Quick Recession Advice To Serve Up To Your Business Clients & Prospects!

If you want to become a Business Banking Rockstar, you need to deliver valuable insight on the fly! The easiest way to do this is by reading articles like this one.  You don’t need to be an expert on every topic…you just need to have a well-informed opinion on a variety of topics that are important to your business clients and prospects.  

In order to survive a recession, Business Owners need an action plan before the plan is needed! There is no need for an elaborate plan. A simple and executable plan will get the job done: they need to be ready to pivot their focus as the market changes, they need to be willing to quickly scale operating expenses up or down, and they need to diversify their funding sources.

Pivot Focus: Knowing when to pivot is key to overcoming any challenge or take advantage of an opportunity. Business Owners need to pay attention to the numbers: the KPIs (Key Performance Indicators). A good accountant will set them up with an accounting system that will give them the KPIs they need to determine if and when market conditions are changing. If they don’t have a good accountant, you can refer them to one in your network! They also need a Rockstar Business Banker to give them advice. This is where you come in and serve up valuable insight that will help them make the right decisions. Having access to KPIs and a reliable advisor (aka Rockstar Business Banker) will help Business Owners steer the business through a recession!

Streamline Overhead: The business’ KPIs will inform the Business Owner on how quickly operating expenses need to be scaled up or down. A recession does not impact all businesses the same way. Some businesses will thrive and some will perish. Either way, the Business Owner needs to be able to quickly determine how the recession is impacting the business and act quickly. If KPIs indicate that there is a surge in demand for the product or service, the Business Owners needs to quickly ramp up to take advantage of the opportunity. If KPIs indicate that demand is quickly contracting, then overhead expenses need to be quickly scaled down.

Diversify Funding Sources: “Cash is king” is not a cliché! It is the key determinant of surviving a recession. There are several ways for a business to create cash to either take advantage of an opportunity or overcome a challenge. It can internally generate more cash by reducing its Accounts Receivable Days, increasing Accounts Payable Days & Accruals, and decreasing operating expenses. It can request for a line of credit increase. It can use a commercial card to pay vendors or purchase supplies. It can use digital payment solutions to quickly convert sales to cash. They could also use a Home Equity Line of Credit to inject cash into the business. You’ve probably already said this to your business clients: “Apply for a line of credit when you don’t need it”. Business owners need to know where and how they can access capital if the worst or best-case scenarios materialize. In a worst-case scenario, they may need access to capital to temporarily fund the business until the situation improves. Being the Rockstar Business Banker that you are, you will put together a recommendation of all the products and services that will help a Business Owner generate the cash needed to survive a recession! Once they have a plan and know where they can access capital, they will be ready to scale the operation down or ramp up fast once the situation improves.

You can’t create the plan for them, but you can advise them on how to plan for best and worst-case scenarios. You can serve up valuable insight that will help them get started.  I love this stuff!  Short, sweet and valuable! I spend about 30-45 minutes every day reading stuff like this.  It pays off, my friends! If you need a crash course on the most common types of business loans available in the marketplace, check out the free Commercial Lending Toolkit at www.bizpetrol.com.

Bizpetrol has information, insight and tools that will help you become a Business Banking Rockstar!  You can start elevating your business credit skills using the free Commercial Lending Toolkit at www.bizpetrol.com. You can see all the Business Banking articles (like this one) at www.bizpetrol.com/blog. You can access a series of how-to business banker guides at https://www.bizpetrol.com/Downloads-Free.