainty Headline

While uncertain times surely make it harder to build a business, the truth is that there truly is no certain or perfect time to do so. If you’re considering starting a new venture, evaluate your life, relationships, and bank account and decide if they’re sturdy enough to ride the waves of entrepreneurship. 

Be prepared for the ups and downs of business-building. Add safety nets before starting your business (whether that’s having X months’ living expenses saved, a healthy pipeline of leads, etc.), and know that there’s always risk involved.

Data from several sources continues to support those looking to start a new business. The Census Bureau reported that more than 4.4 million new companies were created in the U.S. during 2020 — a record-setting high. This is a 24% increase from 2019 and 51% higher than the average from 2010-2019. 

The influx of entrepreneurial activity during 2020 didn’t just set records in the US. It was also the largest increase of any country in the Organization for Economic Cooperation and Development or the G20 with available data.

Before taking the leap, consider which industries have been most affected by the pandemic and which may be the most profitable. Retail, food service, and logistics have seen major losses. However, finance, construction, and eCommerce barely slowed down. 

Your chosen industry plays a part, as well as the amount of additional funding you can get from the government and private stipends. But it’s clear that the economy is getting back on its feet, and more people than ever before are setting up their own businesses.

When Is The Best Time to Start a Business

Ask any entrepreneur when is the best time to start a business and they’ll probably tell you “there is no perfect time.” Every business takes dedication, strong leadership, a great product or service, and a little luck.

Research from the Kauffman Foundation found that 30% of new entrepreneurs in 2020 were unemployed when they started their companies. Some entrepreneurs had ideas brewing for a while and took advantage of downtime during lockdown to create their own companies. 

See what the experts are saying.

The Bottom Line

There are unique benefits associated with starting a business in any economy. If you do your homework, think strategically, and take advantage of every opportunity to minimize costs while maximizing the value to your customers, you can build a foundation for long-lasting business success.

 

By Leslie Radford
Tips for Motivating Your Remote Team

Tips for Motivating Your Remote Team

Tips for Motivating Your Remote Team

By Leslie Radford

With many teams working remotely due to the pandemic, it can be hard to keep them motivated. Here are a few tips to implement to make sure your team happily does their best work.

Create a Remote Company Culture

You can’t replace water cooler talk or hang out with your colleagues at lunch, but you can reward their success through incentives.  This in turn helps you retain top talent, boost engagement, and encourage high performance.

You can do this by:

  • Send them a handwritten thank you note or gift
  • Extending your company’s culture remotely with team-wide recognition  
  • Have positively reinforced contests amongst teammates

company culture

Help Them Solve Time Management Problems

Not everyone is cut out for remote work. It may have been forced upon them during the pandemic. When you struggle in this area, you aren’t producing your best work, are more likely to miss deadlines, and you’re unable to maintain a healthy work-life balance. Try using these techniques:

  • Stress the importance and benefits of time management to them
  • Set goals together
  • Focus on quality, not quantity
  • Help them identify what’s causing their time management problems so that you can come up with solutions
  • Offer training on programs being used by the company 
  • Provide resources for time management tools (Focus Keeper, MyOrganizedLife, Trello, etc.)

Trust Them

Allow them the flexibility they need to work at home. Many are juggling their children who are learning from home and they’re trying their best to get it all done.

That doesn’t mean that you don’t need to clearly define responsibilities, expectations, and deadlines, as well as checking in on them, but there’s no need to micromanage them. 

Emphasize what is produced instead of focusing on when and how much.

 

Collaborate with Them Frequently

Working remotely can take a social and psychological toll on some. Not having that human connection can affect their work. Use technology (Like Zoom and Slack) to touch base with them often. This will allow for team interaction and make them not feel isolated and alone.

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