7 Reasons Why The Recession Is Good For You
By Mike Michalowicz The Toilet Paper Entrepreneur
America is dealing with an economic crisis. Everywhere we turn the media is covering negative story after negative story.
Sadly, the media fails to highlight the “good” that comes out of recessions for individuals and entrepreneurs.
Now before you say, “There is never anything good that comes out of recessions,” I challenge you to read the rest of this article with an open mind to see if it makes you think differently about our current situation.
So read on, oh courageous one, here is why this recession is good for you…
1. Tough Times Help You Monitor Cash Flow Like A Hawk
You know how in boom economies most people become pretty careless about where their money is flowing through in their life? Well in tough economic times, individuals and business owners must challenge themselves to manage and allocate the cash that is flowing in their business to better sources which will help them stay in business through the storm.
Why It’s Good: By shifting your focus to monitoring your cash flow like a hawk in a tough economy, it will allow you to make better business and personal decisions about where and how to allocate cash in the future as the economy begins to recover. This will further lead to more cash flow on the backend and higher profitability in the long run.
2. Focus On Personal Friendships
When was the last time you spent some high quality time with a really good friend? Before you answer think about 3 things you can do with friends in tough economic times that still would be fun, but not cost a lot of money. In these tough economic times, building stronger bonds with your friends is important. Not only should you support each other, but further do whatever you can with them to get their mind off of the tough economy as well.
Why It’s Good: Building stronger bonds with friends when the economy is suffering helps you in the long run, because it allows you to solidify your trust in those friendships you have taken so long to build. Spending time with these friends is also a healthy way to escape the stresses the economy is putting on you. Everyone needs a little R and R.
3. Make Better Choices About Spending Money
When the economy is good, you know how people who have more money than normal tend to spend it on “extras” they don’t necessarily need? Well in tough times, entrepreneurs using money on these “extras” stop allocating cash to them because they know it is not smart. Instead of just spending money for the sake of spending money, in tough times, entrepreneurs must carefully think about and analyze whether what they are spending their money on will generate a return that is worth the initial expense.
Why It’s Good: Shifting your focus on using your money that comes into the company more efficiently and effectively, and further focusing your attention on generating solid returns with the money you are spending, helps you come back to the main focus of owning and running a business…generating cash and making money on everything that you sell and provide your customers.
4. Experience Memorable but Simple Entertainment With Family
Do you remember those times where taking the family to the park with the dog, pulling out a board game, or hanging out with the kids in the house allowed you spend some “priceless” time with your family? Well in tough economies “entertaining your family on a budget” is something where you have to get creative. Trips to the park, or walks with the dog are some potential options to choose from when money is tight.
Why It’s Good: In tough economies because there is not much extra money laying around to spend on extravagant vacations, or expensive trips taking simple day trips with the family to places that don’t “cost” much is a good thing. Building those bonds between your family through inexpensive entertainment in these tough times keeps you closer together and helps you strengthen the bonds between all of you.
Cut the Fat
5. Forces You To Cut The “Fat” Out Of Your Life And Business
You know when you are spending money on something that feels like it is “extra” but you continually do it anyway because you know you will still have the cash next month to fund the same thing? Well in tough economies these types of expenses must go. Not only are they a “waste of money,” but I like to call them the “un-needed fat” in your life and business. Cut these faster than white on rice
Why It’s Good: By cutting the fat out of your life and your business, it allows you to improve your cash flow situation significantly, which then allows you to help better allocate funds to the correct locations in your life and business. All of this not only improves your bottom line, but also helps you survive from month to month easier.
6. Tough Economies Force You To Innovate
You know how the greatest human motivator is to avoid pain? Well in tough economies we all deal with cash flow and profitability issues. When accepting this reality you can do one of two things. You can either act as a victim blaming everything on the economy, or you can do everything you can in your power to figure out ways to improve your business or personal life as a whole. Because our biggest pain would be to “lose our business” or “lose our home” the tough times a recession brings forces us to take our business and mind to the next level.
Why It’s Good: You never know what may happen when you step back and think about how you can improve your business or personal life with lacking resources. You very well may come up with the next multi-million dollar idea that will turn your business or personal life around for years to come.
7. Spend More Time At Home Eating Home Cooked Meals
It is a fact in tough economies people don’t go out to eat as often because they are doing everything they can to conserve cash. This is the best opportunity to have more home cooked meals. Not only are they healthier for you, but further it allows you to build better bonds and relationships with family. When was the last time that you ate a home cooked meal with your significant other and children?
Why It’s Good: I am not psychologist, but I am sure that eating dinner with family is a good thing for your mind body and soul. By taking the time to interact with your family over a meal, it allows you to step away from the stress of the economy and hopefully re-energizes you to help you recognize why you are here in the first place.
Idea For Post Inspired By: @Supernova17
Written by Scott Bradley: @ScottBradley
Mike Michalowicz started his first business at the age of 24, moving his young family to the only safe place he could afford – a retirement village. With limited resources and no experience, he systematically bootstrapped a multi-million dollar technology business, sleeping in conference rooms to avoid hotel costs. After selling his first company, Mike launched a new business the very next day, and in less than three years, sold it to a Fortune 500. With his newest multi-million dollar venture, Obsidian Launch, he fosters startup businesses with his “get rich right” approach.
A graduate of Inc. & MIT’s “Birthing of Giants” Entrepreneurial Program, Mike has received multiple entrepreneurship awards, including the SBA’s Young Entrepreneur of the Year. He is a recurring guest on CNBC’s The Big Idea with Donny Deutsch, ABC News, and other television programs. He has been featured on National Public Radio (NPR), and in the New York Times, Smart CEO Magazine, and other publications.
Mike is a frequent guest lecturer for entrepreneurial groups and professional business groups throughout the world. Mike is also a reoccurring guest lecturer for entrepreneurial programs at Babson, Boston College, Columbia, Harvard, Penn State, Princeton and other colleges throughout the country.