MBA1393 Guest Teacher: Jonathan Slain – How to Look Forward to the Next Recession

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Hey O welcome to the Hunter dollar MBA show where your business gets better with every episode. That's why we deliver daily 10 minute business lessons for the real world. I'm your host, your coach, your teacher Omar Zed home. I'm also the co founder of the $100 MBA, a couple of business training and community online and today's episode is a guest teacher episode. Today's guest teacher is Jonathan Slane and he'll be teaching you how to look forward to the next recession. Jonathan Slane is the founder of recession.com amazing URL author, keynote speaker and thought leader. When it comes to preparing your business for the recession, don't fear it, just be prepared. It's just a matter of time for the next recession and recessions come in different forms as Jonathan will explain. But the most important part is being prepared, being ready so you can actually grow in a recession. Jonathan has a lot to cover in today's lesson, so let's get into it. Let's get down to business. Ups and downs in your business, in the economy are inevitable and those who are prepared for it are those who are able to not only survive but strive. We brought on Jonathan Slane to show us exactly how. He shares his own personal story on how to actually thrive in a recession, how to be Prepared how to make sure you're not caught off guard. So I'm going to pass it to Jonathan now to teach you his guest lesson. But I'll be back with with my takeaways and to wrap up today's episode. So for now, take it away, Jonathan.

