It's five months into 2001, and for months now we've been hearing words like "downturn," "economic indicators," "layoffs" and, of course, "recession" in daily conversation. Everyone from Federal Reserve Chairman Alan Greenspan to your cashier at the grocery store has something to say about the economy, but no one can agree on whether we are, in fact, headed for a recession.
Maybe you think all this talk affects you; maybe you don't. It doesn't matter. What matters is what you're doing right now to prepare yourself for lean times. The fact is, it can't hurt to tell yourself we're headed for the big R. To put it another way, it can't hurt to tighten your belt a bit and trim costs wherever you can.
Now, I realize cutting back can seem like a daunting task if you're new to homebased business, set in your ways or just not sure what can be trimmed and what can't. So I'm going to ease you into this process and give you six really simple ways to cut your costs-so simple, in fact, that you have no excuse not to do them.
1. Watch for sales and special offers. Scour newspapers and the Internet to find the best deals and rebates on office supplies, services and the like. It pays not to pay full price-the extra money goes straight to your bottom line.
2. Get creative if you're in the market for new office furniture. Buy unassembled furniture from places like IKEA, shop at outlets or second-hand stores, or build some furniture yourself if you have that talent.
3. Get a business charge card with perks. Many of the major credit card companies offer discounts on products and services when you use your card. For instance, American Express offers discounts with FedEx, Hertz, Hilton and others. Shop around for a card that's appropriate for your needs. If you travel frequently, for example, a card that racks up miles might be best. And look for cards with low interest rates and no or low annual fee-you don't want your card to cost you more than whatever you're purchasing.
4. Create a budget for yourself, and stick to it. If you have one already, congratulations-but take a look at it to see if you can cut back anywhere. It's amazing how much you can save if you plan out your major purchases and stick to your budget religiously.
5. Use barter to your advantage. Do you know any local business owners with whom you could trade products or services? Is there something you have that they want-and vice versa? It's worth investigating.
6. Join an association. Often, professional and trade associations offer discounts on products and services, such as health and business insurance. (By the way, you do need insurance-imagine the cost of being uninsured if a major disaster strikes.)
From there, once you've got a momentum going, you can contact a good consultant and other business owners in the know to get advice on how to handle the larger issues involved with dealing with an economic downturn. Whatever you do, just don't do nothing. Remember, your business is at stake.