Understanding what is really happening to your company in a developing crisis is no easy task. It is vastly different than prudently planning for the next general economic downward cycle. To survive, you must commit to developing the plans and near-term performance necessary to be in business one more day! Start by finding and applying the power of your business. Once you know what you want to do and what you can do, it is much easier to know what to avoid. Careful reviewing of the following three principles can help you and your business weather the storms in an economic crisis.
This is true whether the problems are broad-based or more unique to your business. To survive in a highly disruptive period, you will have to do things you have never done before. All of which will be difficult … and necessary! Here are the three most important operating survival principles to take to heart. It is axiomatic that you should never run out of cash in your business. However, what is critical is to understand exactly what happens to most businesses in a deep drop in economic activity.
There certainly are differences between retail, distribution, manufacturing, and service businesses. In practice, however, the problems are the same. The cash flow needs and cycles do vary in these diverse business models. Each one may require a degree of renewed understanding in a crisis.