Six Tips for Growing Your Business During a Recession
Every economy is likely to experience a recession every five decades. Some economies deal with it more frequently. In such places, entrepreneurs have condition their businesses to remain growth during economic downturn.
Some experts suggest that recessions can be likened to the common cold. It happens to the healthiest, but nobody knows when it will strike. So, it’s better to take consistent preventative measures to fortify your business to help it thrive during tough times.
In this article, I list six tips that will help you keep a strong foothold, develop and handle your business during a recession.
#1 Trim the Fat
There is a saying: A chain is as strong as its weakest link. Any employee who is not contributing, or rather bringing the company down, needs to go. Optimizing resource allocation applies to all company-wide resources and not just your employees.
One way of cutting costs is to outsource services that will cost significantly lesser in other countries, especially when everyone is working remotely. According to BlueFace, remote working will start competing with working from the office by 2025. There are already trends showing that the majority of the workforce prefer to work from home. This means that entrepreneurs can hire talent from anywhere in the world for a much lower price.
You could also outsource services that you may not need on a consistent basis and focus on your core competencies. Some of the services that can be outsourced include lead generation, customer service, social media marketing, filing and preparation of taxes, accounting, event management, project-based tasks, and creative services.
By outsourcing these services to countries (or automation tools such as Growth Channel) where the cost of managing is less expensive, without sacrifices to quality, you can save a good deal of money that can be allocated to other resources.
#2 Upsell To Your Existing Customers
The keyword is “existing.” Why are your customers still current? The answer is most probably because of their loyalty to your business and the quality of your service.
One strategy that you can implement to upsell is by doing a case study on a customer that is using one of your higher-end services. This case study can serve as an example to other similar customers who may not be using your higher-end services.
By upselling your customer, not only are you generating more cash flow into your business, but also providing a valuable and much needed service.
You may implement various strategies for customer retention to derive more value from your existing customers.
#3 Promote
Businesses usually tend to cut their funding on advertising and marketing during a recession. Companies that succeed during times like these are ones that engage in proactive and tactful marketing such as PPC ads, social media ads, email marketing, text message marketing, and more.
Although it is not wise to overspend on advertising during a recession, it would be wise to advertise nonetheless, because it is possible to negotiate lower pricing on advertising due to reduced demand.
This serves a two-fold advantage: firstly, that you don’t cut, or could even save on, your advertising budget; and secondly, your brand name will be out there while the competition’s under a blanket.
#4 Tweak Your Operations
This needs to be analyzed from two perspectives: employees and customers.
With regard to your customers, you will need to pinpoint and troubleshoot areas where customer satisfaction and delight can be excelled during this time. Find creative means and approaches in your operations to benefit your clients and keep (and hopefully increase) their loyalty to your business. Times like this are ideal to re-strategize customer service, thereby increasing customer loyalty.
One of the largest trends seen in most companies these past months is the shift towards working from home. According to Flexjob, 66% of employees reported higher productivity levels outside the office, and 76% reported having to deal with fewer distractions outside the office. Perhaps, with this trend, consider looking at reorganizing how your teams operate. Having them work from home will not only be cost-effective but extremely productive.
#5 Venture Uncharted Lands
It can be tempting to make a complete 180 degree turn in your business model or add services you are not ready to engage with. Unless it’s absolutely necessary and doable, it’s not recommended. However, do find creative ways to expand what your business already provides. I’ll demonstrate what I mean with an example.
There is a real estate company I know whose focus is on global mobility and expatriate management services. With the inception of the lockdown and expatriates repatriating back home, they found their business hanging on the edge of a cliff. However, they partnered with a local vendor that was in the sanitization business. They began offering this to their existing clients when they began working from the office. Although this didn’t lead to a significant rise in profits, it helped the company stay alive during rough times. In other words, find other related services for your existing customers.
#6 Be a Sponge, Not a Brick
Keep an active mind. There are tons of courses being offered out there on LinkedIn, edX, Coursera, Udemy, and many other platforms.
Now that people have more time on their hands, without the need to commute to and from work, there is more time that can be dedicated to learning.
This will not only increase your value, and that of your employees, but is bound to have a carryover effect on your business.
These are some simple ways to grow your business during a recession. Read the signs of the times as they happen and use better judgment. But more importantly, have a solid plan ready for when a recession strikes.
Now, let’s look at some essential takeaways.
- Your top employees are your golden eggs. Do not be afraid to show them that you are grateful to have them as part of your team.
- Focus on your operations and how you can further enhance them to ensure peak employee productivity and customer satisfaction. If you successfully do this during bad times, it will make you even more trustworthy during the good times.
- Be adventurous and explore new paths on which you can take your business. Remember that Amazon was initially selling just books; and scryroketed its business with a much wider business model.
- Your business is like a small garden, which requires patience and smart decisions. Bad decisions will lead to withered plants. But wise choices, attentive care, and pruning will turn a small garden into a vibrant and beautiful one, despite the unwelcoming weather.
