How To Make Your Business Recession Proof
With the recent outbreak of COVID-19 around the world, many people are predicting that an economic downturn will soon follow.
The idea of a recession is certainly a scary thought for everyone. If you’re a business owner, you may be feeling extra anxious about the effects of recession on business.
You may be feeling that your livelihood and your employees’ livelihoods are at risk.
The stress of worrying that your business will do poorly through a recession is certainly a big burden to carry.
Thankfully, you can turn that worry into work and begin preparing your business for the next recession.
Whether it is caused by COVID-19, or it doesn’t come for another 15 years you can use these uncertain times to make your business stronger!
Today, Infinity Staffing wants to give you some key tips on how to prepare your business for a recession.
1. Have A Plan
All businesses should have a business plan.
Your plan should address things such as the company’s description and goals, financial plans, products and services, and marketing strategies.
There should also be preventative measures and emergency plans in place for times of recession. These plans may include costs that you could cut during a lean period, or ways to make emergency cash.
Being well organized and having certain procedures to follow in the case of a financial downturn is an important first step in ensuring your business is secure.
2. Prepare Financially
“If you already have an updated financial plan, it’s time to start building a cash reserve. This may be the most important step you take.
Start saving money in a bank account. Consider building enough reserve cash to cover at least six months’ worth of business expenses.
This will help you to sustain your company, and the longer you can sustain your company through the recession, the more likely you are to survive in the long-term, through good times and bad.”
If you have not already begun preparing financially for possible recessions that could come in the future, it’s better late than never.
If you can work to get financially sound there will be a lot less stress once hard times come along.
3. Keep Up Your Good Credit
This is not the time to let your credit fall. It may be tempting as things get harder near or during a recession to use your credit card more often, or to miss a few bills here or there.
However, that is the last thing you should do.
In hard times, getting financing you need will be next to impossible if you don’t keep your credit score intact.
If your credit is already not doing too well, begin to work on increasing it. Catching up on bills and even slightly increasing the payments you make on your debt can go a long way.
At some point during a financial downturn, you may need to take out a loan to keep the business running. To do this you will need a good credit score, so be careful and keep your credit score high.
4. Build Strong Customer Relations
Be sure to determine who your most loyal customers are and invest in them. They will likely be the ones who stay by your side and support you during a recession.
“Business owners will often overlook this as they look for more customers, but don’t underestimate your relationship currency with clients who already know, like, and trust you and your business.
It’s much easier to get a repeat client, through good service and delivering on your promises. It’s also considerably cheaper than getting new clients through ads or other means.
An added benefit: happy clients act as ambassadors for your business and share their experience with other potential customers, in turn helping you to draw in new sales for a much lower cost.”
5. Be The Best At What You Do
A good business owner will always aim for their business to excel.
But if you’ve been complacent or discouraged with the stresses of running your business, it can be easy to let your standards gradually slip.
The threat of a recession is an ideal time to evaluate your business and make sure the quality of your services are at an all time high.
During times of financial troubles in the economy, this is especially important. You want customers to see you as the best option.
If you are seen as doing the best job in your given field, then your business is less likely to struggle as much during a recession.
6. Continue Marketing
In times of economic downturn, it may be tempting to cut costs and pull back on your marketing expenses.
But keep in mind that it is important to stay visible to your ideal clients and customers if you want your business running smoothly. Cutting out marketing could be a detrimental mistake.
There may be ways to do your marketing in a more economically friendly manner, and you can certainly look into different plans and pricing.
But above all, be sure to continue to get the news out about your business and it’s services and/or products.
7. Stay Updated On The World
If you are a business owner it is vital that you stay up to date on the news.
Being aware of what is going on around you (especially in the financial realm) is essential for being ready for a possible recession.
Watch the news, check the stock market, and stay current so you will know how to act and what to adjust.
Knowledge is key to being a successful business owner.
8. Be Sure You Have Good Staff
It is vital to be working with the right people, especially when the risk of an economic downturn is around the corner.
Having quality staff members who know what they are doing can make all the difference to whether your business thrives or not.
If you need help finding solid staff members, a staffing agency has the resources and tools to help you find amazing employees.