I am sure we all agree that this is a terrible time and one of mass insecurity. I have experienced a few economic downturns in my time and still recall the big hit of 2008. Amongst the uncertainty, disruption and in many cases heartbreak there are success stories. Tales which come out of the darkness and remind us all that there is hope in the UK economy.
I remember in 2008, chaos reigned supreme and clients were folding, friends were losing their jobs and old stalwarts of industry were falling by the wayside. Even the banks look set to crumble! It was a really scary time, especially when the walls first began to come down. The media hype was full of doom and gloom with an apocalypse looming in the wings. Life was never going to be the same again.
The things that I remember after the dust had settled, but not quite subsided, was the return of hope and optimism. It seemed like new businesses were starting to pop up everywhere. New, innovative ideas started to push through the debris. This was a great time for the entrepreneur, the salesperson and the anyone with an idea. Now, I know many people were pushed this way due to job losses and a lack of new jobs but still new entities started, grew and thrived. It was an exciting time and I know this is different but I am 100% sure we will see the same again. These desperate circumstances could be the push people needed to step forward and start-up on their own.
I thought I would put together a few of the things I learned from startups in 2008 and offer some of the best advice I saw from around that time and how it could apply today.
The New Problems
The world has changed dramatically in the last few weeks and things will not be the same again. Whist this state of flux is troubling for us all, it is also a time of great opportunity. The core of any successful business is solving a problem. This life-changing pandemic has created a huge range of new problems and will continue to do so. Now is the time to look for the new problems you can solve. Try to pivot your business idea in this way. Think of homeworking, shopping, entertainment – every industry will be touched and changed by this. Where there are problems, there are opportunities.
A low price strategy is often looked upon in a negative way suggesting a lack of value in your proposed service or product. However, right now all businesses are feeling the pinch and cashflow is king. If consumers or businesses can make savings, right now is when they are likely to seek these out. It is fair to say many “current incumbents” will come under pressure from clients and this is an opportunity for a small business with less overhead and the ability to dedicate more time to one-to-one client care.
Fill a Need
It is a sad and unfortunate fact but it is clear that this situation will cause high levels of unemployment as organisations look to streamline and cut costs. This is where “outsourcing” comes in. It is definitely cheaper to outsource certain activities rather than employ an in-house resource. Therefore, in the current climate, businesses that are able to offer services which were once provided by an in-house resource will certainly be able to grow. Top areas to outsource are; Marketing, Accounts, HR, IT Support, Admin and Lead Generation – can your business fill these gaps?
Cheaper Credit & Government Action
In times of economic instability often the Government will step in with measure to help stimulate the economy. This is often in the form of grants or loans for innovative start-ups (For example – just announced https://www.gov.uk/apply-funding-innovation). It is too early to assume this yet but often the cost of credit and criteria tumbles in such times of economic hardship which may be able to assist in funding your new venture.
Office, What Office?
Many employers have long been sceptical about allowing employees to work from home often citing issues of trusting their productivity. Well, the enforced lockdown has certainly changed all that! Many businesses are discovering that they don’t need offices and can operate remotely. I would strongly recommend simply starting from home and if you are looking to outsource, don’t feel you are tied to engaging with prospects anywhere in the UK. This should really open up the job market across the country. There are also a number of tax benefits if working at home as you are able to claim relief for a proportion of rent/mortgage and utilities.
Social Media is Your Friend
Love it or hate it, social media is here to stay and is having an increased impact on the business world. Many people are confused or scared of using social media for business but once learned and tested, social media is an absolute must for almost all businesses. The key is to offer good content and not overstretch. It is better to pick 2 core platforms and do well on those rather than blanket coverage over every possible medium. The benefit of social media is firstly it is a great leveller where you stand shoulder to shoulder with larger organisations and often the smaller business is more flexible and able to respond quicker. The second benefit is they are all free to join, post and grow your profile on!
Who Else is Out There?
If you are starting up, let me tell you it can be a lonely place but it doesn’t have to be. Remember there is likely to be a large pool of talent out the now, could you form a partnership with another person who brings a different skillset? If you plan to go it completely alone, ensure you gain a group of peers and friends in business to offer advice, bounce ideas off and just complain to when things aren’t as rosy as they should be. There are plenty of online and offline communities you can get involved in here, so the journey isn’t so lonely.
Plan, Research, Ask, Learn, Repeat
I can’t emphasize this enough but you have to do your homework on core areas of your new business. You need to know the market, the competition, your break-even-point, your lead generation plan. The great news is this is all readily available on the internet with a little dedication and some digging. I would recommend turning this into a business plan which offers a chance to grow and review. In addition, I would set a time limit on the research, 1-2 weeks should be enough. I have seen too many potential entrepreneurs drag this out for months due to a fear of starting for real. Pick a launch day and tell everyone about it. This added pressure will ensure you hit that launch day!
Haggle, Leverage and Negotiate
In times of uncertainty, true savings and bargains can easily be attained with a little negotiation and pushing. If you need equipment or a service, do not accept the first price. You need to haggle, you need to drive for a better deal.
I hope this helps and I truly believe some of the next huge businesses will rise from this financial crisis and lean, smart, problem-solving startups will have a huge part to play in the future recovery of the world economy
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