Recessions are not new. They have happened in times past and are with us right now. No doubts, it is usually a hard nut to crack for many businesses, especially the small independent businesses since they are not as financially buoyant in comparison.
However, some of the small businesses increase their profits during such hard times. The secret is creating flexible revenue streams and business models in times of recession. Also, some of such smart businesses choose to outsource during recession instead of hiring more employees in-house. Keep reading to learn more.
Tip #1: Go for Less Costly Alternatives
One of the smart ways to stay in business when a crisis hits is to offer less-costly products and/or services. This is one of the secrets used by the businesses that thrive in crisis. As long as your product can match your competitors’ without being unnecessarily expensive, you are in for new and more customers. The best part is that you will retain these customers even after the crisis. Just ensure you are not compromising quality in any way.
Tip #2: Run Your business in a Cost Effective Manner
When planning to start a business in recession, you should prioritize cutting as much cost as possible from the onset. Shop for hot deals, discounts and sales on items you would need for your business. For equipment’s, you may consider going for fairly used ones to save more. Even if you have to buy missing parts to transform the second-hand equipment, it will still save you more money than buying a brand new one.
Also, when starting business in recession, you can save much more cost by using virtual assistants to tackle your administrative task instead of hiring full-time administrators. You will save more on overhead costs and salary. This also applies to online marketing – you are better off outsourcing online marketing to experts. Once the contract ends, you will stop paying service fee and deploy the excess into growing and expanding your business.
Tip #3: Identify a Felt Need
The need of the hour can turn you to a millionaire overnight if you can locate that felt need and meet it effectively. Some of the most successful companies we celebrate today leveraged this tactics to build businesses that are known as fortune companies today.
You will generate more customers, hence increased profits when you offer such solution in a super-affordable manner. While your profit markup may be small, it will quickly build up and ultimately accumulate into wealth due to high rate of turnover. The best part is that those customers would want to become your loyal customers even after the recession or crisis.
Indeed, you can take advantage of a recession to start and grow a successful business.
Daven Michaels is a New York Times Best Selling Author and CEO of premiere global outsourcing company, 123Employee. The company employs hundreds of young bright individuals on three continents. His International event, Beyond Marketing Live! Inspires entrepreneurs to build & grow their business with revolutionary new theories and systems allowing them to design the business and personal lifestyle of their dreams.