7 Recession Survival Strategies for Small Businesses

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The recession of 2008 is here and it is expect that it will last into 2009 if not 2010.  Here are several strategies that you can use to stay afloat during the coming rough months. With any luck, these tips will help keep you in business while other go under.

1.  Expand Your Customer Base

Often businesses will batten down the hatches during a recession and cut back on the customers they service. Instead, you should find ways to increase you customer count. For example, you may prefer to only deal with businesses that have excellent credit. Expand by allowing in those with moderate credit ratings. Consider extending what you do. For example, you are 100% business to business allow in some consumer customers as well. Be flexible and you may have a wider array of opportunities during the recession.

2.  Increase Your Prices, Carefully 

Typically a soft economy isn’t the best time to increase your prices. However, this recession has elements of stagflation in it. This gives you the opportunity to pass on your price increases, particularly for fuel, to your customers. Avoid the temptation to curry favor by “holding the line” on prices increases. This just will fan competitive fires. Use “smart pricing” to cloak increases to customers who’re unlikely to leave and decreases to customers who might be new or wavering.

3. Visit the Graveyard

Perhaps you have old clients that you haven’t touched base with in a while or old leads that you haven’t followed up on. Now would be a good time to revisit both of these with an eye toward signing up new customers or bringing old ones back into the fold.

4. Hire Bird Dogs

Use your existing customers to bring in new customers and then more revenue. Offer incentives for your customers to bring in new business. I’ve always found offering a cash incentive to work well although this wouldn’t be appropriate for some.

5. Super-Size It

Here’s an easy one. Offer to tack on a high profit item for an extra cost just like fast food restaurants do with their combo meals.

6. Change Packaging

There are several methods that you can use that can allow you to repackage your products or services. One way is to decrease the amount of product while keeping the size of the package the same. This is common in the food industry. Another is to group like products together in a bundle that looks like a discount but really isn’t. In some cases, you can offer things like economy or no frills versions, special discounts and/or payment plans and other such offers to attract customers.

7. Aggressive Marketing

As the economy slows down your sales efforts must become more aggressive. Leads that you let slide a year ago you should follow up on. Push to close sales quickly. Create a sense of urgency. Maintain a consistent and aggressive advertising campaign. Creating the illusion of success can often bring success.

This entry was posted on Sunday, November 19th, 2017 at 9:12 pm and is filed under Recession. You can follow any responses to this entry through the RSS 2.0 feed.

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