In agrarian societies, winter was a serious threat. If you were a farmer in a climate with four seasons, you had to prepare for winter if you wanted to survive through the year.
In our modern society, few of us spend a lot of time worrying about the seasons. Not preparing for winter isn’t a catastrophe. We can drive to the grocery store during a snowstorm and buy oranges from Florida, bananas from Costa Rica, and mangos from the Philippines – all fresh and ready to eat.
There’s a different kind of winter coming in business. Even though we’re not used to preparing for winters, this is one that every business founder should be making plans for.
Don’t wait until the storm to prepare
I see a lot of business founders planning as if the current economic cycle will last forever. It won’t.
I’m not trying to make any kind of political commentary here. I’m not making an economic forecast or predicting when things will change. What I do know, however, is that we are at the tail end of the longest bull market in U.S. history, and bull markets never last.
Two things are certain for now: winter is coming, and so is the recession. I have no idea when it will come, how it will start, where it’s going to hit hardest, and who will be affected the most. I just know that it’s coming, and we should all be preparing for it.
Just as our ancestors had to store grains and preserve foods before the temperature dropped, business owners and sales leaders will have to start thinking about the strategies they’ll need to put in place. If farmers waited until the first snowstorm to start stocking food, they wouldn’t make it through the winter. Waiting to feel the effects of the recession before putting a strategy in place could be just as dire for your company.
A recession can be an opportunity to create value for your company and help it survive or thrive. It can also put it at great risk. If you’re prepared, however, you can make the most of a challenging situation.
How to prepare for a recession
History offers lessons on how to prepare your sales strategies for a recession. Here are five things you should review while the market is still strong.
1. Review your customer base
Review your customers with someone who has been in a management position during a previous recession. Which customers are likely to farewell, and which are likely to struggle? If your product helps them save money or make more money, make sure they are fully utilizing your services.
This is something you should be doing already, but recessions force you to get better.
2. Review your industry focus
Certain industries do well during economic downturns, like government, entertainment, food, and healthcare. Get some of these industries at the top of your funnel now.
It will take time to figure out the messaging and sales approach for these industries. So, make sure you work that out early so you’re ready to sell when the times comes.
3. Review your technology
Are you fully utilizing the technology you already have? Could your tools help you make more money or help you save more?
Do you have any dead weight you’re just keeping because you might use it someday? Dust it off and start using it now or cut it and save the expense.
Are there any tools you should be getting while you can? Technology can make you more efficient and more effective. This could give you the advantage you need.
4. Review your processes
What is working now may not work when things get hard. So, take the opportunity to try something you haven’t tried before.
If you haven’t invested in email sequences yet, try it. If you’ve been avoiding cold calling, try it.
Take a close look at your cost per customer acquisition and see if you can get it down. Get scrappy again. Test, measure, and repeat.
5. Review your people
If you have a salesperson who is barely cutting it during the strongest economy in U.S. history, they probably won’t cut it when the storm hits. Replace them with top performers.
Don’t wait to do this. You might think it will be easy to hire when the economy loosens up. However, companies will hold onto their best performers tightly, and the top performers won’t want to leave something they are comfortable with.
You also want your team to have spent some time working together before it gets hard. If you were managing a sports team, you wouldn’t want new players on your team as you enter into March Madness, the Super Bowl, or the World Series.
It’s time to start planning
You can only face the winter if you have a plan. If you don’t think you need a plan, then you should at least draw up a list of friends and family members who will let you sleep on their sofa. If your company doesn’t have a strategy for the next recession, you just might need it.