Preparing your Business for a Recession
I don't know if you feel it too, but there always seems to be a summer slump for my web design business. After years of experiencing it, now that I know it's coming I use it to my advantage. I plan my vacations during the expected slump. And I work to ramp up sales for lower-cost services and digital products to make up for less custom web design revenue.
I've also been thinking a lot about how our businesses can be impacted by a recession. We saw some of the same patterns at the beginning of the pandemic that we are beginning to see here again in the United States, especially for small service-based businesses. I want to share a bit about the steps I take in my business to prepare for a recession and I hope you find them helpful as well.
Review expenses
The first thing that I do is review my expenditures. I run a pretty lean business and I don't have a lot of money going out the door, but I did take the opportunity to cut a couple of software subscriptions that I was paying for but not really using. I also reached out to a couple of other companies to ask if I could put my account on hold and kudos to ContentSnare who actually have a plan just for that at less than $5 a month!
Keep an even closer eye on finances
In general, I keep a much closer eye on my finances. I scale back my own purchases for office supplies, domain names ( that's my kryptonite ), or courses that I have my eye on. And each month I do a careful review of all the money that came in and went out. I want to understand exactly my revenue and expenses from month to month so I can make adjustments on the fly if needed.
Review service offerings & consider adding a lower price point offer
The next thing I do is review my service offerings. In times of economic uncertainty, I sell fewer of my larger budget services and sell more less expensive services. In fact, looking back to when the pandemic hit, my income was basically the same each month as it was before, but I was selling far more of my lower-priced services and fewer custom builds. If you only offer a service with a higher price point, you might want to consider rolling out a lower-cost option to see what kind of traction you get there. It might be a great time to offer a service you don’t normally sell, like a low-cost site audit where you provide people with a list of things that they could fix on their website - or they could hire you to do it for them.
Review digital products & consider a sale
And the same for my digital products. Low priced digital products (<$20) still seem to fly out the door, but I don't see as many sales for the pricier digital products and courses ($300 and up) I offer. So if you want to jump-start that revenue, you might consider running a flash sale. I use Lizzy Goddard’s method and that's been incredibly helpful for me.
Stay engaged
I make it a point to stay engaged with my audience - I always send out at least a monthly email. And during times when things are slow, I schedule free office hours or more Ask Me Anything sessions. I send out additional emails for reminders, so I stay top of mind for anyone who might need to hire me for updates to their website, talk about strategy, or build a new site. The office hours and Ask Me Anything sessions are a great way to give back to the community - and it's also a natural platform to talk about some of my digital products that people might find helpful. Want to get notified when I offer these free sessions? Join my email list.
When things are slower with client work, that's also when I spend more time creating YouTube videos, writing blog posts, and posting to LinkedIn. Anything that will serve me well over time and live on in perpetuity. Spending time on my blog and making it helpful has been the number one boost to my business. I consistently bring in a good chunk of affiliate revenue each month. And it's also how many people find me to hire me. So I view the time away from clients as a chance to pour into my own business and set myself up for later success.
Consider an emergency fund
When things pick back up again, I make it a point to set aside some funds as an emergency reserve for my business, just in case. This is important not only for market slowdowns but in case something happens and I'm not able to work for a period of time. Last year we had an unexpected family emergency and I ended up working only 5 days in August. Thanks to a flash sale that I ran last minute, I was actually okay on income, but it was good knowing I had an emergency fund to rely on if I needed to.
Every business is different and our life circumstances are different as well. (And I’m not an attorney or accountant, so be sure to talk with a professional before you make your own plans.) These are some of the steps that have worked for me to help prepare for a recession and I hope you find something helpful to apply to your own business.
More resources (low-cost & free)
The Stay Booked Roadmap to find clients on repeat ($29 with my affiliate link) from Super Easy Digital. I have used this roadmap myself and found it very helpful.
Building a Successful Web Design Business Workshop ($47 with code CIRCLE). I ran this workshop earlier this year and got great feedback.
The Calm Business Review (free) from Kerstin Martin. I’ve also done this myself and it gives you a bird’s eye view of your business.
