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Business > Here's Six Recession Proof Strategies For Bulletproof Profits
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Article rating : 0.00, 0 votes. Author : Dennis Francis
Here's Six Recession Proof Strategies For Bulletproof Profits
Many of my clients are asking me about the current economic slowdown and how it will affect the small business owner. Some like Susan, a gift shop owner have already seen a steady decline in sales. After a pretty good Christmas, the first quarter had experienced less foot traffic but still ended up in the black. The second quarter wasn't faring a well.
I hear similar experiences from dozens of people each week. Some are start-ups, others are mature businesses. Most business ideas flop on the first try. The key to success is knowing how to give yourself a BIG second chance. Sometimes you will need to try a third or fourth time before your new product or service brings home the bacon.
Here are SIX simple ways to extend your business profits during slow times.
1. Tighten your marketing focus.
During lean times, its prudent to cut back on the scope of your services and products. Sharpen your focus on key products and services and the markets that need them. This exercise often causes a business to get back to basics and identify the areas of profitability.
Use the Pareto Principle of the 80/20 rule to carve out your niche and identify your most profitable products and services and the top 20% of customers who use them.
2. Make your prices more competitive.
Re-examine your pricing. That doesn't mean lowering your pricing, it means researching, forming strategies that allows you to match your product/service mix with the market that is comfortable with your price structure.
Before deciding to lower your prices always start by offering additional services or features. If you can give away more for the same price (without cutting into your profits) then you will always be better off than you would be if your trained your customers to focus on price.
3. Retool your product/service mix.
Offer more versions of the same product or service. If you currently run a service business, develop a product line to go with your service. If you only sell products, offer a corresponding service such as training or maintenance to bolster your product's sales potential.
4. Sharpen your marketing materials.
Most small businesses cut their marketing budgets when times get tough. The really smart business owner shifts their marketing focus based on the effectiveness of the result. They don't cut the means of their profits, they re-engineer their marketing to fit the needs of prospecting and qualification.
5. Expand your promotional efforts to new markets.
During a down cycle, markets do not all slow down at the same time. Many times what happens during a recession, is we see the shifting of priorities and a realignment of spending. The movement of money continues even in a depression. Someone is always making money; the question is whether you will be able to move smoothly through the cycles. Keep you promotional strategies flexible and continue to track your progress.
6. Use the power of referrals to generate recession proof income.
Build a testimonial letter collection. Better yet, get your best clients on audio and video. This is a powerful endorsement to new clients and works well in connection with the above concepts.
You can build your business to the point where the majority of your business is powered by referral marketing; it takes time, systems and constant care and attention.
So you can see there are effective ways to offset the issues of an economic slowdown. The best way to offset the negative effects of recession is to prepare for it; build your list of customers. Grow and maintain your list and utilize them for referral generation.
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