David Royce is the founder and chairman of Aptive Environmental, and was an entrepreneur during the Great Recession.
His company saw revenues up to $23 million during that time, and based on his experience suggests doing five important things to recession-proof your business.
With another recession possibly on the horizon, he argues that spending on marketing, training, and recruiting great talent is actually the right move, even when you have the urge to save.
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The last decade of economic growth has almost overshadowed the sting of the Great Recession. But several recent economic indicators have led some economists to believe another recession may be on the horizon. Whether or not a bust is coming, this boon we’ve been enjoying can’t last forever.
The economy took a downturn just as I was starting my second company. I was a young entrepreneur, and there were plenty of self-proclaimed business experts who were eager to give me advice. Looking back, I’m glad I didn’t take most of it. Though I made some mistakes, my team and I discovered a formula for how to not only survive but thrive throughout a recession.
In 2009 — our first year in business — my company reached $3 million in annual revenue. We were small but expanding quickly as we looked for ways to rapidly grow our business at a time while others were struggling. Over the next couple of years, our revenues rocketed to $11 million and then $23 million. The lessons I learned during that time — both from my own experience and other successful companies — continue to inform my business choices today, and it’s knowledge I will apply when the next inevitable downturn hits.
Here’s what I learned:
Keep on marketing
It can be tempting to cut back on marketing to save on costs, but that kind of decision usually does more harm than good. You can’t grow your business if no one knows about you, and just counting on current clientele to stay with you is a serious gamble in a downturn.
Instead, maintain your marketing volume for four to six months into the recession and track your profitability on those new accounts to see if you’re still getting a return that makes economic sense. In my case, I found our marketing investment brought in sales numbers that were just as good or even better, likely because other companies panicked and …read more
Source:: Business Insider