As a former real estate professional, I love to drive around looking at housing developments across St. Louis. As I drive, I think hard and gain tremendous clarity on issues facing me. One issue I’m contemplating is how to prepare our businesses for the next recession.
Based on my almost three decades in the real estate world, I know markets are cyclical and we’re heading towards the downward part of the cycle.
Here are my three quick tips on preparing your business for a softer market.
You may or may not know, I’m a product of the 2007 housing industry crash, and this is super relevant to what’s happening in business right now.
I was a consultant exclusively to the home building industry when the entire industry came to a screeching halt due to the subprime mortgage lending crisis which triggered a global recession. And while the factors aren’t exactly the same, what happened then is not too dissimilar to what’s brewing right now.
There are a few things business owners need to be doing to prepare for the next downturn.
Here are my top three tips:
1. It’s time to go back to really effective, strong, aggressive cash flow management practices. Dust off your old plans that you enacted when the pandemic first hit, because now is the time to cut costs and drive revenue.
2. Speaking of driving revenue, it’s time to power up the business development engine in your business. Holidays are already going to slow things down a bit for decision makers, so get active right now to build momentum as you head into the new year. I want you to hit the ground running.
3. Now is the time to bring in outside resources. You need folks at a time like this who are objective, third parties looking at your business with you. You need an external view of what’s happening in the economy in total, in businesses in general, and applying those learnings to your business so you can be more strategic. Also so you’re held accountable to do the hard things, to make the hard decisions, and to have the tough conversations that it takes to get your business prepared to weather this storm.
