Stating a Business in Recession

How to Survive an Economic Crisis

Oct 29, 2009

Starting a business during an economic crisis is hard work, but with the right approach and a good business plan, there is less chance of failure.

Before the market dropped out from under itself, there were many individuals who had spent months planning to start their own business. When the recession hit, many of them decided not to take the risk, but there were those who were determined to soldier on, despite the economic gloom. Of course, for many, the decision was not down to them as individuals, but to the bankers that gave (or didn’t in some cases) the loans necessary to start the business.

Getting Publicity for a New Buisness

It’s important to spread the word of the business and make waves in the right subject market. It’s no good spending the entire advertising budget on a national newspaper with a high number of readers when a fraction of the budget can target the people who really matter in a trade magazine. Most newspaper readers skim even the articles and can not be depended upon to read an advert (hence, the full page colour ads that demand attention and costs upwards of £3,000).

It wouldn’t do to put an ad for baby clothing in a widely distributed lad’s magazine but it would be useful to put the same ad in a parenting magazine for a similar cost. Therefore, it makes more sense to target the audience who will be reading the advertisement and delivering maximum impact and readership.

There are places to advertise for free. Write news bits about the business and send it to trade magazines and journals. If the business now has an extra item or trade, write a piece about it; if there is a new partner or job opening, advertise it again in a news section of a trade publications. It all helps spread the word about what the business is about.

Earning a Good Business Reputation

Customer service is key to keep customers returning for more and spreading the word about the business. Good advertising is wonderful, but when a person tells a friend how good a service or product is, then the product and business begins to gain a solid reputation. The more happy customers that a business has, the more return custom the new business will receive.

If there are any favourable articles written about the business, have a copy framed and put up in the office where customers can see; or, if the business is web-based, have a link to the site where people can read the article.

Spending Little with High Rewards

It may have been a viable option in the past to take out a loan and throw money into the business, but now banks have cut back on loans to small businesses. It therefore goes to reason, that there will be less money to throw into the small business. Now is the time to make do with as little spending as possible while pursuing maximum impact.

Check out the competition: are they a small business too? Learn from them. Find out what has worked for them in the past and what hasn’t. In times of crisis, it may even help to lend support to another business and share both ideas and custom; create a bond with a sister company. If they already have a good reputation, the new business will benefit greatly from this.

It takes on average about three years for a new business to make a profit or break even, so ensure that there are enough funds and safety nets to see it though to the end. In the meanwhile, the business should have done well to establish itself and gain a good clientele and excellent reputation.

The copyright of the article Stating a Business in Recession in Marketing/PR is owned by Holly Stacey. Permission to republish Stating a Business in Recession in print or online must be granted by the author in writing.