Survival of the Fittest in Business
The current state of business is precarious for many, however, recessions and times of economic upheaval have happened previously and can give us insight and perspective. Historically we have been through changes in how business is done and what products and services are relevant. From automation in manufacturing, to tech as an industry, the workforce skills and consumer needs have evolved. To have staying power, businesses must think of how they can "stay in shape"; and not unlike a personal health goal, you should have a plan, motivation, and grit. In order for a business to survive this downturn it must be adaptable; in how it utilizes staff, to what services it offers and the strategy it implements for marketing.
At this point, most businesses have had to take stock of their situation and likely take some decisive, yet painful action. Some may have been forced into lay offs to cut costs while revenue was lost. This is a good time to re-evaluate your workforce, redefine roles to be more efficient and rebuild your team strategically. What roles are essential? What roles are under performing? What roles are redundant? What roles could be part-time? Was someone not right for a particular position but their skill set would fit better in another? Your staff will show their loyalty through this as well. Some may take the opportunity to move on, but those who are more invested can contribute to innovative and unique ideas for how to move forward. When looking to rehire, keep in mind that doing thorough background screening can save you time, money, and frustration in the future by getting it right the first time. Also, consider a temporary employee to fill in a gap while you are in transition.
They say desperation is the mother of invention and that crisis can create opportunity. The demand for your existing service or product may be low now, so how can you use your resources (staff, facilities, raw materials) to create a new product or offer your service in a different way or to a different market. “You’ll want to rethink your product mix and pricing strategies in response to shifting customer needs. Purchasing behavior changes dramatically in a recession.” (Harvard Business Review - Seize Advantage in a Downturn)
Some examples are making masks or hand sanitizer, making your service more affordable or accessible online or providing delivery options. “Scrutinize your customers' changing needs and make sure that your products or services are in tune with what they want. Keep your eye on your competitors and see where you can outshine them.” (BDC.ca)
At the same time, don’t change so drastically that your core business and customer are abandoned. While people may tighten up for a time, if you can stay the course, most consumers will resume previous purchasing habits in due time.
No matter what product or service you offer, if people don’t know about it, you won’t be profitable. It might be tempting to see marketing as an expendable at this time, but “companies that put customer needs under the microscope, take a scalpel rather than a cleaver to the marketing budget, and nimbly adjust strategies, tactics, and product offerings in response to shifting demand are more likely than others to flourish both during and after a recession.” (Harvard Business Review – How to Market in a Downturn)
The medium and the message of your marketing will need to be reviewed. You don’t want to be tone deaf to your audience’s current apprehensions and feelings. “Reassuring messages that reinforce an emotional connection with the brand and demonstrate empathy (for example, by conveying a sense that “we’re going to get through this together”) are vital.” (HBR.org)
Although we don’t know how long this slump will last, and it may seem more drastic than anything you’ve experienced before, history shows that the market will adjust, and the economy will recover. We hope that you can ride the wave with patience, optimism and fortitude and use this time to make your business better than ever.