With millions now unemployed due to COVID-19 and others dealing with furloughs, reduced hours and general work uncertainties, many people may be thinking about striking out on their own. I did it when disaster hit my life. And what seemed to some people like a terrible time to start a business turned out to be the best one for me.
Despite the incredible economic uncertainty of these times, starting a business is a far less off-the-wall idea than you might think. In fact, economic downturns can be the best time for entrepreneurs to pursue their dreams of creating small businesses.
Some of the world’s most well-known companies started in very dark times. General Motors, Hewlett-Packard, Hyatt and Trader Joe’s were all born during economic downturns. And technology companies that we use every day, like Venmo, Instagram, Uber and Slack, were all products of the Great Recession. It’s the silver lining of difficult economic times. And I believe it will happen again.
So how can someone with a great idea make sure they’re well-positioned to start a successful business during this pandemic and recession?
Have A Comprehensive Plan, But Build In A Lot Of Flexibility
Being able to adapt is the single most important factor when navigating a fledgling business through uncharted waters. That means not only having the flexibility to shift directions, but also ensuring that you build flexibility into the business for all future employees. That may include seemingly simple choices like having liberal work-from-home policies or hiring workers who are strictly remote, as so much of the workforce is now. Those are moves that could attract strong talent to your business in the long run as we all become more accustomed to working remotely.
That could also include ensuring that your business has a number of suppliers with which you form relationships so that in the event of a disruption, your business can be less impacted. This is one of the ways startups can get a foot in the door when larger competitors struggle to adapt in the ways that smaller companies can.
Take Advantage Of Bad Times
For one, many goods may cost less during a recession, and you may have an easier time negotiating big-ticket expenses like rent if you plan to secure an office space or a storefront. Interest rates will probably be lower as well, which will save you money on financing.
And as we all know from watching unemployment numbers swell, there are many talented people out of work right now. Employers will likely have a solid pool of job candidates over the next 12 to 24 months.
Downturns Demand Innovation
It may not yet feel like there will be an end to this pandemic, but it will come, and businesses will look different on the other side. I am already fielding many calls from businesses looking for new ways of doing things. Innovation is in high demand as businesses look for smarter and less costly ways of operating. The industries that will likely see big changes include airlines, restaurants and retail. But there are myriad ways in which businesses of all sizes and types will have to change and adapt to our new normal, much as we are starting to see now.
There’s room to start new businesses in this period of uncertainty and thrive — and I can’t wait to see what comes.