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How to Grow Your Business in a Recession: Lessons From 8 Downturns

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How to grow your business in a recession comes down to adapting faster than your competitors, getting more done with less instead of only cutting, and keeping your team focused on the two or three things that actually make money. Dave Liniger, co-founder of RE/MAX, says the company went through eight recessions in 50 years and made money in every one except one. That’s the playbook I wanted to pull apart.

Episode 212: Dave Liniger - How to Have The Ambition & Grit to Build A Billion Dollar Empire

If you don’t know RE/MAX, you’ve almost certainly seen the sign. Dave and his wife Gail started it in 1973, and it has grown to more than 140,000 agents in over 110 countries, according to his official site. He started with one agent, no money and no partners. When I asked him to sum up his life in one word, he said adventure. The biggest adventure, he said, was taking an idea with nothing behind it and ending up in a hundred-and-some countries.

So I asked him straight: when the leads slow down, do you cut costs, double down on sales or get more resourceful? Here’s what he told me.

Eight recessions, one losing year

Dave put it plainly. Over that 50-year run he lived through nine U.S. presidencies, “a couple were geniuses, a couple were out and out crooks and a couple were pretty stupid,” and his summary of the business side was simple. “We went through eight recessions and we made money in every recession except for one.”

Most people treat a recession like weather. Dave treats it like a test you can study for.

And it wasn’t overnight. In the early days he made a lot of management mistakes. “It was my fault. I was very naive.” They stuck with it, and within five years RE/MAX was the number one real estate company in Colorado.

Why adaptability beats strength in a downturn

For years RE/MAX said it won because of the quality of its agents. Dave now says it was really their adaptability. The agents who lasted were the ones who took on a changing industry and a changing economy instead of staying in the same old groove.

He framed it with the famous line about survival: it isn’t the strongest of the species that survives, it’s the most adaptable. Dinosaurs were strong. Mosquitoes are still here. Quick note for the record, though. That wording isn’t actually Darwin’s. The Darwin Correspondence Project traces it to a 1963 paraphrase by management professor Leon Megginson. The idea still holds up in business, and Dave’s conclusion is the part that matters: “Embracing change and not being afraid of change is a cornerstone of anybody’s big, big success.”

My take? In a slow market you’ve got to be able to think quick on your feet and have the courage to take risks when other people are holding back. Most people throw the towel in way too early.

Don’t just cut costs. Use the theory of more

Dave read The Magic of Thinking Big by David Schwartz and copied one paragraph onto a plaque in his office. He calls it the theory of more. Progressive farmers look for more bushels per acre, more eggs per hen, more pounds per cow. Manufacturers try to make more widgets with less waste.

When most people hear the word recession, the first thing they do is cut costs, lay people off and get the budget under control. Dave doesn’t say that’s always wrong. Businesses get fat in good times. But he calls it a knee-jerk reaction. “You should be looking at your balance sheet all the time.”

Then he flips it. If the market’s bad, it’s bad for everybody. So what can you do to take advantage of it, and how can you take market share from the people who aren’t making good changes? That’s the question. How do you get more done with less?

Before you touch anything, know your runway. Know how many months of cash you actually have, then decide what to trim and where to push. A good mentor of mine once said there’s the economy, and then there’s your economy. The headlines don’t get to decide how you think.

Leaders sell hope, especially when the news is bad

I asked Dave which leadership principle mattered most. His answer: all great leaders sell hope. They inspire people to believe there’s a better way.

In his case he was selling real estate agents the dream of a better compensation model. In the early 1970s the standard deal was a 50% commission split, and nine out of ten people who got a license didn’t have it two years later. RE/MAX let agents share office costs and keep most of their commission. The industry hated it. It worked anyway.

And he didn’t sell it from a corner office. Dave was the company’s number one trainer for over 40 years and traveled at least 200 days a year. “I was the chief cheerleader of the company more so than a CEO.” When people are nervous, that’s the job.

Shrink your business down to two or three things

Dave says there’s no such thing as total balance. The real skill is setting priorities, and that means focusing on two or three simple things.

At a Darren Hardy seminar, Hardy asked the room to describe what they do in one sentence. Dave and his CEO put their hands up at the same time and said it together: we sell franchises, we recruit and retain sales associates, and we collect the money. That’s it. You can get lost in a hundred services, but if those three things stop, the company stops.

His warning about shiny objects is even more useful in a downturn. Everyone chases the newest app. Dave says focus on the service you give your clients. Give outstanding service and clients send you customers, so you don’t have to go out and prospect. If you struggle to stay focused when every tool and trend is screaming for your attention, start there.

The team you start with is never the team you end with

Early on, you’re the chief cook, bottle washer and janitor. But Dave says the minute you’re profitable, you need to hire talent that’s better than you.

