The past few years have seen a recovery in the U.S. economy, but some economists and economic observers are concerned that the U.S. could be at risk for an economic slowdown.
With global economic uncertainty and other economic instability, even if the U.S. does not go into recession any time soon, it's always a good idea to keep strategies in mind for how your business could adapt to a slowing economy or to a slowdown in your specific industry or key markets.
Here are some ideas on how to improve sales, source new business, and increase cash flow during a slow economy:
Adjust Your Sales Strategy
Why do your customers buy from you? The answer might be different in a slow economy. For example, especially if you are a B2B company, your product or service may have a different value proposition in a different economy when your customers are cutting back on expenses—than it does when times are good and your customers are feeling more confident.
Try to adapt your sales strategy to get inside the minds of your customers and match their new priorities to suit the realities of a slower economy. If your customers are cutting back on spending, you need to reassure them that your product or service is a good value with a strong ROI.
Instead of showing them how your product or service can help them make more money or be more profitable, you may choose to focus on showing them how your product or service can help them save money. You can keep selling the same product, but utilize a different sales strategy.
Leveraging data isn't just for social media sites, sports teams, and wearable fitness devices. If your business is growing, you're probably using data to track customers, identify market opportunities, and monitor market share. But are you using data to analyze your finances? Many small businesses aren't. Although the data is available in your accounting software or financial system, few companies take the time to access it and study the numbers. You may think cash flow is only about how much is coming in and how much is going out. But if you dig deeper into your own business data, you can create more accurate forecasts, identify upcoming cash gaps, and help spot opportunities and threats long before they appear.
Hire Top Talent
When the economy slows down, many of your competitors might overreact by laying people off. As a result, lots of talented people could become available in the job market—and this is a good chance for your company to hire great sales people and other top talent just as other companies are cutting back. While your competitors are slowing down, you can be scaling up your sales efforts but given the economy, this will need to be a well-planned and budgeted decision.
Become a Student of Your Own Business
In a world of small business owners, the spectrum of education levels is vast. From self-made high school dropouts (such as Tumblr founder David Karp, who sold his company at $1.1 billion to Yahoo) to private practitioners of law, medicine, and business, a wide variety of professions with different degrees fuel the US economy. While academic accomplishment is not a requisite for commercial achievement, the best general managers of small to mid-sized businesses are avid students of their own business. Those who never cease to learn about every part of their trade on a regular basis, even if they are not true experts of that particular field, often taste success. As Benjamin Franklin (known for his apt for learning) said, “An investment in knowledge pays the best interest.”
Reach New Customers
A slow economy often can be an ideal opportunity to launch a new product or enter a new market. The reason? There is less clutter and churn in a slow economy: With fewer competitors trying to launch products or build buzz, there is often some quiet space for your company to make big moves. So be sure to do some research to find those new opportunities. One example is text marketing. Although this channel was mainly adopted for unilateral notifications, people are very fond of it. Thus, it is an intricate and necessary part of the business model. Text messages are a very reliable channel to deliver information and is a highly effective way to communicate quickly. Over 95 percent of text messages are read within three minutes. Over 97 percent of text messages are read versus only 2 out of 10 emails read. Limiting to emails is now a dead method of communicating for business purposes. Text messages in business ensures that not only will you reach every single person but all of your messages are being read. In addition, you will be able to communicate both internally and externally and you will be able to use your business phone number to text from your smartphone, tablet, or computer. Therefore, business texting is the most effective, and convenient, way to communicate for any business.
Sometimes a slow economy can give your company the added burst of motivation that you need to shake things up. Instead of making you complacent, a slow economy can actually be a good thing. It can motivate you to make needed changes—whether that means eliminating unprofitable products, or creating a leaner organization, or investing in new growth opportunities.
Encouraging and empowering employees to make impromptu decisions to maximize customer satisfaction can also be beneficial, when managed correctly (a child drops the ice cream on the floor as soon as it was bought, and the employee offers a new ice cream free of charge- then reports this to the owner/manager at the end of the day etc.). Witnessing and influencing customer satisfaction has been shown to be intrinsically motivating for employees, which increases morale and retention rates for your business.
No single business owner can control the vagaries of the global economy: All small businesses are affected by larger forces that are beyond any individual's control. But all business owners have the power to control their attitude, their strategies, and their level of focus and effort. Even in a slow economy, you can find ways to think creatively about your business and keep trying new things—and help your sales keep growing.
Source: PNC Cash Flow Challenges https://www.pnc.com/en/small-business/topics/cash-flow-challenges/slowing-economy.html