Buckle up. My name is Jonathan Slane, and today I'll be teaching you how to look forward to the next recession. It's time to rock. My story is that right before the Great Recession in 2008, I partnered with my brother in law to start opening up gyms, fitness businesses, you know, like personal training studios. We opened new locations and we grew very fast. Our studios achieved new franchise records every year. We have the most personal training sessions ever in the history of the franchise. We had the most locations ever in the history of the franchise. We couldn't miss. We grew and we grew and we grew. That is, until we ran into the Great Recession. Looking back, I'm gonna let. I'm gonna let this audience in on a little secret. Nobody wants to pay for personal training in a recession. And worse, I didn't have a plan for what to do when the recession hit. So I spent the first couple months of the recession curled up in the fetal position in the corner of my office. On the other hand, Paul, my business partner and co author who I wrote Rock the Recession with, he had a plan for the recession. He was looking forward to it. He bought a company and he did very specific things to grow it spectacularly. Using the downturn as fuel that led to his American dream exit. Paul had picked the H Vac business because he knew that he could leverage H Vac service in a recession. In contrast, I was in the personal training business because my brother in law happened to be a fitness fanatic. And then I ended up borrowing a quarter of a million dollars from my mother in law in order to help us survive the recession. And the worst part is I didn't even borrow the money all at once. I borrowed it $20,000 at a time. So you do the math. That's 12 phone calls groveling for money. Now, I've paid my mother in law back since and now I'm on a mission to make sure that nobody has to borrow money from their mother in law in order to survive the next downturn. You know, right now the economy is booming, unemployment's at record lows, consumer confidence is at record highs, and almost nobody has a plan for the next recession. And I want you to be honest with yourself. Are you prepared for the next recession? And when I say recession, I don't just mean economic recessions. If you lose your job or your biggest customer, you're in a recession. If your five best employees leave and form a competitor, you're in a recession. If you, if your partner embezzles from you, you my friend, are in a recession. But don't worry, no matter why you're in a downturn, it's possible for you to rock the recession. And that's what we're talking about today. So let me get specific. Let me tell you exactly how to get ready for a recession. If you have a pen, pick it up now and get ready to write this down. Step one. Are you ready? The first step in building your recession plan is to do a credit check on your mother in law. Alright, in all seriousness, the first step in building your recession plan is to assess where you and your company are. So Paul and I developed the recession gearbox model to help business leaders and you see the four gears that Paul used to accomplish his American dream exit from his company. First gear is to assess your situation. Second gear is to tune up your business and personal life to prepare for a recession. Third gear is to race, which means getting your company culture healthy, measuring productivity of your employees, rooting out, profit fade. Fourth gear is to hit the gas and accelerate. This is where you're going to start to capitalize on all the opportunities a recession brings. And finally there's the emergency brake, which is there in case all else fails. You'll have a backup plan to prevent catastrophe. Now I want to take a second pass through this model highlighting tactics that you'll employ in each gear. So for first gear you're going to assess, you always start here. You need to know how the economy works at a basic level. And you need to understand the economic cycle because it always includes a recession. It's like the seasons of the year. Spring, summer, fall, winter. Sometimes winter arrives late, but it always arrives in terms of the economic cycle. Winter is always coming. In first gear, you assess where we are in the economic cycle. This is also the gear that you're in when you use the recession readiness assessment to understand how prepared your company and you are for the next downturn. In this gear, you're benchmarking your preparedness. From there, it's all about evaluating what you learn, understanding how much opportunity you have to use the next recession as leverage for massive growth, and gathering the documents you need to shift into second gear. If you want to follow up on first gear, you can go to recession.com ready. That's our website, and you can take the free recession readiness assessment there takes about five to 10 minutes. Once you're done with first gear assessing, now you're going to tune. This is the gear where you perform stress tests to figure out where your personal and business finances are strong and where they're weak. You tighten up your business and personal affairs in an unemotional way, and then you'll emerge confident for the next year. You'll have conversations with your banker to figure out your line of credit. You want to increase your line of credit now, before we're in a recession, before you need it. Because banks like to loan money when times are good. They don't like to loan money when times are bad. Perhaps my favorite tip of the entire lesson we're doing today is that now today is the perfect time to ask your banker to reduce, lower, or cap your your personal guarantees if you have them on corporate or personal debt. Your banker, they aren't going to do this when times are bad when we're already in a recession. They're going to let you reduce or cap your personal guarantees now when times are good. And sometimes you may have to switch banks to accomplish this goal. But I think the effort of finding a new bank, of switching banks is certainly worthwhile. And it doesn't cost you anything for you to simply ask your bank or for you to shop your bank with other institutions. Banks are so hungry for new business right now that it's entirely possible for you to reduce or cap your personal guarantees. But times are so good that most people just don't think to ask. So please take me up on this huge opportunity if you have a loan with personal guarantees. Okay, once we're through second gear, now we're gonna shift into third gear race. This is the gear where you're going to be improving your business, improving your company's culture, measuring employee performance, measuring labor productivity, measuring your company's workload, your backlog, and how much work that you have in your upcoming pipeline. You're gonna be figuring out how much job fade, if any, that you're experiencing. And by job fade, I just mean the difference between how much you estimated that you would make on a job or a project or a retail item and how much you actually make when it's when the project is completed or when the item is actually sold. The difference there is called profit fade. And trying to figure out how to improve on your profit fade and lower that number is part of what we're doing in racing. This is also the gear where you take your written plan out for a spin by practicing it with your team and with these test drives, you see where adjustments are necessary so that you can achieve peak performance. I want you practicing your recession plan now before we're actually in one so that your team can just execute. When we get into a recession, fourth gear, that's where we're going to accelerate. This is the gear you've been waiting for. The chance to step on the gas and pass other drivers to capitalize on growth opportunities for your business. This is when you're going to acquire talent assets in other companies. So if you've been doing your planning and you have a list of the talent that you want to acquire when we get into a recession, the assets in the companies, then you'll have this before a recession so that when it's announced on CNN and CNBC and Fox News, you can be the first to act. But you need to be in position as soon as you hear we're in a recession to talk to other companies, to call banks to be able to buy those assets for cheap, and to be able to acquire those other companies that weren't smart enough to listen to podcasts like this one so that they would be prepared last, you need an emergency brake when you're driving, the emergency brake can be used to stop in a critical situation. During a recession, the truth is you need to make you may need to make one or more hard stops, and knowing what your dashboard is telling you is critical to knowing if and when you need to rip the emergency brake. No matter what's going on in the economy, you might have to tap the brakes in your company or you might have to go all out and just lock up the emergency brake. So back to my story. If I had had a recession plan for my gyms, I would have slammed on the brakes much sooner and saved a lot of money and heartache. Paul, my co author of Rock the Recession. Paul and his team had an emergency break planned. They just never had to use it. Finally, I want you to imagine that surrounding all the gears in this recession readiness model is a chain or a band called the Economy. And while you're always going to start in our model with first gear assessment, the economy dictates which gear you engage next. Depending where we are in the economic cycle, recession, expansion, recovery or contraction, you're going to engage different gears. The model isn't linear. So right now in 2019 is a time of continued recovery. It's a perfect time for assessing your business and tuning it up second gear. However, if we are already. In a recession like early 2008, you would skip second gear, you would skip the tuning and you'd go right to racing third gear or accelerating fourth gear. You wouldn't have time for tuning up and you might need to yank on your emergency brake. All right, I want to thank you again for listening to me. Jonathan Slane if you want to continue learning about how you can rock the next recession, then go to Amazon, get a copy of my book Rock the Recession or go to www.recession.com yes, that really is my website. And take the free recession readiness assessment and start benchmarking yourself. Thanks again for joining me today and I want you to rock on. Back to you, Omar okay, does this.

