After years of uncertainty and volatility, most roads point to continued economic distress and even a potential recession. Recession-proof your business by transforming your mindset, culture, and behaviors.
Supply chain issues, massive layoffs, budget freezes, global crises, persistent inflation – businesses have experienced a host of challenges lately. Unfortunately, most roads point to continued global economic duress and, according to many experts, a recession. The volatility doesn’t have to mean all doom and gloom, however. It can also be an opportunity.
Rather than making small, temporary survival adjustments, shift your focus to transformation and long-term success. There is no better time to take steps that evolve your organization into one of resilience and recovery.
In an eBook featuring input from Vendavo experts and industry thought leaders, Expert Tips for Recession Proofing Your Business, we’ve identified four broad categories to focus on for a business transformation that both mitigates risk and future-proofs your organization. If you’re looking for practical tips that you can start implementing today, you’ll definitely want to give it a read. In the meantime, here are some tips on transforming your organization’s mindset, culture, and behaviors.
Mindset and Culture Recession-Proofing
There’s plenty of chaos in the world today and headlines share the concerning stories widely. While following world events is important, it’s critical that you avoid quick reactions to news of the day and instead set and follow your own strategy with confidence. Your organizational mindset plays a key role in surviving economic distress. Experts recommend the following:
1. Focus on the fundamentals
Reinforce the core, innovate, and make the investments you never had time to make.”– Stephan Liozu, PH. D, Pricing Evangelist and Thought Leader
2. Do not panic
Do not start a price war; try not to participate in someone else’s price war. If possible, provide more value for your customers versus automatically dropping your prices.”– Kevin Mitchell, President, Professional Pricing Society
3. Think long-term
Focus on managing your long-term strategies with a balance of a few purposeful short-term directives to get past the coming 6-12 months.”– Aneesa Needel, SENIOR Product Marketing Manager, Vendavo
4. Diversity, diversity, diversity
Diversity in business protects from all the revenues being impacted at once. For example, new equipment and aftermarket; customer management information systems and pricing.”– Kalle Aerikkala, Business Consultant, Vendavo
While taking news headlines with a grain of salt can be considered a best practice, actively listening and learning from the behaviors of your key audiences and stakeholders is essential when preparing for a recession. Pay close attention to your employees, customers, competitors, and the wider market.
5. Gain a deeper understanding of your customers
Understand the needs-based and psychological buying data for your products such as why do your customers purchase your products? How recession resistant are your customers?”-Paul Sansom, Business Consultant, Vendavo
6. Listen to your market
Explore what buyers value and how they discover it. Price segmentation is often very profitable at this point.”– Mark Stiving, PH. D, Chief Pricing Educator, Impact Pricing LLC
7. Consider your products’ perceived value
Stay close to any changes in your product’s perceived value and associated market dynamics and reflect that in your pricing.”– JT Bowlin, Consulting Director Pricing Solutions, EMEA, Vendavo
8. Use the soothing aftermarket tonic
Clear evidence from the last downturn shows that while investment in capital equipment will be delayed, your aftermarket business presents a great opportunity to replace lost sales and maintain key customer relationships.”– Robert Irwin, SVP Global Business Consulting, Vendavo
9. Rationalize your customer book of business
Gain visibility to actual pocket margin to understand who makes you money and who is a drain on your company. Find a way to serve marginal customers profitably or reconsider the relationship.”– Daniel Cakora, Business Consultant, Vendavo
No one can predict the future entirely, but the days of easy growth are behind us for now. Savvy organizations who look at this as an opportunity to focus on long-term sustainability and profitability may not experience completely smooth sailing, but they are more likely to weather the storm.