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Going by the headlines, it's hard to believe that anyone would be interested in starting a business. Retail sales are crumbling, financing is tough to obtain, and there is a lack of confidence throughout the economy.
Yet it's during such times that can be ideal for starting a business. How?
Well, I had a chance to talk to Devin Jopp,the chief operating officer of SCORE, Counselors to America's Small Business. (Interestingly, his wife is currently setting up a new business.)
Here's what Devin has to say:
Deals, Deals, Deals: Everything is cheap right now, such as equipment, leases and even labor. With some negotiation, you are likely to have fairly low start-up costs.
Less Competition: Businesses are going bust. At the same time, fewer people are starting businesses. As a result, you may have an easier time getting customers.
Capital: True, banks are not lending and VCs are pulling back. But there are still many angel investors who are looking for opportunities. Hey, with interest rates at nearly zero, people are looking for alternatives for higher returns.
So it's a good idea to put together a business plan and investor presentation. Even if you do not raise capital, it's a useful exercise, which should help focus your business and improve the chances of success.
Also, make sure you take the steps to keep good credit. Thus, when lending comes back, you'll be in a good position to get more capital.
Resources: Make sure you contact your local SCORE office. This organization consists of thousands of retired executives who provide counseling – for free.
There are some helpful books and web resources too. For example, Tim Berry has a new book called 3 Weeks to Startup
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Reader Comments (Page 1 of 1)
12-29-2008 @ 2:30PM
Brenda Wallace said...
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12-29-2008 @ 2:36PM
Clay C. Scroggin said...
I started my first Internet business this year and things are going extremely well. All I read about is doom and gloom yet my new business is thriving. I am almost embarassed to celebrate.
After 15 years of working in the HR and Payroll software industry I created a lead generation and HR Software selection website. There was a niche that was not being filled for prospects and vendors. I suspect regardless of the economy there are always niches to be filled.
The advantage of starting a business during a downturn for me is that if you can survive the lean times, it makes things easier once the economy rebounds. When the econnomy does rebound you become well positioned for growth. Other competitors may enter your space but especially with an web based business I already have the page rank and the keyword rankings. I received a leg up just by starting my business first. By the time the econnomy does rebound I will be two years ahead of anyone else who wants to compete.
To continue to improve our rankings we have created a tremendous amount of content which we have added to our HRIS Articles page. We currently have over 90 mostly original content on the site. Anyone wanting to move into our space once the economy is growing again, would have a huge amount of work ahead of them to equal what we created during the slow economy.
Is a recession a good time to start a new business? Well like anything it all depends but for me I am glad I followed my belief as opposed to all the news of gloom and doom.
Good luck
12-29-2008 @ 6:32PM
Scott Savel said...
This article is spot on. When the economy is down is a great time to move into business with an agressive plan and a good product and win over marketshare. If you are interested in an advertising business that is well established and can be very successful check out http://.starkart.net and http://starlinesusa.com then email me at sellwithsavel@aol.com and I will give you the information to start your own protected territory selling advertising space to local businesses. We are a recession resistant business with a very small investment and having a great time hiring great sales reps because of the downturn in the economy.
12-29-2008 @ 9:56PM
Joseph said...
Home based corps or LLC 'S let you compete without all the overhead It's working for mine carolsitaliancatering.com Save on things like rents and utilities.
12-30-2008 @ 12:22AM
Donna said...
Timing is everything. This time a business that helps out the hardest of all hit economic areas, real estate is what gave us the idea for our new internet business. It is a win-win-win for everyone. If you have a home that you cannot sell, if you are interested in owning a home, but you don't want the expense of a motgage, if you are a realtor that needs to move some property or make commision on the buyers, check out perfectplacecontest.com
12-30-2008 @ 4:15PM
Sherra Scott ~ Virtual Assistant said...
As a virtual assistant who owns her own business and works from a home office, my business has also picked up this year. Most of my fellow VAs at VAnetworking.com are also experiencing an increase in their client loads. Virtual Assistants can be a great asset to small and home based businesses. VAs range in specialty from general administrative, web design, Internet marketing, bookkeeping and just about any other specialty need you can think of!
1-08-2009 @ 9:02AM
maisie said...
We have just started our business end of 2008, and is doing great. From home, no overheads, just a small investiment if you wish to have a look or think someone could benefit from it please visit earn25kin30days.com - there is no recession here! Good luck!
2-24-2009 @ 1:35PM
Beverly said...
Home-based businesses are the way to go and franchising can give you tremendous advantages, with proven systems and tools. You must be careful though that you invest your money, time and energy into time-tested, legal, and legitimate concerns. In my business we are expanding and interviewing for a 3-4 key people for our team. We are part of Global Business Alliance and backed by hundreds of Fortune 500 companies. Anyone interested can reach me at 866-722-4243.