Business during the crisis
Since March 2021, the Government has adopted the law "On Tax Holidays", according to which individual entrepreneurs who have started their own business for the first time are exempt from taxes for 2 years. This document deals with industrial enterprises, processing of agricultural raw materials and food production, as well as those who intend to work in the field of innovation and IT. In April, absolutely all regions introduced this law, and it is already in effect.
The nuances of starting a business in a crisis
Despite the difficulties, small business lives and develops, constantly increasing the share of revenue in GDP. If in 2021 it was 22%, then in 2021, according to Rosstat, it was already 22.6%. In terms of the number of people, this is several million new small and micro enterprises, which provide almost 17 million jobs.
And the market is satiated with trading companies, there are so many of them that each new wave of decline washes away from their homes by the thousands. More than half of small businesses are trade: shops, boutiques, wholesale companies. They are experiencing all the negative consequences, while profitability falls dramatically. This does not mean that in a crisis life is worse, but that the economy demands, and the government is turning towards production workers and the service sector.
What not to do at a time like this
In the current crisis, it is highly undesirable to open a company or individual entrepreneur that will exclusively engage in trade. The time for quick money is gone, so it's worth investing in more promising areas, which will be discussed below.
The crisis is throwing weak players out of the market, but consumer demand remains. Entrepreneurs who fill the vacant niches need to use more efficient production models and management methods in order to be competitive.
Most entrepreneurs are essentially artisans. They know their business and know how to sell their products, but they sorely lack the skills of competent management. Each person has a ceiling of possibilities. If you work alone, it is very quickly achieved, and further movement becomes impossible. Only the ability to organize work, the availability of knowledge about modern management methods contributes to constant growth.
As already mentioned, the time of easy money is irrevocably gone, although the mentality still makes you dream of fairy tales and look for instant earnings. Many craftsmen profit from this, and their victims are beginner entrepreneurs who want money, but do not know where to get it. The success stories of such giants as R. Kiyosaki and T. Edison are, of course, instructive, but they in no way correlate with Russian reality.
You need to study a lot and diligently, acquiring management skills, developing knowledge of production technologies and adopting the experience of more successful competitors. Knowledge is power, and today this thesis is more relevant than ever.
Which areas are not affected by the crisis
Whatever the conditions in the economy, there are areas that are not subject to significant fluctuations:
During the crisis, the purchasing power of a significant part of the population is significantly reduced. For this reason, many goods and services become unclaimed. Therefore, all entrepreneurs need to know what is profitable to sell in a crisis. At a time when a difficult economic situation comes, people concentrate their expenses on goods and services, which cannot be dispensed with.
To achieve high business efficiency in a crisis, it is enough to make a list of essential goods, and then find out in which segment there is a deficit in your city or region. The scope of activity is limited only by the type of product and the amount of start-up capital.
Business in crisis - what to open in order not to miscalculate?
First of all, entrepreneurs are interested in what exactly to do in a crisis so as not to burn out. Below are some examples. All these types of businesses have one thing in common - it is the provision of services and goods that consumers need, regardless of the current economic situation.
Foodstuffs remain essential goods at any time. Despite the crisis, people continue to eat. Of course, it will be problematic to get high income by selling delicacies and expensive products. If you are thinking about starting a business in which you definitely do not burn out and do not lose, then pay attention to the sale of food products. With a small capital, you can organize the marketing of rabbit meat.
The most profitable will be the sale of inexpensive cereals. Accordingly, the purchase must be made at wholesalers at the lowest possible prices, which will require certain costs. Also, the right decision would be to conclude an agreement with bakeries for the supply of inexpensive and social types of bakery products. To ensure a low cost, it is better to buy vegetables from farmers directly.
It will take some time to establish business contacts, but buyers will flow like a river to those who can provide a lower cost. Fewer competitors - less cost of goods for the store, which increases the profit. To assess the order of running costs, look at the cost of the McDonald's franchise. In a crisis, it is risky to acquire such an establishment, but if you choose a suitable place, the number of clients will be quite large.
Medicines and devices from the healthcare sector are always in demand. They say that money cannot buy health, but no one wants to do without the help of appropriate means. This is a profitable direction that does not lose customers at any time. It would not be an exaggeration to say that today medicines are a commodity that is one of the basic necessities. Open a personal pharmacy or even a small network. No one wants to save on their health, therefore, the sale of drugs does not decrease even in the most difficult crisis, and sometimes, on the contrary, shows a certain increase.
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Personal hygiene items can be distinguished among the essential goods. During a crisis, the level of sales of such goods may decrease slightly, but this affects extremely expensive products imported from abroad. In addition, consumers prefer to replace it with available domestic counterparts. Among personal care products, the highest sales are shown for washing powders, toothpastes, shampoos, cleaning products, deodorants and perfumes. Firms selling such goods are able to survive any crisis if they have products at affordable prices on their shelves. It is beneficial to arrange periodic ones, not timed to public holidays. For example, give small discounts on a certain day of the week.
In this article we will try to find out which business to open during a crisis and how to ensure its development, taking into account the situation in the economy.
