Focusing on the four areas to diagnose the health of your business during the recession, consist of a SWOT analysis that include the following quadrants:
Recapping the first two areas of your SWOT analysis when diagnosing your business that we included in Part 1, you want to begin by examining your strengths and weaknesses. These areas are critical to maintain and intensify. Continuing with the second part of giving your business a recession checkup, we will examine the next two areas (or quadrants) to diagnose: Opportunities and Threats. What opportunities or threats does your business face during the recession?
Your “opportunities” are the heart of your visionary perspective. These are areas of possibilities that you can take advantage of (by building off of your strengths) to grow your business. Do you see the possibility of increasing sales opportunities in a targeted demographic or geographic market? Is there a way to establish brand awareness through various avenues of growth potential within your marketing mix? Are you able to establish repeat business by intensifying your CRM (customer relationship management)? Remember, the opportunity is an open door to possibility.
As we review the last quadrant or area of your SWOT analysis, our attention is drawn to those internal and external risk factors that are “threats” to your business. Once you realize the potential threats to your business, you take precautions and devise strategies to avoid succumbing to those factors. Is there strong competition present from existing larger companies? Does a slowdown in the economy affect consumer discretionary spending for your product or service? Do you find volatility in your industry, with your product or service? Do you or your staff lack the necessary training and knowledge to remain competitive with your products or services?
By diagnosing the health of your business during this recession, with these four areas listed in your SWOT analysis, you are able to use this information to analyze your staffing, financing, human resources, salesforce, decision making, advertising, communications, operational tools and your distribution networks. Diagnosing these SWOT components is extremely useful during an uncertain economic and environmental crisis. During economic challenges such as the recession we are currently undergoing, consumers become more price-sensitive, but although they are still spending, the amount they are spending is less. Consumers are still influenced by effective advertising, promotions and marketing. How customers perceive the value of your products or services is an asset to your productivity, survival and profitability. Advertising, promotions and marketing are areas you do not want to terminate during the recession.
If we reflect on history and take a look at those companies that survived and were successful during the Great Depression, you will find that they continued to advertise heavily. They created a demand for their products or services during the most difficult times while their competitors cut advertising budgets and literally dropped out of sight and out of mind.
The recession is clearly not going away any time soon. Promoting your business during this economic upheaval can in the long run, strengthen your business, increase brand awareness and customer loyalty. Now is the time to diagnose your business. Make sure its immune system is strong (strengths), feed it nutrients to make it (weaknesses) stronger, search for alternative medicines (opportunities) to ward off attacks to your immune system and take preventative measures to curtail any airborne viruses (threats) that could possibly admit your business into intensive care.
The atmosphere that a recession creates can realistically be overwhelming and depressing. When we think of the phrase “survival of the fittest” coined by Herbert Spencer in 1864, it could basically mean survival of those who are better equipped for surviving. By giving your business a checkup, lowering your intake of certain business pathogens and strengthening your company’s immune system, your chances of survival are excellent, as you build credibility and profitability in the midst of a hostile economic environment; the ailments of a dreaded recession.