How to Recession-Proof Your Business By Laura S. Wharton The Associated Press reports again that economists fear a recession is already upon us. Many of us might cock our heads sideways and say, “Duh.” So once we get past the shaking of our collective head, how do we recession-proof our businesses? We take action. While that beaconing stack of papers on the floor of your office could be the focus of your energies for the next six months (I share the same filing system), a better way to prepare for downtime is to use strategies to immediately recession-proof your business. Instead of just weathering a pending recession, you’ll position your company as a leader in your field, leaving less-savvy competitors behind when the economic pendulum swings back into positive territory again. Implement the following strategies that make the most sense for your company: Diversify Your Services and Products As with investing, diversifying services and products your offer will bring more clients for you to serve. If you can’t figure out how to offer more services or different products, consider repackaging what you do offer to sell to different clients. This is where creative, innovative thinking comes into play. Be Creative This means being willing to listen to employees at all levels of your company, paying attention to ideas and suggestions presented. This is often where you’ll find money-saving ideas – a source of ways to possibly eliminate unnecessary expenditures and waste. Offer Outstanding Customer Service It’s more expensive to get a customer than it is to keep one, so provide the highest quality product or service on top of exceptional client service. Keep them happy with responsive attention from the point of taking an order to delivery. Consider conducting a client satisfaction survey to make sure you are meeting unstated needs. If you can, make your company’s offerings more valuable with speedy deliveries or flexible payment terms. No doubt your clients are experiencing a downturn in business, too. Implement Cost-Cutting Measures There are several ways to cut costs. Depending on your business, you can: -Slow spending on inventory. What’s collecting dust on the shelves of your warehouse? Is there a way to focus energy on moving it rather than buying or manufacturing more? Establish inventory targets and get your sales and purchasing managers to talk about what’s coming in – and what’s going out. -Focus on profitable core services or products and shelving less profitable ones, you’ll save money and effort. -Forget discounting services and products to free up cash flow. In the end, you’ll be cutting your profit margins and possibly dilute your brand. Besides, once a bargain is made, it’s hard to go back to original prices – they’ll look inflated compared to your discounts. One way to free up cash flow is to ask suppliers to extend payment terms. Another is to call in old debts so that you have a good amount of cash on hand in case you need to avoid credit for awhile. -If you have a contract or lease that’s coming up for renewal soon, consider renegotiating a lower price – or go without. It’s time for a reality check on what you really need to conduct your business. Appreciate Employees Reward your productive employees and push productivity among your less-than-star performers. You could offer vacations or time off as incentives, which are relatively inexpensive incentives given the cost of interviewing and re-hiring these people back in the future, in the event you need to layoff employees. Accelerate Marketing Don’t be afraid to spend on marketing campaigns that may grow future business. This is one of the key decisions that every company has to make, and regrettably for many, marketing is viewed as something to cut back on during slow economic times. But the reverse is actually true. Now is the time to leap ahead of competitors in the minds of your clients through a more aggressive and integrated marketing approach. This starts by instilling a business-development mindset in all employees. Every touch with a client (past or present) can lead to business, and everyone in your company is responsible for making it happen. As P.T. Barnum said, "Without promotion, something terrible happens - NOTHING!" Be the Leader Do you know your company’s USP? Your company’s unique selling position is what differentiates you from your competitors; it’s why clients would choose to work with you over someone else. What distinguishes you from competitors might have to do with your ability to expedite a delivery schedule, your specialized client care program, your no-questions-asked refund policy, or the promise that you make to each client regarding the project you’ve just been blessed with. Welcome Technology Advantages Do you send out an e-newsletter like this one? It’s easy, it’s not that time consuming, and it keeps me in front of the people on my e-list. Does your website reflect your company’s offerings in an enticing and search-engine-friendly way? If not, you might be missing out on cost-effective ways to stay in front of clients and prospects. If you want to take this recession and turn it around for your company’s benefit, take some time to plan. Be flexible and creative in coming up with solutions rather than making wholesale changes or slashes to your employee ranks. If you keep the big picture in focus and your head down aiming toward it, your company will make it through successfully to the other side of economic “Down”.