How Entrepreneurs Can Plan For Recession And Thrive During It
The economic recession has always been an uninvited visitor for the business sector. It sneaks up on you without any warning, and you can never know when it’ll pack its bags and leave. A recession is a time when profits take a nosedive, millions lose their jobs and the costs of products and services soar.
But just like you have companies that go broke or struggle to break even, some enterprises make millions during the recession. What makes them distinct from the companies that fail during a recession is that they interpreted the scenario from a different perspective. We reached out to four women entrepreneurs to know their insights on how to thrive during recession:
How can entrepreneurs plan for recession?
Working on core competencies
Pradnya Kakade Singh, the founder of ‘The Brand March’ states that every business wants to thrive in a difficult economy; however, only entrepreneurs who focus on their core competencies can strike through any business hurdle. “We can sail through ups and downs only if we constantly work on enhancing one’s competency, our core skill. What’s new, what’s different than I am providing to my clients? What value additions does my client get? Is my product sustainable? All these questions we as entrepreneurs must ask ourselves,” she adds. Pradyna believes that there is a need to cut costs when in recession, but one should not compromise on their marketing budgets and employees value. “This is your long term armour which will keep you going.”
Every business wants to thrive in a difficult economy; however, only entrepreneurs who focus on their core competencies can strike through any business hurdle. – Pradnya Kakade Singh
Ideate and innovate
Sujata and Taniya Biswas, the co-founders of Suta, feel that in the fashion industry, it is imperative to ideate and innovate, and guard yourself during a recession. “Hire good resources, plan your calendar and your upcoming collections and be prepared with your funds so that you can fuel your journey ahead in times of recession,” they further said.
Make a proper plan
The founder of Digital Pushp, Abhishree Bharti, lists down a proper plan for handling situations in recession. She suggests three steps to ensure stability. The first being to always keep an eye on cash flow in order to protect wealth. Secondly, to build a portfolio based on goals and not on the market ups and downs and lastly but most importantly, to maximise your core competencies which work as an integral part of the business.
Creating a brand name and value
Priya Florence Shah, the founder of BlogBrandz, suggests creating a brand for oneself and their business. “During a recession, people will be more choosy about who they spend their money with, and brands will win over others,” she states.
What are some challenges you faced during the recession and how were you able to overcome them?
Pradnya says that there is a mental block which means; recession = cost cutting, and the same happens with clients who either curtail their marketing expenditure or stop it. “In such a situation, we consult them not to stop their marketing activities. They can, however, slow it down with minimum budgets. This helps to give an edge to customers when someone requires their services,” she states.
Sujata and Taniya discuss how their three-and-a-half-year-old company is facing a considerable slow down this year for the very first time. “During this time, we did an overview analysis and found out our roadblocks. This analysis helped us hire good resources, and we even started new verticals which we did not have before in our management system. This ensured that the entire system is more sturdy and robust so that delivery happens smoothly to the customer,” they added.
People are not going to stop buying what they need, so offer them something they can’t do without. – Priya Florence Shah
Meanwhile, Abhishree describes the various challenges faced during a recession like loss of demand from the customer side, workforce reduction and reduction in marketing activities. So, she suggests that the best way to overcome this condition is by always having primary customer base list, by hiring employees on contract/ad-hoc basis apart from the core members and finally by using guerrilla marketing techniques.
Priya, on the other hand, narrates how people close to her lost their jobs and became unemployed for a long time. To avoid this, she said that the key is to be adaptable. “If your industry is suffering, get into a new industry. Read the book Who Moved My Cheese and decide which mouse you’ll become”.
What are some anecdotes you reflect upon while planning for a recession?
“One anecdote, which is very close to our heart is when Sujata was pregnant. It is was a recession for us as we weren’t able to sell better due to pregnancy. Sujata reflected on the things that should be done and can be done when she couldn’t help much and had to stay indoors,” says Taniya while sharing their story.
While planning for a recession, Abhishree advises on few things to be taken into consideration such as reducing operational costs to reduce the amount of project cost, never spending on new products or market and always having an alternate plan B for upcoming months.
To sum it up, Priya suggests that scarcity is all in mind. “People are not going to stop buying what they need, so offer them something they can’t do without,” she says.
Saumya Rastogi is an intern with SheThePeople.TV.