Running a business is tough, and economic uncertainties like recessions only add to the challenge. But don’t panic! To help you recession-proof your business, Mike Michalowicz, author of Profit First and The Pumpkin Plan, recommends three key plans:
- Cash Flow Plan
- Business Plan
- Message Plan
In this article, we’ll break down each of these plans and show you how they can help keep your business afloat during tough economic times.
This blog is a part of the “Rallying During the Recession” series. For additional resources on how to navigate a recession, be sure to check out our Learning Center.
The Three Plans for Recession
Cash Flow Plan
Creating a solid financial foundation is the first step in recession-proofing your business. The Cash Flow Plan focuses on maximizing cash inflow while reducing outflow. Here’s how:
- Cut costs and expenses: Identify areas where you can reduce costs and expenses, such as unnecessary purchases, and cut back on them.
- Improve collections: Make sure you are collecting payments on time and actively pursuing past-due accounts.
- Monitor cash flow: Keep a close eye on your cash flow and make adjustments to maintain a positive cash flow.
The second step is to revise your business plan.
In times of crisis, it’s important to reduce the variability of your offerings and concentrate on your core customers. By focusing your efforts on the fewest things that bring the most results for your best customers, you can increase your chances of success.
Here are some steps you can take:
- Offer essential products and services that are in high demand during a recession.
- Identify your best customers and target them with your marketing efforts.
- Reduce the number of products and services you offer to focus on what is most profitable.
The final plan is to develop a clear and consistent message.
During a recession, it’s essential that you keep your customers engaged and informed. Here are some tips for creating an effective message plan:
- Communicate frequently: Keep in touch with your customers through email, social media, or other channels.
- Keep your messages short and to the point: Provide short, bite-sized messages that are easy to understand and won’t overwhelm your customers.
- Make sure your customers know you are available: Let them know that you can answer their questions and provide support during this difficult time.
Don’t Let the Next Wave of Fear Affect You
Mike Michalowicz’s three plans provide a solid framework to help you recession-proof your business.
Remember, the key to success during tough times is not to let the next wave of fear affect you. By implementing a cash flow plan, revising your business strategy, and creating a clear message plan, your business can continue to thrive despite the downturn.
For further assistance in streamlining your operations and cutting costs, Sum of All Numbers offers smart, cutting-edge solutions. For more information, contact us at +(888) 564-5777 or leave us a message.