You will know:
Is it worth starting a business during a crisis
There is a stereotype that a business in a crisis economy has no chances for successful development, but there are many examples that demonstrate the exact opposite. In an unstable economy, there are excellent prospects for entrepreneurship, if the right approach to the choice of the sphere of application of efforts appears.
One of the options could be a commercial activity related to the production or provision of services. During a crisis, there is a chance to receive a stable profit by reselling goods in high demand. These can be food products, especially natural ones. Given this circumstance, it is possible to establish a business in the countryside. Another reverse option is to open a rural store, which will present an assortment aimed at meeting the basic needs of the population. Further in the article you will find a detailed analysis of ideas in a crisis and you can download ready-made business plans.
Choosing a direction of business largely depends on where you are. Consider several areas of entrepreneurship.
- Starting a business, you can open an enterprise that provides services for the repair of household appliances, vehicles, etc.
- In the financial sector, you should choose areas with high profitability: the issuance of microcredits (money before wages) and pawnshop services.
- Times of crisis provide good opportunities for students and youth. Any non-standard idea can become an excellent foundation for a profitable startup.
You can always use the economic crisis to form a team of real specialists, with whom you implement any idea aimed at creating a profitable project.
Advantages of the solution to start a business during a crisis:
- At this time, you can gain invaluable experience in running your business in difficult conditions. Often, businessmen who have managed to open enterprises in a stable situation are unable to withstand economic shocks. The crisis allows one to acquire the skills of making quick decisions, which increases the level of readiness for any changes. After that, any business reformatting will not be seen as an impossible task.
- During the crisis, many enterprises go bankrupt. By being active, you can get a chance to occupy the vacant niches.
- When deciding to start entrepreneurship in a crisis, one should first of all focus on the basic needs of fellow citizens. The psychologist Maslow can find useful theses. In order to understand which business will grow during the crisis, it is necessary to carefully study what the consumer needs: food, clothing, and medicine. And, therefore, it is worth focusing primarily on these areas.
Firms and enterprises are the backbone of the business sphere. The level of employment of the population, the intensity of scientific developments and research activities depends on the development of business. Some companies decide to open a new direction of activity in unpromising, at first glance, areas of the economy.
The main difficulties of business development during the crisis:
New phenomena in the economic situation, those that a few years ago frightened entrepreneurs with the loud word "crisis" are now nothing more than a familiar state of affairs. Business has adapted to the crisis and made such an element an integral part of all-round development.
The entrepreneurial market a priori notes future instability, resource constraints and large fluctuations in demand for manufactured goods and services. Credit institutions have become an order of magnitude more careful with the issuance of credit obligations, and investors have lost their serene confidence and stopped investing their money in any more or less interesting project.
Doing Business in Crisis
A break-even enterprise is a profitable business in a crisis. Minimizing liquidity losses will allow you to survive an unfavorable period without major problems and stay afloat, without approaching the zone of discomfort - the zone of bankruptcy.
There are many ways to keep your business profitable. Large consulting companies offer various anti-crisis policy services, but most of them do not work and are a waste of funds.
To keep your business buoyant, you shouldn't be nervous; it's better to carefully develop an enterprise policy to minimize outside costs. To do this, follow four simple rules:
Keeping the business "squeezed"
In essence, the risks of new projects are practically identical to the same risks to which enterprises on the market are exposed. The most significant risk is the lack of the required level of liquidity. The decline in demand is not so dangerous in comparison with the lack of funds for the minimum development of the enterprise. A drop in customer purchasing power will be the most dangerous for those businesses that cannot shrink in direct proportion to the changes. To avoid unnecessary risks, the retail business should refrain from long-term commitments and unreasonable expenses. Statistics show that for small businesses, about 80% of the cost structure is prescribed for the lease and remuneration of personnel. Retail business is characterized by high staff turnover (up to 60% of staff). For a more thorough "squeezing" of the enterprise, it is planned to suspend the hiring of new personnel and stop the indexation of wages. In any case, optimal "compression" will only happen with an agile business model.
Lack of sufficient liquidity as a result can turn into big troubles. A striking example is the real estate business (development). During the 2021 crisis, most of these projects died out due to the lack of funds to complete the work.
In a crisis situation, people switch to economy mode, reducing their costs. Before deciding which business to open during a crisis, you need to understand what changes have taken place in the economy. It is with their consideration that you need to look for options.
From this article you will learn:
- Factors to consider when starting a business in a crisis
- 8 reasons why it is worth starting a business in 2021-2021.
- 9 real business ideas
- Actual business on the Internet
- Business management in crisis
factors to consider when starting a business in a crisis
reasons why you need to open a business during the crisis in - yy
If no one guarantees stability at work, and your salary leaves much to be desired, then why not go into business and depend on anyone? You will spend your time and energy implementing promising ideas. If you have talent and have always dreamed of having your own business, then you should start right now.
- More highly qualified specialists
Experienced professionals are hard to find in good times. As a rule, such people are already employed. But during the economic crisis, the state is often "cleaned", and even highly qualified specialists may be laid off. Think, perhaps among your acquaintances there are those who can help you in starting a business.
- Affordable business support
Consider renting an empty office space located near you. Try to negotiate with their owners.