This is the last of a series of eight posts about how a down economy can be good for your finances. Reason number eight follows. The other seven are listed at the bottom of this post.
Many people think that a bad economy is a bad time to start a business. Existing businesses, including large, established businesses are struggling to survive in these challenging conditions. It’s precisely the fact that existing businesses are struggling that makes this economy a great time to start a business.
Here are some of the top reasons why now could be a great opportunity for anyone to start their own business:
- A new business has a massive advantage over existing, established businesses.
That advantage is the ability to make decisions and change direction quickly. It can take a large company months to make a simple decision, and years to change its strategy. A small business can make a decision in a single meeting, and change its strategy in minutes.
These challenging economic circumstances require new and flexible business strategies. Large existing businesses are simply too big to adjust to the changing economic climate. That’s why it’s easy for a small company to come in to the market and make money.
- Existing businesses are looking for new suppliers.
Many existing businesses are facing lower profits and lower revenues. This is causing them to find new ways of saving money and cutting costs. In a good economy, many businesses are not interested in trying out new suppliers for services or products that it consumes. However, these challenging economic times are great to approach existing businesses and offer a service or product that is more attractive than their existing supplier. Perhaps a small business can offer a better price or better service. If a small business can meet the other business’s needs better than the existing supplier, it has a great chance of getting a new client and making money.
- Technology is on our side.
Computers are getting faster and faster, mobile devices are becoming more ubiquitous, and the Internet is becoming more useful. These trends allow a small business, or even an individual, to compete directly with large business. For example, many large businesses have entire departments dedicated to functions such as accounting. The problem with doing every activity in-house is that it does not leverage off the unique skills, technology and assets of the business. Therefore, a small business can focus on what it does best, and simply outsource everything else. A large business pays a significant amount of money to run a whole department. A small business can accomplish the same result for itself using an online service, a software, or an independent contractor.
- Capital is unnecessary.
50 years ago, most people needed thousands or hundreds of thousands of dollars to start a business. Now, anyone can start a business that has the potential to generate millions of dollars. And, it typically requires zero investment of dollars. A writer, programmer or designer can set up a website and offer their services to a global audience. A kid with a laptop computer can connect to Amazon’s database and create a brand-new Internet service. A writer can start a blog, advertise on it, build his audience, and generates a six-figure income within a few years. All of these options and opportunities require almost no investment of money. The only require time, effort, and belief.
These are just a few ideas about why this economy can help launch a business. Opportunity is unlimited. Anybody with an idea, commitment and persistence can start and build a company and create a whole new stream of revenue. Steve at My Wife Quit her Job is a good example. Markus Frind, founder of Plenty of Fish, is another great example. By the way, Plenty of Fish, by some measures, is the largest online dating site on the Internet. I wonder what other great businesses can be grown in this challenging economy.
Here are the other seven reasons why a down economy can be good for your finances:
1. What Are the Hidden Opportunities of a Down Economy?
2. Can Getting Laid Off Actually be a Good Experience?
3. Tough Times are an Opportunity to Get Better at Managing Money
4. Falling Prices are the Bright Side of a Bad Economy
5. A Wake-Up Call for Personal Finances
6. A Volatile Economy is Great for Traders
7. Now Could Be a Good Time to Purchase Assets
Business Strategy, Investing, Money, US Economy
business, depression, economy, entrepreneurship, finances, Money, recession
Investing can be a complex art, with many nuances and possibilities. You can invest in real estate, stocks, currencies, businesses and oil and gas. There are as many ways to invest as there are people selling investments. How can you know what will work for you?
is one of my favorite financial books of all time. It's an allegory about a guy who has a terrible job, and how he overcomes challenges to achieve his dreams.
