We all have giants we must face. We come up against huge obstacles in our lives that feel like they are impossible to overcome.
Today, we are looking at part one of the two biggest “giants” you face right now when it comes to surviving and thriving as a business in 2015. You could call them the biggest piles of entremanure you have to deal with right now. This first one might be a surprise to you…
#1 The Economy
Our economic “recovery” has certainly not been what we would all like it to be, and there’s not a bright light at the end of the tunnel yet. Despite what many are saying, things could be getting worse before they get any better. Don’t be caught unprepared during a downturn. Here’s a list of tips to help you be smart and keep your business healthy this year.
If you are hiring, hire up. Pay more money for a superstar instead of hiring 3 average employees. Keep the belt tight when it comes to the head count on your payroll.
Stop renting off-site storage facilities. If you’re honest with yourself, most of the time half the stuff could be thrown away anyway. If what you pay in rent is more money than what the stuff is worth, it’s time to get rid of it!
Thinking about expanding? Think twice. You don’t want to be over extended if the economy takes a downturn.
“It’s better to be a yard wide and a mile deep, then a mile wide and a 1/2 inch deep.”
Have extra space? Rent it out! Or move into a space with someone else. The extra rent money will come in handy.
Sell unused assets. A truck, forklift, or whatever will bring more today than it will a year from now. If you need it later, go rent one for a week.
Thinking about borrowing money? This might be a good idea and it might be a bad idea, it all depends on why you are borrowing money. Repaying loans with deflated dollars is painful.
- Bad Reason to Borrow: Borrowing money to expand and spread your business thinner across a wider area.
- OK Reason to Borrow: If you’re asset rich and cash poor, borrowing now will protect your assets and allow you to operate your business.
- Better Reason to Borrow: If you have sufficient cash, and sufficient assets. Borrow cash to make moves during the downturn others won’t be able to.
Put together a pile of cash. Be one of the strong who will be able to weather a storm. Remember that in a downturn cash will be king. You don’t want to unload your assets at firesale prices, you want to buy assets at firesale prices.
“Distance runners ‘carb-load’ the night before their race. Now is the time you should ‘cash-load’ for the same reasons.”
Be Future Focused
Choose a healthy bank. Be sure the bank you choose is not in trouble. WEISS ratings website is a great resource for doing some research to find your safest option.
Landlords are raising rates and asking for long term leases. Opt for short term leases, even if you have to pay more for month to month now in order to lock in long term later at a much better rate.
Beat This Giant
Be lean, be liquid, and think long term. This is how you’ll be ready to beat the economy, no matter what happens.
Part 2 is here! Click here to see what we picked as the #2 biggest challenge. Unlike this challenge, it’s probably one of the most talked about. You won’t want to miss the helpful tips we provide for overcoming it.