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A rising tide lifts all boats…so the saying goes.
Likewise, a strong economy helps many companies grow. When the cash is flowing, customers are ready to invest. Everybody’s winning, and it feels great.It doesn’t last forever.
In an uncertain economy, those same customers snap their wallet shut. The tide starts to go out—and you don’t want your boat to run aground.
A tight economic market can tell you a lot about your business. To be honest, you may not like what you learn.
In some cases, companies that struggle during economic downturns have fundamental gaps in their strategy. They were able to float along on goodwill and the benefits of a strong market.
Strip all that away, and the customers stop coming in. The product no longer moves off the shelves. There aren’t enough clients to go around, and competitors start winning the fight.
Important Note: If you’re struggling, it doesn’t necessarily mean you have a strategy issue. You could be in an industry that’s been hit especially hard in the current economic climate. Give your strategy a second look, but if all of your competitors are similarly affected, there may be other factors at play. In that case, tinkering too much with your strategy is unlikely to help.
If your company is in crisis, the first thing you should do is rightsize your business. Prevent further damage.
The second thing you should do? Get out of firefighting mode. Step back. Reflect. Reevaluate your strategy.
It may be true that demand for what you sell is down. But by how much? If you’re losing business to competitors: why?
Were you selling something that was truly valuable to the people you were selling it to?
Or were you floating along based on the strength of the market at large?
Your instinct, should you find yourself in a difficult position (and sooner or later, you will, if you stay an entrepreneur long enough), will be to ignore this advice.
Every fiber of your being will scream that you need to sell at all costs. Stay in motion. Come up with new ideas. Don’t slow down.
Like a shark (not to belabor the water metaphor but…) - if you stop swimming, you die.
But sometimes, those quieter moments in your business are a gift. A chance for you to pick up your head and look around. What is your team doing? What are your competitors doing? What are your customers doing?
Stop. Observe. Listen.
Then, use that information to assess what you’ve been doing. What’s working? What isn’t?
What could you adjust to make your offer more compelling? Do you need a new market segment, a different sales channel, a stronger value proposition?
Business is about pulling levers, adjusting dials and knobs. But first, you have to understand what the dials and knobs of your company are.
Don’t mistake me: I am not suggesting you blindly throw everything you’ve got behind a full-scale pivot. The market is quieter right now, and your bottom line may reflect that. It doesn’t necessarily mean something’s wrong.
But if your observations—and your intuition—tell you there’s a misalignment with the market, trust that. Make a hypothesis about what you need to adjust. Test it. Learn, refine, test again.
The economy will loosen up again, for certain. Everything is cyclical. When that happens, we’ll all benefit. Nobody will be happier than me.
In the meantime, though, wouldn’t you rather take control of your own destiny?