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Growing fears of a global recession and a soaring inflation rate that’s the worst in more than 40 years have left many on Main Street with feelings of uncertainty and unease for the future of their companies.
Almost half of small business owners are anticipating a recession before the end of the year, according to a quarterly small business report by payment platform company Veem. When it comes to preparing for a possible slowdown, Veem found that small business owners are reducing their workforce and scaling back expansion plans, while others are looking to pay down their debt and increase their savings. “We have a long way to go before inflation and interest rates come back down to Earth,” wrote Veem CEO Marwan Forzley in the report. “Despite these issues, we can see business owners wearing their David vs. Goliath hats, knowing that they will come out on top in the end.” That’s certainly true, as some are looking at the shift in the market as an opportunity to grow their business.
Small businesses have survived the Great Depression, Great Recession and an ongoing pandemic, and they’re sure to weather the storm now. Many successful companies were launched during recessionary times. In fact, launching or scaling a business during a market downturn could pose an advantage for your startup, writes Forbes contributor Serenity Gibbons. There is less competition and it can be easier to attract new customers and hire talent. While companies may lower their rates to stay competitive and entice customers, a bear market could put small business owners in a good position to negotiate better vendor deals. Here’s how scaling amid economic uncertainty can boost your business.
How Two Shoemakers Are Bucking The Offshoring Trend
Outsourcing manufacturing overseas is a model well-worn. In fact, for shoe companies, it’s a trend that’s grown near-ubiquitous in recent decades. As supply-chain woes continue to disrupt manufacturing, Sabah and Okabashi, two small, family-owned firms, find themselves at odds with the offshoring trend. With manufacturing plants in Texas and Georgia, respectively, both firms are committed to shoemaking locally.
Key quote: “People would ask my father, ‘Have you ever thought of moving your factory to China?’ time and time again. He just made this commitment.”—Sara Irvani, CEO of Okabashi
Must-Reads Across Forbes
In California, insurance companies can use software from seven-year-old startup Zesty.ai to determine how likely it is your house might burn to the ground. As the frequency of severe wildfires has grown—eight of the state’s ten most destructive fires have occurred within the last five years—the AI company’s 49-year-old CEO, Attila Toth, hopes his machine-learning algorithms can help clients better assess their risk.
When companies shifted operations online in 2020, it looked as though the in-person event planning business, shuttered entirely for months, may have been another casualty of the pandemic. But now, more than two years later, the Montreal-based platform Planned is one example of the industry’s revival. The event-planning website just raised an $18 million Series A after its sales grew 400% between the last quarter of 2021 and the first of this year.
Christmas in July has taken on a new meaning in recent years, writes Forbes contributor Rhett Power. The holiday season may be a few months away, but it’s never too early to start readying your small business. To make sure you meet your revenue targets, start stocking up on inventory and expect a long, e-commerce-driven season. Here is how retailers can prepare.
Have you had a flight canceled this summer? Know someone who has? Boston-based Merlin Labs, which raised $105 million in its latest funding round, is trying to address the pilot shortage with a computer model that will allow planes to fly themselves.
With the possibility of a recession looming, hiring the right talent is growing more important. Recruiting platforms like Omnipresent, WithYouWithMe, Flexa and Screenloop can help you diversify your workforce and avoid bad hires, writes Forbes contributor Alison Coleman. Read more about how you can win the war for talent.