| The uncertainty of the economy causes the thought | | | | smaller banks such as the co-operatives and less well |
| of business start-up in a recession to be quite a | | | | known banking names usually offer more competitive |
| daunting task. Of course this is understandable with | | | | rates, so they are worth paying a visit. Also private |
| the negative economic growth that leads to | | | | individuals such as friends, family and business |
| unemployment and increased debt for both the | | | | associates may be alternatives to consider. In this |
| individual and the economy as a whole. | | | | case, you may want to consider interest free options |
| However, it is a known historic fact that some of | | | | where the return on investment will materialise at the |
| the great businesses of our time were started in | | | | end of a given period, for example 5 years. The |
| periods of recession and the economy itself is | | | | advantage of this strategy is the fact that you will |
| boosted by the activities of small to medium sized | | | | not pay any interest at the outset thereby reducing |
| businesses. So though it may be a daunting prospect, | | | | your initial running expenses and as a result giving |
| starting a business in a recession can be a good | | | | your business a better chance of survival. However, |
| option to consider. When done properly it could end | | | | it is important that you seek legal advice before |
| up being a very rewarding venture indeed. | | | | entering into any sort of financial arrangements, even |
| The following pointers will help stack the odds of | | | | with your family and friends. |
| success in your favour: | | | | 4. Low cost marketing strategies: Your marketing |
| 1. What product or service are you looking to offer? | | | | revenue is the only money that leaves your |
| Although passion for your product or service is a | | | | company, apart from expenses for merchandise, |
| good place to start, you should give careful | | | | which has the potential of increasing your incoming |
| consideration to the type of products or services | | | | revenue. However, in a recession as well as any |
| that you offer. The reason for this is, when money is | | | | other time for that matter, low cost strategies will |
| scarce due to inflation, people will lean more towards | | | | serve us in good stead and help bring about growth |
| products and services that take care of the | | | | more effectively. Low cost marketing can be done |
| necessities before looking to the luxuries of life. | | | | using the traditional method such as direct mail |
| 2. How can you reduce your business start-up costs? | | | | advertising but you have to start small and test |
| You want to seriously consider your business start-up | | | | before marketing on a wider or larger scale. The |
| costs and make this as lean as possible. For example, | | | | other option which I subscribe to is marketing your |
| is it possible for you to run your business from home | | | | business online. With this method, you can reach a |
| as opposed to having an office outlet? This will | | | | wider audience using very low cost and sometimes |
| eliminate the cost of leasing which is usually a | | | | free methods of advertising. Before you do any form |
| substantial amount of money out of your business | | | | of marketing however, it is advisable that you carry |
| start-up costs. You may also want to consider low | | | | out some market research. This is important because |
| cost options for furnishing your office if you have to | | | | it will help you tailor your marketing to your target |
| be located on external premises by either collecting | | | | audience- this will ensure that your marketing |
| unwanted furniture from friends and family or visiting | | | | activities are more effective and it will stretch your |
| an auction site. Employing some part time and | | | | budget as far as it can go to produce the results |
| temporary staff as opposed to full time and | | | | that you desire. |
| permanent staff is yet another option to consider. | | | | Business start-up in a recession should not be looked |
| 3. Have you considered alternative ways of raising | | | | upon as a daunting proposition. The odds will be |
| finance? Even though some fortunate few may have | | | | stacked in your favour if you take the points |
| money saved up to finance their business start-up | | | | discussed above into consideration when choosing |
| venture, the majority of us are not so lucky. Most of | | | | the type of business to set up and how you |
| us will more likely go to our local banks where the | | | | eventually run the business. |
| interest rates are high. In comparison, some of the | | | | |