Are you prepared for the potential challenges that your business may experience over the next year? Although economists are divided, key indicators point towards a U.S. recession by 2023. How you prepare could mean the difference between your business staying afloat or sinking like a ship in a storm.
The National Bureau of Economic Research says a recession “involves a significant decline in economic activity that is spread across the economy and lasts more than a few months.” What that could mean for your business is a tougher time making sales because heading into and during a recession, consumer confidence in the economy drops and customers buy less.
Recession or not, a need will always be a need. Luckily, smoke shops and dispensaries serve a need and are the only businesses on block where these needs can be met. Still, it’s important to think about just how the products you provide truly meet customer needs. Does the product help people to boost their spirits to show up effectively in life? Does the product help people to do something more efficiently or lead to a better end user experience? These are needs that step outside of traditional definitions and help to anchor small businesses throughout all economic conditions.
While some businesses may think they should scale back on their marketing during a recession, that is not the case. Instead, businesses need to stay top-of-mind with their customers now more than ever. Ways to do this include email marketing, regularly updating your blog, consistent and engaging social posts, and making sure your website is up to date with any news, events, sales, etc.
Once you’ve got customer attention, keep them coming back by continually providing them with products that exceed their reasonable expectations for quality and value and by showing them that your business has their back. And how do you do that? By under-promising and over-delivering, by treating them the way they want you to treat them and by saying ‘thank you’ in memorable ways that support your brand. Loyalty programs, which offer discounts on future purchases, are a great way to give a little back.
Behind the scenes, stay lean and flexible. Delete those expenses that serve no purpose. If possible, work with vendors to bring in the best selling products and see what you can do to make deals — maybe it’s free shipping or discounts on bulk orders — every penny counts. If all of that is a no-go, find a supplier that offers the same quality products but at a lower price.
During a recession, shoppers want the most for their money. Don’t get into a price war with the shop around the corner because nobody wins that battle — rather look at what areas your competitor outperforms you, and figure out how you can adjust to keep up? When times are tough, it’s time to focus on your strengths. See what products you offer that the competition doesn’t have?
You might think fewer customers means it’s time to cut back on inventory selection, but in reality now’s the perfect time to expand your product offerings. It’s difficult to find new customers during a recession, but one way to expand your reach is by offering new products. By diversifying what you’re currently selling, you’ll be able to not only re-engage with your current customers, but you’ll be able to bring in new customers looking for products they can’t find anywhere else.
The best way to recession proof your business is to stay in the game and weather it out. Most businesses will try their best to survive and not go under, while you need to be focused on growing. This change in mindset will let you go through a recession and come out stronger. Plus, focusing on growth fills you with optimism and an optimistic mind can overcome any challenge life throws at it. Every storm eventually passes, the skies clear and the sun shines once again.