With the rising cost of living crisis among us and setbacks from the covid pandemic, launching a successful start-up during a recession may not seem sensible. However, a tough economic period may be the best time to launch a successful business.
If you are looking to run a successful start-up during a recession but not sure where to begin, we have highlighted our top four tips below.
How to run a successful start-up during a recession
Less competition
With the economy on a downturn, fewer funding opportunities may deter many other businesses from starting up. Established or existing companies have financial and growth plans based on the notion of the economy performing well. During a recession, these businesses have more overheads to consider such as employees and retail premises, leading to a lot of companies going bankrupt, cutting staff or closing stores. Small start-ups have fewer overheads and can take on a more flexible approach to working, anticipate consumer spend and react quickly to sudden changes.
Opportunity to recruit qualified staff
The economic downturn can lead to a number of job losses and redundancies which in turn means an influx of highly qualified and experienced professionals on the job market. This puts your start-up as top of the list for qualified job seekers, often with a wealth of knowledge and can prove to be a great asset to your business.
Lower rates
If you require funding or a loan to help launch your start-up, interest rates during a struggling economy may be lower. This simply means that it could cost less when repaying your loan. You may also see lower rates when it comes to rental spaces or suppliers, with the opportunity to negotiate better deals that can benefit you and your new start-up.
Better working environment
With the recent pandemic forcing businesses to rethink the way they work, working from home opportunities have skyrocketed and have remained ever since. Flexible working allows for a start-up to be launched from anywhere in the world, including co-working spaces where you and your employees are able to hot-desk when needed.
Businesses that started in a recession
The UK has seen its fair share of successful start-ups during various economic downturns. Such as;
- Poundland – founded in 1990 during the recession that transformed value and bargain-based shopping
- Wilko – first opened in Leicester in 1930 at the height of the Great Depression
- Graze – founded in 2008 during the deepest recession the UK has seen since the Second World War, through a postal subscription service
At Grosvenor House, we offer virtual office spaces, hot desking and co-working solutions with a wide range of add-on services to meet your needs. Get in touch with us today to discuss our range of bespoke office solutions or book a unique space and discover why we offer the perfect office solution for your business.