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Does a recession signal the end of your business?

Written by: Ray Stewart

Article Overview: As the world plunges into another recession, lot's of small business owners are starting to worry that their business may not survive. It will certainly fold if you do nothing extra or fail to adapt your existing strategy to new trading conditions. So, your option is to fight back. Learn more marketing tactics, re-look at your existing tactics, make sure you are testing everything and monitoring every result. Make your business survive and come through these harder times fighting fit and trading better than ever.

Does a recession signal the end of your business?

As a business person facing recession, here is a list (not comprehensive) of What You Should Not Do:

• Do Not Panic – you must remain positive at all times, no matter what

• Do Not Slash your prices – a price war helps no-one and will drive your business into the ground very quickly

• Do Not Sack any staff – the effect on remaining staff morale can be catastrophic and in itself lead to an early business failure

• Do Not Change your marketing tactics – what worked before will still work in a recession

• Do Not Refuse to tighten up non-essential expenditure – make sure every penny spent counts

• Do Not Contract your business – don’t fall into the trap of thinking a smaller version of your business may survive better – it won’t make any difference

• Do Not Listen to the media and their “experts” – they delight in reporting every possible negative effect of recession every single day but all they are doing is creating a circle of negativity about the trading conditions which is more likely to depress than motivate a business owner

• Do Not Branch out willy nilly in all directions in desperation to keep sales going – never a good idea in a boom time, let alone a recession. Remain focused on your specific niche. Don’t be tempted to waiver

• DO NOT GIVE UP – the only way your business will fail is if you give up!

Please learn to wear blinkers when watching TV. Learn to ignore the constant gloom and doom that the news and breakfast programs seem to delight in broadcasting every day. How many jobs have been lost, how many businesses have folded, how bad exchange rates are, how bad the European picture is, how fragile the global economy is – ignore it all.

Your mission is to remain positive and drive your business forward using as many marketing tactics as possible to ensure your business survives. You may even find you experience considerable growth as well!

The thing to remember is that life goes on. In times of recession; in boom times; in times of plenty; in times of war – life goes on. People still need things. Even if unemployment again reaches the unforgivable levels of the early 1990’s of 3 million plus, there are still many more millions in work and in business.

I know it is easily said, but on this website (Evan Carmichael) you will find a host of marketing tactics being trumpted by established experts. Find at least 20 tactics that you are not currently using in your business and get working with them.

Fight for the survival of your business. Remember, if you don't - no-one else will...

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Article Tags: blinkers, boom time, boom times, breakfast programs, business failure, business owner, business person, desperation, exchange rates, global economy, gloom and doom, jobs, marketing tactics, negativity, niche, price war, recession, single day, staff morale, watching tv



Related Forum Posts
surviving an economic crisis - I'm moving to Idaho then I'm building a bunker and stockpiling 2 years worth of supplies. I'm buying a fishing rod, a hunting rifle and bunch of chickens to produce eggs... I like chickens because they don't care about recessions or depressions. OK... that may be Plan C - let's hope it doesn't get to that. So far, our business is doing well, we often target affluent markets and from our experience in the early 90's recession this worked well. BUT - what we're seeing this time around is not a simple recession. I think it could get bumpy. What type of businesses thrive in an economic downturn?
The Hidden Hand Effecting Your Bottom Line - If you are based outside the U.S and run an online business, you'll probably receive a lot of your payments in U.S dollars. When the recession hit I saw a lot of non-U.S business people boasting how they [u:20bfadx5]hadn't been effected by the recession[/u:20bfadx5], brushing off the recession as something that was not important. But they [u:20bfadx5]overlooked the hidden hand[/u:20bfadx5] effecting their profits. The currency markets which for non-U.S businesses paid in U.S dollars has masked the effect of the recession somewhat, and has an incredible effect on your overall profits. Looking at my profits over the past several months I can see fluctuations up and down. I may have a hard time attributing what is causing these fluctuations if I believed the recession didn't effect me because overall my earnings and traffic are up. But then I compare to the U.S - ££ exchange rate, and notice a [u:20bfadx5]strong correlation[/u:20bfadx5] with my profits. When the dollar is strong my profits are higher, and when it is weak they are weaker. It didn't account for all fluctuations but the effect was very strong. I know most people are aware that exchange rates effect their business, but I don't think people realize how strongly it's effects can be, and how closely related to the economy this is. So to say "the recession didn't effect me" because your profits went up can be [u:20bfadx5]very wrong[/u:20bfadx5]. The hidden hand of exchange rates could have improved your profits, and the exchange rates changed due to changes in the economy, i.e the recession. The recession has caused this fluctuation in exchange rate as people fled from the stock market into cash, and with the $$ being the biggest currency in the world, more people fled into the dollar, pushing up its value against other currencies. When the stock market bounced in March and people moved back into stocks and other investments, the dollar weakened. In addition I did see a overall drop in advertiser spend which wasn't just attributed to the dollar weakening after March. I attribute this to advertisers cutting back their budget in response to the economy, but given a change in mood and outlook in recent months this is now reversing and advertiser income is up despite a weaker dollar. So the recession has played a bigger role in my business than at first glance, so just because profits are up does not mean my business is not being thrown around by external economic factors. For this reason I've studied the economy, made a prediction on what is most likely to happen based on trusted sources with the strongest track record, and made a plan for that eventuality, and then also plans for less likely scenarios, so that my business can prosper in either situation. Instead of overlooking this hidden hand it is important to recognize it is there, and not accept it as a mystical force your business is a slave to, but something you can react to and plan for in order to take your business further.
Re: Obama Wants Social Security for Illegals - [quote="Lucy Wu":2dlphfqu]I think America's biggest problem right now is clearly the recession, and that should be the main focus as of now.[/quote:2dlphfqu] I agree. Do you think President Elect Obama is doing or will do what is best in terms of beating this recession?
Re: Are Economic Recessions Good for Franchising? - All we can do is remain wide awake and pay attention to the ebb and flow. My strategy is to be prepared and go with the flow. There could be some rough times ahead... Interestingly, our business has remained strong. I believe it's because we're in such a tight little niche and we're well positioned to sign jobs nationwide, therefore we're not restricted to location. We also target affluent markets that have higher disposable incomes - this we do locally. Here are some Franchise Categories that could weather a good recession... Health and Personal Care Food services like Subway Debt Collection Tax Preparers & Advisors Any other recession proof franchise opps out there?
Re: Funding Question - Well everything is on the verge of commencement for me for instance the necessary fundings and the bank loans but I am skeptic to start my business owing to the recession and the economic turmoil which is being witnessed throughout the world. I am in a dilemma whether it would be a good idea to launch my business at all. What do the expert members have to say on this.


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