Prepping For a Downturn: 4 Things to Do If This Market Makes You Nervous

As we say all the time on the Contractor Evolution show, business is a game you have to play for the long run.

One situation you are inevitably going to face at some point, or many points, is an economic downturn. Or Recession. Or Meltdown. Whatever you (or the media) wants to call it.

You get what I’m saying though. Business isn’t just about winning when the times are good and everyone is fat and happy. You also need to know how to play the game when things aren’t so flush.

Now I want to be clear. We are not economists. We don’t have a crystal ball. we’re not in any way trying to guess what the market is going to do.

However, we do try to stay current and provide value to our listeners, and lately this conversation, around the market, what’s ahead, and what to do, seems to be coming up a lot with our contractors.

While we’ll be the first to tell you we have NO IDEA what’s going to happen, I think we can all agree there are a lot of flags on the field right now. There are a lot of scary headlines, and that’s making people nervous. Fair enough.

In this episode Igor and I are going to go over:

• Why a downturn isn’t a bad thing and how to look at it from a new perspective
• How to identify true revenue drivers vs ‘nice to haves’
• Why you need to create 2 business plans and 2 budgets when times are unstable, and what the 2 plans should look like
• The true costs of laying people off (which is beyond the loss of ROI)
• What reserves should you keep in place to make it through a rough period?
• What percentage of monthly revenue should you put away for a rainy day?