RECESSION: IT HAS to be the most dreaded word in business. Visions of hardship coupled with the last two years of uncertainty make for many sleepless nights. However, the sign industry has shown it can weather such an economic storm. It isn’t necessarily recession proof, but it is a business that can benefit from hard times, providing one can pivot when needed. During the last economic downturn in 2008, our sector bounced back faster than others.
You’ve likely made shifts during the pandemic and quickly learned to adapt. Plastic partitions and social distancing signage briefly soared in demand. Those who leveraged these opportunities did exceptionally well. Silver lining is, the next economic turn down will have similar opportunities. You need to have the right mindset and be ready to meet client needs. Know you’ll make it through no matter what happens and set out a plan to get through the next 12 to 18 months.
A recession affects everyone. Everyone! Do not go through it alone. Find other business owners you can talk to. Tales of good and bad days will give you insight and encouragement when you need it most. There’s no shame in sharing the struggles you’re experiencing. We’ve all been there, and will be again. Experienced businesspeople can help guide you since they’ve likely gone through this all before — several times. These people thrive in challenging times and build business based on opportunities they have the experience to identify. They will help expose you to prospects you may not be privy to sitting at home worrying by yourself.
Pivot — One More Time
As the economy shifts, you’ll likely see your client base change and with that the products you create. During the pandemic, e-commerce grew at an exponential rate as we were all forced to buy online. Recently, with in-person shopping having returned a while ago, studies show retail vendors are increasing spending on advertising for both their brick-and-mortar locations as well as their e-commerce platforms. This will likely be in the form of soft signage applications, as well as programmable digital options so clients can also easily adjust their strategies.
Listen to your customers’ needs and pair them with solutions tailored to their budget. Educate them on the cost increases across the board, due to supply chain shortages and other inflationary costs. Be ready.
Mind the Money
Managing cash flow, inventory and spending is vital. Keeping enough for at least two months’ worth of business expenses in the bank at all times is the best way to provide peace of mind. Closely manage receivables and payables to maintain the cash flow needed to guarantee your expenses are covered. Reality is, some customers will go out of business, and you’ll be left with a loss should you extend terms to someone who is buying a going-out-of-business banner and wanting 30 days to pay. Just because a client paid on time before doesn’t mean they can now.
Be smart when spending money on marketing. Maximize economical strategies such as social media and email campaigns to connect with both new and existing customers. Make sure your messaging reassures that you understand the financial struggle they’re facing and that you’re there to help.
Most of us are already prepared to adapt from what we learned from the pandemic. Don’t let fear take over; keep to the mindset that you will not just survive, but thrive.
Remember what you learned, what you did and the advice you received that got you through. When the next recession hits, be that person who pays it forward by helping those facing the same challenges. Your pearls of wisdom may save a business going through the same perils you’re about to endure.
Published first here: https://signsofthetimes.com/3-steps-for-sign-pros-to-weather-a-recession/