Then he admitted a mistake. For 38 years in real estate he bragged that no officer had ever voluntarily left the company. He was proud of it. Now he says he was wrong. Many of those people didn’t keep up as the company grew, and he let them tag along too long. In a recession, carrying people who’ve stopped growing is expensive.

Raise your circle and watch your own behavior

Dave quoted the Jim Rohn idea that you become the average of the five people you spend the most time with. You pick up their work habits, their attitudes and their drive. His golf example: you play better when you’re with serious golfers. You play up to your competition.

I believe your association determines your destination. You start acting like the people around you without even knowing it.

The same thing runs the other way inside your company. Dave calls it boss watching. “If you are the boss or you’re the supervisor, no one ever stops looking at you.” Be kind and professional and you build that culture. “If you’re a jerk, jerks will join your company.” When a downturn hits, your team copies whatever you do with the pressure.

Improve 100 things by 1%

Dave’s book The Perfect 10 is named after gymnastics and diving, where a perfect score almost never happens. His answer for small business owners is kaizen: improve 100 things 1% at a time, not one thing 100%. “Don’t seek perfection, seek continual improvement.”

His advice is to ask yourself every day how you can do this a little bit better and a little bit less costly. Stack enough small wins and a lean year starts to look like progress. I summed it up to him like this: you can have it all, just not all at once. He agreed.

Turn fear into normal, then go again

Dave started racing NASCAR in his 50s after Bill Marriott invited him to a two-day driving school. By the end of the first day he was beating the professional drivers’ times. Soon he was testing at Daytona at over 200 miles an hour, terrified for one lap. By the second lap he knew he just had to keep his foot in it. Within a year the fastest tracks felt like a freeway. “I never lost a single race. I just ran out of laps.”

That reminded me of working in the deserts of Western Australia before I started my business. I was catching snakes and lizards with the environmental team, and snake handling scared the pants off me at first. My teacher told me your knowledge has to reach the level of your fear. The fear doesn’t vanish. Your knowledge just goes beyond it. Recessions work the same way. Know your numbers and your customers, and the headlines rattle you less.

Grit when everything stops

The hardest part of our conversation was the day Dave said he’ll remember forever. He went into the hospital thinking he had a herniated disc. An hour later he was in toxic shock, on a ventilator, and his organs were shutting down. His official site describes it as a staph infection along his spine that left him paralyzed. He told me eight doctors recommended hospice. His family and best friend said give him a chance.

He came out of a coma three months later as a quadriplegic. Told he’d never walk again, he gave himself 15 or 20 minutes of a pity party, cried, got angry and said, “Screw you, I’m gonna walk out of this place.” He begged his therapists never to let him give up. He went home in a wheelchair, worked for another year, and finally hit 10,000 steps a day.

At a RE/MAX convention he asked the whole room to stand up, then told them he’d give every dollar he had to do what they’d just done. That’s what real wealth is. You think you’re having a bad quarter? You’re still breathing, and if you’ve got your health you can do anything.

How to grow your business in a recession: a quick checklist

  1. Check your balance sheet now, not when sales drop.
  2. Cut real fat, then ask where you can get more done with less.
  3. Sell your team hope, and show up as the chief cheerleader.
  4. Write your business in one sentence and protect those two or three things.
  5. Put service ahead of the newest tool so referrals keep coming in.
  6. Hire people better than you and stop carrying people who’ve stopped growing.
  7. Find one thing to improve by 1% every day.

I hope you’re taking notes on this, and more importantly, putting it into action. Knowing this stuff won’t save your business. Applying it might.

FAQ

How do you grow your business in a recession?

Adapt faster than competitors, watch your balance sheet constantly, and get more done with less instead of only cutting. Dave Liniger says RE/MAX made money in seven of eight recessions by focusing on its core and taking share from slower rivals.

Should you cut costs during a recession?

Cut genuine waste, but don’t treat layoffs as the only move. Liniger calls automatic cost-cutting a knee-jerk reaction. Watch your costs all the time, then use the downturn to improve efficiency and win customers from competitors who aren’t adapting.

What is the theory of more?

It’s an idea from David Schwartz’s The Magic of Thinking Big: progressive farmers and manufacturers keep finding ways to produce more with less. Liniger kept it on a plaque in his office and applies it to growing a business when markets get tight.

Did Darwin say the most adaptable species survives?

No. The Darwin Correspondence Project traces that wording to a 1963 paraphrase by management professor Leon Megginson. The business lesson still stands: companies that adapt to change tend to outlast those that stay in the same groove.

What is the official definition of a recession?

Two consecutive quarters of falling GDP is a popular rule of thumb. In the U.S., the NBER’s Business Cycle Dating Committee officially dates recessions using a broader look at a significant decline in economic activity.

