When there are declines in customer confidence or sales, then it can have an impact on all industries. After all, businesses need customers, in whatever form they come, in order to do well. But larger businesses can often get by when the economy isn’t doing as great. They have money behind them and the name that customers know; it can hit small business owners much harder. So with that in mind, is it possible to launch a business when the economy is bad, or even look for ways to ‘recession-proof’ your business? Here are some practices that might be able to help you.
Cash Flow
Having cash and a cash flow is the lifeblood of your business. And in order to keep your business alive and well, then you need to have a cash flow that will keep going. If times get tough for your business, things will always be better for your business if there is cash flowing. So look for some ways to improve the cash flow. You could look to reduce your expenses for starters, as well as keeping things going as much as you can.
Keep an Eye on the Market
When the economy is a little unstable, as it has been in recent years, then it can help you and your business if you are keeping an eye on things in your industry. You can look for patterns in the economy, as well as what is going on with your competitors. You could look at the stock market for trends and seeing how well things are going, as well as using a trading tool like CMC Markets if you wanted to get into it yourself. You could even look into CFD trading (contract for difference) enables you to speculate on the rising or falling prices of fast-moving global financial markets, such as forex, indices, commodities, shares and treasuries.
Inventory Management
In order to keep control of your costs, the looking at reducing your inventory costs can be a good thing. You won’t want to reduce the quality of things or make any sacrifices there, but are there some errors in your processes at the moment? Are there always things that you order too much of? Can you look into new suppliers that offer the same quality but for a better price? Could you even consider using drop shipping methods to reduce space and costs for storage too? All different things to be thinking about.
Appreciate Clients and Customers
If you already have customers that are loyal to you, then it make a big difference to keep them shopping with you or returning back to you. It is easier and more cost-effective to keep customers that you already have, rather than get new ones. So look for ways to keep them coming back time and time again. Offering discounts or exclusive offers can help, as well as looking into things like subscriptions, depending on the kind of business model that you have.
Keep Personal Credit Looking Good
When times are little tough, then it can make it tough times for everyone. So it can have an impact on you personally, as well as the business. And if money is tight in the business, then small business loans are some of the first things to cease. Which is where you might need to borrow personally for something. So keep tabs on your personal credit score when you are the owner of a small business; it can make a big difference.
Competitor’s Customers
If you want things to go well under tough economic pressure, then you need to keep a customer base. As has been said, you are likely to have a ‘tribe’ that are loyal to you and your business and will carry on supporting you. But if you want to carry on doing well and not just surviving, then it is a good idea to expand your customer base. Can you offer something different or unique to your customer base, and entice some of your competitor’s customers while you are there?
Focusing on your core work and core competencies can be a good idea too. If one of your core competencies is your customer service level, then you need to make sure that you’re doing a good job with it. That can take your business above and beyond competitors, especially at a time when everyone is struggling.
While there are no things that are one-hundred percent going to guarantee anything, there are things that will help your business to thrive under a crumbling economy, rather than just survive.