Economies grow and contract; a continuous, never-ending cycle. But even though we know to expect it, it doesn’t make it any less troublesome to deal with when that recession or economic downturn comes around.
The point is that, yes, the current economic times are tough, but they are as much a fact of business life as the booms. The only difference is, that when it’s a trough instead of a peak, it is down to each business owner to ensure that their business isn’t the one that goes bust!
To improve your business resilience generally, here is our best advice. Advice that can even be used during this recession and the next!
Tips to survive the economic downturn
So how do you deal with the downturn? Often, it is about going back to business basics and just being better than the business next to you.
Yes, you need to pay attention to cash and invoicing and collecting, profitability, employee retention, production quality, and indeed all aspects of your business, but in a downturn, the biggest thing you need to focus on is making sales. It seems kind of obvious – if you don’t have cash coming in, then you don’t have a business! But it´s more than that; it´s also about maintaining the clients that you have, and this takes understanding their needs and how to meet them more than you do already. And certainly better than your competitors do!
During the Covid pandemic, the buzzword was pivot – to pivot your business – so you changed from working in the office and face-to-face transactions to online and delivery transactions. The changes that were needed were easier to identify, sure, but it´s still the same during a recession. While these changes may be more nuanced and subtle, they all need to link back to the big issue – making sales.
Here are some questions to get you started:
- What products or services do your customers value the most?
- What is it about your business that your customer’s value – and have you asked them about this recently?
- Review your pricing and product structure – do you need a tiered pricing structure to stay competitive?
- Do you need to add in a loyalty or discount scheme?
- Do you need different or additional products to tap into current needs?
- Review your business from a customer’s perspective – is it a good experience or does it need improving?
Here are some actions you can take to improve your business resilience
- Focus on your strengths – analyse what makes your business unique and concentrate on amplifying these. Not only will it help you deliver a better service to your current clients, but it will also attract new potential clients.
- Prioritise customer service – during a recession, your clients are likely to have their own stresses and worries, which may result in them becoming more price-sensitive and demanding. Prioritise these clients and see how you can meet their needs.
- Improve your marketing strategy – many businesses stop marketing during a recession either to save money or because they think no one is looking to buy. But this isn´t necessarily true! Marketing is crucial to show your target audience the value you can give them and how you are helping similar businesses during difficult times. So look at your efforts – where can you improve?
- Reduce any unnecessary expenses – it´s vital to be mindful of your expenses during a recession, so look for ways to cut costs without compromising quality. For example, look at your essential processses. Where can you automate to cut time and cost while increasing efficiency and effectiveness?
- Diversify your revenue streams – if you’re in a vulnerable industry, try to diversify your revenue streams by offering new products or services that complement your existing ones. This helps mitigate the risk of relying on a single revenue source.
- Be agile and adaptable – stay up to date with the latest trends and shifts in the market, and be prepared to pivot your business quickly if necessary. This can help you to stay ahead of the competition and capitalize on new opportunities.
Need help improving your business resilience?
If you have any queries or need help reviewing your business and implementing impactful changes, speak to us; we can help you get sorted! We can help you build your business resilience, from simply giving advice and guidance to automating your processes and doing it for you.
With our help, you can work smarter, not harder, and build a successful business even during a recession. Get in touch with us today and see how.
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