4 things to consider when running a business during downtime

The opinions expressed by entrepreneurs contributors are their own.

When running your business, it's easy to get caught up in day-to-day operations. However, it is important to remember that it takes money to make money. And if you don't have enough cash in the bank to cover your expenses, you could quickly find your business in trouble.

When times are tough, it's easy to lose sight of the bigger picture. For example, when economic dynamics change negatively, we may find that consumers spend less. When this happens, you need to make sure you have a plan for what happens next. It means preparing for the difficult years ahead.

The good news is that your business can weather downtime if you prepare for it by managing cash flow effectively and prudently over time. Here are some tips to help you:

Related: 5 Ways to Prepare Your Business Now for the Next Major Disruption

1. Stay informed of economic and industry trends

The business world is constantly changing. Trends come and go, and businesses that don't keep up can find themselves out of the game. The world of online retail is constantly changing, so it's essential to stay on top of developments in your field. If you want your business to stay competitive, you need to be sure you know what's going on.

When it comes to keeping up with new technology trends, there are plenty of ways to do it. For example, if you have an e-commerce website, you can use tools like Google Analytics or Webmaster Tools to track traffic trends and see how customers are interacting with your site. You can also do market research on your competitors, using tools such as Google Trends or Alexa Traffic Rank (if they offer this information).

If you don't have access to these tools, there are other ways to get contest information. For example, if one of your competitors has recently been taken over by another company (or is currently struggling), this may be an opportunity for you to take advantage of their weakness by establishing yourself as a viable alternative.

2. Budget for a few lean years ahead

Consider budgeting for a few tough years ahead. It means taking action now to avoid problems later. You need to take a close look at your expenses and determine if they match your business needs. If not, you may need to adjust them.

One thing you can do to prepare for the future is start saving. Even if you feel like you have enough funds in your business, the reality is that many small businesses fail because they don't have enough money to cover their expenses for the tough years ahead. I generally recommend keeping at least six months supply, so that if sales drop or new products don't sell as well as expected, you won't have to close. In lean years, you want to triple that.

Related: How to Help a Business Thrive During an Economic Recession

3. Make good use of any excess cash

The next thing to consider is whether you should put any excess cash to good use. If your business is still in its infancy, chances are that the money you have and the money coming your way will be enough to keep things running smoothly for a while. However, if you're starting to grow quickly and want to invest in new equipment or staff, now might be a good time to think about it.

The best way to know how much money you need is to look at how much you spend each month. Write down everything that goes into your business, from rent or property rates to utility bills and the cost of any materials that go into production or marketing campaigns.

Then add up all these numbers and see if there are any discrepancies in your income. There may be areas where costs are higher than expected or where there has been a discrepancy between sales revenue and expenses that needs to be corrected immediately so that money is not lost through lack of funding.