Six Strategies to Recession-Proof Your Business Experts Suggest That the Coronavirus Pandemic Will Push the UK Economy Into a Deep Recession

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Six strategies to recession-proof your business Experts suggest that the coronavirus pandemic will push the UK economy into a deep recession. So what can businesses do to protect themselves – and what lessons can be learnt from the past? Cash flow is king 50,000 UK businesses fail each year because of cash-flow problems. Recession-proof your cash flow by examining your outgoings. Are some expenses higher than they need to be? Is your bookkeeping fit for purpose? Digital accounting software gives a ‘live’ picture of your cash flow – if you’re still using spreadsheets, you might not spot Hold on to your existing potential pitfalls until it’s too late. customers Previous recessions suggest that customers don’t stop spending in a recession, but they do spend differently. Can you create lower- priced lines, or include value options? Nurture your client base. Reward loyalty. Invest in customer relationships. Communicate regularly. Work harder to supply what clients want in uncertain times. But don’t fall into the trap of heavy discounting. Don’t skimp on marketing It costs five times as much to get a new customer as it does to retain an In difficult times, marketing can seem existing one. an easy way of reducing costs, but continuing to advertise during periods of disruption can help maintain your market share. Focusing on growing your social media presence is also a cost-effective way to reach new and existing customers. Amazon grew 28% in 2009, despite the recession. “Marketing helps soften the depth of the downturn,” says Mantas Ciuksys, director of content marketing at Socialbakers, “and can reduce the duration of the recession effect by accelerating your business in the upturn once the economy awakens.” Think about the new world Will people behave differently as a result of the impacts of coronavirus? Are your core products and services fit for purpose, or do you need to refocus energies? Try to have more than one revenue stream to your business. Reflect changes in consumer behaviour in your business model; for example, by developing effective online sales channels. Get your house in order Have a contingency plan. Do you have financing in place? If not, now is the time to do it – today’s favourable lending rates may not be in place when a recession bites. Look into government grants and financial support options for your business. The new world also reminds us of the importance of a business Look after your employees continuity plan – do you have one? Employees are a company’s “Companies that have contingency lifeblood. In previous recessions, plans act faster,” says economist Dr Bill notably 2001, many companies Conerly. “Most good business leaders were quick to make staff redundant can easily figure out what needs to be but this presented further problems done. The time lag is getting up the in the period of recovery, according nerve to execute the plan.” to the Institute for Employment Studies. Seeking to retain as many staff as possible, focusing on their well-being and prioritising learning and development will help you be on the front foot as the economy recovers. Sources: Xero, FreshBooks, Forbes, Invesp, AdAge, The Atlantic, Perfect Marketing Equation, Socialbakers and IES Socialbakers Equation, Marketing Perfect Atlantic, The AdAge, Invesp, Forbes, FreshBooks, Xero, Sources:.

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