Business requires some sort of guidance in order to prosper. This is often known as the 5 -year strategic business plan. This plan is updated annually to reflect changes in philosophy as well as actual outcomes as the business grows, but is often forgotten when the economy gets tough. When plans written in a different economic atmosphere do not continue to guide businesses when economic conditions are poor, it is time to sit down and develop an alternate plan to ensure survival under the most adverse conditions.
Businesses can not only survive a recession, they can often thrive if the mindset reflects an understanding of how market economies change during this time. For instance, this is the time when buyers have the greatest advantage; therefore, businesses need to be able to adapt at an incredible pace. It’s easy to fall into a “wait and see” mentality, however, no one really knows when or even if the economy will recover to the point it was just a couple of years ago so it’s time to create a new plan.
What helps a business survive during a recession is customer loyalty and satisfaction. With this in mind, then, creating a “recession-proof strategic marketing plan” will help any business weather the storm. Here are few things to keep in mind as you find key factors that will help your business survive:
- Refine and redefine. You need to rethink your priorities. Buyers have the power right now and that includes you. If you were thinking of buying new equipment 2 to 3 years down the road and have the cash now, it’s the best time to buy as businesses even you buy from are often willing to negotiate. If your cash-flow right now is low you need to think of ways you can conserve without impacting the elements that keep your business thriving; like customer satisfaction and loyalty. If cash flow is an issue it might be time to consider taking on a partner or joining forces with another business.
- Review. Really sit down and evaluate every aspect of your business and figure out what’s profitable and what’s a “millstone around your neck.” You need to decide if the things that aren’t working can be redeveloped in order to make them generate income. If you have some products or services that lose money, but keep customers coming back then as long as you’re compensated monetarily by the other purchases they do make, keep them. Remember if you have no customers, you have no business.
- Strategize. Whether you are a leader in your market, a follower, or someone who challenges the norms, you need to develop a strategy that will work during economic downturns. If you’re a market leader and you have the capital you can survive by providing the best price. If you’re a follower you can survive by picking only the best products and components that work for other businesses similar to your own. And, if you love to challenge the norms, although you may have the most difficulty adjusting during an economic crisis, you can survive if you’re able to put the capital up to sway consumers to your way of thinking.
- Evaluate. Analyze all aspects of your business from the point of strengths, weaknesses, opportunities, and threats. If you can lure consumers from competitors, that’s an opportunity. Changes in interest rates or the value of the dollar is a threat. If you have leaders in your business that can motivate and challenge others when times get tough, it’s a strength. And, if those in leadership positions fold under the pressure during tough times, it’s a weakness.
- Set Daily Objectives. You need to know daily how your business is doing. This is not just your profit margin, but also payables, receivables, inventory, orders, sales, bids, and the number of calls received from potential clients. The only way to know where you stand and be able to adjust at any given moment is to stay on top of things. It may take a little more work, but will help you adapt quickly in the end.
Out of all the measures of business success, the only one that’s really reliable, regardless of the economy, is customer loyalty, engagement, and satisfaction. The philosophy behind this thinking is simple, the more loyal the customers, the harder it is for the competition to steal them. Not only are customer relations built on logic, but on the depth of emotional connections, as well. This, however, goes beyond how much customers like you. They must also be “engaged” with you. If they stop by for your free coffee and a chat, but buy nothing, they are not engaged. Research shows there is a strong tie between customer engagement and future growth so make the most of what you have and keep your customer base strong as well as engaged.
iSearchDécor is the nation’s premier, free, online referral service for those seeking the perfect match to local home décor hidden gems stores and home service professionals. Exclusive savings are offered to the users of the iSearchDecor website. Visit us for all of your home decor needs at www.isearchdecor.com. Coming soon to Tucson, Dallas and Southern California.