5 Ideas to Grow Your Business During a Recession

5 Ideas to Grow Your Business During a Recession


In this video, I’m going to answer the
question of how to grow your business as you’re going through difficult times,
challenging times, recessions. What to do when your business is slow? There are really a few things that you have to keep in mind and focus
your efforts on to grow your business. When you think just about any
industry when majority of the players, majority of the businesses are really
slowing down, contracting, firing their employees, losing revenues lose money,
there is a smaller percentage that is actually growing. How did they do it? What did they do differently and how do you apply what they have done so your
business actually expands while everyone else is contracting? First and
foremost thing is that you have to think about the mindset that you bring to your
work every day. That is when there is so much fear out there, do you focus on
fear or do you focus on the opportunity because there is a bound opportunity in
every downward market. Let me explain. People who make market in the stock
market are the ones who buy low and sell high. When the stock market begins to
plunge people who know how to deal with that know that on average if you look at
the last 70 years or so, it takes the stock market like S&P 500 538 days to go
from this back to this. Little less than a year and a half to recover on average,
sometimes it’s longer, sometimes shorter but on average it’s 538 days, no matter
what type of calamity is here over the 70 year period, it’s a long period to
think about. So it’s the same thing that applies to any business. You think about
when the whole business starts going down, not just your business, your whole
industry starts going down. How long will it take for the whole industry to
recover to the previous level? Could be a year and a half, could be two years, could
be a year, could be less than a year. But what do those companies that actually
keep on gaining traction, keep on gaining momentum through recession and come out
at the tail end of it much bigger, much stronger, much more profitable, what they
do differently? Aside from mindset, when they look at their competition, when
they look at their industry, they see that everyone is contracting, they’re
trying to cut their expenses, they’re firing employees or laying off employees,
they’re taking a defensive position and the one thing that winners know is that
when you play in any kind of sport and business is a contact sport. When you
play in any sport, you cannot win by taking a defensive position. You can lose
the game by taking a defensive position but you cannot win. The only way to win
in business is to go on the offense. Yes, you have to have strong defense but you
also have to go on the offense to win. Here’s what that means in practical
terms. Most of your industry, regardless of what the industry you are in, are going
to do the following: they’re going to think about what expenses they’re going to cut
and one major expense that they cut that leads to recession of their own making
is they cut marketing and advertising. Think about that. Marketing and
advertising when done right deliver more business to your company. When you cut it off, when you turn off or turn down your marketing and advertising, you
get – what? – you get less of it. You contract and that contraction is
of your own making. The winners, the companies that actually grow
through difficult times and thrive at the tail end of the recession, they do
what? They do the opposite: they expand their marketing and advertising efforts.
The best rule to apply here is the 10x rule. The 10x rule means or states the
following that it will take 10 times the effort, 10 times the time, 10 times the
resources to achieve your objectives . Whatever you have been doing in the past
to attract new customers, think of how to increase those efforts 10 times and
what will inevitably happen, as your competition shrinks their efforts and
you expand them, your business will expand with that expansion because just
as your competitors will fuel their demise, you will fuel your growth. But
again, this takes a certain mindset, not contractionary, not defensive mindset, not
fearful mindset. It takes courage and it takes
expansionary mindset so this is the number one strategy that we recommend to
all of our clients and we do it ourselves, especially when we face things
happen, when there is another recession like we’re going through right now in
the middle of March of 2020. Major recession is hitting everyone, everyone
is fearful. We don’t just think how to expand. We have already created a plan
with 10 points in it how and what we’re going to do to expand our business
through this and we have already started implementing some of the things on that
bullet point list to keep on growing, to make sure that we get more clients as
our competition is shrinking. We will not let the fear destroy or demise our
business, we will work off of other people’s fear and work on expanding our
business so that’s the number one strategy. Number two strategy and this
again may seem counterproductive: fire your bottom 20% customers. Here’s what I mean. If you’re in the service business and you have recurring business with
your customers, look at the list of your customers and ask your frontline people,
people who are actually working with your customers. Ask them who are the
worst customers based on this, this, this criteria: slow to pay their bills,
give you a hard time, required a disproportional amount of effort to serve them. If you have customers – and every service business does – that hit
these 3 criteria or even two out of these 3 criteria, fire them. This
sounds insane to let go of some of the revenue in this environment but you
ought to do it and here’s why. As you expand your marketing and advertising
efforts, you will get more business. To serve that more business, you will need people to deliver the services. What you want to do is you want to free up that
