I am a small business owner, a writer, a web/graphic designer, an audio engineer, and a father.
Every small business has a time (or ten) in the first two years of business where they struggle to make ends meet. It can be the most gut-wrenching feeling anyone can experience.
Knowing that, for the first two years of business, most banks won't extend most sole proprietors a loan, the average owner needs to be able to float the cost of operating until things take off.
How Do You Float the Costs?
1. Maxing Personal Credit Cards
Some people max out their personal credit cards and pay them down with the profits from their business.
Pros: There is nothing wrong with this approach. If you have the ability to get enough credit to do what you need and are making enough doing what you're doing to pay the balance, then continue.
Cons: A lot of the time, this method actually adds to the pressure of the slump. If you aren't making enough cash to pay those bills, they are just another 100 pounds on your already weighted shoulders.
2. Keeping Your Day Job
Some entrepreneurs decide to stay at their day job and try to work their businesses on the weekend.
Pros: Depending on what you do as a day job and what your business is, this method could be very beneficial. If your day job was one that put you in front of a vast receptive audience, it could be a way to start your word of mouth and paper advertising for your new venture.
Cons: At the same time, this could put you in a jam. Sometimes your businesses needs will conflict heavily with your day job obligations. Sometimes your business will have to be kept secret, as it would be a conflict of interest for you to maintain your position with your current employer. This situation really isn't the most ideal. This has you pinned to a place where you can't generate any leads or tell anyone what you're doing. If this is your situation, you should probably look for something more conducive to your needs.
3. Getting Investors
Some businesses start with the backing of an investor, or a large group of investors.
Pros: These people don't usually have a problem surviving the slump. Most times, they have the right people in place to assure that the budget is adhered to and all operations are running smoothly.
How to Identify the Slump
This article is about identifying the slump. I pitched out the previously mentioned situations to show that there are multiple ways a small business could be funded. Each case is different. A slump can strike at anytime for any reason.
If you are in your infancy as a business and are working it full time, you may not know how to identify a problem with the market. You may only notice that your business has slowed. It's easy to ignore the obvious and down play a couple days or even a week of slow business. If your being blissfully ignorant and not noticing an economic down turn or local market deviation, your business could be crushed.
The Many Forms It Takes
A slump can come in many forms.
- It can be the second day no customers contact you for service.
- It could be your having relationship problems and they are causing your slump.
- Some times a late order can put you in a slump.
- Aggravated customers or even having to refund a customer on Amazon knowing you sent them what they ordered can cause it.
- A slump could be depression or envy. It could be a petty slump brought on by a bad review or comment left on your social media.
No one, anywhere is free from the reach of a slump. A lot like karma, a slump can slap you in the face and either knock you down or wake you up. Hell, your slump could very well be karma starting her assault on you for cutting in the long traffic line, knowing you saw the flashing arrows just like everyone behind you now. A slump could literally be anything. Monday mornings and Wednesday afternoons are also good examples if you still work a 9 to 5.
Define Your Criteria and Make a Plan
I chose a more pragmatic approach, it won't work for everyone, but it works for me. I see 6 hours of no calls as a slump. Your criteria for a slump may be different than mine. That is OK. Like I said before, every slump is different for every body experiencing one. Yours may be even more aggressive than mine, but what ever works for you. That just tells me that your drive to succeed is outweighed by nothing.
Once you have set your standards for what your definition of a slump is, you can begin to start to try and plan for the eventuality that is the slump.
Slumps vs. Ruts
I feel the need to mention one more term in this article. Some may say that this and a slump are one in the same, but there is a reason they are in 2 different parts of the dictionary. A rut is not the same thing as a slump.
A rut is caused when decisions have already been made and aren't getting the expected outcome. You see, a slump can be a rut but a rut is never a slump.. A slump is something that is inevitable but a rut is completely avoidable. If you learn to identify your slump, you can take actions to avoid the rut. However, if you don't identify the slump and mitigate it correctly, again you will be facing the barrel of the rut. The rut is inherently more serious of an ordeal and will take more than just the a new idea to get out of it. Hence the phrase “Being Stuck in a Rut”.
Focus and Think Your Way Out
A slump isn't a situation really its more like a state of mind. You can think your way out of a slump. All that you need to do is focus. What are the factors than may have brought on this slump. For me, its usually that I need to tweak my ads on social media or I need to get into the local sale groups and find some new clients. Each slump can be dealt with uniquely. My way may not be a solution to your problem, but it can be a starting point for your train of thought.
Sometimes you can get yourself into a situation everyday that could be causing your slumps. I like to call this the act of Slump Jumping. Slump Jumping is where you are constantly putting out fires that are causing you to stay in a slump. Staying in a slump may begin to feel like a rut, but if you are jumping from slump to slump, eventually with a little luck or one good decision you will be back on your feet.
Sometimes Slump Jumping is the only way to get out of a slump. Your just dealing with all of the things that could go wrong at one time. Once your past them, usually the experience you have gained is enough to help you deal with future issues quickly and effectively.
This whole article may sound like Dr. Seuss had a hand in writing it, but I can promise you he didn't. It sounds funny with all the slumpidy jumpily talk, but its a good way to remember the difference between a slump and a rut. Don't let a slump turn into a rut. Ruts cost time,money,reputation, and more. As long as you are getting through your slumps, your becoming a better business person. It's all part of the game.
You Can Survive
No Matter how you got into your slump or what criteria your slump meets, As long as you have the drive to do whatever it takes to keep the doors open, you should be fine. If you are reading this article, I promise you will have a better grasp on what it takes to survive a slump.