What Your Business Can Learn From The Boy And Girl Scouts – Always Be Prepared!
by Leeia Ladipoh on November 29th, 2007
Even if you have never been involved in the Scouts of America group, there is little doubt that you have heard their famous motto: Always be Prepared! No doubt you have also realized that this catchy little slogan does not just apply to outdoor excursions, but to most other areas of life as well, and that includes business.
Let’s get one thing clear before we get into the “meat” of this article: just like the little boy who brings a Swiss Army Knife to every single campout, the prepared business is likely to suffer some forms of derision from the fly-by-nighters out there.
One unfortunate facet of business seems to be bragging rights, and some of the precautions you take to guard against a downturn in the economy may mean that you don’t get to live quite the lifestyle of some of your peers.
Like the kid who brings his winter boots, though, you’ll be the one protected when the weather starts to get a little bit colder. Here are some basic rules you can implement in your business in order to be prepared for an economic downturn.
* Keep most employee contracts reasonably short term. You do want to take care of your good employees, but most businesses will employ people who really only fill positions when business is good.
Make sure that you don’t commit to long term contracts with your employees; and keep unions out!
* Keep your other contracts short as well. A good sign of a possible economic downturn is a scramble by companies which provide services to get you to sign a contract for long term service. Stay away from these, because from Internet providers to repairmen, these companies will try to squeeze any shortfall in their budgets out of you by pointing to that contract.
Never sign up with a company for services beyond a year!
* Don’t tie your personal and business debts together. Never accumulate business debt on a personal account. A business that goes bankrupt means a failed business, while a person who goes bankrupt stands to lose everything and will find it hard to get back on his or her feet!
Keep your business and personal lives totally separate.
* Don’t overspend when times are tight. If you specialize in seasonal goods, you already know of the importance of making a killing in good times to offset the bad. The same holds true for any business; if you are making a lot more than what you projected, that’s great.
You will want to, and should, invest some of that money back into the business, but try to act as though you had hit your mark and nothing more. Put the extra money away somewhere it can accrue some interest you can draw on if times get tight.
Just as it can be hard to be the responsible child who truly takes the old Scout motto to heart, so it can be difficult for a diligent business owner to guard against tough economic times. Still, economic downturns are as inevitable as rain, and it will never hurt to always be prepared.