I am the the Founder of Addicted2Success.com and I am so grateful you're here to be part of this awesome community. I love connecting with people who have a passion for Entrepreneurship, Self Development & Achieving Success. I started this website with the intention of educating and inspiring likeminded people to always strive for success no matter what their circumstances. I'm proud to say through my podcast and through this website we have impacted over 100 million lives in the last 17 years.

Business Advice

Cash vs Accrual Accounting: When Your One-Person Business Should Switch

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Cash vs accrual accounting is a question of timing. Cash accounting records income when the money hits your account and expenses when you pay them, while accrual accounting records income when you earn it and expenses when you incur them, even if no cash has moved yet. Most one-person businesses can start on cash, but you should switch your management books to accrual once unpaid invoices, bills or inventory start hiding what’s really going on.

You’ll also see this asked as “cash basis vs accrual basis,” “cash method vs accrual method” or “which accounting method should my small business use.” Same decision. This is education, not tax advice. Changing your tax accounting method is CPA territory, so loop one in before you file anything.

A Simple Guide to Cash vs Accrual Accounting

What’s the difference between cash and accrual accounting?

Here’s the simplest example I can give you. Say you finish a $10,000 project for a client in December. They pay you in January.

  • Cash basis: the $10,000 shows up in January, because that’s when you got paid.
  • Accrual basis: the $10,000 shows up in December, because that’s when you earned it. Until they pay, it sits on your books as accounts receivable.

Same money. Same client. Two different pictures of December. The IRS lays out both methods in Publication 538, and the definitions there are worth reading once so you’re not guessing.

Cash accounting Accrual accounting
Income recorded When money is received When it’s earned
Expenses recorded When you pay them When you incur them
Tracks receivables and payables No Yes
Easy to run yourself Yes Harder, usually needs a bookkeeper
Shows true profit for a month Often not Much closer
What lenders and buyers expect Sometimes accepted for very small firms Usually preferred

Why cash accounting feels great and then lies to you

Cash basis is simple. You look at your bank account and you basically know where you stand. For a freelancer who gets paid the day the work is done, it’s honest enough.

The problem starts when timing gets messy. You land a big client, do three months of work and get paid in month four. On cash basis, months one to three look like you’re broke and month four looks like you’re a genius. Neither is true.

It works the other way too. You collect a year of prepaid subscriptions in January and feel rich. You haven’t earned most of that yet. You still owe the customer eleven months of work. Spend it like profit and you’ll feel it in October.

That’s the gap I keep pointing at: knowing the number in your bank account isn’t the same as knowing your business. You can’t make good calls on hiring, pricing or ad spend if the report you’re reading is off by a quarter.

When should a one-person business switch to accrual?

This is the part most guides skip. Here’s the switch list I’d use for your management books, the numbers you run the business on.

  1. You invoice and wait to get paid. If you regularly have more than a few weeks of unpaid invoices, accrual shows you what you actually earned.
  2. You have bills you pay later. Contractors, software on net-30 terms, a big annual expense. Accrual matches costs to the month they belong to.
  3. You sell physical products. Inventory ties up cash before you make a sale. Accrual shows real margins.
  4. You take prepayments or retainers. Cash basis makes money you haven’t earned look like profit.
  5. You plan to raise money, borrow or sell. Investors, lenders and buyers usually want accrual financials. Starting late means a painful clean-up right when you’re busiest.
  6. You hired help. Once payroll and contractors are in the mix, the timing swings get bigger and more expensive.

If none of those apply, cash is probably fine for now. Don’t add complexity you don’t need. But be honest with yourself about number five. Most people say “someday” and then scramble when someday shows up.

Cash vs accrual for taxes: the rules that matter

Running your business on accrual and filing your taxes on accrual are two different decisions. People mix them up all the time.

For taxes, plenty of small businesses can use the cash method. Under the gross receipts test in tax code section 448(c), a corporation or partnership qualifies for tax years beginning in 2026 if its average yearly gross receipts over the prior three tax years don’t exceed $32 million, per IRS Revenue Procedure 2025-32. That number is adjusted for inflation each year, so check the current figure when you file.

A few things can still push you toward accrual for tax:

  • A C corporation, or a partnership with a C corporation partner, that fails that gross receipts test
  • Entities treated as tax shelters, which can’t use the cash method at all
  • Inventory rules, though smaller businesses that pass the same gross receipts test have simpler options

Some owners keep monthly management reports on accrual while their CPA handles the tax return on cash. Whether that setup works for you is a question for your CPA, because the IRS expects your tax method to be used consistently and to clearly reflect income.

How do you change your accounting method with the IRS?

Changing your tax accounting method usually means filing Form 3115 to get the IRS’s consent, along with an adjustment that catches up the timing difference between the old method and the new one. Don’t try to DIY this. A CPA can tell you whether your change qualifies for automatic consent and how the catch-up hits your taxable income.

