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Loading ...Small Business Credit Crunch - A Blessing in Disguise?
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Almost all small businesses relies on credit to fund their operations or expansions.
That means, almost all small businesses experience credit crunch to a certain extent.
Some has gone bankrupt, some barely survive. But you might see credit crunch today has a positive upside or two.
A blessing in disguise for the economy and credit crunch victims
With all the collapse of the big guys of the finance world, such as AIG and Lehman Brothers, credit crunch today is obviously not anywhere near to be called a good event.
However, I would like to try to convince you that the credit crunch today is doing a thing or two that could actually help a small business and the economy.
How can credit crunch today could very well be a blessing in disguise?
- Natural selection - Survival for the fittest
Winners in, losers out - Only the strongest survives the credit crunch, and the surviving small businesses are candidates for you to deal with. - New small businesses emerge, particularly in the finance industry
Believe it or not, the credit crunch today born new breed of small businesses that offer a ’safety float’ for credit-strained clients. Some of the services offered is buy-and-rent-back real estate services, credit card balance transfer services, debt restructuring services, financial consulting services, and many more. - Uniting small business to work in collaboration
The key word of the decade: collaborate. Your chance of surviving credit crunch alone is slim, but collaboration or creating a network will carry your small business over the storm - two heads are better than one.
Just be ready to ride the wave - what’s come down, must come up
Are you a recession and credit crunch survivors? Just hold on and prepare yourself, as the history has already proved that what’s come down, must come up.
Make sure you have your surfing board ready, and wait for the best time to ride the wave :)
Ivan Widjaya
Just hold on and be resilient
Image by fauxto_digit.
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{ 6 comments… read them below or add one }
Karen 10.17.08 at 11:55 pm
I really like your perspective. It’s nice to read about how the recent economic events can have positive outcomes for small businesses.
But will it balance out the effect on small businesses who extend credit?
Noobpreneur 10.18.08 at 11:46 pm
Karen,
Thanks :)
About the small businesses that extend credit - IMO, they will eventually sustain themselves, in a way I described as natural selection. The most able small businesses will survive, even thrive. Others don’t.
Unfortunately, not all small businesses can be saved from today’s credit crunch.
smebus 11.13.08 at 11:40 pm
Good post. I guess any small business that was over stretched financially before the crisis will be lucky to escape unscathed.
My experience from previous recessions is that the financially sound business will survive stronger and fitter.
Noobpreneur 11.18.08 at 11:44 am
smebus,
Indeed - what businesses must do is to maintain their industry ‘acceptable’ rate of debt to equity ratio.
Taking too much risk on the debt side will damage your business’ potential, and ultimately, severe your business’ survivability.
Thanks for leaving your comment :)
Sell and rent back 11.21.08 at 10:25 pm
The News & Star reported a sharp rise in number of home owners who are handing back their properties. The UK government recently announced they will be providing a sale and rent back scheme to homeowners to try and minimise the huge amount of repossessions taking place at the moment.
Noobpreneur 11.22.08 at 12:37 am
Hi,
Thanks for the story update - what’s happened in Cumbria is pretty much a typical thing happening throughout the UK, IMO… and also in most part of the world.
If there’s a company that do similar to sell and rent back, I guess there will be a large group of people with financial difficulties who want to sell and rent back, rather than going for personal bankruptcy.