The question is, however, what does destiny look like? As I write this, I expect that the Dow will open below 7,000 for the first time in more than a decade. The S&P and the NASDAQ have also cratered but not yet bottomed. If I were “Chicken Little,” I would be saying that the sky is falling.
But, I’m not Chicken Little. I’m not Pollyanna either, but I’ve read enough human and American history to know that we’re not plowing this ground for the first time. Eventually, conditions stabilize, markets begin to recover, and life takes on a new definition of normal.
In the new normal, we’re all probably going to find that the bar has been raised. If you want to stay in the game, or if you are getting in for the first time, here are several points to keep in mind. How you handle the short term will determine whether your destiny is in your hands or in someone else’s.
The only thing that’s cash is cash. Get close to your CPA or your accounting people and identify where you’ve got some “sleepy capital” or idle cash. Put it to use to maximize financial momentum and increase cash flow stability.
Get serious about budgeting expenses and revenues. Start with your expense budget so that you know your variable costs of goods/services, your fixed expenses, and your break even points. Create revenue projections that include a “worst,” “likely,” and “best” case scenario.
While you may budget for a 12-month period, pay the most attention to the next three months. Revise as necessary to accommodate the changing economic conditions facing your business.
Build in some additional marketing expenses. But, don’t expect the same old marketing techniques you’ve been using to be successful. Your marketing will need to be much more focused on those most likely to require and need your goods or services.
Improve the quality/value of your products and services. It’s a buyers’ market. They will be choosy, and they will be under pressure to improve the price – value relationship of everything within their area of responsibility.
Stay Calm. According to Douglas Adams, the author of The Hitchhiker’s Guide to the Galaxy, the number one rule of survival is: Don’t Panic!
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