Steve Davies Online

You say you want recurring revenues and you know that is the way to build equity in your business…yet you spend your time and energy on your product sales and somehow your service revenues don’t grow as fast as you would like.

Business downturns come in many shapes and forms – from a recession that affects the whole economy to something very specific that only affects your industry. This year, the business soothsayers are warning us to watch out for murky credit markets, a decline in the gross domestic product, and a decrease in consumer spending—none of which is good news for the small business owner.

But downturns can also be caused by such diverse elements as a market crash, a terrorist attack, a natural disaster (such as Hurricane Katrina), an epidemic on another continent (such as SARS or the avian flu) or by one of a thousand other things.  Predicting these kind of things is virtually impossible. Lehman Brothers recently appointed a high-ranking ex-CIA official to give them information on events worldwide that could have an economic impact. That may or may not work for them, but it is way beyond the reach of small business owners with limited resources.

One of the most easily identifiable risk factors facing any company is the loss of a major customer. It is one of the most alarming things that can happen in business but as with any risk factor, there are ways to minimize the risk beforehand and processes that can be implemented if it does occur. 

In this article, I will look first at some things you can do to minimize the risk in the first place and then go on to look at how to react when it does happen to you. Planning ahead is critical but with a little effort the damage can be significantly reduced.