Published on Oct 14, 2019
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Lately when you watch the news, or read your news feed, you are bombarded with the prediction of the impending economic downturn, but it seems Cessnock business owners are optimistic about the future.
The recent business survey in the Cessnock LGA shows that our local businesses are largely optimistic about the future of their business. Business owners were asked to rate their perceived optimism for the future of their business on a sliding scale of 0-100. 0 represented “very concerned or negative” and 100 represented “very confident or positive”.
Initial analysis on the recent Cessnock City Council’s Business Capability Study has shown a vast majority of all respondents (92%) scored between 50 and 100. Indeed, 14% of respondents provided a perfect score of 100 on the optimism scale, and 32% provided a score of 90 or above. This indicates they are very confident or positive about their business future.
How to insulate your business from an economic downturn
Optimism is part of the solution. Research shows that pessimism can actually become a self-fulfilling prophecy. Negatively strips away at your energy levels and makes you feel like you have no control over the future.
What else can you do?
Diversify – think of other revenue streams you may be able to add to your business. This spreads the risk. But don’t spread yourself too thin, and don’t neglect your core business.
Be proactive – don’t wait until things get bad. Try planning for the worst case scenario and work to become leaner and more agile. Agility can be the difference between being able to adapt to a new economic situation and going under.
Cash flow – in tough times, keeping a keen eye on your cash flow can be key. Don’t let accounts become overdue, and keep in touch with those who owe you money. The longer it takes you to notice an account is overdue the harder it can be to recover money owed to you. And if possible, reduce your debt levels too.
Collaborate – developing a relationship with other people in your industry can sometimes lead to a win-win. For example, if you have a business that has feast or famine fluctuations, teaming up with other businesses that you can refer your customers to when you’re too booked up to help them can be reciprocated.
Keep your team updated – if times are becoming tough, let your staff know. Be upfront about how things are going and, if you can, give them a timeframe if you need to temporarily cut back on hours or staff numbers. Nobody likes nasty surprises.
The bottom line
Remember, whenever there is an economic downturn, it doesn’t affect all industries equally. Being able to anticipate what people will still be spending money on in tough times can be the clincher.
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