The R word and what it means in small business.
Well, if it isn’t a recession, it sure looks and smells like one. Many people of retirement age or near retirement age who have been looking for work have been moved to the sidelines. Easy credit is getting dry. Not the conventional time to start a new business. At least not the conventional time to get conventional financing.
Most lenders are becoming risk averse. Many people are also. Even in Silicon Valley, employees are leaving smaller firms and seeking jobs with larger and potentially more stable companies. Maybe it is a time to be risk averse.
The question is how do you lower your risks while proceeding with your business plan? Going slower with fewer cash outlays is always a good idea, but more so now. Think two and three times before spending cash is a really fine idea. Consider barters for goods and services you need. Hiring a part-timer may be preferable to a full-time employee right now. maybe putting in more hours yourself is the best idea.
If you don’t have a burning need to start up a new operation, now is the time to wait. Speculation in realestate is still speculation. One of the things that is driving the real estate and stock markets lower are margin calls. Leverage is fabulous on the way up and murder on the way down. With the way financial institutions are getting hammered you can get caught by their failure to keep a promise.
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POSTED IN: Business Plan, Finance
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