Should you start a business during a recession?
Just as people around the world experience changes in the seasons, persevering through cold winter temperatures and basking in the summer sun, the economy also experiences seasons. When things are going well, you feel as if you have no financial worries and your professional dreams are thriving. However, when the economy takes a turn for the worse, it makes you question everything you thought you knew about business.
This is especially true for those looking into starting a business during a recession. Most first-time businesses fail within 10 years – that’s a fact. How can you succeed in not only launching a new company, but in opening a business during a recession?
“Whether you suffer, or whether you succeed, is not based on the season,” says Tony Robbins. “It really comes down to what you do.” Although it might seem counterintuitive, when the economy takes a downturn, it’s actually an excellent time to start a business.
Take inspiration from major innovators
Did you know Apple was launched during a recession? Steve Jobs was initially making computers in garages and selling products from a Volkswagen van, but he found tremendous success, partially because of when he decided to debut his company. Disney, Fortune Magazine and Microsoft were all founded during recessions. How did these mega companies find success, even when the economy was at its worst?
While these businesses are renowned for their hardworking, talented founders, they also had something else going for them – they dared to launch during recessions. While their competitors feared failure and didn’t want to enter the market during a volatile time, companies like Apple did so anyway. Because of this, they set themselves apart as leaders and innovators, and were able to go largely unchallenged for a long period of time. The founders of these businesses didn’t ask for the economy to change. Instead, they found ways to better their offerings, so as to differentiate themselves in the marketplace
Be confident in your competence
If you’re looking to continue operating or are intent on opening a business during a recession, you have to have complete faith in what you’re offering consumers. Steve Jobs and Walt Disney chose good times to launch their companies, but they also felt unshakably confident about what they had created. Can you say the same of your company? Have you thought about your differentiator, or what truly sets you apart from others in your field? Employing business strategies during a recession is essentially meaningless unless you’re certain that your product or service brings something unique and valuable to the table.
Anticipate, don’t react
As you think about potential business opportunities during recession, there’s something important you need to keep in mind – the world, and the market, is constantly changing. You need to hammer this mindset into yourself so you never become too comfortable. The most successful people in the world don’t wait for something bad to happen and then react to it – they anticipate all the things that could go wrong ahead of time and have a plan. If you know that the road ahead will not be an easy one and you’re able to anticipate that you need to account for potholes, accidents and unpaved sections of the road, then you have the ultimate business advantage.
Know the biggest chokehold in business
Without question, the biggest chokehold in any business is an unprepared leader. It’s not the economy. If you’re leading a company and you don’t have the right mindset or skill set to succeed, then you will never find the success you crave. You need to reframe how you’re thinking. Are you putting limitations on how much you and your brand can accomplish? Are you setting yourself up to fail because you’re afraid that things won’t work out? The first step is changing your mindset.
Next, when you’re running a business during recession, you need to objectively evaluate your skill set. Do you have the technological prowess needed to do your job? Are you stretching yourself too thin when you could be delegating tasks to other employees? Lastly, do you have the leadership skills needed to excel? People aren’t born natural leaders – leaders are created over time. There are many leadership styles and one certainly speaks to you. If you’re not where you want to be when it comes to your skills, don’t worry. You can learn how to more effectively manage your time and resources, and learn how to lead.
If you’re able to successfully open a business during a recession, your work isn’t over. Not only do you need to set yourself apart from competitors and be able to market your product, but you also need to constantly be working to improve your offerings. If you’re able to sell something once, then you’ve made a sale. When you’re able to consistently offer something that people want and need, then you’ve created a sustainable business. Strive to add value to people’s lives by continually innovating when it comes to your brand. You don’t need to make huge, monumental changes, but you do need to consistently be evaluating what’s working and what’s not in addition to anticipating gaps in the market and creating items that bridge those gaps. The best brands in the world aren’t always pumping out new products just for the sake of having something to sell – they strategically innovate, which helps them to convert their customers into loyal fans.
When presented with business opportunities during a recession, don’t try to convince yourself that there are a million reasons to wait until the economy rebounds. If your brand is ready to be launched, launch it! The market will always have its up and downs, but if you’re able to anticipate these changes and offer something that provides value to the lives of others, then you’re bound to succeed.
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