Every long-lasting business will go through boom times as well as bust times. Sometimes it’s due to your own bad choices, but sometimes it’s due to things outside of your control. The good news is, regardless of the reasons for the downturn, you can get through hard times with preparation and realism.
Prepare for Hard Times – The moment you sit down to write your first business plan, you should set up your business to run extra lean during difficult times if needed. Save money for six to eight months of overhead, know what you can cut and keep without sacrificing quality and integrity.
Know Your Break-Even Point – Every business owner needs to know what their overhead is. What does it cost you just to keep going? For most business owners, this will include everything they need to run their business, from software to marketing to employees.
Focus on Customer Retention – It’s always smart to focus on retaining customers by delighting them and spending your time and money finding new customers. When times are rough, it’s even more important to focus on customer delight so that you can retain them.
For example, if you have a continuity program or a monthly membership website, you might consider reducing the price of your membership temporarily to spread the pain of the economic downturn if that’s the reason your business has hard times.
Don’t Stop Advertising or Marketing – Never stop your advertising and marketing. Sadly, many people do this first, which is a big mistake. You still need to tell buyers about your products or services if you want to make sales. You may need to rework your campaigns based on the new information you have but don’t stop.
Automate Strategically – If you’ve not set up automation yet, now’s the time. You can cut some of your labor costs or free up some of your time to do more marketing if you have anything automated that can be automated. Learn about platforms like Zapier.com that can help.
Remember: Cash Is King – Try to keep as much of your cash as you can during the downturn. While you don’t want to go into debt, you don’t want to spend all your cash first because it can be hard to get business loans if you don’t have cash on hand.
Add Value To Differentiate Yourself – The more value you can add to your customers’ experiences, the better. If the hard times affect everyone, including your customers, say so and let them know you care. Do anything you can to make them feel like you’re in it with them.
Keep Your Quality High – Keep everything in place that allows you to provide the most top-notch and high-quality products or services you can. During hard times people are more sensitive, and if you are one person they can count on, it’ll make things a lot better for you and them.
Over a long life, things happen. Sometimes you’re up, and sometimes you’re down. No business starts as a success and stays a success forever. One reason the government set up various reorganizing bankruptcy options is that sometimes even if you’re the best at what you do, things don’t turn out.
Even if it feels like the end of the world right now, it probably isn’t. Get a big picture view by focusing on history so that you can gain perspective and focus on the tactics above to sustain your business, keeping sales steady during hard times.
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