Dave Cantin, Chairman and CEO Dave Cantin group.
The verdict is not yet known when and how severe a possible recession in 2023 will manifest itself. Leading economists investigated citing by the National Association for Business Economists that “a majority of respondents believe there is a greater than 50% chance that a recession will occur in 2023.”
Whether this recession will be short and relatively mild or long and painful has yet to be determined. A silver lining found during any economic downturn is how it can be the optimal time to take a moment, reassess, strategize, and plan for future growth.
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Analyze the data and then plan
Analyzing historical data can help companies better prepare for a recession. By understanding the real needs of your customers, you can adjust offers, promotions, sales guidelines, and even fine-tune services to focus on what works and cut back on what doesn’t. This means you may have to make some tough decisions regarding your sales incentives, your objectives, and your overheads.
Interpreting historical data and focusing on any trends that may emerge is the best way to make these tough decisions. By conducting an internal audit, you can identify the unnecessary projects and processes that you need to trim or review within your company’s business divisions. The statistics can show not only where your business is suffering and needs attention and change, but also what is going well within your business.
Map the competitive landscape
It is not enough to know what your competition is doing. You need to understand the motivation behind those moves, dig up areas where they fall short, and work out a systematic game plan that will position you in pole position once the economic landscape becomes more favorable.
This is also a good time to look at where you can innovate for the longer term. Is there something customers are asking for that your competition is trying to offer that you could offer better? Map out which products and services are most in demand, discover what is currently missing and investigate how you can develop that offer. Most customers are unable to identify the exact features they need from products or services, especially in hyper-competitive industrial sectors.
However, once they are identified, you can develop price-benefit models to help you better understand your competitors’ moves and how best to respond. So while keeping abreast of your competitors’ products and services activities, you should also take note of their strategic alliances. By gaining a better understanding of your competitors’ partnerships, you will be better able to strategically develop a post-recession winning plan that will put you one step ahead of your rivals.
Expand your network strategically
A recession is also a good time to increase your visibility in different market segments within your industry. After you analyze the competition and determine the direction they are heading and what services or products they offer, you can take the steps to expose your company’s profile to a new audience.
There’s no cut-and-dried answer here, but reviving old contacts that may have new introductions for you and your team; dive deeper and build stronger relationships with your current customers, suppliers and vendors; and joining relevant or adjacent industry groups or associations may later prove profitable and help you expand your business into new areas or deeper into your market sector.
Decide how to break new ground
Speaking of building, you have to keep innovating even during a recession. Now is the best time to identify what is missing in the market, what customers are asking for and what expected needs they will demand moving forward. Then you can start building a plan that meets those needs and a go-to-market strategy that can increase your revenue over the longer term. Diversifying your revenue streams with innovative offerings can not only provide some post-recession cost relief, but is also a way to stay ahead of your competition.
By preparing now, you can ensure that your business is well positioned for success, regardless of the challenges ahead. A recession can be a frightening time and one of the greatest tests your business could ever face. But it’s important to never lose sight of how the very best companies and leaders weather challenging economic times and achieve great future returns by using their time well during the recession. Take stock, evaluate and expand your network and offerings so that you can emerge stronger, more competitive and more resilient. Apply this mindset so your business can handle the ‘new normal’.
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Janice has been with businesskinda for 5 years, writing copy for client websites, blog posts, EDMs and other mediums to engage readers and encourage action. By collaborating with clients, our SEO manager and the wider businesskinda team, Janice seeks to understand an audience before creating memorable, persuasive copy.