Ways to Weather an Economic Downturn
Reactivate Your Leads
While you might wait for customers to come to the door, consider contacting your existing leads with tailored product suggestions. A study by the Thomas Publishing Company found that 80 percent of sales to businesses were made after 5 sales calls, but only 10 percent of salespeople called prospects more than 3 times. Be persistent.
Strengthen Existing Relationships
Harvard Business School research found that a 5% increase in customer loyalty can lead to 40% to 90% increases in the lifetime value of that customer relationship. You need to earn your customer's loyalty, so during tough times consider offering discounts and easing payment schedules. Also consider bundling inexpensive features into your product line, adding value and potentially adding revenue.
Protect Your Core Business
Staff cuts may be necessary to keep your business running, so don't set people up for disappointment. Communicate realities clearly and objectively, and keep people informed. During severe trauma, a human body will divert blood to vital organs as a priority; similarly, a business needs to keep its core functions working.
Fix Your Systems
It is your responsibility to keep your processes running efficiently. Inspect your production cycles for ways to increase efficiency and value, and scrutinize your supplier and production costs. Understand your price points relative to your cost of production, and also estimate those price points for your competition.
Make Strategic Plans
Slow times can present opportunities to work on strategic plans for marketing, product design, website updates, staff training, equipment repair and building repairs. A slow period could also be a good time to improve your management skills. E-Myth has an array of business training programs available to help you work ON your business, not IN it.
A positive attitude can make a difference. Prospects will sense a positive outlook and are more likely to do business with positive contacts. Business goes through cyclic ups-and-downs; keep your outlook on the upside.