Who should keep your books once you switch?

Accrual books take more work. You’re tracking who owes you, who you owe and when revenue is actually earned. That’s usually the point where a bookkeeper stops being a luxury. If you’re not sure who to hire first, I broke down the accountant vs bookkeeper decision for small teams.

Your software can usually run reports either way. Most popular accounting tools let you flip a report between cash and accrual so you can compare. Do that once a month. The gap between the two reports tells you how much of your “profit” is still sitting in someone else’s bank account.

And if reading those reports still feels like a foreign language, start with the basics on how to understand your business finances before you worry about the method. A clean set of books on either method beats a messy set on the “right” one.

My take

Start simple. Cash is fine when you’re getting paid on the spot and the business is just you. The moment invoices, inventory, prepayments or hiring show up, move your management books to accrual so you’re steering by the truth, not by your bank balance. Then let a CPA decide what your tax return should use. Most owners who get blindsided by a cash crunch weren’t short on revenue. They were reading the wrong report.

Frequently asked questions about cash vs accrual accounting

Which is better, cash or accrual accounting?

Neither is better for everyone. Cash is simpler and fine for many very small businesses. Accrual gives a truer picture of profit once you have invoices, bills, inventory or prepayments.

Can a small business use cash accounting for taxes?

Often, yes. For tax years beginning in 2026, corporations and partnerships generally qualify if average gross receipts for the prior three years don’t exceed $32 million, though other rules can apply. Confirm with a CPA.

Do I need IRS permission to switch from cash to accrual?

Usually, yes. Changing your tax accounting method generally requires filing Form 3115. A CPA can tell you whether the change qualifies for automatic consent.

Does accounting software use cash or accrual?

Most accounting software can show reports on either basis. The method that matters for taxes is the one you file under, not the report toggle.

Do businesses with inventory have to use accrual accounting?

Not always. Smaller businesses that pass the gross receipts test have simpler inventory options. Larger businesses with inventory generally use accrual for purchases and sales.

What is modified cash basis accounting?

It’s a hybrid used for internal reporting that tracks most items on cash but records some, like fixed assets or loans, on accrual. It isn’t a separate IRS tax method, so ask your CPA before relying on it.

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Business Advice

Why Do Businesses Fail? Speed Over Structure, Not Just Cash

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Why do businesses fail? Most of them run out of cash, but cash is usually the last domino to fall, not the first. The deeper cause is building for speed instead of structure: a business model that isn’t stable, no reliable way to generate cash, and a strategy the culture can’t carry out. Fix the structure and the money problems get a lot smaller.

Episode 211: Sandeep Chennakeshu - How To Build & Scale Billion Dollar Companies

Sandeep Chennakeshu has spent his career inside companies most of us use every day. He was CTO of Ericsson Mobile Phones and Sony Ericsson, president of Ericsson Mobile Platforms and president of BlackBerry Technology Solutions, and he served as COO of Uhnder, a digital imaging radar company, according to his official bio. He also wrote a book called Your Company Is Your Castle: Proven Methods for Building a Resilient Business. I love that title.

I know a lot of people want to leave the 9-to-5 to build their own businesses, or create more employment for others in their city or local area. So I kept it real with him. The business world is not a walk in the park. It can be pretty brutal out there if you don’t know what you’re doing.

Why do businesses fail? The reasons on paper

The numbers back that up. The SBA’s Office of Advocacy, using Bureau of Labor Statistics data, puts the average 10-year survival rate for new employer businesses at 33.9%. So when I asked Sandeep why two-thirds of businesses don’t make it to year 10, he started with the well-researched list.

  • They run out of money and can’t raise more, because they have nothing to show for what they spent.
  • They don’t research the market, so they price products at a level the market can’t bear.
  • They don’t know enough about their competitors.
  • They don’t hire the right people to start the functions a business needs.

Running out of money is the one everyone quotes. CB Insights went through the shutdown stories of 431 venture-backed startups, and among the 385 where a reason could be identified, 70% ran out of capital. But its analysts make the same point Sandeep does. Running out of cash is “almost always the final cause of death, not the root problem.” Poor product-market fit (43%), bad timing (29%) and unit economics that don’t work (19%) are why the money dried up in the first place.

The real root cause: speed over structure

Sandeep has seen the highs and lows across a lot of industries, and his diagnosis is blunt.

“I think it’s because people opt for speed over structure,” he said. “I don’t think you need to be bureaucratic and process-oriented to do that, but you need a certain structure to build a business and grow it methodically. And if you don’t do that, you’re invariably going to run into trouble.”

Structure doesn’t mean red tape. It means you know what holds your business up before you pour more money on top. I like that he’s broken it up into an easy-to-follow structure and system, step by step, so the everyday person can learn from decades of experience.

