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With alarm bells ringing more incessantly about the coming recession, what should businesses be doing to prepare? Key Takeaways

World leaders, economists and investment banking bosses are becoming more certain that a recession will occur

Interest rates are rising, and research shows customers are already changing their behaviours as inflation eats into their buying power

Ways to recession-proof your sales

Leaders of the World Bank and the International Monetary Fund have warned of a growing risk of an economic slowdown next year as central banks around the world fight stubbornly high inflation – highlighting the uphill battle policymakers are facing to fight spiking prices without plunging the world into a recession.

The head of Goldman Sachs, David Solomon, believes a prolonged recession is approaching, and forecast the likelihood of one occurring next year at 35% when he spoke at the recent Future Investment Initiative summit in Saudi Arabia. Bloomberg analysts put the possibility at 100%.

JP Morgan CEO Jamie Dimon said the world would know in six months if recession fears materialise, however, the bigger concern for him was geopolitical headwinds.

“The most important thing is the geopolitics around Russia and Ukraine, America and China, relationships of the western world,” Mr Dimon told delegates during a panel discussion at the summit. “That to me would be far more concerning than whether there’s a mild or slightly severe recession.”

Australia’s inflation rate accelerated in the September quarter as energy prices soared, heaping pressure on households and businesses and the Reserve Bank of Australia on November 1 raised the cash rate another 25 basis points to 2.85%, its seventh straight increase since May, which could potentially push some mortgage borrowers to their “stress test” limits.

Workers in Australia are looking for new jobs, asking for extra shifts, and switching to cheaper brands as everyday expenses eat up a bigger chunk of their paychecks according to research from Qualtrics.  

“As budgets tighten, people across Australia are searching for ways to meet the rising cost of living, from finding ways to increase their salary through to spending less on discretionary items and switching to cheaper brands,” says Crissa Sumner, Employee Experience Solutions Strategist for Australia and New Zealand, at Qualtrics.

“If businesses fail to recognise and respond to these changing behaviours they risk customer churn and unexpected employee departures – two things no organisation wants in the current environment,” Sumner says.

“With inflationary challenges set to continue through 2023, organisations that can confidently identify and meaningfully respond to changing customer and employee behaviours will be well placed to navigate the months ahead.”

Periods of challenge and uncertainty, and recessions in particular, can act as a catalyst and prompt businesses to focus on issues that they might have been ignoring, says Jack Delosa, founder of business coaching provider The Entourage.

“The next 12 to 24 months are certainly going to be a challenging time for business owners, many of whom will have been caught off guard because they are still recovering from the pandemic and multiple lockdowns,” Delosa says.

“As a result, many wouldn’t have taken the necessary preventative steps to mitigate the risk of a declining economy. For the business owners who haven’t implemented any strategies to bulletproof their business against a recession, now is the time to start taking action.”

Navigating uncertainty, particularly economic uncertainty, is a core capability that every business owner will be forced to face at some point, says Delosa.

Delosa suggests that business owners look at a few strategies:

Adopt a focus on revenue-generating activities

Develop an empathy map for where your customers are

Have a plan, but be flexible

Abbie White, founder of Sales Redefined, notes a Gartner poll of 74 sales and business leaders that found that 54% said meeting quotas or customer retention worried them the most about an economic downturn.

“Upskilling your sales team should be a top priority right now,” says White. “Focus hard on lead generation and proactive prospecting to build a buffer.”

White suggests taking the number of prospects you currently need to hit your quota and doubling it and says focus on prospects with the highest potential.

The fluctuating prices that businesses are being hit with, in particular fuel and energy price increases, are making planning very difficult, says Alexi Boyd, CEO of the Council of Small Business Organisations Australia (COSBOA).

“It used to be seasonality that was the biggest driver and that was understood, but Covid threw that all out. Now businesses are expected to have the time to adjust and pivot, but the constant changes are making it very difficult to manage.”

Boyd says that for service providers needing products to keep operations going, they are faced with higher freight costs and supply chain issues continue to be of concern for many.

