Recent volatility in the stock market, concern about global instability and other economic challenges are leading some economic observers to believe that the U.S. economy is heading for a recession in 2016. This might sound like bad news, especially when so many business owners have just recently recovered from the Great Recession and years of slow growth that followed it – but with careful planning and smart strategic decisions, you can keep your business growing even during a recession.
According to this article from Harvard Business Review, there are several reasons why a recession doesn’t have to be bad for your business:
Hire New Talent
When the economy is struggling and other companies are holding off on hiring new employees, this can be a great opportunity for your business to hire some talented new people. And your new employees might be willing to work more cheaply for your company than they would at times when the economy is strong.
Refocus Your Value Proposition
Why do people buy from you? What emotional needs does your company, brand, product or service meet in the minds of your customers? Some companies sell products or services that are “nice to have” but are not essential – these businesses are often vulnerable during a recession because customers start to cut back on nonessential spending. However, if your company can offer a “must-have” value proposition – showing your customers why your product or service is crucially important to their lives, their success and well being – you will be more likely to be recession-proof.
Get Inspired to Work Harder
It sounds glum, but it’s true: nothing focuses the mind like a tough economy. If the economy is strong, small business owners tend to get complacent – they might keep offering too many unsuccessful products, or get lazy about customer service or otherwise lose some of the competitive edge that made them successful in the first place. A recession throws all of this complacency out the window. Tough times are an occasion to make your business into a leaner, meaner machine: get rid of unprofitable products, revamp your business operations, cut costs, do things differently and approach each day with a spirit of innovation. You don’t have to do this work out of a place of fear – do it out of love; out of a renewed commitment to making your business the best it can be.
Outlast Your Competitors
It sounds grim, but it’s true: during a recession, the number of small businesses in any industry or category tends to shrink because lots of companies go out of business. This doesn’t have to be bad news if you have a survivor’s mentality and are willing to do what it takes to make your business successful. Follow the latest industry news and follow your competitors on social media – if a competitor is closing, look for ways to pick up where they left off and attract their customers to your business instead. After the dust settles and other competitors are eliminated from the market, once the economy recovers and starts growing again, you might end up being one of the big players in your industry.
Do you think you would be able to keep your business growing during a recession? What are your biggest fears? Share them with us on social media.