Is there a recession coming?
There is a lot of talk that the economy is entering into or may already in a recession.
One problem with talking about a recession is that just talking about it can help cause it. People stop spending money because they are worried about hunkering down for a recession which means businesses that would get the money the people would have spent don’t get it anymore, so those business also can’t spend money and eventually, they cut services and staff and the recession really does occur.
It can be a self-fulfilling prophecy and its certainly possible that as a country we might be currently talking ourselves into a recession.
What might happen during a recession?
Some of us might not have been in business during a recession. What’s it like?
For many, Google might stop sending so many clients and the phone stops ringing as much. It’s harder to find clients and we might become more negotiable on price to keep the business running. Profitability might drop. Growing a business during a recession can be harder.
Ironically, a lot of new businesses start during a recession.
Choosing to participate in a recession
We can choose not to participate in a recession. We may not even have to choose. Some industries and professions will be unaffected by a recession and may even do well from a recession.
What does choosing not to participate in a recession look like?
At an individual level, we can’t spend enough to stop a national recession, but we can choose to run our business so that our own business isn’t affected by the recession. This protects our business, staff and family.
Ways of doing this is include:
1.Continue to invest money, prudently, on marketing, technology, advertising, and training.
This keeps our business in good shape, gives us a competitive advantage during a recession and positions us well when the expansion phase of the economy happens.
2.Attract and retain good staff. Good staff are hard to get, this can change during a recession. Good staff create business and improve profitability.
3.Work harder on your business and personal network. This is where BNI comes in.
When the phone stops ringing
If work in our industry is not abundant and the phone slows down or stops ringing, how do we find enough work to keep our business running at a profitable level?
We need to be first in the queue for the available work. Don’t picture the 1930’s with long lines of people looking for work.
What will place us at the head of the queue is who we know, and who knows and trusts us that will recommend and refer us. It is a strong business and personal referral network that is deliberately created and maintained.
BNI is obviously such a network. Investing in a network like BNI stays very cost effective – it places us at the front of the queue for work and that work is profitable work because it’s not based so much on price, it is based on being good and trustworthy. Service and products can be good, fast or cheap, but you can only pick two of those attributes. In BNI we should be (relatively) fast/responsive and good. Not cheap.
A recession is not the time to stop investing in yourself or your business. In fact, it’s the best time because others will stop, leaving you ahead of your competitors.