Can Your Shop Weather a Tough Economic Storm?
The economy—the fun buzzword we all love to hate, the term that leaves our shear-holding hands shaking, the end-all-be-all of so many businesses before us. The state of the economy has been such a hard line in the sand for barbershops, salons, spas, and more in the past—think about all the famous economic downturns that have affected businesses in your biz before.
But here’s the thing—the economy doesn’t have to be the make or break factor that determines whether your business survives a trying time. Seriously, it doesn’t. As a barber, you’re already in a better position than other types of services-providing industries—it’s unlikely that people would stop coming to barber altogether (though, you’d likely see a steep drop-off in clients), our services can’t be automated, and historically, high unemployment rates often benefit the barber and beauty industries, too.
Still, we’re not saying you will be totally immune to economic trouble should it come our way. We’re definitely not writing this up as a scare tactic to spook you (although, Halloween is right around the corner…). Rather, we’re writing this to inform you, to ready you, to provide you with some economic insight. More than anything, we’re trying to show you that there are strategies and plan you can put into action that can help you weather any economic storm that comes your way.
Interested? We thought you might be.
Here are a few tips and tricks for our buds in the barber biz for employing the right types of tactics and strategies to keep your business safe should the economy take some kind of nosedive (big or small) in the future.
Check ‘em out.
Save, Save, Save
And we don’t just mean for that new piece of property or the prime real estate for your dream shop. Sure, your hopes and dream fund should be growing with each passing day, but so should your special, less-exciting fund—the emergency fund. Adding to this regularly is vital for the success of your business should something bad happen (including an economic downturn).
If you’re regularly putting cash away for the eventuality that something bad is going to happen, then you’re regularly putting yourself in a better position to handle that bad if it does come. Your emergency fund should be just as important to you as your other savings accounts—if not more—because it’s your primarily plan of action if something insane happens. It’s an emergency fund for a reason—so remember, don’t borrow from it unless, well, there’s an emergency. If something bad does end up happening, you’ll be in a much better position to dig yourself out of a bad situation.
Build Your Credit Line Beforehand
Don’t wait until the economy is tanking to build up your credit. Think about it—if you’re dealing with stress and chaos because of the economy, don’t you think the banks are, too? It’s unlikely a bank will grant you a line of credit if you haven’t already been building up your credit and improving your scores—especially in a time of financial crisis for everyone. If you’re working on this regularly when times are good, you’ll be in a better state when times are bad.
Have Creative Backup Plans in Mind
Coming up with creative solutions, services, and backup plans before you need them is key for running a successful business during an economic downturn. We’re not saying that you can’t work on the fly, just that you might be in a better position if you already have a few tactics in motion before a crisis hits.
Think about how you could better serve your clients during an economic drought, how you can keep them coming back, and what services you can offer that other shops won’t be able to.
Think about your customer base: is it diverse enough? Will an economic downturn steal away your current customer base? It’s vital to consider who your target audience is at all times—not just when the economy is thriving.
Think about how you can attract a diversified client base and how you can maintain that client base in good and bad times.
Cut Costs Where You Can (Before You Have To)
This is a good business practice regardless, even if you’re not technically considering it an economic downturn strategy. Take a regular look at your costs, expenses, overhead, inventory, and more to determine where you’re overspending and how you can save costs.
All of that extra cash you’re saving your business by doing this? Toss it into your emergency fund.
Stress-Test Your Business Regularly
We’re not saying that you need to live your barber-business-life in constant fear of what could happen—but we do think that regularly stress-testing your business is vital for keeping your strategy on its toes. If you’re not going through your business’ finances every month and analyzing where you’re losing money, how you could improve, or figuring out what would hypothetically happen should the economy change directions suddenly, then you’re doing your business a huge disservice.
Being prepared is more than half the battle, friends. Even though stress testing your business might not be fun (and might give you some serious heart palpitations), doing it before you’re forced to do it by the economy will save you a lot of stress, chaos, and more if the time ever does come for an economic downturn.
Did our tips prove helpful? We sure hope so.
At NAOB, we’re all about keeping badass barbers like you in the biz for as long as possible, that’s why we hope you never put yourself in a position to fall victim to hard economic times. As long as you’re keeping your business in check, saving up a storm, and regularly assessing how to employ strategies that’ll save you money (even when times are good), you’ll be in good shape!
Looking for more barber biz advice? You’re in the right place. Keep up with our regularly updated blog here for more barbering tips, tricks, advice, and insight!