In today’s economy, most business owners are thinking about survival. However, many successful entrepreneurs will point to previous economic downturns as the launching pad for explosive growth of their business.
In today’s economy, most business owners are thinking about survival. However, many successful entrepreneurs will point to previous economic downturns as the launching pad for explosive growth of their business. Many will point out that because their core business had declined so rapidly, they were forced to look at new markets, new products, new customers or all of the above just to keep their businesses alive.
Marketing and sales When business is tight, there is a tendency to cut business expenses across the board. However, the area that has to be maintained is marketing and sales. The marketing effort has to be tactical, in that it is looking to identify markets and buyers that are in the buying cycle now. If your current marketing efforts are not producing results, change your tactics.
Reach out to your existing and past customer base. Are there opportunities to expand in their market place? Where are their businesses headed and can you expand with them in new markets?
Columbus Woodruff II is founder and owner of Hotcards.com, a rapidly growing full color printing and graphical design business with offices in 12 cities around the country.
“You cannot be local, you have to reach further and grow your business where business is growing. The goal is to have your eggs in a whole bunch of baskets, not just one,” he said
Capital management Capital is the lifeblood of any business. Most businesses fail because they do not have sufficient working capital capacity to reliably pay suppliers, employees and taxes. During a downturn, it is critical to have close control on receivables, inventory, operating expenses and credit lines.
Andrew Jackson is Executive Director of the Commission on Economic Inclusion and leads the Minority Business Accelerator in Cleveland, Ohio. He also owns several successful businesses in the area.
“Too many people think that a recession is the time for their business to take a recess. During a recession, it’s a buyer’s market and people with capital have the best opportunity to grow their asset base,” he said.
Customer satisfaction Mobilizing and motivating your staff and yourself during a recession is difficult, because there tends to be significantly more bad news than good. This can affect morale and customer service. According to Woodruff of Hotcards.com, “First, we use the term customer satisfaction instead of customer service. Our goal is to satisfy our customers, not just service them. During a recession, when people are spending less, they have to be satisfied or they will go to one of our competitors. Our slogan is do unto others as they want to be treated.”
Growing in a downturn Growing a business during a downturn begins with the owner understanding that economic expansions and downturns are a regular part of the business cycle. Marketing and sales, capital management and customer satisfaction are the keys to growing your business during a downturn and establishing a broader business platform for rapid growth during business recovery.
Michael G. Shinn, CFP, Registered Representative and Investment Adviser Representative
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