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The No. 1 Reason Most Entrepreneurs Start Businesses

Key Takeaway

Before you apply for business loans, you’ll need a detailed business plan that shows how you’ll generate income.

Choosing a business structure

Whether you work at home or in an office, your business needs a formal legal structure. A small home business can become a sole proprietorship in a few simple steps with little paperwork. Be aware that this structure intertwines your personal and business finances, meaning issues on one side could affect the other.

Another option is to incorporate as an entirely separate business entity. This way, you can file taxes, own property and handle lawsuits without affecting your finances. To incorporate your business, you’ll file articles of incorporation that establish your business’s legal status.

Creating a marketing strategy

For your business to be successful, people need to know it exists. A marketing strategy can help you identify potential customers, connect with them, and turn them into returning customers. Outreach campaigns, product promotion and customer engagement are all key components of marketing.

To create an effective marketing plan, know your brand and the audience you want to reach. From there, identify the core problems your business solves and market your company as the solution.

Paying taxes

Forms, deadlines, records – they all make filing small business taxes a hassle. But if you properly handle your business’s documents and payments throughout the year, you can avoid a lot of frustration come April.

You’ll need to track your business’s expenses, store receipts, and create income reports. This information is key to properly filing your taxes and claiming deductions that lessen your tax obligation. You can file your taxes online yourself with software like TurboTax, a popular tool for small business owners. Read our review of TurboTax and other options to find the right software for you.

Did You Know?

The IRS will likely require your business to pay taxes quarterly instead of annually.

Hiring professionals

You might be great at managing your business’s operations, but there are plenty of areas in which you’ll need expert help. That’s why many entrepreneurs hire business professionals to oversee or handle certain aspects of their startups.

If your expense report or list of write-offs is getting lengthy, consider hiring a CPA to handle your taxes. This way, you can have peace of mind during tax season.

Another important professional to hire is a lawyer. A study from the U.S. Chamber Institute for Legal Reform found that small businesses faced tort costs of $182 billion in 2023. If your business is sued or needs to file a lawsuit, an attorney can review the case and help you navigate the legal process.

Hiring employees

As your business grows, you might realize you can’t handle all its operations alone. Hiring employees can streamline your operations so your business can grow and function effectively.

Whether you’re bringing on one member or recruiting a few hundred, create a hiring plan to facilitate a smooth onboarding process. First, identify exactly which positions you need to fill. Then, decide whether you want to use a recruiting agency or simply post a job ad to connect with potential employees.

Successful onboarding process

Although a new entrepreneur wants to be their own boss, usually their startup does need to hire new employees to perform various tasks. One of the challenges for a startup is attracting new employees, as some view joining a startup as risky for their careers. Keep in mind that most startups don’t end up being successful.

The pressure of funds, which can be limited for a startup, are also a challenge. Therefore, it’s not easy for any new business to hire the right people. To combat these challenges, a startup should have a plan for how to onboard new employees effectively and efficiently.

David Mielach contributed to the writing and reporting in this article.

How Can A Customer Support Chatbot Grow Your Businesses Success?

Straightforward or simple chatbots scan the keywords in a client’s query to deliver pre-packaged replies, while more complex chatbots powered by artificial intelligence (AI) and machine learning (ML) may utilize natural language processing to produce answers and discussions which are more complicated. AI chatbots are more elastic when the individual talking to them does not offer the specific message they are programmed to get. Rather, they actively learn from the discussions they must help clients reach their objectives.

AI-powered chatbots are usually better integrated with the CMS and CRM platforms which underpin a brand’s internet presence, letting them tap into client information and deliver personalized experiences.

1. Seamless Live Chat

Clients can participate with a chatbot in substantially the exact same manner that they want in an internet dialog with live customer care workers, so the learning curve for clients to participate with chatbots is almost nonexistent. Since most chatbots utilize natural language processing techniques, they could assess the client’s query and provide a response that satisfies the client’s requirements.

