We know what you’re thinking, but before you completely turn down this idea, just hear us out. Some people see a recession as a restraint. Some see it as an opportunity. Honestly, starting a business in any environment is hard and tireless work, and requires determination and proper planning. This only proves to be true during a recession; however, it is doable. In fact, both Microsoft and Apple were founded during a recessionary period. So, keeping this in mind, here are some reasons why you should consider starting up now.
One of the biggest concerns with starting a business is whether or not you have the money necessary to startup. This is the right time to find deals, especially for things that contribute to overhead prices. In a down economy, used furniture, used equipment, certain services, and even rent prices typically reflect market or below market value. This puts you in a better position for negotiating input costs. Whether you’re looking to spruce up your office space or find land for your business, take advantage of things being less expensive.
Most people tend to start businesses in a strong economy because entrepreneurs aim for funding. During an economic downturn, people are less likely to startup, making competition less fierce. In addition, companies that startup when the economy is thriving, may have a difficult time adjusting in terms of where to cut prices or what aspects of the company they should invest in. These very companies may even be your competition. A startup formed during a recessionary period is purely designed for a low-cost, making it a little easier to adjust to change, compared to larger firms.
As we mentioned earlier, some people see recession as a restraint or an opportunity. We see this as an opportunity for innovation. Consumers are always looking for businesses that can be nimble and problem solve; specifically in unforeseeable circumstances. With more available time, startups have an opportunity to use this time to come up with ideas for innovation, and creating new plans that can possibly give them an edge over competitors.
Innovation also applies to hiring new talent. Economic downturn results in frequent layoffs, and highly skilled and talented employees are now looking for job opportunities. This may be an opportunity for you to build out a strong team or hire subject matter experts that would be mutually beneficial to your business and those looking for work.
This goes hand-in-hand with innovation. If present clients see that you are dependable and nimble in the face of change, they are more likely to stick with you when the economy picks up again. For prospective clients, use this as an opportunity to undercut competitors. Knowing that people’s number one priority is to save money during a recession, you can get creative with sales pitches that will get new clients to consider your services.
When Will You Start?
Time is of the essence. The more time you have to plan out a business, the more likely it is you will succeed. Between motivation, commitment, and planning, this is the foundation a startup can be built upon. Not only that, but you are no longer confined to the same routine–you can be your own boss, and really get creative with ways that will keep your company afloat. By starting a business during an economic downturn, you are at a slight advantage due to a lean business model, and you can focus on building a better experience for clients and customers. Whether it’s fear, money, or time (or lack thereof), there will always be something holding you back from pursuing the idea of starting your own business. But if you don’t start now, when will you start? What is holding you back? Do you have new business ideas you would like to try out during this time? Let us know your thoughts in the comments.