Is There A Recession Coming?

The answer is, like the answer to a lot of these types of questions, “Maybe”. Is there a recession coming? Well, the bond market seems to think so. The President and his administration say, “No way”. The stock market can’t seem to make up it’s mind.

With the carnage of the 2008 Recession still fresh in most people’s minds, it’s understandable why a lot of consumers and businesses are starting to get nervous lately. There are some troubling economic signs out there – inverted yield curve, wild swings in the stock market, order cancellations by retailers, etc.

Lots of empty space for years after 2008

Our clients are small businesses, and we’re most concerned about them. So, if you’re a small business owner, what can you do to protect yourself and weather this potential storm?

Well, a “Plan B” is always good to have, whether you think a recession is coming or not. Start with the assumption that your business revenues fall 30%, figure out how that will ripple across your operations, your payroll, your debt obligations, etc., and just how you deal with that, and stay in business and make money. It’s a great exercise to do, and will get you prepared for something bad happening to your revenues. It doesn’t have to be a recession – you could lose a big customer, you could lose a key employee and not be able to take on as much work, you, the owner, could become ill and not be able to work as much, you could have supplier issues, etc.

There’s an old adage that I’m sure you’ve heard: “Hope for the best and prepare for the worst.” That’s what this is all about. If you don’t have the time to do these projections yourself, we can do it for you. Some preparation for a worst-case scenario is better than no preparation.

And, for all of us, fingers crossed that we won’t have to make this anything more than just an exercise….

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