It’s pretty clear, whichever way you look at it, that we’re in for a recession. The only discussion is about the severity and length of it.
So what’s in store..?
A recession, caused by a slowing down of consumer spending, which will lead to companies’ profits dropping. That, inevitably, leads to salary cuts, cancelled bonus payments and lay-offs.
Unless your head is deep in the sand, you know this is coming, but have you made your plans? If not you would do well to start now.
Prepare yourself to deal with a recession
Creating alternative sources of income is a good way to prepare yourself for the coming storm. It’s the opposite of hunkering down in survival mode, as I discussed here.
But, unless you’re very lucky or already have an alternative income source just waiting to be turned on, it takes a while to get another income stream flowing strongly enough to protect you.
Starting now, while you still have your current income to fund the start up period, makes sense. In fact, it would be madness not to.
So how to create an alternative source of income? Here are some things to consider:
What type of income stream?
This will depend on what your skills are, what people want to buy and what you like doing – probably in that order.
It’s no good trying to create an income out of something you can’t do and, if it’s something that you can do but no one wants to buy, then you’re wasting your time (and money) too.
So work out what your strengths are. Can you teach? Can you write? Can you sell? Are you technically proficient?
Then work out what people want to buy in a recession.
Luxuries and frivolous things are not going to be at the top of people’s shopping lists if they are struggling with the effects of recession. Necessities are.
If there’s something that you like to do, take account of that. If you can make a business out of something you actually like doing you’re probably going to do it well. But, again, if it’s not something that people want to buy then you’re wasting your time!
Cross-matching your list of skills with what people need in a bad economy should highlight some potential opportunities
Create a plan
Once you know what it is you’re going to do you MUST make a plan. Without a plan you will have no focus, and without focus you’ll fail. It’s as simple as that.
Here are some things to consider in putting together your plan:
Is there a market?
Is there a demand for it? How much would people be prepared to pay for it? What will affect demand for it (e.g. weather, strikes, competition) and how?
Here’s a quick, simple way to do some market research.
More details can be found in my free, 65-page eBook.
What will the process be?
How are you going to make it? How are you going to market and sell it? How are you going to deliver it? How are you going to get people to pay you?
What are the dependencies?
Do you need premises – and if so what type? Do you need outside suppliers – if so for which parts? Do you need licences – if so what licences? Do you need special equipment? Do you need staff?
What are the costs?
Premises, raw materials, suppliers, marketing, delivery, license costs, staff costs, lawyers and accountants, day-to-day operational expenses.
Do you have sufficient funds?
What are the start-up costs? How long before you can break even? Where is the funding going to come from?
It doesn’t matter what type of business you’re thinking of, creating a plan by answering the questions in that checklist is a good way to make sure you’ve got most things covered.
The good news is that you can mark a lot of those items above as ‘not applicable’ if you can start an online business.
With an online, affiliate marketing business, for example, your start up costs would be negligible, your delivery and logistics costs zero, you would have no need for special equipment or premises and no need for separate outside suppliers.
If you had your own physical product (not an affiliate product) and marketed it purely online you could do away with retail premises and sales staff costs.
But marketing and promoting businesses online is a specialised skill.
If you already have a background in Marketing or Sales then you’ve got a head start. But if you’re new to Marketing and Selling then you need to educate yourself in both Marketing and Selling skills, as well as how to use the Internet effectively.
I’ve written well over 80 articles on Internet Marketing – you can find them here.
Additionally, there are lots of resources available online. There are courses, forums and personal coaches to be found everywhere. A search will bring you plenty of results to pick from. The skill is in picking the right one.
Probably the most effective way of getting yourself up to speed quickly is to attach yourself to someone who’s doing it already.
This can be through a mentor type relationship, joining a forum or membership site (make sure it’s a good one), or becoming part of an Online Direct Sales business, where you have a sponsor whose job it is to coach you and bring you up to speed as quickly as possible.
As always – make sure you pick the right one! There are plenty of hit and run sponsors out there (with bad products that offer zero value) and lots of forums where you’ll find bad advice. Take your time to review what’s out there and pick carefully.
The watchword always should be ‘Value’. Does this product offer real value? Is it something I’d be proud to offer my parents? Does this program offer real value – what support and training do I get in return for my investment? Does this forum or membership site offer me real value – what extras are on offer?
One thing is for sure: A recession is coming, so whatever it is you decide to do, start now while you still have the time to get it up to speed.
Leave a reply below and let us know what your plan is – maybe it will prompt some ideas for other readers.