Should You Start a Business During a Recession?

I say a resounding - maybe. Regardless of all the bad news spewed out in the media versus all the contrarians telling you to sink everything you have into marketing because nobody else is and you will get market share, it's not that cut and dry.

I suggest you stick to your plan of starting the business. HOWEVER, now more than ever, you should keep your day job.  It's not time for experimenting. If your new venture starts to succeed with part-time results then you could keep shifting your emphasis in that direction. But what if you don't see any results? Is it because you don't have a good idea or a good product? Is it because the economy is slow and nobody's buying? Or, are you in an industry that is not "recession proof" and one that ebbs and flows with the general economy?

What I am saying, is that it's difficult enough to run a business and gauge its success during normal economic growth cycles. Don't put yourself under undue pressure when you don't need to. Recessions are called that because business recedes to a lower level. That being said, there are some businesses that actually do better in a recession and there are some products that people still have to have. Collection agency is one of the first businesses that come to mind. Discount or coupon related marketing are another. And people always have to eat; just maybe not at a restaurant.

There are some things that you can do during the downtime to help you prepare for the time when there is a better business climate. Here's a few tips:

Network more. Find people who would be great for your company when you start hiring. They may be looking for a job then. Also, go out to lunch with an entrepreneur. Ask them what they are doing to keep their business growing during the economic downturn.

Purchase products you know you will need. Typically, in a recession, prices come way down and there are some bargains to be had.

Keep learning. You have more time to use to your advantage. Use it wisely. Increase your learning effort on all aspects of your business, including studying your industry and your competition. I don't advocate spending a lot of time being obsessed with your competition, but in this case time is on your side and not theirs. Perhaps they might want to get out of a part of their business and let you take it over. Sometimes, if the timing is right, a business will be happy to let go of a product line or group, just for taking over the expenses.