Tips for SMEs and entrepreneurs in challenging times

The rise in inflation, the uncertain economic outlook and the high price of the dollar, with the consequent devaluation of our currency, are factors that are causing entrepreneurs and owners of small and medium-sized enterprises to see their subsistence capacity threatened again.  
Preparing for difficult times can be critical to long-term success, but the situation we are currently experiencing is not normal. The forced paralysis of activities during the pandemic barely allowed businesses to recover for a few months and now, they are faced with these problems without having had the opportunity to move forward.
Therefore, the measures implemented by the Government to support SMEs, which are also the engine of the economy and provide almost two thirds of the existing jobs in the country, are essential. In fact, the recently announced Budget Law speaks of 58 billion pesos for the strengthening of the program of access to credits for unbanked SMEs with the aim of strengthening entrepreneurship.
But as long as that doesn’t happen, you have to survive. Nor will access to credit for SMEs solve the underlying issue on its own. Thinking about this, and while the economic cycle is down, one of the first tips we can give to SMEs and startups is to focus on businesses that solve specific problems of people through an effective, simple product offer that has a market opportunity.
It is also very important to allocate expenses to really essential areas and expand cash flow estimates as long as possible. The fundamental purpose of any company is to grow, but when this becomes difficult because revenues are variable and the economic recession raises the expenditure of inputs, the goal should be to sustain itself by focusing on the operability of the business. Creating an extra emergency fund every month – regardless of whether the savings are not huge or fixed – can make a difference in the future. 
Another important factor to take into account is to take care of our work teams. They are the economic sustenance of their families and in addition, we need their talent so that the company stays afloat. Remember that it is in difficult periods where the mettle of people is tested and if we remain united, we are more likely to find alternative paths and have allies to help us realize projects. It is important to value those with whom we share the workday, hopefully listening to them more and encouraging informal conversations that help us discover new answers to what we are facing. 
A final call has to do with resilience. Although things look bad today, historically cycles go up and down. Thinking positively, this can be a good opportunity to analyze our work, adapt, plan the steps to follow and be attentive to the signs. Bad experiences teach us a lot about ourselves and expose us to challenges we didn’t think we could do before. If we know how to get around them, the benefit is that we will come out of this situation wiser, stronger and prepared for what comes in the future. 

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The content expressed in this opinion column is the sole responsibility of its author, and does not necessarily reflect the editorial line or position of El Mostrador.

Original source in Spanish