When things are good, its easy to go buy that new toy or take that lavished vacation. But when the economy is thriving, there is no better time to raise capitol or invest in your company! Paying off debt or investing in your infrastructure is MUCH harder to do when cash is tight, or business is slow, so make sure you take care of that stuff when business is good!
Here are 5 things to focus on when things are going well!
1. Diversify Your Revenue Stream
Things are good right now, great even! But that won't last. The next time the economy decides to take a dive, make sure your revenue doesn't dry up with it.
To prevent this, try diversifying your product line or targeting a new industry.
Don't just diversify your offers, diversify your customers too. You want to get to a point where no one customer is more than 15% of your overall revenue. Otherwise, that customer poses a huge financial risk to your business should their business suffer.
2. Make Sure You Have Credit Available-you May Need It Later
Chances are, you're going to need a loan at some point. Maybe you want to launch a new product, open a new location or pay off some lingering debt. If you wait until you need it, it might be too late!
The best time to ask for money is when you don't need it. Why? Because it's much easier to secure credit when your financial numbers are at their best! Furthermore, if the economy is doing well it will make it that much easier to secure that loan.
Think ahead and stockpile your cash for when times start to slow down -Josephine Geraci, founder and president of My Mom Knows Best, Inc.
3. Do Your Bargain Hunting Now
Quite simply, it's easier to hunt for bargains when you don't need them. The pressure isn't quite intense, you have more time to think things through and weigh-out all of the options.
It's also easier to ask for a better deal from your suppliers when things are going well. Generally, if things are going well for you, their going to be going well for your supplier. On the flip side, the same applies for bad times too. So if you wait for when you need that bargain the most, it's going to be a lot harder to negotiate.
4. Pay Down Your Debts
Everything is easier when you don't have debt. When things are going well, focus on paying off your mortgage, credit lines, or business loans before you go out and buy that new toy.
5. Invest in Yourself and Your Business
If things are going well and you've got cash flow to spare, there is no better investment than in yourself or your business. Put yourself through that class you've been putting off, invest in your infrastructure or get that new piece of equipment that will boost productivity.
If the economy takes a turn for the worse, these improvements will help you weather the storm, even if your competitors are struggling.
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