The 8 elements of a resilient business

I asked Sandeep to walk me through the eight elements of a medieval castle and how he applies them to a business. Castles that lasted, he said, were built in strategic locations on solid bedrock, and everything else sits on top. Towers along the wall guard it, and he splits those duties into products (creating and delivering them), sales channels and execution.

Castle part Business element The question to ask
Bedrock Business model Is it stable and sticky, or will it give way?
Foundation Cash generation Can we fund growth, either from investors or from what we earn?
Perimeter wall Strategy Does it encompass the whole business?
The keep Culture Will our people actually carry out the strategy?
Towers Products Are we creating winning products and delivering them at the right time, quality and cost?
Towers Sales channels Are our “pipes of sustenance” productive?
Towers Execution What do we do every day to keep every part of the business thriving?
Roof Stakeholder confidence Do investors, customers and employees trust us?

The foundation is where most young companies crack. “Without cash you cannot grow your business,” Sandeep said. If you can’t say how many months of runway you have left, you don’t know how solid your foundation is.

The roof is trust. “Investors give you money to do good things, customers pay you to continue to go do good things, and without employees you cannot do good things,” he said. Build all eight and, in his view, your business can ride out recessions, pandemics and competitors.

Why culture is the keep

The keep sat in the middle of the castle, home to the nobility, the granary and the armory. “When the keep fell, the castle fell,” Sandeep said. “It didn’t matter if the wall was standing.”

His line on this is worth writing down: “Strategy tells you what you want to get done. Culture determines what you get done.” If the two aren’t aligned, you’ll never implement your strategy.

A lot of entrepreneurs I speak to are really getting into this whole culture conversation. They want a company that’s vision-driven and on the same page. Sandeep said someone once told him it takes seven years to change a culture. By his account, his team fixed theirs in a year. Here’s what he did.

1. Build engagement both ways

He ran informal “ask me anything” sessions where anyone with a birthday that month could sit down for breakfast with him and ask literally anything. He filmed short customer interviews, never more than about 10 minutes, and played them at town halls. One customer told his team: “You’re the smartest bunch of people I’ve met, but I trusted you and I lost my bonus last year.” Sandeep said they never had a delay after that. He and his leaders also wrote newsletters to the team: “Just like we expect them to report to us, we need to report to the team too.”

2. Make your metrics thermostats, not thermometers

He breaks the annual operating plan into a handful of diagnostic metrics that, if you hit them, mean you hit the plan. “A thermometer tells you what the temperature is. A thermostat reacts to it.” Then every person gets goals from those metrics. He calls it “know your numbers.”

3. Give every deliverable one owner

You can have plenty of contributors, but only one owner. “You can’t have two quarterbacks in a team playing at the same time,” he said. “The team will get confused.”

4. Grow your capability cube

He asks his managers to grow three dimensions every year, even a little: competence (solving harder problems with the same people), capacity (doing more with the same people) and clarity of communication. The point is urgency: fix a problem before it gets big.

5. Prune the yellow leaves

A Columbia University professor told Sandeep about two potted plants getting the same sun and water. His wife’s was lush; his kept growing yellow leaves, until he noticed she pruned hers every morning and started doing the same. “Very often in companies we spend an inordinate amount of time with difficult people,” Sandeep said. “If you refuse to row in the same direction, well, you probably get on to another boat.”

I had Gary Vaynerchuk on the podcast, and he said it’s more important to know who to fire than who to hire. I actually know somebody who comes in and trains employees to live by their values, and some of them end up leaving the company on their own accord. It’s a bit of a passive approach, but it means people can walk away and do what they really love, and the company ends up with people who want to be there.

6. Reinforce and reward on time

Show the team regularly whether they’re on track, correct course when they aren’t, and reward people for doing the right thing at the right time. “Warm porridge is always better than cold porridge,” he said. I love his analogies. They make the principles easy to remember.

What a turnaround looks like when the structure gets fixed

When I asked for a real example, Sandeep went back to the joint venture between Ericsson and Sony. He said revenue fell almost 40% in about 18 months because the company was copying Nokia, which had more scale, brand and distribution. Copying the biggest player is not a strategy.

The new plan was multimedia phones that could play music, show video, run games and pay bills, and he was sent from North Carolina to Sweden to help the company building the technology deliver it. The business, full of brilliant people, lost a dollar for every dollar it made. By his account, applying the principles in his book turned it profitable within a year and took it to 30% world market share in under three years. At the next company, he says, gross margin was about 18 points below the industry standard, and they closed that gap in 18 months. At a third, he says, revenue compounded at roughly 27% a year.

Those are his reported results, not a promise or a forecast for your business. And the method is plain. “It’s a lot of common sense,” he said. “I don’t know why it’s not done more often.”

