How to Keep Going When Business Isn’t Booming
The year’s end brings holiday times and hopes for what’s to come. But for many small businesses and contractors, it can also bring an unwelcome drop in revenue. Clients go on vacation, long-term yearly projects come to an end, end-of-year spending may be curtailed—reducing your revenue flow to a trickle.
So how do you stay “in the black” while you’re waiting for that income trickle to grow back into a healthy stream? It takes focus, hustle, and a bit of imagination, and we’ll show you how.
Whether you’ve been in business for a few years or you’re a new small business or freelancer, you doubtless know the value of planning, budgeting, and looking ahead. The very fact that you’re pursuing your own dream in business indicates some level of foresight on your part. So it should come as no surprise that you’ll need to plan for a revenue shortfall at some point in your business career.
If you have an accountant or financial advisor, let them know that it’s important to you to have a budget plan for the slow times. Your bank, lender, or financial institution may provide programs to help your more effectively put money aside. Also, consider the wide selection of budgeting software available for personal and business use.
The first step many businesses take when trying to increase revenue is to decrease expenses. For a small business or freelancer, this could be as simple as giving up or leasing out your office space and working from home. Think about canceling subscriptions you don’t use or need, reducing or eliminating extraneous business services, or even budgeting your food allowance better (a sandwich from home is a fraction of the cost of a restaurant lunch or even take-out).
If you have employees or subcontractors working for you, a furlough or seasonal layoff could help keep costs down during the leaner times. Be sure to be clear with your employees about your plans in this regard. Be upfront about when they’ll be needed and when they won’t. This can allow them time to seek supplemental income themselves. Workers who are suddenly laid off due to a foreseeable work slowdown won’t be very eager to return to work when you need them again.
Go With What You Know
Even though the gig economy has exploded in recent years, you don’t have to slap an Uber badge on your car as soon as you start feeling the squeeze. First, think about how you can use the skills you already have to keep making money (this is where imagination really comes in handy).
Say you’re a copywriter: why not keep generating income within your area of expertise? How else can you apply your skills? Reach out to other writers in your professional community and see who’s hiring for one-off jobs or bigger projects that need “hired-hands.” Writing blog posts, news articles, and editorials can all bring in extra cash while getting your name out to a wider, more diverse audience, which itself could lead to even more opportunity. It may even be time to try to sell that novel or book of short stories you’ve been finishing in your off time.
Got a landscaping or construction business that drops off in the colder months? Pivot to offering support for greenhouse gardening, interior renovations, or consultations. You’re not the only one who needs to plan ahead in these slower months, homeowners and property owners often need to plan months in advance for major work. Now is the time to bill some hours for consulting and planning.
Doing work at a “friends and family” rate is a great way to help your friend and make some money at the same time. What’s more, you can offer a discount coupon or a “freebie” in exchange for a referral or a positive review. Think of the money you don’t make now (by charging a reduced rate) as money coming to you from potential future clients you’ll attract.
As we’ll talk about in the next section, expanding your network and gathering new customers can benefit you many times over in the future.
Grow Your Network
Making money in the short term is great, but if you find yourself in dire financial circumstances every year at the same time, you may need to rethink your business plan. Short-term solutions are merely band-aids to a larger issue that you need to identify and improve.
Good planning means anticipating potential problems but also building systems that can avoid those problems altogether.
One of these systems sits in front of our noses every day in the form of social media. Dig through the noise and chatter of Facebook and LinkedIn, and you’ll find like-minded people in your field who can not only help you figure out how to navigate the harder times, but who’ve also experienced what you’re going through firsthand. It’s never fun to watch your numbers drop over the slow season, but if you’ve made a plan and have budgeted your income to allow for a slump (or even a sudden downturn), you can actually use the quiet times to invest in the future of your business.
Time is money, as the saying goes. Time can be spent wisely in the same way that money can. A quiet season may give you time to beta-test a new product, for example, or attend industry conferences and professional development events. Extra time lets you engage more deeply with customers or take stock of the past year’s agenda and plot a better course for next year. The opportunities to invest time in your business during the days when the phone isn’t ringing are limited only by your imagination.
Loans and Advances
If you’re really strapped for cash and the future of your business is at stake, there’s always the option to take out a small business loan or advance on your line of credit. A lump sum of cash that you pay back over time can be helpful, as long as you make sure to budget those payments into your future expenses. If you use PayPal for your payment processing, you might check to see if your eligible for their small business financing.
You may also consider applying for more than you need at the moment if you know you’ll be able to make regular payments on time. Lenders love clients who pay on time. A regular payment schedule, in addition to improving your credit score, can build a solid reputation with lenders which can be an advantage as your business grows.
Be advised, however, that business lending can be complex, depending on the amount you borrow and the type of business you have, and doing it the wrong way can have long-term consequences. Consult with a financial professional before you decide to borrow from any bank or lender.
Okay, So Maybe Being an Uber Driver Isn’t That Bad
When it comes to pursuing your dream, you’ll do just about anything, right? So you may have no other option than to seek income from a source outside your field, and that’s okay! School teachers take various “survival” jobs over summer break, for example. Actors work restaurant shifts (among other things) when they aren’t performing.
While you can put your dream on hold, the hard reality is that your bills, rent, and food expenses won’t wait. So don’t be ashamed of doing whatever it takes to make ends meet while you keep your business afloat. Temp agencies, part-time work, and yes, even rideshare jobs with Lyft or Uber offer easy and flexible solutions to short-term cash shortages. And who knows, maybe you’ll end up like your side gig so much, you’ll find a way to do both!
When you decided to go after your dreams, you knew it wouldn’t always be easy. With some smart planning and preparation, however, you can face hard times with more focus and ferocity than fear.
Got a great tip on how to bridge the income gap when business gets slow? Leave it in the comments!