Related: – Grow Your Social Media Marketing efforts using Facebook Messenger Chatbots

2. 24/7 Support

Clients’ needs often arise out of business hours, therefore that they require a means to find answers to key questions occasionally when client support staff members are inaccessible. Chatbots provide customers the chance to receive answers to their queries at any moment, so that they do not need to await a reply out of a voicemail or email address. The top chatbots can also offer you the client the feeling of interacting with a live operator at any time.

3. A Smoother Journey

To lessen the buying process for your client, your chatbot will pop up on almost any item page to provide extra info, video articles or possibly a coupon code. Chatbots may also help clients with the procedure for collecting data, like the item they want to buy, the way they wish to use for buying the product, and how they need it sent. Perhaps even people dreaded shopping cart abandonment rates will eventually fall, also.

Related: – Chatbot Impact in BFSI for Customer Experience and Customer Support

4. Personify Your Business

The flexibility of chatbots enables them the opportunity to interact with clients on several distinct levels. They could act as the client’s primary resource for technical assistance, account management, or sales info. Chatbots may also be programmed with various kinds of conversational styles, from technical and precise to friendly and useful to snarky and funny. The numerous kinds of”styles” accessible with chatbots will keep clients returning and re-engaging together with the brand.

Related: – Chatbot – the Latest Trend that’s taking the Industry by Storm!

5. Cut Down on Operational Costs

Customer service costs can be considerably reduced with the assistance of AI chatbots. In accordance with Chatbots Magazine, executing virtual brokers or chatbots will help companies to save as much as 30%. Chatbots provide support and resolve insistent client questions, freeing up service representatives to handle more complicated inquiries and provide better support to the clients. Thus, chatbots help increase productivity for brokers. Hiring brokers with 24/7/365 existence and adding the tools required to provide support to the clients around the clock, can prove just too costly for all businesses.

Strategic Planning For Digital Marketing

Should you just live “in-the-moment” or should you plan ahead using different planning horizons?

At Smart Insights we believe that businesses with a more strategic planning approach to their marketing and digital marketing are more likely to succeed in the long-term, despite the fact that many businesses don’t have a long-term digital or marketing plan. We’re not saying that those with a more ad hoc approach aren’t capable of doing great marketing that can get results, they certainly are. Rather, we’re saying that we’ve seen that they may miss out on core “always-on” digital marketing techniques that need to be prioritised and resourced over ongoing campaign activities which become all consuming and still often get the lion’s share of attention.

In our research into how businesses manage online marketing, we were interested to see how marketers plan. We saw that short-term non-strategic planning was most common among businesses who answered.

The standout figure is that over 50% don’t plan beyond quarterly or campaign plans or even less.

Planning horizons for strategic marketing planning

Traditionally, strategic marketing planning in many larger businesses has been longer-term, meaning annual or longer. In an ideal world strategic digital plans should align with these. For example, this case study on the strategic planning used by multichannel retailer Dunelm shows long-term alignment for of digital marketing plans with strategic plans. Sajjad Bhojani, Head of Multi Channel Marketing and Development explained:

“The business has an ongoing three year plan, which is revised every 18 months or so. For introducing new features to the site and improving our digital marketing we have an 18 month roadmap for development of new features and are currently adopting a new agile model for faster delivery”.

The benefits of longer-term planning for digital marketing

Longer-term planning enables consistent strategies and resource allocation to be followed in line with company product launches and campaigns and anticipated changes in the marketplace. In digital marketing we recommend a similar strategic approach. Although digital media change rapidly, the long-term transformation needed for effective digital marketing means that you won’t be able to transform the organisation in 3, 6 or even 12 months as shown by the Dunelm 18 month roadmap example.

We think that to summarise and manage digital effectively, a cascading hierarchy of plans works best as Dan explains in his post:

So how may you be missing out? You’re likely directionless if you don’t have a long-term roadmap, so we recommend using a range of plans and checklists that suit your business. You may also miss out on strategic initiatives which require separate investment from campaigns and require their own business case. These may include these types of initiatives from across the RACE planning customer lifecycle:

Reach: An increase in budget for “always-on” through SEO or Google AdWords visibility

Act: A strategic approach to content marketing developing high quality shareable content assets you plan through the year.

