Generally, an upcoming recession is not good news for any business owner. Most companies buckle down, pull off new projects and look for ways to cut overhead as they anticipate a decline in sales and profits.
By reacting conservatively, business leaders attempt to minimize risks to keep business running and ensure that it doesn't make deep cuts or close doors altogether.
Following the second consecutive quarter of negative growth in the U.S., many business owners and management teams are, understandably, fearful that recession looms. However, history has demonstrated that it's not only possible to survive a recession but also to thrive in it.
If you're wondering how you can help your business navigate through the choppy economic waters, you've come to the right place.
How to go through a recession
Growing a company in a recession may seem like a tall order, but it is possible, especially if you're willing to do what it takes.
Great leaders know how they fight and often decide whether they will win the peace. In other words, your approach to the recession plays a crucial role in the performance of your company throughout the period.
In a nutshell, the best way to go through an upcoming recession is to grow. Companies that get on the offensive rather than on the defensive during a recession have a better chance of success than others, and here are 3 reasons:
1. Less competition
Boom times are usually considered to be times of opportunities by all, so everyone has enough to invest. Because the economy looks good, many businesses are daring in their strategies in the hopes of raking in profit. As a market downturn sets in, most business leaders get cautious and retreat, but this is the best time to strike. With your competitors sitting tight and others cutting down on their budget, there's never a better time to gain market share.
2. Easier to attract customers
Many businesses shutdowns while others minimize their efforts during a recession, which means many customers will look for alternatives to meet their needs. This is the best time to make more efforts to capture their attention and show them that buying from your business is a smart decision.
3. Better deals from vendors
During a recession, many vendors tend to lower their rates to entice customers and to remain competitive. Thus, focusing on growth during a recession allows you to keep your business doors open without breaking the bank.
How to grow in a recession
Throughout history, recessions have served as opportunities for the creation of innovative and successful companies and the exponential growth of existing businesses. Now that you know that growth is an approach that can help your business thrive, there are 4 strategies to help your company grow.
1. Reduce costs
One of the first things to do in an upcoming recession is to decrease operational costs. The idea here is not to sacrifice efficiency and productivity but to adopt cost-effective solutions that can help reduce expenditure. Thus, the goal should be to get more and pay less.
In this regard, DG1 is a lifesaver as it allows you to free up cash to keep your company in business while offering the value you need to drive productivity. Instead of entering crisis mode once the recession hits, you can better prepare by switching to more affordable solutions that offer equal (or even better) value.
2. Expand your reach to sell more
One of the first things that come to mind in an upcoming recession is to reduce marketing efforts or even eliminate them and sit still to see what happens after the recession. However, history has shown that this is often a way to fail slowly.
Recessions are a good time to increase your marketing spend, especially because most businesses will feel compelled to pull back on their marketing campaigns. At this point, customers are restless and are always looking to make changes in their buying decisions. Businesses that increase their marketing will fill that void and reach a wider audience.
Again, DG1 allows you to do just that. With DG1, you can globalize your business by setting up an online shop so you can sell to customers outside your location.
Related blog post: What Are The 5 Benefits Of Cross-Border ECommerce?
3. Digitize your processes to be faster
A major challenge that many companies face is in digitizing their business to be faster with fewer resources. The expectation is that lower resources will translate to slow speed of business operations, but it's vital to maintain (and even increase) your momentum in a recession.
To digitize your business, you will have to start adopting different digital marketing tools like mobile applications, campaign management tools, booking systems, Email marketing, SEO, etc. Many times, doing this requires subscribing to the services of different vendors, but DG1 provides all those tools, allowing you to access all you need for success in one place.
4. Aim to increase conversion rates
It's not enough to improve your marketing game; you must ensure your business is closing sales. The more conversions your business can achieve, the more growth it can realize.
To do that, consider employing strategies like personalization, targeting, and advanced onsite promotions. All these can help protect your business from the decreasing buying power that's coming by helping you acquire more customers.
Related blog post: What Is The Difference Between Upselling And Cross-Selling?
Recessions may be unavoidable, but if you plan, your business can succeed in difficult times.
By following the strategies above and growing your business with the help of DG1, your company will be better fortified to survive any economic climate.
If you are ready to build a recession-proofed eCommerce site, you can start a free trial here. If you need help creating your cost-effective eCommerce site, contact us online to book a call with our expert today.