I think it’s that allure within our own human psyche to want to try the trendy thing, the sexy thing, the cool thing. But ultimately it’s principles over trends. Principles last throughout the ages, and trends come and go.

Will AI change why businesses fail?

Technology is literally like a hockey stick right now, and a lot of people are scared AI is going to replace their jobs. Sandeep doesn’t see it that way. People still do the science behind AI and build the chips, servers and networks it runs on.

He sits on the board of a company that uses AI to help patent attorneys answer examiners faster by searching prior art. “Think of AI as a tool, and nothing more,” he said. In his view it will enhance productivity, not replace people. We always need human connection, and our creativity goes beyond the computer.

7 beliefs for new founders who don’t want to become a statistic

I asked Sandeep what he’d tell an entrepreneur who’s a little star-eyed and maybe a little naive about business. He tells his children and mentees to adapt these beliefs in their own style, “because everyone’s journey is personal.”

  1. Dream with conviction. In 1984 he fell in love with mobile phones while they were still big and bulky, and people told him the industry was going nowhere. His conviction gave him his career.
  2. Get out of your comfort zone. He left a respected research job for a product job where he was “the runt in the litter,” adapted, and rotated through every part of the business until he was the one person who knew all of it.
  3. Reflect on success and failure. “Success is exhilarating, but I learned more from my mistakes.”
  4. Learn to deal with adversity. A professor friend once told him that if someone took the only sandwich off your plate, you’d have a right to be upset. But his plate was full of sandwiches. Don’t dwell on the past, dwell on what you can do with what you have. That’s what mental toughness looks like in practice.
  5. Get battle-tested. Net practice only goes so far when a fast bowler is steaming in. It takes talent, technique and temperament, so volunteer for the hard assignments.
  6. Stay true. No one will believe in you as much as you believe in yourself. Walk the talk, and don’t say things just to be popular.
  7. Be curious. A Jesuit priest who taught him at school said it’s your choice whether to be ignorant. Ever since, Sandeep has jotted down things he doesn’t know and gone to learn them. “Knowledge and attitude breaks down every barrier.”

Why do businesses fail? A quick self-check

Run your business through Sandeep’s eight elements. Any “no” is a crack worth fixing before you push for more speed.

  1. Is my business model stable and sticky?
  2. Do I know how I’ll fund the next stage, from investors or from my own cash?
  3. Can I state my strategy in a sentence my team would repeat?
  4. Does my culture match that strategy?
  5. Are my products winning, and delivered at the right time, quality and cost?
  6. Are my sales channels actually productive?
  7. Do investors, customers and employees trust what I say?

Even if you’re not at the stage of building your business yet, you can start getting into the mindset of what it takes to create something and put it out there. When I asked for his last 30-second speech to the world, Sandeep gave me the last line of his book: “Believe in yourself, do the things you like, work with the people you like, and always believe in the great hope that the future brings.”

FAQ

Why do businesses fail?

Most businesses fail because they run out of cash, but that’s usually the final symptom. The root causes are weaker structure: no market fit, poor pricing, bad timing, the wrong hires and a strategy the culture can’t execute.

What is the number one reason small businesses fail?

Running out of money is the most common reason given. In CB Insights’ review of startup shutdowns, 70% ran out of capital, though poor product-market fit, bad timing and weak unit economics usually caused the cash to dry up.

What percentage of businesses fail within 10 years?

About two-thirds. SBA Office of Advocacy figures based on Bureau of Labor Statistics data put the average 10-year survival rate for new employer businesses at 33.9%, and roughly half close within five years.

What are the 8 elements of a resilient business?

In Sandeep Chennakeshu’s castle model they are business model, cash generation, strategy, culture, products, sales channels, execution and stakeholder confidence, with stakeholder confidence acting as the roof over the rest.

How do you build a strong company culture?

Engage your team both ways, give everyone clear numbers, assign one owner per deliverable, grow competence, capacity and clarity every year, deal with people who won’t row in the same direction, and reward good work quickly.

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Business Advice

How Event Planners Can Maximize Their Profits This Christmas

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During Christmas, event planners may juggle corporate parties, charity galas, family celebrations, and year-end receptions on overlapping dates. A full calendar, though, doesn’t automatically translate into a profitable season. Extra bookings can also mean higher labor costs, rushed purchases, longer setup hours, and expensive last-minute changes.

To earn a healthy profit, you need to look beyond the total value of your bookings. How much will each event cost to deliver? Which services can you price profitably? How can you serve several clients without exhausting your team or stretching your budget?

Peak-season bookings also place competing demands on your cash, available staff, and supplier relationships. Your pricing, purchasing decisions, staffing, and payment terms all require planning before the busiest weeks arrive.

Calculate Your Profit Before Quoting a Price

Estimate all costs before quoting: venue fees, rentals, decorations, transport, subcontractors, setup and breakdown labor, commissions, and payment fees. Include your time for client meetings, revisions, and supplier coordination.

