Recession Proofing Your Business

How to get ready for the storm

With a recession looming, what steps can you take to recession proof your business? There is no guaranteed course of action that will see you through a recession but when people spend less you either have to cut down on your expenses or increase the number of customers.

Use these 6 steps as a guide.

Diversify

If you offer more services then you have more opportunities to attract and retain customers. Offer boutique or unusual classes. You may have smaller class sizes than you’d prefer and may even operate the class at a loss, but even a small amount of income goes towards your rent and keeps your name out there.

Add classes at times that might be less convenient for you but better for customers. Weekend classes and Sunday classes really expand your possibilities. Remember this is only a temporary thing but gear yourself up for working harder and longer.

Add fitness classes or other classes outside your usual area of focus if you haven’t already.

Differentiate yourself with exceptional service

Go out of your way to accommodate your customers, especially existing ones. If they want a coffee machine in the waiting room, pay the $40 for a machine and even pay the $20 a week in coffee and filters.

You should treat your customers with respect anyway, but remember, every customer counts, so give them the time of day even if it is an annoyance. Spend time in your waiting room and greet people. Ask them how their day was, get to know them.

Stay in touch with customers

Send out newsletters and updates that remind parents why they’re paying you to teach their children. Don’t let customers drift too far and follow up with customers who drop classes. You don’t have to give them classes for free, but you can offer discounts that will keep them showing up for class. Your overheads are the same, so even $10 a week extra goes towards the rent or your marketing budget.

A word of caution though. Be careful how you offer discounts so that you don’t get a flood of people crying poverty. Call them hardship grants or something like that and it will discourage the proud parents but support those genuinely in need.

Increase your marketing effort

In the early stages of a recession, you have to attract more customers so contrary to what your gut is telling you, increase your spending on advertising. Promote your new classes like crazy and get your name out there. You will need to cut back later, but early marketing can get the customers in that your business needs to survive the recession.

Tighten your belt

This last one is the most difficult because it means going without. Your staff will fear this one the most so it’s vital that you re-assure them you won’t be cutting salaries or hours unless it’s absolutely essential.

Buy generic inks for your printers. Cut down on subscriptions. Eliminate as much office waste as you can. Only print what really must be printed. Justify every new CD you buy or download. Turn off lights when the studio is empty, cut down on heating/AC when the building is not in use.

Form partnerships

Chances are, if you’re feeling the pinch, then so is your local dance store. If you haven’t already, offer to display some of their products in your studio or sell on consignment for a commission. If you do ballroom classes, run a dinner/dance evening with a local restaurant. They’ll be feeling the recession too.