Happen to anybody else? You sit down with a juicy QPC, some McNuggets and those golden fries from McDonald's. Then you take a long sip of your Sprite because you can still hear your mama saying don't fill up on that drink before you eat your food. But you're grown now so you do what you want.

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Lesson from Jonathan Slane of Recession.com if you want to learn more about today's topic, check out Jonathan's workbook, the Recession Workbook. You can get 50% off with this special link at recession.comproducts/recession workbook. I want to highlight something that Jonathan mentioned in the episode today. Your business itself has recessions. Losing a key player on your team, losing a big account or client, losing a vendor, something that actually makes your business go. There'll be tough times ahead in your business, and that's just par for the course. One of the things I picked up in being in a technology business is having a list of contingencies. A disaster plan. In a tech business, you have to be prepared for all disasters. What happens if there's a hurricane that blows out your servers? What do you do? What's the plan to make sure the uptime for your customers is minimal? You could do the same for your business, regardless if it's a tech business or not. But what are you going to do if you lose your vendor? What if you lose one of your top clients or some of your top clients? What happens if your best player on your team decides to leave you for another company? Plan for these events have a plan before they happen so that when it does happen, or if it does happen, one of these or something similar, you could just execute the plan and not have to worry and scramble. You'll have a sense of calm because you've already thought this out, you're already experienced, what would it be like? And you have a plan in place to make sure your business doesn't skip a beat, or at least there's minimal delay. There's so much time wasted when there is an issue, when you're not prepared. So take maybe an hour this week and think about what happens if. What happens if? What happens if? What do we do? What can we do? You don't have to have a fleshed out plan completely today in one hour. But just thinking about these things will prepare yourself mentally and start thinking about, hey, what can I do to make sure I have a backup plan that I can move forward? And even when there's hiccups, when there's little roadblocks along the way, when we keep moving forward as a business. Awesome lesson by Jonathan Slane. Thank you so much for listening to the Hundred Dollars NBA Show. If you love it here, hit subscribe right now so you don't miss a beat on whatever you use to listen to podcasts, whether it's Spotify, Stitcher Radio, Apple Podcasts, Overcast, Himalaya, we're on them all. Hit subscribe to make sure when the next episode's available, it's right on your device. Before I go, I want to leave you with this. I know sometimes it's sort of a bummer to think about disaster scenarios. What happens if this happens to my business? But this allows you to remind yourself, hey, this is what business is. It's ups and downs, it's challenges, it's obstacles. If it was easy, everybody would do it. If it was easy, no one would, you know, last that long. They would quit as soon as they would have some troubles or some sort of hardship. Being prepared is half the battle. Thank you so much for listening and I'll check you in tomorrow's episode. I'll see you then. Take care.

Dear McDonald's, your breakfast menu. Fire tens across the board. I could be happy with anything even though I ordered the same thing every time. Thanks for not judging me. I'll try something new next time.

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