Allow for unexpected expenses, then add your intended profit. This gives you a minimum price to work from when negotiating. Compare the resulting figure with local market rates and the value of your services before sending the quote.

Be especially careful with requests that sound minor. An extra decorated entrance or a last-minute seating change can require additional materials, staff, and transport. Specify what the agreed fee covers and how you will price additional work. A written change-order process can protect your earnings without creating confusion for clients.

Offer Christmas Packages With Clear Pricing

Some clients need full-service planning; others only want specific services. Create packages for common requests such as corporate Christmas dinners, office parties, and intimate receptions.

Each package should define the planning services, guest capacity, decoration scope, staffing, and event duration included in the price. Offer optional upgrades such as elaborate table settings, additional lighting, or extended coordination hours. Price these additions using their full costs, including the extra time they require.

Packages can also simplify sales conversations. A client with a limited budget can select a basic arrangement without requiring you to discount the entire service. Meanwhile, clients with larger budgets can pay for greater customization. You still need to review each booking for unusual venue conditions or logistical requirements before confirming the final price.

Source Christmas Decorations With Future Events in Mind

Christmas decoration purchases can be expensive, especially for elaborate entrances, tablescapes, and photo areas. Check your existing inventory for pieces you can reuse.

Prioritize versatile colors and materials that suit different themes. Artificial wreaths, garlands, and ornaments can be worthwhile investments when you have secure storage and a practical system for transporting them. Calculate the cost per planned use, including cleaning, replacement, and storage, rather than relying solely on the purchase price.

Once you’ve calculated the cost per use and identified which decorations are worth buying, plan your bulk purchases. Look for suppliers with a wide selection of festive decorations, such as Jamali Garden, so you can source everything you need from one place instead of ordering from several vendors.

But don’t rush to purchase everything you might need for the entire season. Order enough for your next two or three confirmed events. For example, if these events require 120 gold ornaments, you can purchase 10 cases of 12 from Jamali Garden first instead of stocking 24 cases. A month later, review your remaining inventory and place another order based on your upcoming bookings.

Ordering everything in bulk without checking future demand can leave you with unsold supplies and less cash for other expenses.

Schedule Staff and Suppliers to Reduce Extra Costs

As bookings increase, poor scheduling can raise expenses and reduce your expected profit. Assign complex tasks to experienced planners and routine work to trained assistants. Estimate setup and breakdown time from the venue layout and delivery access.

When events occur close together, plan equipment returns and inventory transfers carefully. You only save money by reusing a centerpiece if it reaches the next venue intact and on time. Include travel time, packing, and cleaning in the schedule, especially when crews are moving between locations.

Confirm supplier availability and final delivery arrangements well before each event. Agree on overtime rates, cancellation conditions, and responsibility for damage in writing. If a booking requires extra staff during a peak holiday date, include that expense in the client’s quote.

Require Deposits and Track Expenses During Planning

Profitable bookings can still create cash shortages when supplier bills arrive before clients pay. Use a written payment schedule that secures a deposit before committing funds to rentals, decorations, or contractors. Specify balance due dates, cancellation rules, and change fees.

Review the money coming in and going out each week. Keep separate records of projected and final costs for every event. Regular budget checks during planning can help you spot overruns early. If a supplier’s revised quote exceeds your estimate, address the difference before approving the expense.

Follow Up With Clients to Win Future Bookings

Thank clients, seek feedback, and request permission to photograph their venues. Use the photos in future proposals.

Satisfied clients may refer you to others or hire you for annual corporate celebrations and events outside the Christmas season. Keep a record of their preferences and any useful feedback. When you contact them about next year’s celebration, you can offer a tailored proposal without repeating the entire discovery process.

Conclusion

A successful Christmas season should leave your event planning business with profit, dependable client relationships, and resources you can use again. That requires careful pricing, useful service packages, disciplined purchasing, and realistic schedules.

Before accepting another booking, estimate its complete cost and the time your team will need. Review deposits and supplier commitments before spending. After each event, compare the final expenses with your original estimate and record any lessons for the next project.

A full calendar may be rewarding, but the stronger measure of success is what remains after every bill has been paid. Keep track of what you earned on each project, not simply what the client agreed to pay. Plan for that outcome from your first Christmas proposal through your final event of the season.

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Business Advice

How to Choose Reception Seating for Your Office in the UAE

Choose the right reception seating for your UAE office with practical advice on sofas, lounge chairs, layout, comfort, upholstery and everyday maintenance.

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Your reception area is often the first part of your office a visitor experiences. Before a meeting begins, the seating, layout and overall condition of the space help shape their impression of your business.

But reception seating needs to do more than look good. It should accommodate your visitors comfortably, fit the available space and remain practical through daily use.

