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Joseph R. Cardamone is president and founder of the United States Federation of Small Businesses, which provides products and services to small companies and advocates for the interests of small business.With businesses shuttering every day and joblessness hitting peaks not seen in decades, very few of us are thinking about taking that idea or passion we've been nursing for years and striking out on our own. That could be a big mistake.
Joseph Cardamone, an attorney and insurance broker whose United States Federation of Small Businesses offers support services to small companies, says a recession can be a fertile time for gutsy entrepreneurs. Rents, supplies and other costs can be lower, and it's easier to find qualified and affordable help. Not only does that put financial strain on a company, but it makes it easier to come in with a lower price for goods or services than larger, more established companies at precisely the time customers are looking for any way to spend less.
Obviously, that doesn't mean it's easy. Recessions come with plenty of obstacles -- financing for start-ups can be especially scarce -- and business can be slow as you try to establish yourself. So Cardamone offers tips for how to minimize both risks and costs as you get going. Many focus on how to get the biggest bang for your buck on office equipment, supplies and services and ways to hold down labor costs -- lean heavily on freelancers for special skills and make most of your help part time at first, for example.
But his most valuable insight for succeeding in hard times is his focus on strategy. Size up your market and aim low -- or very high. "Avoid the middle ground; if customers can delay purchase while times are hard or choose a less expensive alternative, that's not the industry to be in," he writes. Make sure that you offer a product that is indispensable or something so high-end that it can only be afforded by the lucky few who still don't have to fret about cutting corners. Don't think you need big bucks, either. There's no reason not to start something on the side. "Keeping a day job for a while can help maintain a steady income while waiting for sales from the new business venture to kick in. It's also a smart way to work out kinks, gain industry knowledge and build a solid customer base."
POSTED BY: Steve Schneider (January 30, 2009 07:32 PM)
How many jobs could be added to the economy by offering very low interest loans to 4 million people who want to start a new franchised business? The repayment terms could be no payments for two years with the loan amortized over years 3 - 7. The loans would only be available to people who had lost their job and had the wherewithal to secure the loan with at least 30% equity. Wouldn't this immediately help the ailing commercial real estate market, spur construction and capital spending and dramatically increase employment as the effects rippled through the economy.
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