BIZ Online NGLCC

Despite the bleak news about the economy and the continuing credit crunch, small business owners have some built-in advantages for surviving—and thriving—during troubling times like these.

Unlike corporate giants, they have flexibility on their side, allowing them to respond more quickly to customers' needs and even to try taking their businesses in new directions.

Small businesses also are uniquely poised to adjust their budgets to offset a downturn in sales. A nimble small business owner can reduce costs overnight, trimming office supplies, water delivery services, travel expenses and trash pick-ups.

And many LGBT businesses can rely on loyalty within their general community and with their LGBT customers to offset any drops in sales that might come from wary consumers looking to cut back.

"What distinguishes successful LGBT businesses is their connection to their communities," says Justin Nelson, co-founder and president of the National Gay & Lesbian Chamber of Commerce. "They have strong ties to their customers, and they are participants in the success of their communities. The loyalty they engender through their support of community events and causes can come back to them in tough economic times."

While keeping a close eye on the budget and taking advantage of customer loyalty will help maintain business, it won't necessarily create new business. That's where the confident entrepreneur needs to stay the course and bravely make even greater investments in marketing and advertising to stand out from the crowd, experts say.

"The tendency is to want to cut back on all your spending to reduce your overall budget," says Kimberlee Williams, principal and marketing director of FEMWORKS, LLC, a Newark, New Jersey marketing firm that specializes in outreach to the African-American LGBT community. "But what you need to do is invest more money into marketing at these points. Customers still need your services and products, and this might be the time where you can stand above the crowd because your competitors are cutting back their marketing dollars."

Some other suggestions for surviving an economic downturn include:

• Evaluating workforce needs and adjusting accordingly, hiring temporary staff or interns to fill the gap or instituting a hiring freeze;
• Offering overtime benefits to hourly employees to stave off hiring a full-time employee;
• Talking to your bank about extending a line of credit;
• Staying in touch with customers and letting them know the value of their business;
• Asking vendors and suppliers for concessions on the length of payment periods and interest rates;
• Being more aggressive when collecting money owed the company, including offering clients the choice of charging their payments; and
• Identifying core markets and targeting marketing efforts to them.

Finally, a more personal approach to boosting business may be increasing networking efforts. Alliances with other LGBT business owners can lead to financial opportunities. By taking advantage of weekly breakfast meetings, receptions or cocktail parties hosted by the local LGBT chamber, entrepreneurs can make connections that translate into business and profits.

"As chamber professionals, we need to be out talking to people about the choices they're making," says Minnesota's Sam McClure, executive director of Quorum: The Twin Cities GLBTA Chamber of Commerce. "We have to ask ourselves: 'Does all of this move us forward?' Supporting this or that LGBT business should be part of the larger effort to move us all forward. It's the whole rising-tide concept.

"If we let any of our LGBT business owners fail when we could have helped them, then we're doing a disservice to them and our entire community. They're creating jobs and the energy that fuels philanthropy. I think we should be out there reminding everyone that it makes a difference where you buy your coffee or your gas or your office equipment."