Choosing the right office lounge seating starts with understanding how your reception works. Here is what to consider before placing an order.

1. Start with Your Visitors and Waiting Times

Before choosing a chair or sofa, look at who uses your reception and how frequently they arrive.

An office receiving individual visitors throughout the day has different seating needs from a business hosting groups for scheduled meetings. Count the people who typically wait at the same time, including busy periods when appointments overlap.

Waiting time matters too. Someone staying for a few minutes may need a straightforward, supportive seat. Visitors waiting longer will appreciate comfortable back support and somewhere convenient to place a drink or bag.

Ask your reception team what happens on a normal day. Their observations can reveal whether you need more seats, a different arrangement or simply better use of the existing space.

2. Measure the Space Before Choosing Seating

A sofa can look perfectly proportioned online and still overwhelm your reception once it arrives. Measure the usable floor area before comparing products.

Include the reception desk, door openings, structural columns and routes leading towards meeting rooms. Check where visitors stand during check-in and whether seated guests would obstruct that area.

Use the actual width and depth of each furniture piece when planning. Then allow room for people to approach a seat, sit down and move past others comfortably.

Consider visitors using mobility aids, as well as those carrying briefcases or luggage. An accessible seating arrangement should let people remain together without blocking circulation.

Marking furniture footprints on the floor with removable tape can help you assess the layout before committing to an order.

3. Should You Choose Individual Chairs or Sofas?

The best arrangement depends on your visitors and the shape of your reception. Individual chairs, sofas and combinations of both each serve different purposes.

Individual lounge chairs

Separate chairs give visitors a clearly defined seat. They can work particularly well when guests arrive independently and may prefer some personal space.

They also offer flexibility when arranging seating around corners or alongside a wall. However, several generously sized chairs may occupy more space than expected, so compare their full dimensions.

The Solace Lounge Chair is one example from our collection, with fabric upholstery and a rotating seat at a fixed height. Consider how that movement would work within your proposed arrangement.

Two-seater sofas

A two-seater sofa provides shared seating and can suit visitors arriving together. It can also help create a coordinated waiting area when paired with an individual chair.

Our Zen Two Seater Sofa offers an option with PU upholstery. Check its dimensions against your floor plan before deciding where it should sit.

A mixed arrangement

For receptions serving different visitor groups, combining a sofa with individual chairs gives guests a choice. Keep the arrangement balanced and ensure every seat remains easy to reach.

4. Check Comfort Beyond the First Impression

A seat that looks inviting may feel very different once someone sits in it. Where possible, test reception furniture before buying.

Start with seat height and depth. Visitors should be able to sit comfortably without feeling perched on the edge or sinking too far into the cushions.

Check back support, cushion firmness and the position of any armrests. Think about how easily someone can sit down and stand up, particularly if your office welcomes older visitors or people with limited mobility.

Reception seating serves people of different heights and preferences. A mix of suitable seating options can be more useful than choosing every piece purely for a matching appearance.

5. Choose Upholstery and Colours for Everyday Use

Reception furniture experiences repeated use, so ask about maintenance before selecting a finish.

Fabric can introduce texture and colour to the space. PU upholstery offers a different appearance and surface feel. For either option, confirm the recommended cleaning method and which products should be avoided.

Do not assume that every fabric resists stains or that every smooth surface tolerates the same cleaning chemicals. Request information for the specific upholstery you are considering.

Review physical samples under your reception lighting where possible. Colours can appear different on a screen.

Choose finishes that work with the flooring, reception desk and surrounding walls. A neutral base with a considered accent colour can connect the seating to your brand without making the room feel visually crowded.

6. Complete the Layout Without Overcrowding It

Once the seating is selected, consider what visitors need within reach.

Well-positioned side tables give guests somewhere to place a drink or phone. In a smaller reception, they may fit more comfortably beside seating than a large table placed in the centre.

Check that table edges do not obstruct the approach to a chair. Leave practical space for bags without turning walkways into storage areas.

Avoid filling every gap with furniture or decoration. A reception should feel organised, with a clear route from the entrance to the desk and onward into the office.

7. A Quick Checklist Before You Order

Before confirming your order, review the complete arrangement rather than each item separately.

Check:

  • Furniture dimensions against your measured floor plan.
  • Seating capacity during your busiest visitor periods.
  • Upholstery, colour and cleaning requirements.
  • Doorways, lifts and other delivery access points.
  • Availability, delivery timing and installation arrangements.
  • Warranty terms and support after purchase.

Confirm any custom finish choices in writing so the final order matches your expectations. Keep a copy of the agreed layout and specifications for reference when the furniture arrives.

At Urban 411 office furniture, our lounge collection includes seating options for different reception layouts. Once you have your measurements and visitor requirements, request a quote to discuss suitable furniture for your space.

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