The year doesn’t seem to be going well so far. Inflation is at a forty-year high and looks like it might become entrenched, supply chains aren’t keeping up, there are widespread staffing shortages in several sectors, the stock market is veering into bear territory, the war in Ukraine has caused gas and oil prices to jump, and an unprecedented heat wave has caused havoc. On top of that, we are still tackling ongoing issues from the pandemic.
With this catalogue of disasters in mind, you would be forgiven for thinking now is not the time to start a business. However, that isn’t necessarily the case. Many businesses have started up in prior downturns, but with the right strategies and attitudes in place, they have managed to ride the waves.
Read: How to Manage Your Money in Business: Tips and Strategies
Start small and build up
When money is tight and inflation is up, it makes sense to take things slowly and start small. So, for example, rather than investing in a brick-and-mortar store with numerous products or services for sale, it would make more sense to open a small website with a shopping cart facility, and sell only two or three products. If you find one of the products sells exceptionally well but the other two don’t, focus on the item that sells.
If you are looking to run an office for your company, why not hire one instead of tying yourself up in leases and long-term commitments? Consider a serviced office from BE Offices, providing WiFi, telephones, photocopiers and many other facilities for a set price. Furthermore, these can be ideal if you only need an office space for two or three days a week, providing an excellent base for hybrid working.
Lower monthly expenses
Capital is hard to come by in times like these. A good way to generate extra funds is by lowering your monthly expenses. Some people will do this by selling assets, using life insurance money, refinancing student loans, or borrowing against their homes.
Do a lot of research
Research is important when you start any business, but this is particularly true if you’re venturing down a new and unknown career path. You need to look at your product and work out who it will appeal to and why. If a similar product is available, is it popular? What price is it on sale for? How could you distribute it to your customers? What do your competitors look like and how can you measure up against them? These are all important questions to begin trying to answer. If it isn’t already available, then is it needed? If so, why? Can you create your own niche market?
Remember to create a business plan from your research. This will be an important document and may be used for things like securing financial backing.
Read: When Do You Know That It’s Time to Hire New People?
Don’t put all your eggs in one basket.
If you already have a day job, do not give it up for the sake of your new business. This is even more relevant if this is your first attempt at running a company. Even if your main job uses a lot of your time, still prioritise it over the new idea.