Build a Business Recovery Plan to Emerge Stronger After a Slowdown
While slowdowns in the economy are challenging and have a major impact on small businesses, they don't last forever.
In fact, businesses that survive difficult times frequently emerge stronger than ever with the help of a business recovery plan.
Planning for better times
As the economic repercussions of the COVID-19 pandemic became known, reports of business closures spread across the US. While many were in hard-hit industries like travel, tourism and hospitality, manufacturers also struggled as global supply chains dried up.
Despite these hardships, many businesses have continued to survive and even thrive. Common keys to success include the ability to transition to a leaner model, meet changing market demands and focus on service.
Consider the following principles as you plan for the time when economic sluggishness fades and growth returns.
1 Remember your roots
A lull in activity is a great time to revisit the reason why you got into business in the first place—especially if you haven't considered it in a while. Has the business rationale changed? Does it fulfill a new mission or purpose? If so, your employees, customers and prospects will appreciate hearing about this new perspective.
2 Get smarter
What does your business do well? What's nonessential? By taking an honest look at every aspect of your company, you'll likely find a weak spot or two. For some, it could be a back-office responsibility, such as payroll or HR processes. For others, it could be a supply chain that needs updating or a legacy product that's outlived its value.
Automate your accounting, tap into technology, sharpen your workforce's skill set and streamline as much as possible, conserving resources and positioning yourself to seamlessly scale up the business down the road.
3 Keep your ear to the ground
Where's the marketplace headed? Are pandemic-driven trends and changes in customer behavior—such as heightened e-commerce, contactless payments and remote work—likely to stick around? If you believe they will, explore how to make them work best with your business and strengthen your company's digital backbone. Also consider creating a specific plan for business continuity.
4 Run the numbers
Eliminate unnecessary costs. Make tactical investments in upgrades and new equipment while suppliers are hungry for business. Take advantage of lower interest rates to finance strategic acquisitions, refinance older and costlier debt, and build up your cash cushion.
5 Keep spreading the news
Thanks to social media and email, marketing on a shoestring budget doesn't have to appear desperate. As long as it's done smartly, your target audiences might not even realize you're running lean. The key is to focus on one or two of your strongest social media platforms and deliver relevant content that customers and prospects find valuable on a consistent basis.
Help is nearby
To help ensure your business is prepared for the inevitable market shift upward, developing a flexible business recovery plan during challenging times—and enlisting the support of a valuable strategic partner like your business banker—can better position your business for the rebound.
Financial insights for your business
This information is provided for educational purposes only and should not be relied on or interpreted as accounting, financial planning, investment, legal or tax advice. First Citizens Bank (or its affiliates) neither endorses nor guarantees this information, and encourages you to consult a professional for advice applicable to your specific situation.