Convert: An investment in a Conversion Rate optimisation project addressing different parts of the user experiences

Engage: A Marketing Automation or CRM project to send more relevant event-triggered emails across different points in the customer lifecycle.

Advice on creating more strategic digital plans

Since we hope to help marketers plan better by going beyond day-to-day digital marketing issues, we have created a lot of posts and hub pages like this one on marketing planning which collect our free planning articles together, so that anyone accessing the site can use them to review different approaches to planning.

For Expert members, we also have our Strategic toolkit which bundles a range of blank and example planning templates in Excel, Word and Powerpoint in one place. You can use these for different planning horizons such as annual, 90 day, longer-term roadmaps or editorial calendars.

Top 3 Businesses You Can Start With Little Or No Money

It doesn’t seem like that long ago when The Lean Startup by Eric Ries took the world by storm. The book gave average people like me hope.

It showed me and people across the world that is was possible to start a business, regardless of circumstance.

It has been nearly a decade because The Lean Startup premiered, but the expectation it the lessons that it taught still live on now.

Thousands of individuals ask this question each day: what’s the ideal company to begin with very little cash?

I wanted to discuss what I think should be the top 3 choices if you’re trying to begin a business but have very little capital to back this up.

Here are the 3 greatest companies to begin with hardly any cash.

Note: All of the below are service-based companies. These generally have the lowest overhead, which makes them ideal candidates for individuals with minimal startup funds. Each one of these companies will probably ask that you challenge yourself and learn new abilities. It is hard, but not hopeless.

1. Tax, accounting and/or bookkeeping services  require little capital

I am certain that you have noticed this one a hundred times. There’s a reason: not only does it possess reduced overhead as stated previously, in addition, it includes higher-than-average profit margins along with a huge client base.

2. Web design, graphic design and/or Search Engine Optimization

This is just another company which has a massive customer base and decent profit margins. It’ll require some instruction, but you will find a high number of classes on sites like Udemy, as well as free tutorials on YouTube.

Also read: Top 10 Programming Languages for Kids to learn

3. Social media management and growth services

Firms have recognized the value of getting quality social networking accounts across the plank. If you can learn how to make excellent content, then develop social accounts and push visitors with these balances, you readily have a six-figure company in your hands.

Expert tip  –  begin by focusing and studying about one social networking platform. As soon as you’ve got a system set up that works, begin providing the support.

This permits you to begin attracting clients and earning when you’re learning. This is just another entrepreneurial ability that’ll set you up for long-term success.

These 3 opions offer a combination of low overhead, high customer bases, higher profit margins and precious entrepreneurial abilities. They could flourish with very little startup funds, and ought to be on peak of each entrepreneur’s list.

Whenever you’ve got an idea or fire to get a company — but little cash — ask yourself these questions before committing.

5.    Does this venture provide a skill that will benefit me long-term as an entrepreneur?

If you are able to answer these questions in the affirmative, you have a viable business idea — you could get off the floor with minimal startup funds.

Essential Photoshop Preferences For Beginners

Learn how to improve Photoshop’s performance, customize the interface, save backups of your work, and more with the important options you need to know about in the Photoshop Preferences! Covers both Photoshop CC and CS6.

Written by Steve Patterson.

In this tutorial, we’ll look at some essential Preferences in Photoshop that every beginner should know about. The Preferences are where we find all sorts of options that control Photoshop’s appearance, behavior and performance. There are more options in the Photoshop Preferences than we could possibly cover in one tutorial, but that’s okay because most of the default settings are fine. Here, we’re just going to look the options that are worthy of your attention right when you first start learning Photoshop. Some of the options allow you to customize Photoshop’s interface. Others will speed up your workflow. And some help to keep Photoshop and your computer running smoothly. There are other important Preferences as well, but we’ll save them for future lessons when it makes more sense to talk about them.

