As it gets cold again here in Wisconsin, I find myself thinking back a few months to when it was just getting warm again in Wisconsin!
The Friday before Easter was a beautiful day, and I was looking forward to plans we had on that first spring weekend.
But something kept gnawing at me that afternoon; two words used by a CEO in a conversation a few hours earlier… two words that I hadn’t heard in quite some time:
“There’s nothing we can do, Steve; we may just have to hunker down.” Well, that was back in March, and they’ve been hunkering ever since.
Paul Glader, writing in the Wall Street Journal last Wednesday states “After the financial shocks of September and October, executives running businesses ranging from hair salons to giant utilities are hunkering down by trimming capital-spending budgets, delaying plant construction, laying off workers and skimping on pay raises.”
There it is again… hunkering down.
Now, there are various definitions of this term ranging from squatting and settling, to assuming a defensive posture, to hiding and taking shelter. When it comes to marketing, promoting, and growing your business, it is difficult to find the positive connotation in any of them.
Certainly, we all agree that cutting wasted resources and managing risk are important activities in rough economic times. But it should be said that those activities are just as important in any other economy. As leaders, we carry those responsibilities in good times and bad.
So before slashing, here are a few things to keep in mind for your small business.
1) The CEO mentioned earlier went on to explain to me that their sales were down ‘significantly’ over the same period in 2007, and had been trending lower for each of the previous five quarters. Their plan was to pull in the reins, maybe lay a few people off, and “just try to keep doing what we’re doing.”
The challenge with that course of action is twofold. Not only is “what they are doing” not working (as evidenced by five negative quarters), but after the layoffs they are now going to try to do it with less staff. The potential ramifications on a business, and its reputation, in such circumstances must at least be considered; you can read more on this in an article posted here.
2) While it may seem attractive to cut back on certain expenditures in a recessionary period, some may be activities that are critical to producing future revenue and market share. Further, because many factors that influence our economy are global in nature, the ‘hunkering process’ may last longer than anyone anticipates.
As Glader goes on to write in the WSJ article “…in response to a recent poll asking “how long will it be until the U.S. economy returns to a normal growth rate,” almost 80% were bracing for a slow economy for at least two years.”
This means that if they decide to hang their businesses’ future on the ‘hunkering down’ strategy, they better be prepared to hunker down for a very long time.
3) Don’t miss this one. When a small business leader decides it’s time to hunker down…, it does not mean that everyone else in the market is going to hunker down with them. One absolute result of a recession is that the landscape will be rearranged. Not might be… will be. And the winners won’t win by accident.
When your competition holes up and pulls in the reins… when they eliminate resources that would otherwise have served present customers, or market to new ones, this may just be your opportune moment to close and lock their door.
I look forward to your success.
Principles and thoughts to consider:
Follow a comprehensive marketing plan that clearly defines strategies, timelines, and budget.
To read more on that, click here.
The current economy will rearrange the landscape; either for you, or against you.
Tough times often provide excellent opportunities to build and strengthen relationships with your customers… and more importantly, those of your competition.
Opening a dialog with your market is one of the easiest and least expensive things you can do.