Business 101 – Is it Really a Good Time to Start a Business?
I stand here to say it is a phenomenal time to start a business! Let’s take a look at history and the companies that said yes and launched a business during tough economic times. Did you know that 16 of the 30 companies that make up the Dow industrial average were started during a recession or depression? These include Procter & Gamble, Disney, Alcoa, McDonald’s, General Electric, FedEx, Trader Joe’s and Johnson & Johnson.
Let’s journey through history to 1973-1975; the United States had an unpopular president, in the middle of the Watergate scandal and at the tail end of an extremely costly war that had divided the country. We watched gas prices jump by nearly 50% in two years leaving consumer confidence at an all-time low. You would think it was a terrible time to begin a business, right? Let’s take a look at a few of the companies started during this economic crisis of the 1970’s: Supercuts, Chili’s, Cablevision, Industrial Light & Magic, Famous Amos Cookies, Oakley and a small company called Microsoft.
What makes it a good time to launch the next Intuit, Whole Foods, J. Crew, Costco, or Applebee’s (all launched during recessions)? Here’s what happens in bad economic times, disruption. Disruption means things change often quickly and dramatically. When change happens opportunities are created and entrepreneurs seize that opportunity that’s what makes them entrepreneurs.
So what sets them apart from the rest of the people? There are a few key points that lead to success during economic crisis, like today:
– Desire for Change
– Passion for Opportunity
– Strong Support System
– Defined RoadMap
– Great Idea
What has changed in the way business is done today?
– Weakened competitors. It’s likely that many of your competitors are facing tough times, tightening their belts, perhaps retiring or selling out. Many of the companies that have been around for what seems forever are shutting their doors.
– Customers seek cost effective options. When times are good, customers are likely to stick with the suppliers they’re used to, even if they’re a more expensive. Today, however, customers are looking around for cost effective options to get the products and services they need.
– Large Corporations cut back. Reducing their services, especially to the small business owners, who might be great customers for you.
– Loyalties loosen. As competitors reduce services to customers, and as customers look around for cost effective options, it means they’re less likely to be loyal even to longtime suppliers.
What is your role in this opportunity?
– Be the cost effective option. Target customers who use more expensive products & services now.
– Market aggressively. As loyalties loosen, your competitors’ customers are more willing to look at other options. They will be looking for those that stand out as the solution to their needs/problems.
– Think out of the Box. Come up with new ideas/solutions, especially more cost effective ones, for customers’ problems; they’ll be in a more receptive mood.
– Present yourself as a consultant for large companies. You’ll be more cost effective than the in-house staff they’re laying off and will bring new innovative ideas to increase their profitability.
“A lot of businesses get started at bad times,” said S. Andrew Starbird, the Acting Dean of the Leavey School of Business at Santa Clara University. “What they have in common is that they were innovative and served a particular need at the right time, the right place with the right product at the right price.”
Robin Hardy offers seminars, one-on-one coaching and group coaching, books and CD’s of our recent seminars. All of these are tools to empower your business for success or launch a new business. We also offer MMPA which is a get it done service for you the busy business owner/entrepreneur.