I’ll be using Photoshop CC but this tutorial is also compatible with Photoshop CS6. All but one of the Preferences we’ll look at are available in both versions. As we’ll learn, Photoshop’s Preferences are divided into categories. In some cases, an option will be located in a different category depending on which version of Photoshop you’re using. I’ll point out these differences as we go along.

This is lesson 7 of 8 in Chapter 1 – Getting Started with Photoshop.

Let’s get started!

How To Access The Photoshop Preferences

As I mentioned, Photoshop’s Preferences are divided into various categories. Let’s start with the General category. To access the Preferences, on a Windows PC, go up to the Edit menu in the Menu Bar along the top of the screen. From there, choose Preferences down near the bottom of the list, and then General. On a Mac (which is what I’m using here), go up to the Photoshop menu in the Menu Bar. Choose Preferences, and then choose General:

The Preferences Dialog Box

This opens the Photoshop Preferences dialog box. The categories we can choose from are listed in the column along the left. Options for the currently-selected category appear in the main area in the center. At the moment, the General category is selected. Note that in Photoshop CC, Adobe added several new categories to the Preferences, like Workspace, Tools and History Log. While the categories themselves are only available in Photoshop CC, most of the options within these new categories can be found in other categories in CS6:

The Preferences dialog box in Photoshop CC.

The General Preferences Export Clipboard

The first option we’ll look at, found in the General preferences, is Export Clipboard. This option can affect the overall performance of your computer. When we copy and paste images or layers in Photoshop, the copied items are placed into Photoshop’s clipboard. The clipboard is the part of your computer’s memory (its RAM) that’s set aside for Photoshop to use. Your computer’s operating system also has its own clipboard (its own section of memory).

When “Export Clipboard” is enabled, any items stored in Photoshop’s clipboard are also exported to your operating system’s clipboard. This allows you to then paste the copied items into a different app, like Adobe Illustrator or InDesign. But Photoshop’s file sizes can be huge. Exporting huge files into your operating system’s memory can cause errors and performance problems.

By default, “Export Clipboard” is enabled (checked). To help keep your computer running smoothly, disable (uncheck) this option. If you do need to move files from Photoshop into another app, it’s better to just save the file in Photoshop. Then, open the saved file in the other program:

Disable “Export Clipboard” to improve performance.

Interface Preferences

Switching from General to the Interface category.

Color Theme

The first option we’ll look at is Color Theme. This option controls the overall color of Photoshop’s interface. In this case, “color” just means different shades of gray. Adobe gives us four different color themes to choose from. Each theme is represented by a swatch. The default color theme is the second swatch from the left:

The Color Theme swatches.

Adobe began using this darker theme in Photoshop CS6. Photoshop CC also uses this darker theme by default. Prior to CS6, the interface was much lighter (photo from Adobe Stock):

The default color theme in Photoshop CC (and CS6). Photo credit: Adobe Stock.

Choosing the lightest color theme.

And here we see that Photoshop’s interface is now much lighter. Adobe’s idea behind the darker theme was that it’s less intrusive, allowing us to focus more easily on our images. Personally, I agree, which is why I stick with the default theme. But some people prefer the lighter interface. Choose the theme you’re most comfortable with. You can change Photoshop’s color theme in the Preferences at any time:

The lightest of the four interface color themes.

Highlight Color (Photoshop CC)

In Photoshop CC, Adobe added a new Highlight Color option to the Interface preferences. This option is not available in CS6. “Highlight Color” refers to the color Photoshop uses to highlight the currently-selected layer in the Layers panel:

The Highlight Color option in the Interface preferences.

By default, the highlight color is a shade of gray which matches the overall color theme. Here, we see Photoshop’s Layers panel with the Background layer highlighted in the default gray. We’ll be learning all about layers in our Photoshop Layers section:

The Layers panel showing the gray highlight color.

The other highlight color we can choose is blue:

Changing the highlight color to blue.

