Entrepreneur - - By Alyssa Gregory

Signs The Recession Is Hitting Close To Home…And What You Can Do To Beat It

recessionWe all see the impact of the recession, in both our personal and professional lives. The challenges for those who own a business or freelance are noticeable, and some even seem insurmountable. Some of the signs you may see in your professional life include:

  • Your clients are starting to scale back on work they’re outsourcing to you.
  • Your business credit card limit is reduced.
  • You start getting pressure from your clients to reduce your rates.
  • You no longer get paid on time.
  • Your business expenses are increasing, while your income is not.

It can be easy to get caught up in the overwhelming nature of some of these changes. Working for yourself can be difficult, even when the economy and your business are thriving. Add a down economy to those challenges and you’re in for a tough fight. But it is beatable. There are some simple things you can do right now to fight the recession and better position yourself to survive economic turmoil.

Tighten Up Your Policies

Now might be the time to take a look at your current policies and see where you can revamp some of your processes to help manage the downturn. You may decide to stop offering any kind of discounts, or perhaps instituting a late payment surcharge might be a way to ensure timely payment.

The last thing you want to do is drive away current and valuable clients, so be prudent about the changes you make. It is possible to adopt new policies that strengthen the core of your business, while catering to your clients. Make sensible changes, give notice and be willing to talk about reasons behind your modifications with your clients.

Raise Your Rates

While it might seem contradictory to raise your rates during a recession, it could be a smart move. Increasing your rates can effectively move you to a higher service bracket, therefore attracting a whole new group of clientele. Assuming you have the skill and experience to justify the increase, you may find that your business morphs into a more profitable, efficient and sought-after company. And you may be able to get rid of some non-ideal clients in the process.

Diversify

There are a number of services you can offer to clients beyond your core offerings to help increase income and attract new clients. See “7 Value-Added Services Web Designers Can Offer Clients” for some ideas. You may also want to increase your knowledge and skills in certain areas to make yourself more marketable.

Take a Look at Recurring Payments

Recurring payments can be easily forgotten when they automatically hit your account every month. Periodically review your statement to see what you really need and what you can eliminate. Some services allow you to pause your subscriptions temporarily, or leave and come back at a later time, so you may want to explore those options as well.

Consider Open Source

Most of us use the best software available for what we do. While I wouldn’t recommend ditching the top-of-the-line options, there are some great open source applications that make decent alternatives on a second computer. There are a number of open source image editors, as well as thousands of other applications available at SourceForge.net.

How has the recession affected you? What have you done to manage the challenges?

Image credit: Tory Byrne