The new year brings talk of change and resolve to do something. Normally, for business owners this means discussion of numbers and goals for growth, which is great, but why not resolve to do something different? Why not resolve to become prepared in 2018?
By become prepared, we mean become prepared for the worst and, unfortunately, the inevitable. This is because of the economic cycle, also known as the business cycle. The economy, just like a small business, has a stage of expansion, a peak, contraction, and trough. The key is to be prepared for the contraction and trough.
Economic cycles can differ in range greatly as well, making it difficult to know when a downswing is coming. Some cycles only last 18 months, while other last up to 10 years before a collapse. So, how do you prepare your business for the inevitable cycle? Through innovation.
One of the most important traits of a successful business owner is being able to adjust to change and finding ways to power through them, even if the economy is tanking. Denise Cagan, president of DCA Virtual Business Support, was able to do this with her prior business during the recession caused largely by the housing collapse in 2008.
Borrowing some ideas from her colleague, Becca Bazzle from Essential Therapy, LLC, Denise created a plan to maintain business. She used her knowledge of the market with DiCi Services, a cleaning company, and began to offer discounts for customers while the economy was down. To make the deals seem great Denise added a sense of urgency to the offer by advertising and making each deal available for a limited time.
Doing this, Denise’s company also suffered a 20% loss in business during this time, instead of the 50% loss many others in the same industry were experiencing. But she had a plan for when the economy wasn’t doing well. She knew what she would do. In 2011, Denise successfully sold her cleaning company, largely by being able to retain the value and show consistent sales through the recession.
So, what can you do to prepare for another lull in the economy?
Get to Know Your Customer Base
One of the best things you can do to prepare for a slow down in the economy is to create a relationship with your client or customer base. One of the best, and easiest, ways to do this is through social media. When used as a two-way tool, social media can provide a platform to maintain regular contact with your clients.
Creating profiles and interacting with your clients on a regular basis will help them remember you when the need for your services arise. Also, social media provides a great opportunity to spread brand awareness and get the word out about your business, even when the economy is healthy.
Another great way to get to know your client base and keep in touch is through email newsletters. You can send out newsletters weekly, bi-weekly, monthly, and even daily, depending on your specific need.
Offer Occasional Deals and Discounts
Every once in a while, offer a deal or discount to get new customers in the door. No matter how many loyal customers you have, you can always benefit from new business. Even if they don’t return, they may tell others about what your company has to offer and send business your way in the future. Offering deals and discounts is a good way to reward your regulars too.
Use your social media accounts and newsletter to communicate with your clients that you are offering a deal. You may even want to offer additional incentive for them if they bring a friend.
Create a Rewards or Loyalty Program
Speaking of rewarding your regulars, you may want to consider creating a loyalty program of some sort for customers. If your business doesn’t allow for points, per se, consider showing your appreciation to loyal customers in some way.
This could be card, a gift, or freebie occasionally to acknowledge your customer base and display your appreciation. Many companies send out cards to new clients and appreciation notes to loyal customers. It can also be something as simple as complimentary refreshments in the member lounge or a gift card to your favorite coffee shop. Through regular communications, you can also send your loyal clients and customers special deals and offers as well as personalized messages from you.
Lastly, if you want to recession-proof your business, we strongly suggest a solid business coach, consultative accountant or fractional CFO, and business attorney to be part of your professional team. We’d be happy to refer you to someone. We can also help you with many of the above mentioned strategies plus more!. Call 704-910-2736 x3 for more information about our services.