And now, we see that my Background layer is highlighted in blue. I prefer the default gray because again, it’s less intrusive. Like the color theme, you can change the highlight color, along with any of Photoshop’s Preferences, at any time:

The Layers panel after changing the highlight color to blue.

UI Font Size

Another option worth looking at in the Interface preferences is UI Font Size. This option is available in both CC and CS6. “UI Font Size” controls the size of the text in Photoshop’s interface (“UI” stands for “User Interface”). Adobe sets the default font size to Small:

The UI Font Size option.

If you have trouble reading small print, you can increase the size. To make the text bigger, choose either Medium or Large. There’s also a Tiny option if you hate your eyes and want them to suffer. Personally, I set “UI Font Size” to Large to help minimize eye strain during long hours at the computer:

Changing the UI Font Size from Small to Large.

You’ll need to close and restart Photoshop for the change to take effect. For comparison, let’s look again at my Layers panel. On the left, we see the Layers panel using the default text size (Small). On the right is the same panel after changing the size to Large (and restarting Photoshop):

The default UI font size (left) and the Large size (right).

Tools Preferences (Photoshop CC)

Switching from Interface to the Tools category (in Photoshop CC).

Show Tool Tips

The first option to look at in the Tools preferences is Show Tool Tips (in CS6, “Show Tool Tips” is found in the Interface category). A “Tool Tip” is a helpful message that pops up when you hover your mouse cursor over a tool or option in Photoshop. Tool Tips offer a short description of what the tool or option is used for:

The “Show Tool Tips” option.

For example, if you hover your mouse cursor over the “Show Tool Tips” option, a Tool Tip will appear in yellow explaining that this option determines whether or not to show Tool Tips:

Tool Tips are great for learning about different options in Photoshop.

And here, we see that when I hover my cursor over a tool icon in Photoshop’s Toolbar, a Tool Tip lets me know which tool I’m selecting:

Tool Tips make it easier to learn the tools in the Toolbar.

Tool Tips are enabled by default. If you’re new to Photoshop, they’re a great way to help you learn. But once you know your way around Photoshop, Tool Tips can start getting in the way. When you feel you no longer need them, simply uncheck “Show Tool Tips” in the Preferences.

Use Shift Key for Tool Switch

Another option in the Tools category in Photoshop CC is Use Shift Key for Tool Switch. In Photoshop CS6, you’ll find it in the General preferences. This option affects how we select Photoshop’s tools when using keyboard shortcuts. By default, “Use Shift Key for Tool Switch” is enabled (checked):

The “Use Shift Key for Tool Switch” option.

Some tools, like the lasso tools, share the same keyboard shortcut.

With “Use Shift Key for Tool Switch” enabled, pressing “L” on your keyboard will select the Lasso Tool. But no matter how many times you press “L”, you will only select the Lasso Tool. To cycle through to the Polygonal or Magnetic Lasso Tool, you need to press and hold your Shift key and press “L”. This is true for any tools in the Toolbar that share the same keyboard shortcut. To save time and avoid needing to press and hold your Shift key, uncheck the “Use Shift Key for Tool Switch” option. With the option turned off, you can cycle through all tools that share the same keyboard shortcut just by pressing the letter itself.

File Handling Preferences

Next, let’s move on to the File Handling preferences. Choose the File Handling category on the left:

Opening the File Handling preferences.

Auto Save

The first option we’ll look at here is Auto Save. Auto Save was first introduced to Photoshop in CS6. This option tells Photoshop to automatically save a backup copy of your work at regular intervals. I can say from experience that Auto Save has saved my you-know-what on several occasions, especially on my aging laptop.

By default, Auto Save is set to back up your work every 10 minutes. That’s usually fine. But depending on how quickly you work, and the reliability of your computer, you may want to shorten the interval from 10 minutes to 5 minutes instead. You can also choose a longer interval if the backups are causing performance issues, but doing so increases the risk of losing your work:

By default, Auto Save will save a backup every 10 minutes.

