When was the last time you were upset or distressed?
When was the last time you felt like things were out of your control?
When was the last time you were in a crisis that came so suddenly that you could hardly prepare yourself for it?
I am sure the answers to all of these questions would not be very long ago. My intention of asking these questions was not to give you an uncomfortable reminder of the past but to make you realize that these things happen to everybody.
Life is unexpected, unpredictable, and messy, and there is nothing you can do to avoid all of the difficulties, it will throw at you.
Perhaps that is why there is the saying;
When life gives you lemons, make lemonade and soothe your thirst with long sips.
I might have changed it up a little, but the meaning is still the same.
The lemons metaphorically refer to the crisis, and by making the lemonade, you take the crisis and capitalize it to profits.
The saying, even with its strange use of words is quite profound. It makes you understand life will not always bring the joys of spring.
Similar to our personal lives, our professional lives also face difficulties. The business domain has to deal with the dynamic world and come out strong.
With the present crisis at its pinnacle, I thought of letting you know that the worst need not always be the worst. You can change it to become the best if you wish.
So, here are five ways that can aid your business in times of crisis.
Knowing The Crisis Beforehand
The number one measure to combat the crisis in the Crisis Management Rule Book is to know when the crisis will happen and what the implications can be for your business.
It is essential because it helps to keep you and your business in making preparations for the worst-case scenario.
You can become aware of an economic crisis by keeping your eyes and ears open at all times.
You can get the knowledge by;
- Following the news religiously;
- Being updated about all the latest changes in government policies;
- Knowing that every aspect of your business is ethically done;
- And having contacts that will let you know something that you missed.
Being aware of the unexpected can become an advantage in a crisis.
For instance, look at the present pandemic.
It started in December of 2019, by the end of January 2020; it had taken an ugly face. A shrewd business person would have anticipated something like shutdown and prepared himself not to be as affected as he would have without that knowledge.
It is what knowledge and awareness can do for you. It gives you the window to prepare yourself for an onslaught of catastrophes and come out of them unscathed, at least somewhat.
Establishing a Contingency Fund
Knowing the unexpected and being prepared for it are two very different things. Awareness will do you no good if you are not using it to gain an advantage.
It is like the difference between knowing that a storm is coming and evacuating because of it. So, a business needs to be prepared at all times to combat a crisis.
A way to do this is to maintain a safe amount that can be tapped into for emergencies. This fund acts as a saviour for the business, much like your own savings.
Without savings, you might not even be able to pay your medical bills in case of an accident. Also, if your business is facing a legal crisis, it would still need funds to resolve the problem.
Therefore, every crisis can only be tackled if you and your business have the finances to do so.
If you still feel that it is not that important, let me tell you that even governments have contingency funds.
Countries like the UK, India, and Spain have a fund or an act with the same name proposed in the constitution. Now, even the European Union is planning to have one to help it face the COVID-19’s devastation.
Other countries also have a reserve like this; however, they use a different name for the same.
Line of Credit
A line of credit is an alternative to a contingency fund. The fund would include the amount that you saved up for your business, while a line of credit helps to raise money from outside sources.
People often confuse a line of credit with a loan. They are somewhat similar, but not entirely.
A loan provides the borrower with an amount in a lump sum, and you start paying the amount when you receive it, which is not the case with a line of credit.
The latter is also a loan and can borrow as much as you want to; however; you do not borrow the entire amount instantly.
A line of credit, like the name, says is a form of credit can be taken in small portions of the total amount as and when you need it. Now, the amount that you borrow will be the amount on which the interest is levied.
I have a business, and my company just landed a big project. I would need funds to make that project happen. But I do not precisely know how much it would cost.
So, I would apply for a £10,000 line of credit. I will keep taking money out in portions of 1000 pounds, or as much as I would need at one point.
So, if my project just cost me £8000, I would have taken out only that amount and saved the interest of £2000.
I can simply use the remaining amount for some other purpose, without having to take another loan.
You can opt to take a line of credit from a bank, a credit union or even the small loan companies in Belgium.
When you find yourself in a crisis, you automatically start thinking about ways to save money. It is justified because money can help you overcome almost anything that is not illegal.
So, becoming cost-effective will help you save a ton of money and combat the crisis as a consequence.
However, this step will not be easy; you may have to do things that you may despise. Since the need of the hour is saving your business, you will have to strengthen your resolve and do it.
The three most common methods are;
- The first way to reduce your cost is to reduce the number of employees. Since a single employee’s yearly salary can be a considerable expense for your business, this becomes vital.
- You can then look at your accounts, and shun all the unnecessary expenses.
- A request for a gigantic TV in the office lounge will not increase your sales.
- The Leave Travel Concession or LTC has given half-yearly to the employees can be made yearly.
- Push your employees to increase their productivity and efficiency during the crisis. They might not like it, but they will do it if the business is their priority. The ones who don’t, well you might have already asked them to leave.
These might seem too much, but trust me they will help you in avoiding bankruptcy in a crisis.
Becoming A Formidable Leader
I will explain this one using an example from TV. You must have heard of the American TV show Suits. Meghan, the Duchess of Sussex and wife of Prince Harry, was one of the protagonists in the show.
It follows the journey of a few lawyers and their law firms. One of the partners in the firm is Harvey Specter; he is the definition of formidable.
An intimidating presence in the courtroom and his take no prisoners attitude made his firm survive anything the world had to throw at them.
You can watch the show if you do not believe me.
I know many of you would say that it is TV, which is far-far away from reality. I know that is true.
However, who says that we cannot learn from TV. Even though the show and the character is a work of fiction, we can still take a few lessons from it.
Despite all the odds being against you;
Despite there being a 99% chance that you can lose;
Despite the entire world saying you cannot do it;
Until the point, you don’t forget. You should never give up. The 1% chance of winning can also make you triumphant, and that is why you need to be formidable, just like Harvey Specter.
I think I have said it all, but I would say one more thing. You can never avoid a crisis; it is bound to happen, and inevitable woe of life. What you can do is be ready for it, both financially and mentally.
If you feel that you cannot fight the crisis, ask for help.
If you need money, companies like Credit Pont will provide you as much as you need.
If you need support, involve your family and friends, let them understand your situation, and maybe they will provide you with a solution to all of your problems.
Once you accept these two facts, your ability to counter the worst will make you victorious every time.
The business world is renowned for its capriciousness. The businessperson has to learn to live with it. Read to know what precisely you can learn.