Can you grow your business during a recession? Small businesses overwhelmingly plan on doing just that, according to a new survey.
Despite the stagnant economy, nine out of 10 small-business owners see opportunities for their own companies, according to a survey conducted for Intuit, maker of Quickbooks. More than three-fourths expect their business to grow in the coming year.
Surprised at this optimistic outlook? In previous recessions, many small businesses actually grow by taking advantage weakened competition and big company cutbacks.
So when the people at Quickbooks asked me what I’d like to know about the current state of small business (I was paid for my involvement), I wanted to see whether entrepreneurs shared my sense that even in a bad economy, there’s reason for hope.
Entrepreneurs see potential even in today’s economy. In fact, growth is the No. 1 issue on small-business owners’ minds, with 80 percent saying that growth is the top or high priority in the coming year. Growth keeps more entrepreneurs up at night (27 percent) than other issues, edging out worries about paying the bills (21 percent).
The survey, conducted between March 7 and 11 by the Global Strategy Group, surveyed 751 small businesses with less than 100 employees. The margin of error was 3.6 percent.
Here are ways to grow even when the economy stagnates:
Keep marketing. Thinking of cutting your marketing budget? Don’t. Businesses that maintain their marketing efforts during slow times come out of recessions healthier and with a larger market share than before the economy went downhill. Stay visible.
Hire terrific talent. A lot of great people are going to be getting pink slips or taking early retirement as large corporations cut back. You’ll be able to attract employees with a wealth of experience — and terrific contacts.
Target big corporations’ small customers. In bad times, large companies cut back their services to smaller customers.
Become the outsource source. Big companies are under pressure to reduce fixed costs, so if you provide services usually handled by corporate in-house staff, now’s a good time to suggest they use you.
Get your finances in order. Clean up your credit as well as your financial records. Establish a credit line at your bank.
Consider acquisition. Your competitors may want to throw in the towel, especially established small businesses with owners nearing retirement. You may be able to buy some businesses at a big discount.
Develop a loyalty program. It’s critical to keep the customers you have. Set up a method to provide discounts or rewards to loyal customers.
Sell from your Web site. Increase profit margins by selling direct to customers and cut out the middle man whenever possible.
Go digital. Find ways to do more of your administrative functions on the Web. Look for inexpensive outsourced services, rather than doing everything in-house with the overhead that entails.
Concentrate on increased sales. Look for new channels, new customers, rather than investing heavily in development.
Finally, stay positive. Remember, recessions are cyclical. Take advantage of opportunities now so you’ll be in a great position when the economy improves.
Rhonda Abrams is the author of “Six-Week Start-Up” and “What Business Should I Start?”
