How to get your business through stormy weather

Having your own business is very rewarding in many ways, but it comes with a price. When you run your own business, no matter how big or small, you are responsible for yourself and the people that you employ, there is no monthly paycheck unless you provide for it. That is why having a solid financial base is crucial to keep your business alive if or when the going gets rough.

There are lots of reasons your income or turnover could slack, not the right season, the economy is slow, there is a new and better product on the market or even new competition.

In most cases, if you play your cards right and stay calm, you can adjust to the situation and get back on track, but you will always need some money to sit it out.

Here are a few tips that could help you stay prepared for a rainy day.

Know your numbers

If you don’t know how much you are making, how you are making it and what your expenses are, then you are just playing a guessing game will usually be caught off guard when the money runs out. Good and precise bookkeeping not only helps you keep control over your business and see if trouble is looming, but it also helps you better control your taxes to avoid unpleasant surprises. “Nothing is certain, except for death and taxes.”

Get off a dead horse

An Indian wisdom says – If you discover you are riding a dead horse, get off, maybe not the exact words but you get the meaning. The sooner you ditch a bad concept or product the sooner you can concentrate on something better. Sometimes we get emotionally attached to a business idea or want to prove everyone else wrong. You should always fight for what you believe in but if you realize that selling air conditioners to Eskimos is not the best idea then ditch it.

Keep the costs low

If you don’t need it, don’t buy it. We tend to get carried away with all the fancy stuff wie can buy with installments. When the cash inflow decreases, you will be grateful for every cent that doesn’t flow out again.

Unless you receive a lot of clients or need a showroom for your product, you hardly need a fancy office.

Optimize your logistics to save on storage costs, reduce theft or damage risks and increase your flexibility. If possible outsource the whole process, with a flexible fee structure.

Don’t fix what isn’t broken. Hanging on to machines and tools that do the job and saving on the monthly installments for new ones, could help you to survive stormy times.

Buy a good car

This may sound paradox to keeping costs low, saving gold coins is maybe a better idea, but a good car could help your business out of a tight situation. In addition to the fact that a good car can be seen as a reward for your hard work and can boost the morale, if you should need money fast and on short notice, then you can easily get a title loan on your car to keep your business going in case a payment is delayed. The advantage over a pawnshop is, you get to keep your little gem, the lender holds a title to secure his loan and you can continue using your car. Of course there are lots of other things you can use as security for a title loan but cars are easier to evaluate, easier to sell and a car is something you most probably already own. Keep in mind that cars usually lose a lot of value during the first two years, so a used car with a stable value would be a better investment.

Caution: When taking short term loans, the interest rates are quite high, if you are not sure that you can pay back your debt on time then find another solution. The same applies for credit card loans, the interest rates and extra fees could, and usually do, make your situaton worse.


If you are starting a business, do your homework and expect the worst, anything better than the worst is a success. For those who already have their own business, even if it is doing well, crunch the numbers and prepare for the worst, which will hopefully never come.