capacity to deliver the service without increasing your payroll. One of the ways
to do it is to let go of your worst customers. It’s highly recommended. There are major corporations that have done that in the past
and thrive because of that strategy. Number three. First strategy is expand
your marketing and advertising. Strategy number two is cut your bottom 20% of the
customers. Strategy number three: to keep on growing, look at the services that
you’re providing today and look for a way to significantly improve the service
that you deliver to your customers. Why? Because that will make you even less
dispensable to your customers. In the recessionary times, some of your clients
may be looking for a way to save money and if your company delivers a mediocre
service, mediocre results, why would they be loyal to you? Instead of that you
actually work on improving your service like brainstorm with your team how do we
improve our service. If we were our customers, what do we see as the fault of
ours and our service delivery. How do we improve on our service and when we do, we will keep retaining or retain rather more of our customers for longer. At
the same time, look at your production process and find inefficiencies within
the production process. Here’s what I mean by that. If you deliver a service
and it costs you 40 hours of labor to deliver that service, look for a way to
make your processes more efficient. Do not cut the number of services that you deliver to your customers but look for a way to make your process more efficient so instead of 40 hours, you cut it by 20% by finding certain efficiencies and now
it takes you 32 hours to deliver the same service. What happens when you do
the following – you expand your marketing and advertising so you attract more
customers, you get rid of your worst performing customers and you deliver
better service to your existing customers and it now costs you less
to deliver that service. now you can service more customers with the same or
fewer resources, with the same or even smaller payroll and here’s the final
point, final strategy on how to grow and expand for any recessionary time. Fire
your worst employees. What I mean by that is look around at
your company and make a list of the people who you have been thinking about
firing but haven’t fired them because you needed them for whatever reason.
They’re really good salesperson but everybody else in the company hates them
and they create a toxic atmosphere. They’re really lazy. You know that other
people perform at like 90% of their skills and capacity and this guy
performs at 50% and you have warned them time and time and again. Fire them
now and at the same time let everybody else on the team know that you love them,
you care about them and you will bleed for them and take a bullet for them and
make sure that you will keep their jobs. Here’s why it’s incredibly important to
assure your employees that you will do everything in your power including
bleeding. And what I mean when I say bleeding is you can go in the red.
This is the year and in any recession you can go in the red, you can lose money. I hope that you have some reserves and I hope that you have a line of credit to
fall back on because you want to keep your core team, you want to
keep your best people and you want to make sure that they feel secure because
the opposite is also true. If you let go a good person, what that will do to
the morale of the company? What that will do to the morale of every employee that
you have is they will think: ‘Am I next?’ And what happens when people think ‘Am I
next’, they have fear, now they have even more fear. When they have even more
fear, will they deliver excellent service to your customers? Probably not. Will they work at the absolute top level of their skills and ability? Probably not.
Will they retract, will they possibly start looking for other opportunities
at other companies? Absolutely. By making sure that you promise your people,
guarantee them security and safety, show them true love and care for them, they
will stay with you and they will bleed and work harder for you to deliver those
excellent level services to your customers. And by the way, what will also
happen inevitably is as your competition is letting go of their good people, they
will come to you. And you want to build a stronger team
because as every recession passes, you want to have a really strong team with the best people in the industry, so you keep on growing and getting even more
customers, so you keep on getting more revenue and building more profitable and
better business. Thank you very much for watching. If you have any question,s if
you want to discuss how to preserve your business, how to grow your business and
how to thrive in your business as you’re going through this challenging time,
reach out to us. You can call the office or you can call me direct or you can
email me. My direct number is 8478777568. Again, 8478777568. Call me, text me or email me at [email protected] I will personally answer your email, I will personally answer your call, I will
talk you through whatever challenges you’re going through and we will create
a plan in writing how to grow through this challenge and thrive at the tail
end of it. Thanks for watching.

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About the Author: Oren Garnes

2 Comments

  1. 02:10 – Increase marketing and advertising spend
    05:25 – Cut the bottom 20% of the worst-performing customer base
    06:40 – Improve operating processes and deliver better services and customer experience
    07:43 – Service more customers with the same or even fewer resources than you are allocating now
    08:46 – Fire your worst employees while assuring the rest of your staff that you are committed to them and their well-being
    businesses that make money during a recession

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