Recent File List Contains

Another important option in the File Handling preferences is Recent File List Contains. This option determines how many of your previously-opened files Photoshop will keep track of. In Photoshop CC, your recent files appear as thumbnails on the Start screen each time you launch Photoshop. In CS6, you can access your recent files by going up to the File menu in the Menu Bar and choosing Open Recent (this also works in Photoshop CC).

By default, Photoshop will keep track the last 20 files you worked on. You can increase the value all the way to 100. Or, if you don’t want anyone to know what you’ve been working on, set the value to 0 to disable this option:

The “Recent File List Contains” option.

Performance Preferences

Next, let’s look at some settings that have to do with Photoshop’s performance. Choose the Performance category on the left:

Opening the Performance preferences.

Memory Usage

The Memory Usage option in the Performance category controls how much of your computer’s memory is reserved for Photoshop. Photoshop loves memory and will generally run better the more memory it gets. By default, Adobe reserves 70% of your computer’s memory for Photoshop. If Photoshop is struggling when you’re working on large files, try increasing the memory usage value.

You can increase memory usage all the way to 100%. Keep in mind, though, that if you have other apps open as well, they each require memory. Whenever possible, close all other apps when you’re working in Photoshop. If you do need other apps to be open, try not to increase the memory usage value much beyond 90%. Lower it if you run into problems. You’ll need to restart Photoshop for the change to take effect:

The “Memory Usage” option.

History States

Another option that can directly impact Photoshop’s performance is History States. “History States” refers to the number of steps that Photoshop keeps track of as we work. The more steps it remembers, the more steps we can undo to get back to an earlier state. History states are stored in memory, so too many states can slow Photoshop down.

In Photoshop CS6, the default number of history states was 20. Back then, I recommended increasing the value to 30. In Photoshop CC, Adobe has increased the default value all the way to 50. I wouldn’t recommend increasing it much beyond 50 unless you really need that many undo’s. If you run into performance problems, try lowering the value. Again, you’ll need to restart Photoshop for the change to take effect:

The “History States” option.

Scratch Disks Preferences (Photoshop CC)

There’s one more performance option to look at. In Photoshop CC, choose the Scratch Disks category on the left. In Photoshop CS6, stay in the Performance category:

Choosing the “Scratch Disks” category in Photoshop CC.

Scratch Disks

A scratch disk is a section of your computer’s hard drive that Photoshop uses as additional memory if it runs out of system memory. As long as your computer has enough memory, Photoshop won’t need to use the scratch disk. If it does need the scratch disk, it will use whatever hard drive(s) you’ve selected in the Scratch Disks option.

The main hard drive in your computer is known as the Startup disk. This may be the only hard drive you have. If that’s the case, it will be selected by default and there’s really nothing more you need to do. But if you have two or more hard drives, choose a drive that is not your Startup disk. Your operating system uses your Startup disk a lot, so you’ll get better performance from Photoshop by choosing a different drive. Also, if you happen to know the speed of your hard drives, again you’ll get better performance by choosing the fastest drive.

Use SSD’s For Best Performance

Lastly, if one of the hard drives in your computer is an SSD (Solid State Drive), choose the SSD as your scratch disk. SSD’s are much faster than traditional hard drives and can greatly improve performance. Even if your SSD is also your Startup disk, it’s still the best choice. In my case, my Startup disk is an SSD drive so I’ve selected it as my primary scratch disk. I also have a fast secondary drive as a backup scratch disk. However, as I mentioned, Photoshop will only use your scratch disk if it runs out of system memory. If Photoshop is routinely running out of system memory, adding additional memory (RAM) to your computer will give you the best results:

Select the drive(s) you want Photoshop to use if it runs out of system memory.

Closing The Preferences Dialog Box

Where to go next…

And there we have it! While knowing how to customize your Preferences is important, so is knowing how to restore them to their defaults. The most common cause of sudden performance issues with Photoshop is a corrupted Preferences file. In the next lesson in this chapter, we’ll learn how to troubleshoot Photoshop by resetting the Preferences.

Or check out any of the other lessons in this chapter:

For more chapters and for our latest tutorials, visit our Photoshop Basics section!

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