When the blue chips struggle, it’s definitely reason for pause for small businesses. Such was the case for General Electric, which reported 6% decline in first-quarter profits. They’re earnings were $4.3 billion, down from $4.57 a share.
So what does this mean for small businesses? Well, first off, it means that a recession is pretty much in the cards. I hate to say it, but it’s seeming pretty darned likely these days when every day there’s new bad news. This just adds to the pessimism.
I’ve discussed the many issues associated with preparing for a recession on here. But it’s probably worth repeating a few warnings.
The first and easiest advice I have to you and your small business is to cut costs wherever you can. These need to be intelligent cost cutting techniques that want cost you sales. Remember that the goal of all of this is increasing your profitability to shore up extra cash during the downturn. So don’t go hurting yourself in an effort to help yourself.
I’m talking about making intelligent cuts, like ditching the fax machine for an Internet based email fax service like GoFaxer. I’m talking about spending a little less on the office renovations. I’m talking about saving energy costs by switching to more efficient light bulbs. All of these savings will go to your bottom line and help you through this time.
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