Experts agree a recession is looming. Here are tips for finding the right mix of people, process, and technology to become more agile and prepare your business for any economic state.
There have been as many as 48 recessions – or periods of economic decline – reported throughout U.S. history dating back to the 1700s. Each one had its own unique set of causes, effects, and resolutions. In other words, economic downturns happen with some regularity, yet no two recessions are the same. While no one can predict the future entirely, financial experts say a recession is certainly a possibility in the near future.
Rather than simply shifting into survival mode, savvy organizations are looking to strategically prepare and protect their financial position. They are focused on transformation that leads to long-term success. To support leaders in their response to disruptive change, Vendavo experts and other industry thought leaders contributed to our eBook, Expert Tips for Recession Proofing Your Business.
Technology, Process, and Strategy Considerations to Recession Proof Your Business
For businesses to succeed in today’s digital economy, it’s less about having the newest technology solution or enough people. Instead, it’s about finding the right mix of technology, process AND people that work in support of the other. The right pricing and selling strategies, staffed by the right people, and fueled by the right technology solution, will get you headed in the right direction.
1. Beware of chasing false indicators
Driving down prices during or at the top of an inflationary period could cause a price war where your industry races towards the bottom.”– Corey Schroeder, Senior Director of Product Management, Vendavo
2. Focus on value-based pricing
Companies should consider implementing a pricing segmentation strategy to better understand what customers are willing to pay and align pricing to that.”– Kamal Sabnani, Principal Product Manager, Vendavo
3. Ramp up your analytics
If a company can’t accurately isolate cause and effect over period changes in revenue and margin they’re probably going to be in for stormy economic seas.”– Mike Slavin, Business Consultant, Vendavo
4. Get a strong re-pricing process in place
An effective re-pricing process ensures early risk flagging with an impact analysis followed by fast price corrections and stakeholder/client communication.”– Pol Vanaerde, Founder & President, EPP-Pricing Platform
5. Uncover revenue and profit leakage and be transparent
With little room for price decreases or increases right now, another option is to keep current price levels by removing non-essential features.”– Yekta Yeganah, EMEA Managing Consultant, Vendavo
6. Consider investing in pricing software
Investing in dynamic, scalable pricing software will help businesses learn how much they are able to charge without affecting sales volume.”– Tariq Shah, Account Executive, Vendavo
Efficiency and Agility Considerations to Recession Proof Your Business
Recessions bring challenging times, there’s no doubt about it. What can you do to gain organizational fitness and fortitude? Efficiency and agility are key – and there are ways in which you can encourage both.
7. No one can predict the future entirely
The best way to prepare for a recession is to enable your organization to respond quickly whether the opportunity is shrinking or growing.”-Dave Anderson, Vice President of Business Consulting, Vendavo
8. Run scenarios for impact, risk, and ability to execute
Create scenarios and, even though the specific scenarios aren’t likely to come to pass, you’ve likely generated viable options – and team alignment – that can be leveraged no matter what happens.”– Mitch Lee, Vice President, Marketing and Profit Evangelist, Vendavo
9. Be flexible and agile
The ability to have real time market data and react accordingly can be a real benefit in times of economic hardship.”– Dayton Kellenberger, CFO, Vendavo
Today is not a time of easy money and growth-at-all-costs. To navigate the disruption and survive, businesses will do well to take the opportunity to reassess current practices and focus on long-term sustainability and profitability.