The United States is currently in recession, according to The National Bureau of Economic Research (NBER). The nonprofit organization said last June that the country’s economy peaked in February.
News of an economic decline isn’t a surprise for many given two things: the double-digit unemployment rate and the closure of nonessential businesses to mitigate the transmission of COVID-19.
The decrease in sales and consumer confidence may discourage people from starting a business. What’s more, those who do have a small business are often in a vulnerable position because they may not have the financial reserves to weather these times of uncertainty.
If your small business is still open but struggling to stay afloat, implement measures to make it out of the economic downturn in one piece.
Here are some survival tips to help you survive the pandemic-induced recession:
How your business can survive the economic recession
Search for opportunities to get ahead of your competition
Your competitors are facing the same dilemma as you. They’re doing whatever is necessary to survive. If you want to get a leg up the competition (and take their market share), you’ve got to step up your service or product line.
If you run a local juice business, for instance, you don’t simply offer lemonade and call it a day.
You diversify your product line by offering unique types of fruit juices, such as orange juice with pulp and watermelon lychee granita. Now is the time to give your business an edge over your competition.
Assess your inventory management
Check if you can cut down on your inventory expenses without undermining product quality or production schedules. An excellent example would be to source ingredients or raw materials at a more affordable price.
Take care of your regular or loyal customers
These customers are keeping your business alive. If they go elsewhere, you’ll have to invest more time and money in finding new customers — something that isn’t easy during the economic downturn.
If you have regulars at your shop, take this opportunity to upsell products or recommend services that meet their needs. You could also deliver stellar customer service to keep them happy and encourage them to come back to your shop regularly.
Continue to promote your business
Many small businesses wrongly believe that they can save money and survive the recession by downsizing or completely getting rid of their marketing budget. The economic downturn, however, is exactly the time when you should bump up your marketing efforts.
When marketing your small business, don’t simply get your name out there. Take the time to help prospective customers discover the product or service that satisfies their needs.
Keep a close eye on your credit score
Borrowing money can be difficult during times of uncertainty. Small businesses with less-than-decent credit ratings will have a low chance of securing approval.
During the recession, watch your credit score and keep it in good shape. This includes both business and personal credit. You’ll have a higher chance of getting the loan you need to keep your small business afloat.
These five survival suggestions will help you survive during the current economic condition. Always take the time to constantly look at how you’re doing business and figure out ways to improve your processes.