We’re designed to always be looking for the next problem, and we’re hearing a lot of talk while we travel this summer about the next recession. Some experts say it will be a global one hitting in 2020, others say it’s already arriving.
But right now, we’re still in a candidate driven market with record low unemployment. You can’t really be recession proof, yet you can be recession ready. Before anyone panics, here’s some tips to be prepared for when it hits.
First and foremost, take a long look at your expenses. It’s easy to ignore all the little costs adding up when times are good. Getting those under control now will mean more cash reserves for you to be saving. For example, last month we talked a coaching student through getting all his interest rates reduced for outstanding debts. We ourselves have cut cable at long last. We have more than enough streaming video to not need to pay more than $125 a month for a few live shows. If you really look at it, most of us have small recurring costs which we no longer need or use, and a little management now is much better than when you are struggling later.
Second, now that you’ve freed up a little cash, start saving it. So many of us get extra cash flow in and find a way to nickel and dime ourselves right back out of it. If you feel an economic downturn is coming, now is not the time to splurge on the unnecessary. Invest it wisely while it is coming in.
Take a close look at your billing. In our industry, it’s a little too common to need to chase down payments from clients. Start collecting what is owed to you as soon as possible. If that is uncomfortable for you, you have two easy options. Take large debts to an attorney. It may cost a few thousand to get tens of thousands. We highly encourage a clause in your contracts which charges late fees to make sure you collect. You can also choose to hire a contingency collection agency. They will keep 20-50% of what is collected, but charge nothing if they get nothing.
Make yourself the most valuable vendor in your clients’ stables. While everyone else is milking them in a robust economy, you should be delivering top value and over delivering. Besides being the right thing to do, you are setting yourself up to remain a vendor of choice when they feel the need to cut costs.
Don’t cut your own prices though. It’s a lot easier to move them down than to recover them back up later. You remain in the best position by delivering well for the price and taking care of your customer.
Finally have a sales plan and continue working it and marketing your services. The business development you do today tends to pay off 90 days from now. So often as headhunters we get on a roll with recruiting and temporarily stop business development. Which in turn means no income coming in 90 days.
In Client Cornucopia, we teach the daily activity needed to get off the roller coaster and have continuous income. It’s why so many people have new clients by the end of the first week of class. Which means more placements in about a month. Add a couple weeks for your candidate to start and another month for standard terms and you’ll see December and January payoffs from our upcoming September business development session.