What’s Your Recession Strategy
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In the event that you happened to just be returning from a 6-month trip into space with no contact to Houston or Mr. Musk, the words of the day are COVID-19 and...recession. The full impact of the virus is still evolving although thankfully in some senses winding down. The impact of the latter word will be felt until 2022/3 according to the smart folk at The Economist.
So, what is a recession and what are the effects of it? A recession is typically described as a period of two or more consecutive quarters of negative economic growth, as measured by GDP or other indicators of macroeconomic performance including unemployment. We see the effects of it right from the leaders of large corporations taking pay cuts, reduced consumer spending, lower bank lending, companies cutting dividends, and unfortunately, companies making large scale employee redundancies in order to save the business as a whole.
But what does all this mean for the small business owner? Well, at PrognoStore, we are passionate about small business so here are some of our recession survival strategies for the small business owner:
Go Digital - Online
It’s not possible to overstate the importance of making sure you have an online presence in this market. Your customers will be doing a lot more online research and shopping as the days of just walking outside and browsing are gone for some time yet. You simply can’t rely on footfall anymore.
You have got to engage your customers, wherever they are online, whether that’s Instagram, Facebook, WhatsApp, Bellanaija and Nairaland. This also means that you have got to be active on those sites so that you communicate with your valued customers, and make them aware, that you have what they need.
Reduce Business Costs - Negotiate, Negotiate, Negotiate
Again, it’s not possible to overstate the importance of keeping track of all your business expenditures. This should go further and you should really be reviewing all your resources and where it makes sense strategically...cut the cost!
Key areas that we hear our clients are exploring are::
- Re-negotiating terms and pricing with your suppliers. You may find that you even need to fully swap out suppliers due to terms or pricing that no longer favor you. An upside to a recession is that we all become much more open to negotiation as there will be increased competition for market share. Previously held positions can be shifted very quickly over to competitors.
- Review your business tech and tools. You may find that you invested in the most expensive accounting, inventory, billing software. Now is the time to really think about what you really use, need, and what returns the highest benefit to your business processes. It could be a great time to switch out super high-tech business tools for one with fewer features but does the basics extremely well and simplifies your processes.
No More Guesswork - inventory/right stock
Another bold statement - Nothing is more annoying to a customer after having queued for a long time outside your store to ‘make it’ inside only to realise that you don’t have what they were looking for in the first place. Major faux pas on your part! Of course, there are exceptions but for the most part, you can preempt and prevent this by understanding your inventory, your customers purchasing habits, and then buying strategically.
You need to make certain that you are really focused on the specific items your customers bulk buy and come to you for. This way, you will keep their repeat business and how important is that particularly in these times of uncertainty. Why? Because your customers will know that you are reliable and will meet their needs.
At PrognoStore we hold to the ethos that the small business owner is an integral part of the global economy. We hope that these points are very useful to you. In these uncertain days, we are more than happy to help where we can so please feel free to reach out to us at firstname.lastname@example.org.
Lastly, PrognoStore is a 3-in-1 Cloud-Based Solution combining Point-of-Sale, Inventory, and Analytics. Developed to make running your business easy and stress-free. It's simple to use but powerful enough to be all you need to run your store. Check us out here: https://prognostore.com/