We are facing the possibility of an economic recession in the coming months, according to experts.
In recent years, the economy has had serious repercussions due to the COVID-19 pandemic, among other factors, such as wars and the current inflation crisis facing the United States. The largest in 30 years. Undoubtedly, this situation creates financial anxiety that we have to deal with.
How can we prepare for an economic recession?
The cost of preparing your business for a possible economic downturn is too low, while the cost of being unprepared may be too high. One of the factors that have helped companies cope with crisis situations, especially in the pandemic and post-pandemic, has been the digital economy.
The implementation of digital devices and the exploitation of the Internet have given a positive response to the the new demands of new consumer profiles or habits, not only in streamlining the commercialization of products and services, but has also helped significantly to to expand business opportunities for companies, and more importantly to maintain them.
How can you protect your business against an economic recession?
It must first be understood that stock market crashes and economic recessions are a natural part of the economy. And while we cannot accurately predict the future, there are some variables that tend to precipitate an economic slowdown. Such as illogically high prices and low interest rates, which form a kind of bubble, although not enough to definitely determine a crisis, it does alert us to keep a business prepared for any event..
Not all companies are the same. For example, those that cater to the basic needs of consumers will have an easier time surviving the crisis than those that offer luxury items or non-essential items. some strategies you can use to protect your business:
Diversify your customer base
Your customer base is important. You must determine whether the customers your business relies on will be directly affected by the recession and how much this loss may affect your business. Also evaluate small customers and classify them, you may lose some of them, but this does not mean a big loss for your company.
Emergency Plan
After assessing the potential customers you may lose or who will consume less of your products or services during the recession, you need to consider what to do. You can categorize the emergency, depending on the category in which you place them, for example, a significant drop in sales, the possibility of closing one of the physical locations or a shortage of cash.
Simply knowing what you would do with your business in case of an emergency can save you a solution in case it happens.
Understand the demands of your audience
Research your industry and competition. You can look at previous recessions and see if your market has been affected during any of these crises and if so, how they overcame them. Or if not, what were the factors that caused the loss.
Your greatest assets are other entrepreneurs and the way they faced the crisis.
Definitively digitize your business
Digitizing a company or business refers to the process through which tools, technology and digital ecosystems are used to provide greater value to customers, new experiences, solutions and business models. They are also all those actions and strategies that make the routine operations of an organization more efficient and, in turn, contribute to increasing productivity.
A company that takes too long to evolve to meet the needs of its market tends to disappear. And it is not only automating some tasks, but it is a mindset about your business culture, taking advantage of the opportunities of the Internet economy, some key aspects, so that you understand the importance of digitizing your business today:
Cost savings
You can make use of software that will help you generate greater profitability and resource optimization. For example, an ERP, or enterprise resource planning system, to help drive sales.
Depending on the needs of your business, you will find different ways to do tasks such as invoicing, human resources management, projects or any activity that can be more productive.
Another great solution is an ecommerce, since you will save costs associated with infrastructure maintenance, services, leases, employees, among others. These costs can be passed on to other areas where more investment is required.
Relationship and acquisition of potential customers
Part of the digitization strategy is to incorporate key tools for managing customers. Nowadays it is vital to maintain a relationship with your customers before, during and after the purchase, in order to build a good relationship with them.
The use of mobile applications, favoring the customer experience using different techniques. How to simplify procedures and offer the possibility of contact, carry out procedures at any time or use mobile functionalities to have a better user experience (UX).
Generar clientes y mantenerlos son dos procesos diferentes. With digitalization it is possible to keep them satisfied, informed and attracted to your brand or business. In addition to establishing a level of engagement and long-term relationship.
Scalability and scope
The scalability of a business is within anyone’s reach, thanks to the digitization process. The more presence you have on the Internet, and the better your conversion strategy, the more business opportunities you will have.
One of the ways to scale your business is a website, with it you can not only make your value proposition known, but you can have a global reach.
Digitalization also allows you to know in real time, hundreds of metrics, to know how and which is your target audience and how to reach them. This information will help you to execute more effective actions that will guarantee the growth of your business, for less cost than with a traditional strategy.
Conclusions
For these reasons, digitalization is not only a good idea but a necessity, especially if we are talking about facing future crises or economic recession.
Having full control of your business will help you know it much better and know what decisions to make at the right time. In addition to always being within reach of your customers and prospects.
By using digital technology, you reduce the time spent on each project, which means more and better results in less time. Time is money!
At EtyaLab we know that making a decision on how to digitize your business is not an easy task, that’s why we offer our experts in digital and technological development, who will help you take the best path, according to the specific needs of your business..
You can request a free consultation by scheduling an appointment through the web here or at Calendly.
