The ostrich is a strange creature. When frightened it will bury it’s head in the sand, convinced if it can’t see the danger, whatever is creating the threat can’t see it either. Over the last few months I have noticed a number of small business owners behaving like an ostrich. Instead of facing the challenging economy head on, the are hanging around with their heads buried in the sand, hoping they can ride it out!
But it doesn’t work. Hiding with your head in the sand is a good way to get run over, or simply miss an opportunity that comes along. Now more then ever, small businesses need to be making and executing growth plans, investing in their business and reaching out to existing customers and prospects.
Seth Godin touched 0n this topic in a post entitled Death Spiral as he cautioned small business owners against trying to shrink their way to greatness. He provides several examples of how companies sabotage their own survival by trying to cut back when things slow down:
The fish monger sees a decline in business, so they have less money to spend on upkeep and inventory, so they keep the fish a bit longer and don’t clean up as often, so of course, business declines and then they have even less money… Eventually, you have an empty, smelly fish store that’s out of business.
The doctor has fewer patients so he doesn’t invest as much in training or staff and so some other patients choose to leave which means that there are even fewer patients…
The newspaper has fewer advertisers, so they can’t invest as much in running stories, so people stop reading it, which means advertisers have less reason to advertise which leaves less money for stories…
What should you be doing? Invest now! Invest wisely, but spend some of your available cash on marketing, new product development, system development which will allow you to provide better or expanded services to your clients. As Seth says:
Right this minute, you still have some cash, some customers, some momentum… Instead of squandering it in a long, slow, death spiral, do something else.