I really don’t think about economic downturns. I keep grinding at the shop and continue to look down the road for our small local business. But here are some things we do to stay the course, not just during downturns, but always.
1. Take a look at your finances. The amount of cash your business has on hand is always important, but even more so in a downturn. Consider how much surplus you have and what kind of security it can provide you. For example, do you have enough for six months, a year, or longer? If you need to increase your credit line…..do it now. Another good tip for weathering downturns is to categorize expenses into buckets and prioritize expenses for potential reductions. Be honest with yourself, cut things from the list that are your unneeded expenses at this time. Everyone has to pitch in.
2. Keep your team engaged and motivated. Your employees aren’t immune to the stress of a tough economy. They may be worried about what a downturn could mean for their jobs. As your business adapts to an economic slowdown, I recommend remembering the impact these changes can have on employees, including their productivity, morale, mindset, and engagement. It’s critical to always communicate openly, honestly and regularly with your team.
3. Workplace culture and values are essential. In a shaky business landscape, you as a leader should always ensure they do what they say they will do. Employees watch to ensure their previous words align with their actions when things get tough. Consider the cultural aspects of any business decision impacting your team, especially cutbacks due to financial limitations. Think about the unintentional message these decisions may send.
4. Focus on employees. Unless you’re a one-person show, you need your team to keep your business running smoothly. In a tough economy, it’s more important than ever to empower your team members with more autonomy and flexibility. Flexible schedules like 4 -10 weeks allow for longer weekends and time with family. Connections and belonging through this shared experience remind employees of how they make an impact and why they are valued. You can also encourage managers to spend more time engaging with their teams.
Most business owners have made it through economic downturns in the past, and they can do it again. Following the preventive measures above can help your company withstand the storms.
