Dan Steppe, director of the nation’s top-ranked entrepreneur program at the University of Houston’s C. T. Bauer College of Business, and Ron Wuensch, an instructor at the Cyvia and Melvyn Wolff Center for Entrepreneurship at Bauer, have decades of experience in guiding businesses through good times and bad. The two have been busy advising current students about how to weather the current financial upheaval, and recently sat down to compile 10 things small business owners can do to emerge from this down cycle unscathed:
– Face facts — but don’t get drawn into what Steppe calls “the media melodrama.” The political maneuvering that prefaced the eventual signing of a $700 billion financial rescue bill threatens to detract from a more important reality, he says. “We got into this problem because we have too much debt and not enough collateral. These problems have not been solved. We are going to be or are already in a recession.”
– Look for places to reduce debt and only invest in necessities. “Cut back on everything,” Steppe says. “Be cruel and heartless about what you need to be in business. Get rid of everything you don’t need. Know exactly why you borrow what you do.” Wuensch adds: “With a change in economics you have an opportunity to really look at your business, and adjust it to the next economic reality.”